UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

(Mark One)

(x)  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
     ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED OCTOBER 2, 2001, 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: 0-17072

                       WINDSWEPT ENVIRONMENTAL GROUP, INC.
                       -----------------------------------
             (Exact name of registrant as specified in its charter)

     Delaware                                              11-2844247
     --------                                              ----------
     (State or other jurisdiction of                       (I.R.S. Employer
     incorporation or organization)                        Identification No.)

     100 Sweeneydale Avenue, Bay Shore, New York           11706
     -------------------------------------------           -----
     (Address of principle executive offices)              (Zip Code)

                                 (631) 434-1300
                                 --------------
              (Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) 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 Common Stock, par value $.0001, outstanding on
November 2, 2001 was 38,544,334.


<PAGE>


                         PART 1 - FINANCIAL INFORMATION
Item 1. Financial Statements

                       WINDSWEPT ENVIRONMENTAL GROUP, INC.
                           CONSOLIDATED BALANCE SHEETS
                        OCTOBER 2, 2001 AND JULY 3, 2001
<TABLE>
<CAPTION>

                                                                                                     October 2,          July 3,
                                                                                                        2001              2001
                                                                                                    (Unaudited)
                                                                                                  ---------------    ---------------
  <S>                                                                                             <C>                <C>
  ASSETS:
  CURRENT ASSETS:
     Cash                                                                                         $      777,950     $      323,732
     Accounts receivable, net of allowance for doubtful accounts of $605,088 and $570,409,             8,150,376          5,581,883
  respectively
     Inventories                                                                                         230,403            208,064
     Costs and estimated earnings in excess of billings on uncompleted contracts                         580,958            686,528
     Prepaid expenses and other current assets                                                           106,838            122,172
                                                                                                  ---------------    ---------------
     Total current assets                                                                              9,846,525          6,922,379

  PROPERTY AND EQUIPMENT, net of accumulated depreciation and amortization of $4,059,751
     and $3,887,920, respectively                                                                      1,095,219          1,118,382

  OTHER ASSETS                                                                                           140,649            151,807
                                                                                                  ---------------    ---------------

  TOTAL                                                                                           $   11,082,393     $    8,192,568
                                                                                                  ===============    ===============

  LIABILITIES AND STOCKHOLDERS' DEFICIT:
  CURRENT LIABILITIES:
     Accounts payable                                                                             $      989,633     $    1,150,987
     Accrued expenses                                                                                  2,439,639          1,816,441
     Short-term notes payable                                                                          1,700,000          1,200,000
     Billings in excess of cost and estimated earnings on uncompleted contracts                          390,311            525,359
     Accrued payroll and related fringes                                                               1,007,274            568,741
     Current portion of convertible notes                                                                680,000            680,000
     Income taxes payable                                                                                897,679            531,714
     Other current liabilities                                                                           655,045            406,174
                                                                                                  ---------------    ---------------
     Total current liabilities                                                                         8,759,581          6,879,416
                                                                                                  ---------------    ---------------

  CONVERTIBLE NOTES                                                                                    2,100,000          2,100,000
                                                                                                  ---------------    ---------------

  OTHER LONG-TERM LIABILITIES                                                                             39,811             14,250
                                                                                                  ---------------    ---------------

  COMMITMENTS AND CONTINGENCIES

  REDEEMABLE COMMON STOCK                                                                                626,503            386,058
                                                                                                  ---------------    ---------------


  SERIES A REDEEMABLE CONVERTIBLE PREFERRED STOCK, $.01 par value; 1,300,000 shares
     authorized; 1,300,000 shares outstanding at October 2, 2001 and July 3, 2001                      1,300,000          1,300,000
                                                                                                  ---------------    ---------------

  STOCKHOLDERS' DEFICIT:
     Series B convertible preferred stock, $.01 par value; 50,000 shares authorized; 9,346
  shares                                                                                                      93                 93
     outstanding at October 2, 2001 and July 3, 2001
     Nondesignated preferred stock, no par value; 8,650,000 shares authorized; 0 shares                   -                  -
  outstanding
     Common stock, $.0001 par value; 100,000,000 shares authorized; 38,481,254 shares
  outstanding at                                                                                           3,848              3,848
     October 2, 2001 and July 3, 2001
     Additional paid-in-capital                                                                       31,697,698         31,717,198
     Accumulated deficit                                                                             (33,445,141)       (34,208,295)
                                                                                                  ---------------    ---------------
     Total stockholders' deficit                                                                      (1,743,502)        (2,487,156)
                                                                                                  ---------------    ---------------

  TOTAL                                                                                           $   11,082,393     $    8,192,568
                                                                                                  ===============    ===============
</TABLE>

  See notes to consolidated financial statements.

                                       2

<PAGE>

                       WINDSWEPT ENVIRONMENTAL GROUP, INC.
                CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
<TABLE>
<CAPTION>
                                                                      Thirteen Weeks Ended
                                                                --------------------------------
                                                                   October 2,       October 3,
                                                                     2001              2000
                                                                ---------------  ---------------
   <S>                                                         <C>              <C>
   Revenues                                                    $     7,735,074   $    3,045,164

    Cost of revenues                                                 5,320,533        2,094,230
                                                                ---------------  ---------------

    Gross profit                                                     2,414,541          950,934
                                                                ---------------  ---------------

    Operating expenses:
    Selling, general and administrative expenses                       974,151          967,033
    Expense (benefit) related to variable accounting
        treatment for officer options                                  240,445          (61,728)
                                                                ---------------  ---------------
       Total operating expenses                                      1,214,596          905,305
                                                                ---------------  ---------------

    Income from operations                                           1,199,945           45,629
                                                                ---------------  ---------------

    Other expense (income):
       Interest expense                                                 74,474           81,992
       Other, net                                                       (9,344)          (4,109)
                                                                ---------------  ---------------
       Total other expense                                              65,130           77,883
                                                                ---------------  ---------------

    Income (loss) before provision for income taxes                  1,134,815          (32,254)

    Provision for income taxes                                         371,662             -
                                                                ---------------  ---------------

    Net income (loss)                                                  763,153          (32,254)

    Dividends on Series A Redeemable Preferred Stock                  (19,500)          (19,500)
                                                                ---------------  ---------------

    Net income (loss) attributable to common
       shareholders                                             $      743,653   $      (51,754)
                                                                ===============  ===============

    Basic and diluted net income (loss) per common share:
    Basic                                                                 $.02            $(.00)
                                                                ===============  ===============
    Diluted                                                               $.01            $(.00)
                                                                ===============  ===============

    Weighted average number of common shares outstanding:
    Basic                                                           38,481,254       38,456,254
                                                                ===============  ===============
    Diluted                                                         77,068,312       38,456,254
                                                                ===============  ===============
</TABLE>

    See notes to consolidated financial statements.


                                       3
<PAGE>


                       WINDSWEPT ENVIRONMENTAL GROUP, INC.
                CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
<TABLE>
<CAPTION>
                                                                       Thirteen Weeks Ended
                                                                ---------------------------------
                                                                   October 2,        October 3,
                                                                      2001              2000
                                                                ---------------   ---------------
    <S>                                                         <C>               <C>
    CASH FLOWS FROM OPERATING ACTIVITIES:
       Net income (loss)                                        $      763,153    $      (32,254)
       Adjustments to reconcile net income (loss) to net
         cash provided by (used in) operating activities:
          Depreciation and amortization                                182,989           221,449
          Provision for doubtful accounts                               34,679            49,000
          Compensation related to officer options and
             redeemable common stock                                   240,445           (61,728)
       Changes in operating assets and liabilities:
          Accounts receivable                                       (2,603,172)         (680,344)
          Inventories                                                  (22,339)           36,817
          Costs and estimated earnings in excess of billings
             on uncompleted contracts                                  105,570          (426,747)
          Prepaid and other current assets                              15,334           146,699
          Other assets                                                       -              (985)
          Accounts payable and accrued expenses                        442,345           169,095
          Accrued payroll and related fringes                          438,533           (21,750)
          Income taxes payable                                         365,965             2,356
          Other current liabilities                                    262,045           (75,501)
          Billings in excess of costs and estimated earnings
             on uncompleted contracts                                 (135,048)         (151,063)
                                                                ---------------   ---------------
    NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES                 90,499          (824,956)
                                                                ---------------   ---------------

    CASH FLOWS FROM INVESTING ACTIVITIES:
       Purchases of fixed assets                                      (148,668)          (49,918)
                                                                ---------------   ---------------
    NET CASH USED IN INVESTING ACTIVITIES                             (148,668)          (49,918)
                                                                ---------------   ---------------

    CASH FLOWS FROM FINANCING ACTIVITIES:
       Principal payments of long-term debt                            (26,511)          (70,338)
       Proceeds from long-term debt                                     38,898                 -
       Proceeds from short-term notes payable                          500,000           500,000
                                                                ---------------   ---------------
    NET CASH PROVIDED BY FINANCING ACTIVITIES                          512,387           429,662
                                                                ---------------   ---------------

    NET INCREASE (DECREASE) IN CASH                                    454,218          (445,212)

    CASH - BEGINNING OF PERIOD                                         323,732           599,970
                                                                ---------------   ---------------

    CASH - END OF PERIOD                                        $      777,950    $      154,758
                                                                ===============   ===============

    Cash paid during the period for:
       Interest                                                        $51,452           $37,892
                                                                       ========          ========
       Taxes                                                           $ 4,417           $ 2,434
                                                                       ========          ========

    Non cash financing activities:
       Issuance of redeemable preferred stock dividend                 $19,500           $19,500
                                                                       ========          ========
</TABLE>

    See notes to consolidated financial statements.

                                       4
<PAGE>


                       WINDSWEPT ENVIRONMENTAL GROUP, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1.   BASIS  FOR  PRESENTATION  -  The  accompanying  unaudited  consolidated
     financial statements include the accounts of Windswept Environmental Group,
     Inc. (the  "Company")  and its wholly owned  subsidiaries.  The  unaudited
     consolidated  financial  statements  have been  prepared  by the Company in
     accordance with generally  accepted  accounting  principles  for  interim
     financial  statements and with the instructions to Form 10-Q and Article 10
     of Regulation S-X. Accordingly,  they do not include all of the information
     and footnotes  required by generally  accepted  accounting  principles  for
     complete financial  statements.   In  the  opinion  of  the  Company,  all
     adjustments (consisting of only normal and recurring accruals)  considered
     necessary to present  fairly the financial  position of the Company and its
     subsidiaries as of October 2, 2001,  the  results of  operations  for the
     thirteen weeks ended October 2, 2001 and October 3, 2000 and cash flows for
     the  thirteen  weeks ended  October 2, 2001 and October 3, 2000,  have been
     included.  Certain prior period amounts have been  reclassified  to conform
     with the October 2001 presentation.

     The results  for the  thirteen  weeks ended  October 2, 2001 and October 3,
     2000 are not  necessarily indicative of the results  for an entire  year.
     These  unaudited  consolidated  financial  statements  should  be  read  in
     conjunction  with the  Company's audited  financial  statements  and notes
     thereto included in the Company's Form 10-K for the transition  period from
     May 1, 2001 through July 3, 2001 and the Company's Form 10-K for the fiscal
     year ended April 30, 2001.

2.   LIQUIDITY AND BUSINESS RISKS - As of October 2, 2001, the Company had a
     stockholders'   deficit  of  $1,743,502  and  an  accumulated   deficit  of
     $33,445,141.  The Company has financed  its  operations  to date  primarily
     through  issuance  of debt and equity  securities  and  through  short-term
     borrowings from its majority  shareholder,  Spotless  Plastics (USA),  Inc.
     ("Spotless").  As of October 2, 2001,  the Company had $777,950 in cash. As
     of October 2, 2001, the Company  had working  capital of  $1,086,944.  In
     addition, as of October 2, 2001, the Company was in arrears with respect to
     preferred  stock dividends plus interest of  approximately  $171,000.  The
     Company also has $680,000  principal amount of convertible  notes that will
     be due in full on March 15, 2002. In the opinion of management, the Company
     will have sufficient working capital to fund current operations and repay
     the convertible  notes and any related accrued interest on March 15, 2002.
     However,  market conditions and their effect on the Company's liquidity may
     restrict  the  Company's  use of cash,  which may result in the Company not
     making payment on the  convertible  notes when they become due on March 15,
     2002. In the event that  sufficient  positive cash flow from  operations is
     not  generated, the Company may need to seek additional  financing  from
     Spotless to satisfy the  convertible  notes when they become due,  although
     Spotless is under no legal  obligation  to provide such funds.  The Company
     currently has no credit facility for additional borrowing.

     The above factors raise substantial  doubt as to the Company's  ability to
     continue as a going concern.  The Company's financial  statements have been
     prepared assuming that the Company will continue as a going concern.  The
     financial  statements do not include any adjustments that might result from
     the outcome of this uncertainty.

     After the terrorist attack on the World Trade Center on September 11, 2001,
     the demand for the Company's  emergency and catastrophe response services
     increased  dramatically.  As a result of this increased demand, the Company
     recorded  revenues of  approximately  $2,500,000 for  remediation services
     performed in downtown  Manhattan from September 13, 2001 through October 2,
     2001. Due to favorable  payment terms, all of this revenue was collected in
     October  2001.  Additionally,  the Company  continued  to perform  services
     related to the terrorist  attacks,  with the same favorable  payment terms,
     through October 2001. The Company  believes that  additional  revenues from
     such  services  will be generated in the  foreseeable future, although no
     assurances can be made as to the expected volume. The Company believes that
     the expected receipt of these revenues will favorably impact its liquidity.

     During the thirteen weeks ended October 2, 2001, in order to address cash
     flow and  operational concerns  and to fund  the  increased  payroll  that
     resulted  from the greater  level of work related to the World Trade Center
     attack,  the Company borrowed  $500,000  from  Spotless.   A  balance  of
     $1,700,000 in loans from Spotless was  outstanding  as of October 2, 2001.
     Subsequent  to  October  2,  2001,  the  Company   borrowed  an  additional
     $1,250,000 from  Spotless  to further  fund the work  related to the World
     Trade Center attacks.  As a result of cash collected from the World Trade
     Center   projects,   the  Company repaid $1,250,000  of  principal  and
     approximately  $40,000  of  interest  to  Spotless  in  October

                                       5
<PAGE>


     2001.  All borrowings  from Spotless bear interest at the London  Interbank
     Offering Rate ("LIBOR") plus 1 percent.  As of October 2, 2001, interest of
     $32,139 was accrued on these borrowings.

     Management  believes the Company  will  require  positive  cash flow from
     operations to meet its working  capital needs over the next twelve  months.
     In the event that positive cash flow from operations is not generated,  the
     Company may be required to seek additional  financing  to meet its working
     capital needs.  Management  continues to pursue additional funding sources.
     The Company anticipates revenue growth in new and existing  service areas
     and  continues to bid on large projects,  though there can be no assurance
     that any of the Company's bids will be accepted. The Company is striving to
     improve its gross   margin  and  control   its   selling,   general  and
     administrative expenses.  There can be no assurance,  however, that changes
     in the Company's plans or other events  affecting the Company's  operations
     will not result in accelerated or unexpected cash requirements,  or that it
     will be successful in achieving  positive  cash flow from  operations  or
     obtaining additional financing.  The Company's future cash requirements are
     expected to depend on numerous factors,  including, but not limited to: (i)
     the ability to obtain environmental or related construction contracts, (ii)
     the ability to generate positive cash flow from operations, and the extent
     thereof, (iii) the ability to raise additional capital or obtain additional
     financing, and (iv) economic conditions.

3.   PROVISION  FOR INCOME  TAXES - The  provision  for income taxes for the
     thirteen weeks ended October 2, 2001 consists of the following:
<TABLE>
<CAPTION>
     <S>                           <C>
     Federal - current             $262,331
     State - current                109,331
                                   ---------
     Total                         $371,662
                                   =========
</TABLE>
     The effective rate for income  taxes  differs  from the  statutory  rates
     primarily as a result of the utilization of federal and state net operating
     loss carryforwards  of  approximately  $555,000.  At October 2, 2001,  the
     Company had  approximately  $1,192,000 in net operating loss  carryforwards
     for tax purposes which expire at various dates through 2020.

     No provision or benefit for income  taxes was  recorded  for the thirteen
     weeks ended October 3, 2000 due to a net loss being incurred.

     Any deferred tax assets that may have arisen  during the periods would have
     a full valuation allowance provided against such asset.

4.   INCOME  (LOSS) PER COMMON SHARE - The  calculation  of basic and diluted
     income (loss) per common share was calculated for all periods in accordance
     with the  requirements of Statement of Financial  Accounting  Standards No.
     128, "Earnings per Share".

     The number of shares used in computing  basic  income  (loss) per share was
     38,481,254  and  38,456,254  shares for the thirteen weeks ended October 2,
     2001 and  October 3, 2000,  respectively.  The  number of shares  used in
     computing  diluted  income (loss) per share was  77,068,312  and 38,456,254
     shares for the  thirteen weeks ended  October 2, 2001 and October 3, 2000,
     respectively.

                                       6
<PAGE>

     The following table sets forth the computation of the basic and diluted net
     loss per share for the thirteen weeks ended October 2, 2001 and October 3,
     2000, respectively:
<TABLE>
<CAPTION>
                                                        ------------------------------
                                                          October 2,       October 3,
                                                            2001              2000
                                                        -------------    -------------
     <S>                                                <C>              <C>
     Numerator:
       Net income (loss) attributable to common             $743,653         $(51,754)
         shareholders
       Add interest and amortization on
         convertible notes                                    31,992             -
                                                        -------------    -------------
                                                            $775,645         $(51,754)
                                                        =============    =============

     Denominator:
       Share reconciliation:
         Shares used for basic income
           (loss) per share                               38,481,254       38,456,254
       Effect of dilutive items:
         Stock options                                     2,764,966             -
         Convertible securities                           35,822,092             -
                                                        -------------    -------------
       Shares used for dilutive income
         (loss) per share                                 77,068,312       38,456,254
                                                        =============    =============

     Net income (loss) per share:
       Basic                                                    $.02            $(.00)
                                                        =============    =============
       Diluted                                                  $.01            $(.00)
                                                        =============    =============
</TABLE>

5.   CONTINGENCIES  -  On  October  12,  2001,   Trade-Winds   Environmental
     Restoration, Inc. ("Trade-Winds"),  a  wholly-owned  subsidiary  of  the
     Company, commenced an action in the New York State Supreme Court, County of
     New York, claiming that Trade-Winds is entitled to approximately $1,060,000
     of contractual billings relating to a large mold remediation  project. The
     court has ordered that the record of this action be sealed.  Management has
     not yet completed an assessment of this action.

     On November 22,  1999,  the  Securities  and  Exchange  Commission  ("SEC")
     accepted the Company's  settlement offer in its "Order  Instituting  Public
     Administrative  Proceedings,  Making Findings,  Imposing Remedial Sanctions
     and Issuing  Cease-and-Desist Order" (the "Order"). Under the terms of the
     Order,  the Company neither admitted nor denied any allegations and did not
     incur any monetary fines in connection with an investigation of the Company
     by the SEC which stemmed from the prior convictions of two of the Company's
     former  officers  for  violations  of,  among  other things, the federal
     securities  laws.  The Order  required the Company to develop and institute
     certain   policies,   procedures  and  manuals  to  improve its corporate
     governance,  including the adoption of an audit committee charter, a formal
     conflict of interest policy and a formal employee handbook. The Order also
     required the Company to obtain a secure off site storage facility to store
     its backup data files and system software and to make certain  reporting
     disclosures.  The Company has  implemented  such  policies,  procedures and
     manuals, obtained an off site storage facility and made such disclosures.

     In November 1997,  Trade-Winds  was named as a third party  defendant in an
     action commenced in the New York State Supreme Court,  County of New York,
     under the caption  NICOLAI GRIB AND  VLADISLAV  KAZAROV  V.  TRADE-WINDS
     ENVIRONMENTAL  RESTORATION, INC. AND GULF INSURANCE COMPANY, by a class of
     plaintiffs  claiming to be entitled to additional wages while working for a
     subcontractor of Trade-Winds.  The Company believes that a verdict in favor
     of the plaintiff will not have a material  adverse effect on the Company's
     consolidated financial statements.

     The Company is a party to other  litigation  matters  and claims  which are
     normal in the course of its  operations, and  while the  results  of such
     litigation and  claims cannot be predicted  with  certainty,  management
     believes that the final outcome of such matters will not have a materially
     adverse effect on the Company's consolidated financial position, results of
     operations and cash flows.

                                       7
<PAGE>

     In January 1996, Laboratory Testing Services,  Inc. ("LTS"), a wholly-owned
     subsidiary of the Company, filed a Chapter 11 petition in United  States
     Bankruptcy Court in the Eastern District of New York.  Subsequently,  this
     case  was  converted  to a  Chapter  7  Bankruptcy  proceeding.  Management
     believes that the Company's financial  condition and results of operations
     will not be materially affected by this proceeding.

     The Company  signed a contract to perform  various  tasks at a site in Long
     Island, New  York.  As a result  of  the  discovery  of  unusual  subsoil
     conditions  at the site,  estimated  contract  completion  costs  have been
     revised. Due to uncertainties  inherent in the estimation process, it is at
     least reasonably  possible that completion  costs for the contract will be
     further  revised  in  the  near-term.  The  Company  is in the  process  of
     negotiating additional contract change orders to address this condition. As
     of October 2, 2001,  based upon the  estimate  to  complete,  the  Company
     recognized a loss on this contract of approximately $84,000.

6.   RECENT  ACCOUNTING   PRONOUNCEMENTS  -  In  June  2001,  the  Financial
     Accounting  Standards  Board  ("FASB")   issued   Statement  of  Financial
     Accounting  Standards ("SFAS") No. 141, "Business  Combinations".  SFAS No.
     141 applies prospectively to all business combinations initiated after June
     30, 2001 and to all  business combinations accounted  using the  purchase
     method for which the date of  acquisition  is July 1, 2001, or later.  This
     statement requires all business  combinations to be accounted for using one
     method, the purchase method.  Under previously existing  accounting rules,
     business combinations were accounted  for using one of two methods,  the
     pooling-of-interests  method or the purchase  method.  The adoption of SFAS
     No. 141 is not  expected  to have a  significant  impact on the  Company's
     financial statements.

     In June 2001, the FASB issued SFAS No. 142,  "Goodwill and Other Intangible
     Assets".  SFAS No. 142 addresses  financial  accounting  and reporting for
     acquired goodwill and other intangible assets. Under SFAS No. 142, goodwill
     and some intangible assets will no longer be amortized, but rather reviewed
     for impairment on a periodic  basis.  The provisions of this Statement are
     required to be applied  starting with fiscal years beginning after December
     15,  2001.  This Statement is  required  to be applied at the fiscal year
     beginning  July  2,  2002  and to be applied  to all  goodwill  and  other
     intangible  assets  recognized  in its financial  statements at that date.
     Impairment losses for goodwill and certain intangible assets that arise due
     to  the  initial  application  of  this  Statement  are to be  reported  as
     resulting from a change in accounting principle.  Goodwill and intangible
     assets acquired  after June 30, 2001,  will be subject  immediately to the
     provisions of this Statement.  The adoption of SFAS No. 142 is not expected
     to have a material impact on the Company's financial statements.

     In  August  2001,  the FASB  issued  SFAS No. 143, "Accounting  for Asset
     Retirement Obligations".  The standard requires entities to record the fair
     value of a liability  for an asset  retirement obligation in the period in
     which it is incurred.  When the liability is initially recorded, the entity
     capitalizes  a cost by increasing  the carrying  amount  of the  related
     long-lived asset. Over time, the liability is accreted to its present value
     each period, and the capitalized  cost is depreciated over the useful life
     of the related asset.  Upon  settlement of the liability,  an entity either
     settles the  obligation  for its  recorded  amount or incurs a gain or loss
     upon settlement. The standard is effective for fiscal years beginning after
     June 15, 2002.  The adoption of SFAS 143 is not expected to have a material
     impact on the Company's financial statements.

     In  October  2001, the FASB  issued  SFAS  No.  144,  "Accounting  for the
     Impairment or Disposal of Long-Lived  Assets".  SFAS No. 144 replaces SFAS
     No.  121,  "Accounting  for the  Impairment of Long-Lived  Assets and for
     Long-Lived Assets to Be Disposed Of." SFAS No. 144 requires that long-lived
     assets be measured at the lower of carrying amount or fair value less cost
     to sell, whether  reported in  continuing operations  or in  discontinued
     operations.  Therefore,  discontinued operations will no longer be measured
     at net realizable value or include amounts for operating  losses that have
     not yet occurred. SFAS No. 144 also broadens the reporting of discontinued
     operations to include all components of an entity with  operations that can
     be  distinguished from the rest of the entity and that will be  eliminated
     from the ongoing  operations of the entity in a disposal  transaction.  The
     provisions of SFAS No. 144 are effective  for financial  statements  issued
     for fiscal years beginning  after  December 15, 2001. The adoption of SFAS
     144 is not expected to have a material impact on the Company's  financial
     statements.

7.   SUBSEQUENT  EVENTS  - On  November  16,  2001,  the  Company  exchanged
     $1,700,000 of short-term notes payable for a demand promissory note payable
     to Spotless that is secured by the  Company's  assets and the assets of its
     subsidiaries,  pursuant  to  amendments  to  existing  security  agreements

                                       8
<PAGE>


     between  each  of the  Company  and  its  subsidiaries  and  Spotless.  The
     promissory note has an original  principal amount of $1,700,000 and accrues
     interest at the rate of LIBOR plus one  percent (1%) per annum.  Spotless
     may, but is under no obligation to, lend additional  amounts to the Company
     under this secured promissory note.

     On November 16, 2001, Spotless exercised its right to convert all principal
     and accrued and unpaid  interest on the $2,000,000 Convertible Promissory
     Note (the "Convertible  Note") issued to it by the Company in October 1999.
     As of the date of conversion, the principal amount of $2,000,000  remained
     outstanding under the Convertible Note, and $256,951 in unpaid interest had
     accrued. As a result, upon conversion, the Company issued 28,555,250 shares
     of its common stock to Spotless and the Company's obligations  to Spotless
     in the aggregate amount of $2,256,951 were satisfied.

     Additionally,  on November 16, 2001,  Spotless's  wholly owned  subsidiary,
     Windswept Acquisition Corp.  ("Acquisition Corp."),  exercised its right to
     convert all 9,346 shares of the Company's Series B Preferred Stock that the
     Company  issued to it in October 1999. As a result of such  conversion, in
     accordance  with  the  terms  of  Company's   Series  B  preferred stock,
     Acquisition  Corp.  was issued  10,495,174  shares of the Company's common
     stock.

     After giving effect to these conversions,  Spotless currently  beneficially
     owns  61,335,107  shares of the Company's  common stock, which represents
     approximately 79% of the Company's issued and outstanding shares of common
     stock.

     As a result of the conversion of the Convertible Note,  options to purchase
     2,811,575 shares of the Company's  common stock held by Michael O'Reilly,
     the  President and Chief  Executive  Officer of the  Company,  immediately
     vested,  pursuant to the terms of an option  agreement  between the Company
     and Mr. O'Reilly.

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

Forward-looking statements - Statements contained in this Quarterly Report
on Form 10-Q include "forward-looking statements" within the meaning of
Section 27A of the Securities Act and Section 21E of the Exchange Act.
Forward-looking statements involve known and unknown risks, uncertainties
and other factors which could cause the actual results, performance and
achievements, whether expressed or implied by such forward-looking
statements, not to occur or be realized. Such forward-looking statements
generally are based upon the Company's best estimates of future results,
performance or achievement, based upon current conditions and the most
recent results of operations. Forward-looking statements may be identified
by the use of forward-looking terminology such as "may," "will," "expect,"
"believe," "estimate," "anticipate," "continue" or similar terms,
variations of those terms or the negative of those terms. Potential risks
and uncertainties include, among other things, such factors as:

       -     the market acceptance and amount of sales of the Company's
             services,
       -     the Company's success in increasing revenues and reducing expenses,
       -     the frequency and magnitude of environmental disasters or
             disruptions resulting in the need for the types of services the
             Company provides,
       -     the extent of the enactment, enforcement and strict interpretations
             of laws relating to environmental remediation,
       -     the competitive environment within the industries in which
             the Company operates,
       -     the Company's ability to raise additional capital,
       -     the Company's ability to attract and retain qualified personnel,
             and
       -     the other factors and information disclosed and discussed in other
             sections of this Quarterly Report on Form 10-Q and in the Company's
             Transition Report on Form 10-K for the period from May 1, 2001
             through July 3, 2001 and the Company's Annual Report on Form
             10-K for the fiscal year ended April 30,2001.

Investors should carefully consider such risks, uncertainties and other
information, disclosures and discussions which contain cautionary
statements identifying important factors that could cause actual results to
differ materially from those provided in the forward-looking statements.
The Company undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.

                                       9
<PAGE>

The following discussion and analysis provides information which management
believes is relevant to an assessment and understanding of the Company's results
of operations and financial condition. This discussion should be read in
conjunction with the Consolidated Financial Statements and notes thereto
appearing in Item 1.

RESULTS OF OPERATIONS

THIRTEEN WEEKS ENDED OCTOBER 2, 2001 AND OCTOBER 3, 2000

Revenue

Total revenues for the thirteen weeks ended October 2, 2001 ("the 2001
period") increased by $4,689,910, or approximately 154%, to $7,735,074 from
$3,045,164 for the thirteen weeks ended October 3, 2000 ("the 2000 period").
Revenues in the Company's Trade-Winds subsidiary increased $5,046,586 to
$7,562,761 in the 2001 period from $2,516,175 in the 2000 period. The increase
in Trade-Winds revenues of $5,046,586 was primarily attributable to
approximately $2,500,000 related to remediation work performed in the vicinity
of the World Trade Center as a result of the terrorist attack on September 11,
2001, approximately $1,500,000 in revenues from a mold remediation contract
related to a tropical storm in Houston, Texas, increases in asbestos remediation
projects of approximately $470,000, construction projects of approximately
$295,000 and emergency spill response projects of approximately $300,000.
Revenues in the Company's North Atlantic Laboratories, Inc. ("NAL") subsidiary
decreased $129,588, or 44%, to $168,164 in the 2001 period from $297,752 in the
2000 period. Revenues in the Company's New York Testing Laboratories, Inc.
("NYT") subsidiary decreased $227,088 to $4,149 in the 2001 period from $231,237
in the 2000 period, due to the discontinuance of NYT operations.

Cost of Revenues

Cost of revenues increased $3,226,303 to $5,320,533 in the 2001 period as
compared to $2,094,230 in the 2000 period. The increase of $3,226,303, or 154%,
was primarily attributable to the costs associated with a mold remediation
contract related to a tropical storm in Houston, Texas and costs associated with
remediation work performed in the vicinity of the World Trade Center as a result
of the terrorist attack on September 11, 2001. The remaining increase in cost of
revenues was a function of the increase in revenues in the period. The Company's
cost of revenues consists primarily of labor and labor related costs, insurance,
benefits, bonding and job related insurance, repairs, maintenance, equipment
rental, materials and supplies, disposal costs and depreciation of capital
equipment.

Selling, General and Administrative Expenses

Selling, general and administrative expenses increased by $7,118 to
$974,151 in the 2001 period from $967,033 in the 2000 period, and constituted
approximately 13% and 32% of revenues in the 2001 and 2000 periods,
respectively.

Expense (Benefit) Related to Variable Accounting Treatment for Officer Options

Under the terms of an employment  agreement and a separate  agreement  with
Spotless, the Company's President and Chief Executive Officer may sell to the
Company, or in certain circumstances to Spotless, all shares of common stock of
the Company held by him and all shares of common stock underlying vested options
to purchase shares of common stock of the Company held by him upon the
occurrence of certain events. The expense related to variable accounting
treatment for officer options increased by $302,173 to an expense of $240,445 in
the 2001 period from a benefit of $(61,728) in the 2000 period. This was due to
a change in the market price of the Company's Common Stock and an increase in
the number of vested options outstanding. Due to the terms of the options,
changes in the market price of the Company's Common Stock, in either direction,
result in a corresponding expense or benefit.

Interest Expense

Interest expense decreased by $7,518, or 9%, in the 2001 period to $74,474
from $81,992 in the 2000 period. The decrease in interest expense was primarily
attributable to reductions in LIBOR.

LIQUIDITY AND CAPITAL RESOURCES

As of October 2, 2001, the Company had a stockholders' deficit of
$1,743,502 and an accumulated deficit of $33,445,141. The Company has financed
its operations to date primarily through issuance of debt and equity

                                       10
<PAGE>


securities and through short-term borrowings from its majority shareholder,
Spotless Plastics (USA), Inc.("Spotless"). As of October 2, 2001, the Company
had $777,950 in cash. As of October 2, 2001, the Company had working capital of
$1,086,944. In addition, as of October 2, 2001, the Company was in arrears with
respect to preferred stock dividends plus interest of approximately $171,000.
The Company also has $680,000 principal amount of convertible notes that will be
due in full on March 15, 2002. In the opinion of management, the Company will
have sufficient working capital to fund current operations and repay the
convertible notes and any related accrued interest on March 15, 2002. However,
market conditions and their effect on the Company's liquidity may restrict the
Company's use of cash, which may result in the Company not making payment on the
convertible notes when they become due on March 15, 2002. In the event that
sufficient positive cash flow from operations is not generated, the Company may
need to seek additional financing from Spotless to satisfy the convertible notes
when they become due, although Spotless is under no legal obligation to provide
such funds. The Company currently has no credit facility for additional
borrowing.

The above factors raise substantial doubt as to the Company's ability to
continue as a going concern. The Company's financial statements have been
prepared assuming that the Company will continue as a going concern. The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.

After the terrorist attack on the World Trade Center on September 11, 2001,
the demand for the Company's emergency and catastrophe response services
increased dramatically. As a result of this increased demand, the Company
recorded revenues of approximately $2,500,000 for remediation services performed
in downtown Manhattan from September 13, 2001 through October 2, 2001. Due to
favorable payment terms, all of this revenue was collected in October 2001.
Additionally, the Company continued to perform services related to the terrorist
attacks, with the same favorable payment terms, through October 2001. The
Company believes that additional revenues from such services will be generated
in the foreseeable future, although no assurances can be made as to the expected
volume. The Company believes that the expected receipt of these revenues will
favorably impact its liquidity.

During the thirteen weeks ended October 2, 2001, in order to address cash
flow and operational concerns and to fund the increased payroll that resulted
from the greater level of work related to the World Trade Center attack, the
Company borrowed $500,000 from Spotless. A balance of $1,700,000 in loans from
Spotless was outstanding as of October 2, 2001. Subsequent to October 2, 2001,
the Company borrowed an additional $1,250,000 from Spotless to further fund the
work related to the World Trade Center attacks. As a result of cash collected
from the World Trade Center projects, the Company repaid $1,250,000 of principal
and approximately $40,000 of interest to Spotless in October 2001. All
borrowings from Spotless bear interest at LIBOR plus 1 percent. As of October 2,
2001, interest of $32,139 was accrued on these borrowings.

On November 16, 2001,  the Company  exchanged  $1,700,000 of  short-term  notes
payable for a demand  promissory note payable to Spotless that is secured by the
Company's assets and the assets of its  subsidiaries, pursuant to amendments to
existing  security  agreements  between each of the Company and its subsidiaries
and Spotless. The promissory note has an original principal amount of $1,700,000
and  accrues  interest  at the rate of LIBOR  plus one percent (1%) per annum.
Spotless  may, but is under no  obligation  to, lend  additional  amounts to the
Company under this secured promissory note.

On November 16, 2001, Spotless exercised its right to convert all principal
and accrued and unpaid interest on the $2,000,000 Convertible Promissory Note
(the "Convertible Note") issued to it by the Company in October 1999. As of the
date of conversion, the principal amount of $2,000,000 remained outstanding
under the Convertible Note, and $256,951 in unpaid interest had accrued. As a
result, upon conversion, the Company issued 28,555,250 shares of its common
stock to Spotless and the Company's obligations to Spotless in the aggregate
amount of $2,256,951 were satisfied.

Additionally,  on November 16, 2001,  Spotless's  wholly owned  subsidiary,
Windswept Acquisition Corp. ("Acquisition Corp."), exercised its right to
convert all 9,346 shares of the Company's Series B Preferred Stock that the
Company issued to it in October 1999. As a result of such conversion, in
accordance with the terms of Company's Series B preferred stock, Acquisition
Corp. was issued 10,495,174 shares of the Company's common stock.

As a result of the conversion of the Convertible Note,  options to purchase
2,811,575 shares of the Company's common stock held by Michael O'Reilly, the
President and Chief Executive Officer of the Company, immediately vested,
pursuant to the terms of an option agreement between the Company and Mr.
O'Reilly.

                                       11
<PAGE>

Management believes the Company will require positive cash flow from
operations to meet its working capital needs over the next twelve months. In the
event that positive cash flow from operations is not generated, the Company may
be required to seek additional financing to meet its working capital needs.
Management continues to pursue additional funding sources. The Company
anticipates revenue growth in new and existing service areas and continues to
bid on large projects, though there can be no assurance that any of the
Company's bids will be accepted. The Company is striving to improve its gross
margin and control its selling, general and administrative expenses. There can
be no assurance, however, that changes in the Company's plans or other events
affecting the Company's operations will not result in accelerated or unexpected
cash requirements, or that it will be successful in achieving positive cash flow
from operations or obtaining additional financing. The Company's future cash
requirements are expected to depend on numerous factors, including, but not
limited to: (i) the ability to obtain environmental or related construction
contracts, (ii) the ability to generate positive cash flow from operations, and
the extent thereof, (iii) the ability to raise additional capital or obtain
additional financing, and (iv) economic conditions.

CASH FLOW

Net cash provided by operating activities was $90,499 in the 2001 period.
Accounts receivable increased by $2,603,172 due to billings related to the World
Trade Center work at the end of the period. Accounts payable and accrued
expenses and accrued payroll increased $442,345 and $438,533, respectively,
primarily as a result of the World Trade Center work at the end of the period.
Cash used for capital expenditures was $148,668 in the 2001 period.

During the thirteen  weeks ended  October 2, 2001, in order to address cash
flow and operational concerns and to fund the increased payroll that resulted
from the greater level of work related to the World Trade Center attack, the
Company borrowed $500,000 from Spotless. A balance of $1,700,000 in loans from
Spotless was outstanding as of October 2, 2001. Subsequent to October 2, 2001,
the Company borrowed an additional $1,250,000 from Spotless to further fund the
work related to the World Trade Center attacks. As a result of cash collected
from the World Trade Center projects, the Company repaid $1,250,000 of principal
and approximately $40,000 of interest to Spotless in October 2001.

INFLATION

Inflation has not had a material impact on the Company's operations over
the past three fiscal years or during the 2001 period.

SEASONALITY

Since the Company and its subsidiaries are able to perform their services
throughout the year, the business is not considered seasonal in nature. However,
it is affected by the timing of large contracts in certain of its service areas,
i.e., asbestos and mold abatement and construction, as well as the timing of
catastrophes.

Item 3.  Quantitative and Qualitative Disclosures about Market Risk

The Company is exposed to  potential  loss from market risks that may occur as a
result of changes in the market price of the Company's common stock (with
respect to the variable accounting treatment of a put option for shares of
common stock and common stock options held by an officer of the Company) and as
a result of changes in interest rates (primarily with respect to its debt
obligations to Spotless). As of October 2, 2001, there were no material changes
to the market risk disclosure as reported in the Company's Transition Report on
Form 10-K for the period ended July 3, 2001.


                           PART 2 - OTHER INFORMATION

Item 1.    Legal Proceedings
           -----------------

Reference is hereby made to Note 5 to the Consolidated Financial Statements
in Part I - Item 1 above and to Item 3 of the Company's Transition Report on
Form 10-K for the period from May 1, 2001 through July 3, 2001 and to the
references therein, for a discussion of all material pending legal proceedings
to which the Company or any of its subsidiaries is party.

Item 2.    Changes in Securities
           ---------------------

Not applicable.

                                       12
<PAGE>

Item 3.    Defaults Upon Senior Securities
           -------------------------------

The Company is required to pay quarterly dividends on its Series A
Convertible Preferred Stock, par value $.01 per share (the "Series A
Preferred"), which dividends accrue from the initial date of issuance of the
Series A Preferred, are cumulative and, if not paid when due, bear interest on
the unpaid amount of the past due dividends at the prime rate published in The
Wall Street Journal on the date the dividend was payable, plus 3%. The Company
is currently in arrears on its Series A Preferred dividend payments and interest
thereon in the aggregate amount of approximately $113,000. Under the terms of
the Company's Certificate of Designations of the Series A Preferred, if the
Company fails to make any four consecutive quarterly dividend payments on the
Series A Preferred, the majority in interest of the holders of the Series A
Preferred have the right to elect an additional director to the Company's Board
of Directors, to serve as a director until such accrued and unpaid dividends
have been paid in full. The Company failed to pay its fourth consecutive
quarterly dividend payment on September 15, 2000 to the holders of the Series A
Preferred. There can be no assurance when or if the Company will make any Series
A Preferred dividend payments.

Item 4.    Submission of Matters to a Vote of Security Holders
           ---------------------------------------------------

           Not applicable

Item 5.    Other Information
           -----------------

           Not applicable.

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

      (a)  Exhibits:

           None

      (b)  Reports on Form 8-K

           On August 13, 2001, the Company filed with the SEC a current
           report on Form 8-K , as amended by Amendment No. 1 to Form 8-K
           on Form 8-K/A filed on September 20, 2001, reporting an Item 8
           disclosure.

                                       13
<PAGE>


                                   SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities and
Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned thereunto duly authorized.

Dated: November 16, 2001
                                      WINDSWEPT ENVIRONMENTAL GROUP, INC.




                                      By:   /s/ Michael O'Reilly
                                      MICHAEL O'REILLY,
                                      President and Chief Executive Officer
                                      (Principal Executive Officer)

                                      By:   /s/ Charles L. Kelly, Jr.
                                      CHARLES L. KELLY, JR.
                                      Chief Financial Officer
                                      (Principal Financial Officer)

                                       14
<PAGE>


                       WINDSWEPT ENVIRONMENTAL GROUP, INC.
                             100 Sweeneydale Avenue
                            Bay Shore, New York 11706

                            Telephone: (631) 434-1300
                            Facsimile: (631) 435-4773





                                             November 16, 2001


Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549

     Re:      Windswept Environmental Group, Inc. (the "Company")
              Form 10-Q for the Thirteen Weeks Ended October 2, 2001
              ------------------------------------------------------

Dear Sirs/Madams:

     Transmitted herewith for the filing pursuant to Rule 13a-13 and
Rule 12b-15 promulgated under the Securities Exchange Act, as amended,
is the Company's Quarterly Report on Form 10-Q for the thirteen weeks
ended October 2, 2001.

     Kindly direct any inquiry or comment with respect to the foregoing
to the undersigned's attention.

                                             Very truly yours,
                                             Windswept Environmental Group, Inc.




                                             By:    /s/ Charles L. Kelly, Jr.
                                                CHARLES L. KELLY, JR.
                                                Chief Financial Officer

                                       15