<SROS>     NONE
<FILER>
</FILER>
<PERIOD>     06/30/2001

                    U.S. SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                   FORM 10-QSB

     X     Quarterly report under Section 13 or 15(d) of the Securities Exchange
     -     Act  of  1934  for  the  quarterly period  ended  June  30,  2001
                                                           -----------------

     -     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  0-28058
                                                     ---------


                             VILLAGEWORLD.COM, INC.
                             ----------------------
        (Exact Name of Small Business Issuer as Specified in its Charter)



          New  York                                11-3137508
          ---------                                ----------
     (State  or  Other                         (IRS  Employer
      Jurisdiction of                    Identification  No.)
       Incorporation)



                  620 Johnson Avenue, Bohemia, New York  11716
                  --------------------------------------------
                    (Address of Principal Executive Offices)


                                 (631) 218-0700
                                 --------------
                 (Issuer's Telephone Number Including Area Code)


------------------------------------------------------------------------------
    (Former Name, Former Address and Former Fiscal Year, if Changed Since Last
                                     Report)


Check  whether the issuer: (1) filed all 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___
                                                                        -

State  the  number of shares outstanding of each of the issuer's class of common
equity,  as  of  the latest practicable date: At August 10, 2001, the issuer had
outstanding  21,940,717  shares  of  Common  Stock,  par  value $.001 per share.
(Assuming  the  conversion  of  all  outstanding  Class  B  Preferred  Stock the
outstanding  common  stock  at  August  10,  2001  would  increase to 92,065,693
shares).

Transitional  Small  Business  Disclosure  Format  (Check  one):  Yes[  ]  No[X]



                                        1
<PAGE>

                             VILLAGEWORLD.COM, INC.
                    INDEX TO QUARTERLY REPORT ON FORM 10-QSB
                FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
                           Quarter Ended June 30, 2001

                              ITEMS IN FORM 10-QSB


<TABLE>
<CAPTION>


                                                                           Page
                                                                           ----

<S>               <C>                                                       <C>
Part  I           Financial  Information                                      3

Item  1.          Financial  Statements                                       3

Item  2.          Management's  Discussion  and  Analysis  of  Financial
                  Condition  and  Results  of  Operations                    12


Part  II          Other  Information                                         16

Item  1.          Legal  Proceedings                                        N/A

Item  2.          Changes  in  Securities                                    16

Item  3.          Defaults  Upon  Senior  Securities                        N/A

Item  4.          Submission of Matters to a Vote of Security Holders       N/A

Item  5.          Other  Information                                        N/A

Item  6.          Exhibits  and  Reports  on  Form  8-K                      16


Signatures                                                                   17
</TABLE>



                                        2
<PAGE>
TEXT>
<TABLE>
<CAPTION>

                          VILLAGEWORLD.COM, INC. AND SUBSIDIARIES
                                 CONSOLIDATED BALANCE SHEET





                                                        June 30, 2001    December 31, 2000
ASSETS
<S>                                                    <C>              <C>
Current Assets:
Cash and cash equivalents . . . . . . . . . . . . . .  $      138,349   $          271,032
Accounts receivable, net of allowance for
 uncollectibles. . . . . . . . . . . . . . . . . . . .        295,371              408,032
Inventory . . . . . . . . . . . . . . . . . . . . . .          36,779               49,872
Prepaid expenses and other current assets . . . . . .          42,014               68,251
                                                       ---------------  -------------------
  Total Current Assets. . . . . . . . . . . . . . . .         512,513              797,187


Fixed assets, net of accumulated depreciation . . . .         264,888              303,373
Goodwill, net of accumulated amortization . . . . . .       1,899,139            2,017,835
Other assets. . . . . . . . . . . . . . . . . . . . .          14,875               15,295
                                                       ---------------  -------------------
  TOTAL . . . . . . . . . . . . . . . . . . . . . . .  $    2,691,415   $        3,133,690
                                                       ===============  ===================


LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Note payable - bank . . . . . . . . . . . . . . . . .  $      192,718   $          125,000
Accounts payable and accrued expenses . . . . . . . .         846,811              780,719
Deferred income . . . . . . . . . . . . . . . . . . .         134,945              200,404
Loans payable, related party. . . . . . . . . . . . .         117,144                    -
Other current liabilities . . . . . . . . . . . . . .         201,281              182,406
                                                       ---------------  -------------------
  Total Current Liabilities . . . . . . . . . . . . .       1,492,899            1,288,529


Loans payable, related party. . . . . . . . . . . .           585,776              580,258
Accrued cumulative preferred stock dividends. . . . .          87,614               71,400
                                                       ---------------  -------------------
  Total Liabilities . . . . . . . . . . . . . . . . .       2,166,289            1,940,187
                                                       ---------------  -------------------

Commitments and Contingencies . . . . . . . . . . . .               -                    -


Stockholders'  Equity:
Convertible Class B preferred stock; $.001 par
 value; 1,000,000 shares authorized; 508,152
 shares issued and outstanding . . . . . . . . . . . .            508                  508
Convertible Class C preferred stock; $.001 par
 value, non-voting; redeemable at $125; 25,000 shares
 authorized; 9,735 and 11,900 shares outstanding,
 respectively . . . . . . . . . . . . . . . . . . . .              10                   12
Common stock; $.001 par value; 200,000,000 shares
 authorized; 21,729,733 and 19,520,236 shares issued,
 respectively. . . . . . . . . . . . . . . . . . . . .         21,730               19,520
Additional paid in capital. . . . . . . . . . . . . .       5,867,327            5,823,339
Accumulated deficit . . . . . . . . . . . . . . . . .      (5,296,305)          (4,582,732)
Stock subscription receivable . . . . . . . . . . . .          (3,520)              (2,520)
Treasury stock (65,279 shares at cost). . . . . . . .         (64,624)             (64,624)
                                                       ---------------  -------------------
  Total stockholders' equity. . . . . . . . . . . . .         525,126            1,193,503
                                                       ---------------  -------------------

  TOTAL . . . . . . . . . . . . . . . . . . . . . . .  $    2,691,415   $        3,133,690
                                                       ===============  ===================

</TABLE>

The accompanying notes are an integral part of the financial statements.



                                        3
<PAGE>

<TABLE>
<CAPTION>

                                    VILLAGEWORLD.COM, INC. AND SUBSIDIARIES
                                     CONSOLIDATED STATEMENTS OF OPERATIONS



                                            Three Months Ended                       Six Months Ended
                                        June 30, 2001        June 30, 2000      June 30, 2001    June 30, 2000
                                                              (Restated)                          (Restated)
                                     --------------------  ------------------  ---------------  ---------------
<S>                                  <C>                   <C>                 <C>              <C>
REVENUES:
Hardware sales. . . . . . . . . . .  $           169,415   $         517,178   $      766,087   $      697,002
Subscription services . . . . . . .              457,375             178,494          978,759          270,075
Maintenance and consulting. . . . .               74,559              74,869          153,601          158,570
Installation services . . . . . . .               65,927              51,896           95,761          106,486
Private label cd roms . . . . . . .                    -             393,500                -          393,500
Other revenues . . . . . . . . . .                 5,281              65,470           42,720           67,143
                                     --------------------  ------------------  ---------------  ---------------
  Total revenues. . . . . . . . . .              772,557           1,281,407        2,036,928        1,692,776
                                     --------------------  ------------------  ---------------  ---------------

COSTS AND EXPENSES:
Cost of sales . . . . . . . . . . .              566,647           1,058,754        1,492,458        1,306,118
Selling, general and administrative              482,838             800,432        1,050,210        1,268,092
Amortization of excess of cost over
 fair value of net assets acquired .              59,348              59,348          118,696          118,696
Interest expense. . . . . . . . . .               28,933              11,979           54,880           23,289
                                     --------------------  ------------------  ---------------  ---------------
  Total costs and expenses. . . . .            1,137,766           1,930,513        2,716,244        2,716,195
                                     --------------------  ------------------  ---------------  ---------------

Net loss. . . . . . . . . . . . . .             (365,209)           (649,106)        (679,316)      (1,023,419)

Preferred stock dividends paid
 in-kind and accrued . . . . . . . .              16,770              17,276           34,257           35,700
                                     --------------------  ------------------  ---------------  ---------------

Net loss attributable to common
 stockholders. . . . . . . . . . . .  $         (381,979)  $        (666,382)  $     (713,573)  $   (1,059,119)
                                     ====================  ==================  ===============  ===============

Basic and diluted net loss per
 common share. . . . . . . . . . . .  $                -   $           (0.01)  $        (0.01)  $        (0.01)
                                     ====================  ==================  ===============  ===============


Basic and diluted weighted average
 common shares outstanding,
 giving effect to the conversion
 to common stock of all Class B
 Preferred Stock outstanding . . . .          90,526,824          89,430,175       90,207,563       89,006,900
                                     ====================  ==================  ===============  ===============

</TABLE>

The accompanying notes are an integral part of the financial statements.




                                        4
<PAGE>

<TABLE>
<CAPTION>

                                       VILLAGEWORLD.COM, INC. AND SUBSIDIARIES
                                    CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                                        For the Six Months Ended June 30, 2001



                                                 Class B                        Class C
                                           Preferred Stock                 Preferred Stock            Common Stock
                                             ----------------               -----------------         ------------
                                         Shares            Amount           Shares     Amount     Shares    Amount
                                      ----------------  -----------------  ------------  -------  -------  -------
<S>                                   <C>               <C>                <C>           <C>      <C>         <C>
Balance, January 1, 2001 . . . . . .          508,152   $         508       11,900  $    12    19,520,236  $19,520

Shares issued upon conversion of
 preferred stock and in payment of
 accrued dividends thereon (January
 1, 2001 to March 31, 20001)                                                  (385)               402,383      403

Shares issued upon conversion
 of preferred stock and in payment of
 accrued dividends thereon (April
 1, 2001 to June 30, 2001)                                                  (1,780)      (2)    1,707,114    1,707

Shares issued for executive
 compensation . . . . . . . . . . . .                                                             100,000      100

Accrued  cumulative dividends
 on preferred stock

Capital contribution imputed for
 interest expense

Net loss . . . . . . . . . . . . . .                -               -             -       -             -        -
                                      ---------------  --------------  ------------  ------    ----------  -------

Balance, June 30, 2001 . . . . . . .          508,152   $         508         9,735  $    10   21,729,733  $21,730
                                      ===============  ==============  ============  =======  ===========  =======

</TABLE>



<TABLE>
<CAPTION>



                                    Additional                      Stock                                 Total
                                     Paid-In      Accumulated    Subscription      Treasury Stock    Stockholders'
                                     Capital        Deficit       Receivable     Shares      Amount      Equity
                                ------------  -------------  --------------     --------    -------      ------
<S>                                   <C>           <C>            <C>             <C>         <C>           <C>
Balance, January 1, 2001 . . . .  $ 5,823,339   $ (4,582,732)  $   (2,520)     (65,279)  $   (64,624)  $1,193,503

Shares issued upon conversion of
 preferred stock and in payment of
 accrued dividends thereon (January
 1, 2001 to March 31, 2001)             2,123           (215)                                               2,311

Shares issued upon conversion
 of preferred stock and in payment of
 accrued dividends thereon April
 1, 2001 to June 30, 2001              13,812         (2,167)                                              13,350

Shares issued for executive
 compensation . . . . . . . . . . . .  10,900                      (1,000)                                 10,000

Accrued  cumulative dividends
 on preferred stock . . . . . . . . .                (31,875)                                             (31,875)

Capital contribution imputed for
 interest expense . . . . . . . . . .  17,153                                                              17,153

Net loss . . . . . . . . . . . . . .        -       (679,316)            -            -             -    (679,316)
                                 ------------   -------------  -----------  -----------  ------------  -----------
Balance, June 30, 2001 . . . . .  $ 5,867,327   $ (5,296,305)  $   (3,520)     (65,279)  $   (64,624)  $  525,126
                                  ===========   =============  ===========  ===========  ============  ===========

</TABLE>

The accompanying notes are an integral part of the financial statements.




                                        5
<PAGE>






<TABLE>
<CAPTION>

                                VILLAGEWORLD.COM, INC. AND SUBSIDIARIES
                                 CONSOLIDATED STATEMENTS OF CASH FLOWS



                                                                   Six Months Ended June 30,
                                                                   2001              2000 - (Restated)
                                                        ---------------------------  ------------------
<S>                                                     <C>                          <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss . . . . . . . . . . . . . . . . . . . . . . .  $                 (679,316)  $      (1,023,419)
                                                        ---------------------------  ------------------

Adjustments to reconcile net loss to net cash
used by operating activities:
  Depreciation and amortization. . . . . . . . . . . .                     157,221             158,839
  Stock issued for compensation. . . . . . . . . . . .                      10,000             137,500
  Interest expense accrued and imputed on
   related party loans. . . . . . . . . . . . . . . . .                     22,671              21,329
  Gain on disposal of fixed assets, net. . . . . . . .                           -              (6,500)
  Deferred  promotional cost . . . . . . . . . . . . .                           -              15,580
  Decrease (increase) in:
      Accounts receivable. . . . . . . . . . . . . . .                     112,661            (284,309)
      Inventory. . . . . . . . . . . . . . . . . . . .                      13,093             (64,644)
      Prepaid expenses and other current assets. . . .                      26,237             (34,378)
  Increase (decrease) in:
      Accounts payable and accrued expenses. . . . . .                      66,092             512,001
      Deferred income. . . . . . . . . . . . . . . . .                     (65,459)              9,082
      Current liabilities attributable to discontinued
       operations. . . . . . . . . . . . . . . . . . .                           -            (391,706)
      Other current liabilities. . . . . . . . . . . .                      18,875             (47,324)
                                                        ---------------------------  ------------------
  Total adjustments. . . . . . . . . . . . . . . . . .                     361,391              25,470
                                                        ---------------------------  ------------------
  Net cash used by operating activities. . . . . . . .                    (317,925)           (997,949)
                                                        ---------------------------  ------------------

CASH FLOWS FROM INVESTING ACTIVITIES:

  Purchase of fixed assets . . . . . . . . . . . . . .                           -             (36,657)
  Proceeds from sale of fixed assets . . . . . . . . .                           -               6,500
  Decrease in other assets . . . . . . . . . . . . . .                         380                   -
                                                        ---------------------------  ------------------
Net cash provided (used) by investing activities . . .                         380             (30,157)
                                                        ---------------------------  ------------------

CASH FLOWS FROM FINANCING ACTIVITIES:

  Note payable proceeds (repayments), net. . . . . . .                      67,718            (200,000)
  Proceeds from issuance of common stock . . . . . . .                           -             496,875
  Proceeds of related party loans. . . . . . . . . . .                     117,144                   -
                                                        ---------------------------  ------------------
Net cash provided  by financing activities       . . .                     184,862             296,875
                                                        ---------------------------  ------------------

NET DECREASE IN CASH . . . . . . . . . . . . . . . . .                    (132,683)           (731,231)
Cash, beginning of period. . . . . . . . . . . . . . .                     271,032             800,561
                                                        ---------------------------  ------------------
Cash, end of period. . . . . . . . . . . . . . . . . .  $                  138,349   $          69,330
                                                        ===========================  ==================

</TABLE>

The accompanying notes are an integral part of the financial statements.




                                        6
<PAGE>

<TABLE>
<CAPTION>

                                         VILLAGEWORLD.COM, INC. AND SUBSIDIARIES
                                    CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)



                                                                              Six Months Ended June 30,
                                                                                2001             2000 - (Restated)
                                                                    --------------------------  ------------------
<S>                                                                        <C>                         <C>
Supplemental disclosures of cash flow information:

  Cash paid during the period for:
    Interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $             28,072  $            7,097
    Income taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . .                    -               1,950

Supplemental disclosures of non-cash investing and financing activities:

  100,000 shares of common stock deemed issued for executive compensation               10,000                   -

  11,111 shares of common stock issued for payment of accounts payable. .                    -              10,000

  150,000 shares of common stock issued for franchise settlement. . . . .                    -              65,500

  152,000 shares of common stock deemed issued for
    deferred promotional agreement. . . . . . . . . . . . . . . . . . . .                    -              93,480

  Cumulative $6 Class C preferred stock dividend accrued/paid in-kind . .               34,257              35,700

</TABLE>

The accompanying notes are an integral part of the financial statements.




                                        7
<PAGE>

                     VILLAGEWORLD.COM, INC. AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements

(Note  1)      The  Company  and  Basis  of  Presentation
               ------------------------------------------

VillageWorld.Com,  Inc.,  provides   community-oriented  Internet  access  under
private  labels  and  installs,  maintains and services computer network systems
consisting of full hardware and proprietary software solutions.  The Company has
two  principal  subsidiaries,  VillageNet,  Inc.  ("VillageNet") and Intelligent
Computer Solutions, Inc. ("ICS"). VillageNet provides Internet on-line services,
offering  its  subscribers  a  variety  of  services  including electronic mail,
software,  computing  support,  and  easy  access  of  the  Internet. VillageNet
provides  small  businesses  with  fully  managed services that include Internet
connections,  remote  dial  access  and  Web  hosting services.  ICS offers full
service  system   integration,  specializing  in  high-end  computer  networking
infrastructures,   Internet   solutions,   and   Local  and  Wide  Area  Network
installations.  All  intercompany  balances  and  transactions are eliminated in
consolidation.  The Company considers itself to operate in one business segment.

The  information  herein  is  unaudited.  However, in the opinion of management,
such  information  reflects all adjustments (consisting only of normal recurring
adjustments)  necessary  to  make  the   financial  statements  not  misleading.
Additionally, in accordance with applicable standards for interim reporting, the
accompanying  financial  statements do not include all disclosures in conformity
with  generally  accepted  accounting principles.  The results of operations for
the  three  and  six  month  periods  ended  June  30,  2001 are not necessarily
indicative  of  the  results of operations for the full year ending December 31,
2001.  The  accompanying financial statements should be read in conjunction with
the  Company's  financial  statements  for  the  year  ended  December  31, 2000
appearing in the Company's  Annual Report on Form 10-KSB.

(Note  2)          Going  Concern
                   --------------

The  accompanying condensed consolidated financial statements have been prepared
in conformity with accounting principles generally accepted in the United States
of  America applicable to a going concern, which contemplates the realization of
assets and the satisfaction of liabilities in the normal course of business. The
Company's  losses  from  operations  and  related  use  of  cash  for  operating
activities  have  resulted  in an extremely tight cash position and a deficit in
working  capital  of  $980,386 at June 30, 2001. The Company's current financial
position  raises  the question as to its ability to continue as a going concern.
The  Company,  in  conjunction  with an affiliate, has been actively pursuing an
international  expansion  of  its networking business and one major contract has
been  provisionally  awarded.  Upon  finalization  of such contract, the Company
anticipates  receipt  of  sufficient  contract-related payments to alleviate its
current  cash  flow  shortfall.  However the Company must also attain profitable
operations  to  insure its long-term viability.  Management is confident it will
be successful in these endeavors, but no assurances can be given in this regard.
(See  Notes  4,  5  and 6 to the condensed consolidated financial statements and
Management's  Discussion  and  Analysis  of  Financial  Condition and Results of
Operations).

(Note  3)          Restatements  and  Reclassifications
                   ------------------------------------

The  Company  retrospectively  reduced  the amount of goodwill recognized in its
1999  merger  with  Big City Bagels, Inc. by $461,250.  Such restatement and the
related  reduction  in  amortization  expense  for  the  applicable periods were
reported in the Company's Form 10-KSB for the year ended December 31, 2000.  The
accompanying  statement  of operations for the three and six month periods ended
June  30,  2000  have  been  restated  to  reflect the reduction in amortization
expense  of  $11,531 and $23,062 applicable thereto.  As further reported on the
Company's  2000  Form  10-KSB,  the  Company commenced recognition of additional
interest  expense (up to a fair-market rate therefor) on certain related company
loans  in  fiscal  2000.  The accompanying statement of operations for the three
and  six  month  periods  ended  June 30, 2000 has also been restated to include
imputed  interest  expense  of  $8,055 and $16,094.  The net effect of these two
adjustments  for  the  three  and   six   month  periods  ended  June  30,  2000
was to decrease net loss by $3,476 and $6,968, respectively.




                                        8
<PAGE>
(Note  3)          Restatements  and  Reclassifications  -  (continued)
                   ------------------------------------

Certain  components  of  revenue  initially reported in the June 30, 2000 income
statement  have  been  reclassified  to  reflect  the  increased significance of
revenues  from  maintenance  and  consulting  agreements.

(Note  4)          Pending  International  Expansion  of  Networking  Operations
                   -------------------------------------------------------------

On  June  7, 2001, the Company announced that in conjunction with its affiliate,
ATTI  International,  it had been selected to provide networking services to the
Royal  Saudi  Air  Force  ("RSAF")  under  a  multi-year,  multi-million  dollar
contract. The overall project is the implementation of a Local Area Network/Wide
Area  Network  solution for the RSAF and will constitute a comprehensive upgrade
and  redevelopment  of  systems  currently  in use  by  the RSAF.   The  Company
will provide the network design, engineering and implementation.

The  Company  and  its  affiliate  are designated sub-contractors to the project
administrator,  an international consulting firm.  Finalization of  its contract
is anticipated by mid August 2001.

(Note  5)          Bank  Loan
                   ----------

The  bank  has  extended  the  maturity date of the Company's bank borrowings to
August 28, 2001.  The facility presently provides for a $200,000 credit line, of
which  $192,718  was  outstanding at June 30, 2001.  The Company has requested a
$100,000  increase  in the credit line to $300,000 and a formal extension of the
due  date to April 30, 2002, the anniversary date of the facility.  The bank has
requested  projections  of  the Company's operations reflecting the inclusion of
the  RSAF  networking  project  and  definitive  evidence  of the letting of the
contract  to  the  Company.

At  various  dates  during May and June of 2001, balances at two of the checking
accounts  maintained  by  the  Company at this bank were overdrawn.  The largest
amounts  of  these  combined overdrafts were $32,543 in May and $25,991 in June.
At  no  time  did  the  overdrawn  balances  exceed amounts of positive balances
maintained  by  the  Company  at  other  accounts at this bank, and all checking
accounts  had  positive  cash  balances  at  June  30,  2001.

(Note  6)          Loans  Payable,  Related  Party
                   -------------------------------

The  Company  borrowed  $117,144 from its affiliates during the six months ended
June  30, 2001, of which $10,000 and $107,144, respectively, was advanced in the
first and second quarter.  Of the  total  loans and advances payable  to related
parties amounting to  $702,920, $117,144 is a current  liability.  Repayments on
the outstanding related party loans and advances have been deferred until August
1, 2002.

(Note  7)          Conversion  of  Preferred  Stock
                   --------------------------------

          (A)  First  Quarter  Conversions

On  January  10th, 22nd, 23rd, February 23rd, March 1st and 6th of 2001, a total
of  385.26  shares  of  Class  C Preferred Stock together with accrued preferred
dividends thereon were converted into 402,383 common shares.  In accordance with
the  terms of the preferred stock issue, such conversions were made at discounts
of 19% and then 21% from the average of the closing bid prices for the Company's
common  stock  during  the  five  trading days prior to the holder's election to
convert.  After  these  conversions,  11,514.74  of  Class  C   shares  remained
outstanding.  Effective  May  22,  2001,  the discount increased from 21% to its
maximum  amount  of  25%.




                                        9
<PAGE>

(Note  7)          Conversion  of  Preferred  Stock  -  (continued)
                   --------------------------------

(B)  Second  Quarter  Conversions

On May  25th, 30th, 31st and June 1st, 4th, 5th, 7th, 15th, 20th, 26th and  28th
of 2001,  a  total of  1,779.90 shares of  Class C Preferred Stock together with
accrued preferred dividends thereon were converted into 1,707,114 common shares.
In accordance with the terms of the preferred stock issue, such conversions were
made  at  discounts  of  25%  from the average of the closing bid prices for the
Company's  common  stock  during  the  five  trading  days prior to the holder's
election to convert.  After these conversions, 9,734.84 of Class C shares remain
outstanding.

(C)  Subsequent  Conversions

On July 11th and August 1st and 7th of 2001, a total of 255.75 additional shares
of Class C Preferred were converted into 276,263 shares of common stock.

(Note  8)          Common  Stock
                   -------------

On  March  1,  2001,  the  Company modified the terms of an existing conditional
grant of 100,000 common stock purchase options to one of its principal executive
officers.  Pursuant  to the modification, such previously granted options, which
were  contingent  on  the  Company's  stock  price  reaching  $4.00 per share by
December  31,  2001,  were  cancelled  and  100,000  unconditional  common stock
purchase  options  exercisable  at  $.01  per  share  for  a five-year term were
granted.  Due  to  the  options'  nominal exercise price, the Company recognized
compensation expense of $10,000, measured by the excess of the fair value of the
common  stock at the date of grant over the exercise price.  Also, in accordance
with Statement of Financial Accounting Standards  No. 128,  the  100,000  shares
are treated as outstanding when computing basic earnings per share.

The  officer  to  whom  these  options  were  granted, who also holds options to
purchase  another  100,000  common  shares,  also exercisable at $.01 per share,
resigned from the  Company on  June 29, 2001,  to  pursue  other  opportunities,
although he will be available to consult with the Company on an as-needed basis.
Such  resignation  did  not  alter or  modify the  terms of  the  stock purchase
options; the 200,000 shares  are  still  treated  as  outstanding  with a  stock
subscription   receivable   for  $2,000   reported   as   a  contra  account  in
stockholders'   equity.

An additional unrelated 152,000 common shares underlying an equivalent number of
options also exercisable at $.01 per share are similarly treated, with a related
subscription  receivable  of  $1,520.

(Note  9)          Common  Stock  Options
                   ----------------------

Pursuant  to  the  Company's 1996 Performance Equity Plan, on March 31st of each
calendar year during the term of the 1996 Plan, assuming there are enough shares
then available for grant under the 1996 Plan, each person who is then a director
of the Company is awarded stock options to purchase 2,000 shares of common stock
at  the  fair  market  value  thereof,  all  of  which  options  are immediately
exercisable  as of the date of grant and have a term of ten years. These are the
only  awards  which  may  be granted to a director of the Company under the 1996
Plan.  On  March  30, 2001, the directors of the Company received this automatic
grant of options to purchase an aggregate of 10,000 shares of common stock at an
exercise  price of $0.10 per share.  At June 30, 2001, options to purchase 8,232
shares were available  for future grant under the 1996 Plan.

The  Company's  1998  Performance Equity Plan provides for the issuance of up to
400,000   shares   of   common  stock  to  employees,  officers,  directors  and
consultants.  The  awards  may  consist of incentive stock options, nonqualified
options,  restricted  stock  awards,  deferred  stock awards, stock appreciation
rights  and  other  awards,  including  outright grants as described in the 1998
Plan.  The board of directors determines terms and vesting periods.  At June 30,
2001,  there  were  100,000  options  outstanding  and  175,000  shares   and/or
options available for future grant under the 1998 Plan.




                                       10
<PAGE>

(Note  9)          Common  Stock  Options  -  (continued)
                   ----------------------

The Company's board of directors has approved the award of an option to purchase
100,000  shares,  exercisable at $.01 per share, as well as an outright grant of
75,000  shares  in  payment  of  a  total of $16,500 of accrued compensation for
services previously provided.  These two grants will exhaust the availability of
shares and/or options under the 1998 Plan.

(Note  10)     Recent  Accounting  Pronouncements
               ----------------------------------

In  July  2001  the  Financial  Accounting  Standards  Board issued SFAS No. 141
"Business Combinations" and SFAS No. 142 "Goodwill and Other Intangible Assets."
SFAS  No. 141 requires business combinations initiated after June 30, 2001 to be
accounted for using the purchase method of accounting, and broadens the criteria
for  recording intangible assets separate from goodwill.  Recorded goodwill will
be  evaluated  against  the  new  criteria  and  may  result  in certain amounts
initially  recorded as goodwill being separately identified and recognized apart
from  goodwill.  SFAS No. 142 requires the use  of  a non-amortization  approach
to  account  for   purchased  goodwill  and   certain   intangibles.   Under   a
non-amortization  approach,  goodwill  and  certain  intangibles  will   not  be
amortized  into  results  of  operations,  but  instead  would  be  reviewed for
impairment and written down and charged to results of operations only in periods
in  which  the  recorded value of goodwill and intangibles is more than its fair
value.  The  provisions of each statement which apply to goodwill and intangible
assets acquired prior to July 1, 2001, will be adopted by the Company on January
1,  2002.  Pursuant  to  these  accounting  standards,  the  Company  will cease
amortization  of goodwill effective January 1, 2002; however, impairment reviews
required by the standards may result in  future periodic write-downs.




                                       11
<PAGE>

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

     The  following  discussion  and analysis should be read in conjunction with
the Company's condensed consolidated financial statements and the notes thereto.
The discussion of results, causes and  trends should not be construed  to  imply
any  conclusion  that  such  results  or trends will necessarily continue in the
future.

Forward-Looking  Statements

     When used in this Form 10-QSB and in future filings by the Company with the
Securities  and Exchange Commission, the words or phrases "will likely result,",
"management   expects"   or   "the   Company   expects,"  "will  continue,"  "is
anticipated,"  "estimated"  or  similar  expressions  are  intended  to identify
"forward-looking statements" within the meaning of Section 21E of the Securities
Exchange  Act  of  1934,  as  amended.  Readers are cautioned not to place undue
reliance  on any such forward-looking statements, each of which speak only as of
the  date  made.  Such statements are subject to certain risks and uncertainties
that could cause actual results to differ materially from historical results and
those  presently  anticipated  or  projected.  The  Company has no obligation to
publicly  release  the  result  of  any  revisions,  which  may  be  made to any
forward-looking   statements   to  reflect  anticipated or unanticipated  events
or circumstances occurring after the date of such statements.

Recent  Accounting  Pronouncements

     In  July  2001 the Financial Accounting Standards Board issued SFAS No. 141
"Business Combinations" and SFAS No. 142 "Goodwill and Other Intangible Assets."
SFAS  No. 141 requires business combinations initiated after June 30, 2001 to be
accounted for using the purchase method of accounting, and broadens the criteria
for  recording intangible assets separate from goodwill.  Recorded goodwill will
be  evaluated  against  the  new  criteria  and  may  result  in certain amounts
initially  recorded as goodwill being separately identified and recognized apart
from  goodwill.  SFAS No. 142 requires the use of  a  non-amortization  approach
to   account  for   purchased   goodwill   and  certain  intangibles.   Under  a
non-amortization   approach,  goodwill  and  certain  intangibles  will  not  be
amortized  into  results  of  operations,  but  instead  would  be  reviewed for
impairment and written down and charged to results of operations only in periods
in  which  the  recorded value of goodwill and intangibles is more than its fair
value.  The  provisions of each statement which apply to goodwill and intangible
assets acquired prior to July 1, 2001, will be adopted by the Company on January
1,  2002.  Pursuant  to  these  accounting  standards,  the  Company  will cease
amortization  of goodwill effective January 1, 2002; however, impairment reviews
required by the standards may result in future periodic write-downs.

Results  of  Operations

 Three  Months Ended June 30, 2001 Compared With Three Months Ended June 30,2000

     Total  revenues  decreased  by $508,850, or 39.7%, to $772,557 in 2001 from
$1,281,407  one  year ago, primarily attributable to decreases in hardware sales
of  $347,763, or 67.2%, to $169,415 and a 100% decrease in private label cd roms
production  from  $393,500  for  the  three  months  ended  June  30, 2000.  The
Company's  sales  department  experienced certain personnel turnover during this
quarter,  which  contributed  to  the decrease in hardware sales.  The Company's
subscription services continued their growth by 156.2% to $457,375 for the three
months  ended June 30, 2001 compared to $178,494 for the same period a year ago.
The  increase  in  subscription service revenue was primarily attributable to an
increase  in  the  number  of subscribers, dedicated users and partnerships with
several community-based Internet services.  Other revenues decreased by $60,189,
or 91.9%, to $5,281 from $65,470.




                                       12
<PAGE>

Results  of  Operations  -  (continued)

Cost  of  sales  was $566,647, representing 73.3% of total revenue for the three
months  ended June 30, 2001, compared to $1,058,754, constituting 82.6% of total
revenues  for  the  three  months ended June 30, 2000.  Cost of sales of ICS was
$133,594,   or    43.1%   of   hardware   sales,   installation   services   and
maintenance/consulting  for  the  three  months ended June 30, 2001, compared to
$457,028,  or 71.0%, one year ago.  The increase in gross margin as a percentage
of  sales  for  ICS is a function of the significantly greater mark-up earned by
the  Company  on  labor-intensive services such as maintenance, installation and
consulting  compared  to  hardware sales and the relative mix of ICS's revenues.
Due  to  a  customer-based cyclical change in such mix, revenues from the latter
type  of services comprised 44.6% of ICS's revenues in the 2001 quarter compared
to  19.7%  in the same period in 2000. The percentage of hardware sales to total
revenue  for  ICS  was  unusually  low  during  the  2001  quarter.   Management
anticipates  continued fluctuation in the mix of ICS's revenues and related cost
of  sales.  Cost  of  sales  of  VillageWorld  was $433,053, or 94.7% of related
revenues  for  the  three  months  ended June 30, 2001, compared to $601,726, or
94.3%, one year ago.

Selling,  general and administrative expenses (SG&A) were $482,838 for the three
months  ended June 30, 2001, a decrease of $317,594, or 39.7%, from $800,432 for
the  three  months  ended  June  30,  2000.  Payroll and related benefits, which
comprise  the  largest  single item in this expense classification, decreased by
$216,078, or 41.4%, to $305,935 in 2001 from $522,013 in 2000.  The decrease was
due to a reorganization of the sales department and the closing in December 2000
of  the  California office. Of the total SG&A expenses in 2001, $371,258 was for
ICS  and  $111,580  was  for VillageWorld, as compared to $366,620 and $433,812,
respectively,  one  year  ago.  Marketing and newspaper advertising decreased by
99.0%  to $1,040 for the three months ending June 30, 2001 from $107,694 for the
three  months  ended  June  30,  2000.  This  decrease represents  the cancelled
advertising  of the Company's Internet franchising program.   As a percentage of
sales, SG&A expenses were 62.5% in both the 2001 and 2000 quarters.

     Amortization  of  goodwill,  after  the restatement applicable to 2000, was
unchanged  at  $59,348.  (See  Note  3  to  the condensed consolidated financial
statements).

Interest  expense  increased  by  $16,954,  or  141.5%, to $28,933 for the three
months ended June 30, 2001 from $11,979, as restated, for the three months ended
June  30, 2000. (See Note 3 to the condensed consolidated financial statements).
The  increase  was  due to the higher average amount owing on the Company's bank
loan  and  indebtedness  to  affiliates, as well as certain late payment finance
charges incurred on the Company's trade payables.  The Company is endeavoring to
work closely with its trade creditors, some of whom are pressing the Company for
payment  while the Company's tight cash position continues.   (See Note 2 to the
condensed   consolidated   financial   statements   and  Liquidity  and  Capital
Resources).

     Net  loss for the three months ended June 30, 2001 was $365,209 compared to
a  net  loss of $649,106 for the three months ended June 30, 2000, a decrease of
$283,897, or 43.7%.  The decrease in the current period loss is due primarily to
two  related  factors:  (i)  the  significant  decrease  in  SG&A  expenses as a
percentage of gross margin, which fell by 125.0% to 234.5% from 359.5%; (ii) the
gross  margin  percentage  increased by 9.3% to 26.7% for the three months ended
June  30,  2001 compared to 17.4% for the three months ended June 30, 2000.  The
gross  margin percentage of 26.7% was unchanged from the first quarter of fiscal
2001.

Six  Months  Ended  June  30,  2001 Compared With Six Months Ended June 30, 2000

     The  Company's  total  revenues  increased 20.3%, to $2,036,928 for the six
months  ended  June  30, 2001, from $1,692,776 for the six months ended June 30,
2000.  This  revenue  growth was principally due to the increase in subscription
service  revenue  of  $708,684,  or 262.4%, to $958,759 for the six months ended
June 30, 2001 from $270,075 one year ago.  This increase in subscription service
revenue  was primarily attributable to an increase in the number of subscribers,
dedicated users and partnerships with several community-based Internet services.
Hardware  sales  increased  by $69,085 or 9.9% for the six months ended June 30,
2001. Maintenance and consulting revenues decreased slightly by $4,969, or 3.1%,
to $153,601 and installation services declined by $10,725, or 10.1%, to $95,761.
Private label cd roms decreased by 100.0% from $393,500 for the six months ended
June  30, 2000 and other revenues fell by $24,423, or 36.4%, to $42,720.




                                       13
<PAGE>

Results  of  Operations  -  (continued)

      Cost  of sales was $1,492,458, representing 73.3% of total revenue for the
six  months  ended  June 30, 2001, compared to $1,306,118, representing 77.2% of
total revenues for the six months ended June 30, 2000.  Cost of sales of ICS was
$661,778,   or    65.2%   of   hardware   sales,   installation   services   and
maintenance/consulting  for  the  six  months  ended  June  30, 2001 compared to
$636,674,  or  66.2%, one year ago.  Cost of sales of VillageWorld was $830,680,
or 84.9% of related revenues for the six months ended June 30, 2001, compared to
$601,726, or  90.7%, one year ago.

Selling,  general and administrative expenses (SG&A) were $1,050,210 for the six
months  ended  June  30, 2001, a decrease of $217,882, or 17.1%, from $1,268,092
for   the  six  months  ended  June  30,  2000.  This  decrease   was  primarily
attributable  to  the  decrease  in payroll and related benefits by $142,172, or
17.7%  to  $660,166  in  2001  from  $802,338  in 2000.  Marketing and newspaper
advertising  decreased by $93,422, or 74.8%, to $31,538 in 2001 from $124,960 in
2000.  This  decrease  represents  the  cancelled  advertising  of the Company's
Internet  franchising   program.  Of  the   total  SG&A  expenses,  $762,695  is
attributable  to  ICS  and  $287,515 is attributable to VillageWorld for the six
months ended June 30, 2001, compared to $659,256 and $608,386, one year ago.  As
a  percentage  of  sales,  SG&A expenses were 51.6% and 74.9% for the six months
ended  June  2001 and  June  2000, respectively.

     Amortization  of  goodwill,  after  the restatement applicable to 2000, was
unchanged  at  $118,696.  (See  Note  3  to the condensed consolidated financial
statements).

     Interest  expense  was  $54,880  for the six months ended June 30, 2001, an
increase  of  $31,591  or  135.6%  from  $23,289, as restated for the six months
ended  June  30,  2000.  (See  Note  3  to  the condensed consolidated financial
statements).  This  increase  was  primarily  attributable to the higher average
amount  outstanding  on the Company's bank debt and loans payable to affiliates,
as  well as certain late payment finance charges incurred on the Company's trade
payables.

     Net  loss for the six months ended June 30, 2001 was $679,316 compared to a
net  loss  of  $1,023,419  for the six months ended June 30, 2000, a decrease of
$344,103, or 33.6%. %.  The decrease in the current period loss is due primarily
to  two  related  factors:  (i)  the  significant decrease in SG&A expenses as a
percentage of gross margin, which fell by 135.1% to 192.9% from 328.0%; (ii) the
gross margin percentage increased by 3.9% to 26.7% for the six months ended June
30,  2001  compared  to  22.8%  for  the  six  months  ended  June  30,  2000.

Liquidity  and  Capital  Resources

     Cash  at  June  30,  2001, all of which is maintained at the same bank, was
$138,349  compared  to  $271,032  at  December 31, 2000, a decrease of $132,683.
This decrease in cash was primarily attributable to the funding of the Company's
net  loss.  Cash  required  for  operating  activities  was  $317,925,  of which
$119,029  was  used  in  the  first  quarter and $198,896 was used in the second
quarter.  During  May and June 2001, combined overdrafts at two of the Company's
checking  accounts  reached  high  points  of $32,543 and $25,991, respectively,
although  such  overdrawn  accounts  never  exceeded  positive balances at other
accounts  maintained  by  the Company at the same bank. At each month-end during
the  quarter,  all  accounts  had  positive  balances.  During  July  2001,  the
overdrafts  reached  a high point of $64,258 and at month-end they were $21,484.
As  of  August  9,  2001,  the overdrafts totaled $37,150.  In each instance the
Company  had  a  positive  net  combined balance for all of its accounts at this
bank.

     Accounts receivable decreased by $112,661 to $295,371 at June 30, 2001 from
$408,032  at  December  31,  2000.  The  decrease  was due to faster turnover of
receivables,  reflecting  the  Company's  aggressive  collection  policies.  The
significant   decrease  in   hardware  sales   and   private   label   cd   roms
production,   also   contributed   to  the  decrease  in   accounts  receivable.

     Inventory  decreased by $13,093 to $36,779 at June 30, 2001 from $49,872 at
December  31, 2000.  The decrease in inventory is directly related to a decrease
in  hardware  inventory  purchases  due  to the slowdown in hardware sales since
March  2001.  Prepaid  expenses and other current assets decreased by $26,237 to
$42,014  at  June  30,  2001  from  $68,251  at  December  31,  2000, reflecting
principally  amortization  of  prepaid  insurance.





                                       14
<PAGE>

Liquidity  and  Capital  Resources  -  (continued)
--------------------------------------------------

     Accounts  payable  and accrued expenses increased by $66,092 to $846,811 at
June  30, 2001 from $780,719 at December 31, 2000, primarily attributable to the
prioritizing  of  payment of operating expenses and salaries over trade accounts
payable  as well as an overall increase in the volume of transactions during the
period.

     Notes  payable  increased  to  $192,718  at  June 30, 2001 from $125,000 at
December  31, 2000, reflecting additional net borrowings of $67,718.  Borrowings
under the line may not exceed $200,000.  The Company has applied to the bank for
a  one-year  renewal  of  this credit facility to April 30, 2002 and an $100,000
increase  in  the  line  to  $300,000.  The  bank  has requested a projection of
operations reflecting the inclusion of the Company's pending overseas networking
contract  together  with  definitive  evidence  of  the  contract being awarded.
Pending the bank's formal response to the requested increase in the line and the
extension  of  its  maturity  date, the bank has renewed the existing line until
August 28, 2001.  Management expects the increase and the renewal to be granted.

     Loans  payable  to  related  parties increased to $702,920 at June 30, 2001
from  $580,258  at  December  31, 2000, attributable to additional borrowings of
$10,000  in  the  first  quarter and $107,144 in the second quarter.  All of the
loans  in  the second quarter came from the affiliate with whom the Company will
be jointly undertaking the overseas contract and constitute a current liability.
Repayments on the non-current balance of the outstanding related party loans and
advances  in the  amount of  $585,776 have been deferred  until  August 1, 2002.
Until  such time as the overseas networking contract is definitively awarded and
contract  related  payments  are  received,  the  Company  will  be dependent on
additional  advances  from  its  affiliates,  of  which  neither  the  continued
availability nor the amounts thereof are assured.  No additional loans have been
made subsequent to June 30, 2001.

     At June 30, 2001, the Company had a working capital deficit of $980,386 and
an  extremely  tight  cash  position. Subsequent to June 30, 2001, the Company's
liquidity  situation  worsened.  While  the  Company  has  successfully  reduced
various  costs,  it  is  presently  dependent on related party loans and/or bank
borrowings.  The  Company  believes  that  once the pending overseas contract is
finalized,  receipt of contract-related payments will alleviate its current cash
flow  deficiency; the Company further believes that such events are imminent and
that  the attendant international expansion of its business will be a major step
in  the Company's attaining profitable operations, which step is critical to the
long-term  viability  of the Company.  Although management believes that it will
be  successful  in these various endeavors, the continuation of the Company as a
going  concern  is  presently  in  question.

     Operating activities used cash of $317,925 for the quarter six months ended
June 30,2001  compared to $997,949 used for the same period one year ago.   This
decrease reflects the  substantial payment of liabilities  associated  with  the
discontinued bagel operations one year ago.  The current period use  of cash was
principally to fund the net loss.

     For  the six months ended June 30, 2001, investing activities provided $380
compared  to cash used of $30,157 one year ago.  Virtually all of the change was
due  to  decreased  capital  expenditures in 2001. Financing activities provided
cash  of  $184,862  in 2001, compared to $296,875 in 2000.  The Company borrowed
$67,718 under  the bank  line  in  2001 while  related company advances provided
$117,144.

     In  March of 2001, the Company issued options to purchase 100,000 shares of
stock,  exercisable  at  $.01  per  share,  to an executive officer and recorded
compensation  expense  of  $10,000, equal  to  the  excess  of  the  fair  value
of the underlying shares at  date of grant over such  exercise  price.  On  June
29, 2001, this officer resigned his position  with the Company,  although he  is
available to consult with the Company on certain matters on an as-needed  basis.

     The  Company's board of directors has approved the grant of 100,000 options
and  75,000  shares  under  the  1998  Plan  in  satisfaction of certain accrued
liabilities totaling $16,500 for services previously provided.  Such grants will
exhaust the availability   of  options and/or shares under the Plan.



                                       15
<PAGE>

Part  II.      Other  Information

Item  2.       Changes  in  Securities

               See  Note  7(B)  to  the  condensed  consolidated financial
               Statements included  in  Part  I  hereof.

               The Company received no cash in any of the transactions described
               in Note 7(B). The  Company's issuances of common shares described
               therein were all exempt from the registration requirements of the
               Securities  Act of 1933,  as amended, pursuant  to the provisions
               of  Section  4(2)  thereof   as  transactions by  an  issuer  not
               involving  any  public  offering.

Item  6.       Exhibits  and  Reports  on  Form  8-K

(a)            Exhibits

               None

(b)            Reports  on  Form  8-K

               None




                                       16
<PAGE>

                                   Signatures


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



                                              VillageWorld.com,  Inc.
                                              -----------------------
                                              (Registrant)



Dated: August 14, 2001                By:                /s/  Peter  J.  Keenan
                                                         ----------------------
                                      Peter J. Keenan,  Chairman  of the Board,
                                      President and Principal Executive Officer



                                      By:          /s/  Edilberto  R.  Enriquez
                                                 ------------------------------
                                      Edilberto  R.  Enriquez,
                                      Treasurer  and  Chief  Financial  Officer




                                       17
<PAGE>