FORM 10-QSB/A

               SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C. 20549


           Quarterly Report Under Section 13 or 15(d)
             Of the Securities Exchange Act of 1934

For Quarter Ended  September 30, 2000

Commission File Number  33-16531-D

              INTERNATIONAL AUTOMATED SYSTEMS, INC.
     (Exact name of registrant as specified in its charter)

          UTAH                               87-0447580
  (State or other jurisdiction   (IRS Employer incorporation or organization)
   Identification No.)

                       326 North Sr. 198
                       Salem, Utah   84653
            (Address of principal executive offices)

Registrant's telephone number including area code    (801) 423-8132

             Not Applicable        Former Address, if changed since last report


Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the proceeding 12 months
(or 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


As of February 16, 2001 Registrant had 16,061,961 shares of
common stock, no par value per share, issued and outstanding
after deducting shares held in the corporate treasury.





PART I

ITEM 1         FINANCIAL STATEMENTS

              INTERNATIONAL AUTOMATED SYSTEMS, INC.
                  (A Development Stage Company)
                    CONDENSED BALANCE SHEETS



                             ASSETS

                                        September 30,    June 30,
                                               2000         2000
                                          ----------   ----------
                                          (Unaudited)
Current Assets
   Cash and cash equivalents              $    3,724   $   8,915
   Net investment in direct financing
      leases -  related party - current
      portion                                 23,814      27,118
                                          ----------   ---------
      Total Current Assets                    27,538      36,033

Property and Equipment
   Computer and electronic equipment         148,864     148,864
   Furniture and fixtures                     20,982      20,982
   Automobiles                                21,657      21,657
   Mobile office                              11,764      11,764
   Leasehold improvements                     18,238      18,238
                                          ----------  ----------
      Total Property and Equipment           221,505     221,505
   Accumulated depreciation                (181,918)    (174,455)
                                          =========   ==========
      Net Property and Equipment              39,587      47,050
                                          ----------  ----------
Other Assets
   Related party receivable                  957,241     819,050
   Net investment in direct financing
   leases - related party                     60,291      62,845
   Patents, net of accumulated
     amortization of $58,989
     and $56,342                             301,230     291,230
   Deposits                                    6,000       6,000
                                          ----------  ----------
      Total Other Assets                   1,324,762   1,179,125
                                          ----------  ----------

Total Assets                              $1,391,887  $1,262,208
                                          ==========  ==========



See the accompanying notes to the condensed financial statements.

                              2


              INTERNATIONAL AUTOMATED SYSTEMS, INC.
                  (A Development Stage Company)
              CONDENSED BALANCE SHEETS (CONTINUED)

                                        September 30,    June 30,
                                                2000         2000
                                          ----------   ----------
                                          (Unaudited)


              LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities
   Accounts payable                        $  83,921   $ 92,833
   Current portion of long term debt           3,023      4,424
   Accrued payroll expenses                   90,612     82,877
   Obligation under capital leases -
     current portion                          23,814     27,118
                                           ---------   ---------
      Total Current Liabilities              201,370    207,252
                                           ---------   --------
Long Term Liabilities
   Obligation under capital leases -
     long term                                60,291     62,845
                                           ---------   --------
Total Liabilities                            261,661    270,097
                                           ---------   --------
Stockholders' Equity
   Preferred stock, Class A, no par value,
   4,400,000 shares authorized, 3,300,000
   and 1,000,000 shares issued and
   outstanding, respectively                 294,786    292,786
   Preferred stock, Class B, no par value,
     600,000 shares authorized, 600,000
     shares issued and outstanding,
     respectively                                  -          -
   Common stock, no par value, 45,000,000
     shares authorized, 15,914,361 and
     15,646,361 shares issued and
     outstanding, respectively             7,261,762   6,430,872
   Deficit accumulated during the
   development stage                      (6,426,322) (5,731,547)
                                          ----------  ----------
       Total Stockholders' Equity          1,130,226     992,111
                                          ----------  ----------
Total Liabilities and Stockholders'
  Equity                                  $1,391,887  $1,262,208
                                          ==========  ==========

See the accompanying notes to the condensed financial statements.

                              3

                 INTERNATIONAL AUTOMATED SYSTEMS, INC.
                     (A Development Stage Company)
                  CONDENSED STATEMENTS OF OPERATIONS
                              (Unaudited)
                                                           For the Period
                                                           (September 26,
                                      For the Three Months          1986)
                                      Ended September 30,        Through
                                    ----------------------  September 30,
                                          2000        1999          2000
                                    ---------- -----------  ------------
Revenue
  Sales                             $       -  $        -   $    111,226
  Income from related party                 -           -         32,348
                                    ---------  ----------   ------------
     Total Revenue                          -           -        143,574
                                    ---------  ----------   ------------
Cost of Sales
  Cost of sales                             -        5,740        81,927
  Write down of carrying value of
     inventories of $108,093 during
    1998 and 1997                           -           -        216,186

Total Cost of Sales                         -        5,740       298,113
                                    ---------  -----------   -----------
Gross Profit (Loss)                         -      (5,740)     (154,539)
                                    ---------  ----------    -----------
Operating Expenses
  General and administrative           633,650      51,635     3,332,022
  Research and development
    expense                             58,211     124,291     2,707,533
  Amortization expense                   2,647       1,184        60,869
  Stockholder class action
    settlement expense                       -          -        170,634
                                    ----------  ---------    -----------
     Total Operating  Expenses         694,508     177,110     6,271,058
                                    ----------  ----------   -----------
Other Income and (Expense)
  Other income                               -           -              -
  Interest income                            -          46         22,227
  Interest expense                        (267)       (323)      (22,952)
                                    ----------  ----------   -----------
     Net Other Income   (Expense)         (267)       (277)         (725)
                                    ----------  ----------   -----------
Net Loss                            $ (694,775)  $(183,127)  $(6,426,322)
                                    ==========  ==========

Basic and Diluted Loss Per Share    $    (0.04) $    (0.01)
                                    ==========  ==========
Common and Preferred Shares Used
  in Per Share Calculation          18,754,141  16,546,361


See the accompanying notes to the condensed financial statements.

                              4

                 INTERNATIONAL AUTOMATED SYSTEMS, INC.
                     (A Development Stage Company)
                  CONDENSED STATEMENTS OF CASH FLOWS
                              (Unaudited)

                                                          For the Period
                                                          From Inception
                                                          (September 26,
                                                                   1986)
                                      For the Three Months       Through
                                       Ended September 30,  September 30,
                                      --------------------  ------------
                                           2000       1999          2000
                                      ---------  ---------  ------------
Cash Flows From Operating Activities
 Net loss                             $(694,775) $(183,127) $ (6,426,322)
 Adjustments to reconcile net income
    to net cash provided by
    operating activities:
   Amortization                           2,647      1,184        60,869
   Depreciation                           7,463      8,221       181,918
   Stock based compensation             605,000          -     1,006,644
 Change in assets and liabilities:
   Prepaid expenses                           -       (400)            -
   Accounts payable                      (8,912)     7,575        83,921
   Accrued liabilities                    7,735     41,908        90,612
                                      ---------  ---------  ------------
   Net Cash Used By Operating
    Activities                          (80,842)  (124,639)   (5,002,358)

Cash Flows From Investing Activities
 Purchase of property and equipment           -     (3,114)    (196,384)
 Purchase of rights to technology       (12,647)       400     (360,219)
      Organization costs                      -          -       (1,880)
 Net cash loaned to related party      (138,191)  (115,497)  (1,010,495)
 Proceeds from capital lease
   receivable                                 -      3,082       44,220
 Repayment of cash loaned to related
   party                                      -          -       53,254
                                      ---------  ---------  -----------
   Net Cash Used By Investing
     Activities                        (150,838)  (115,129)  (1,471,504)
                                      ---------  ---------  -----------
Cash Flows From Financing Activities
 Proceeds from issuance of common stock       -          -    1,362,346
 Cash from controlling shareholder      227,890    261,400    5,169,291
 Payments for treasury stock                 -           -      (3,325)
 Payments for stock offering costs           -           -     (56,509)
 Increase (decrease) in bank overdraft       -      (7,084)          -
 Proceeds from net borrowings from
   related party                             -           -      78,101
 Payments on note payable and
   obligations under capital lease      (1,401)     (5,537)    (72,318)
                                      --------  ----------  ----------
   Net Cash Provided By Financing
     Activities                        226,489     248,779   6,477,586
                                      --------  ----------  ----------
Net Increase (Decrease) In Cash
  and Cash Equivalents                  (5,191)      9,011       3,724

Cash and Cash Equivalents at
  Beginning of Period                    8,915           -           -
                                      --------  ----------  ----------
Cash and Cash Equivalents
  at End of Period                    $  3,724  $    9,011  $    3,724
                                      ========  ==========  ==========
Supplemental Cash Flow Information

 Cash Paid for Interest               $    267  $      232  $   22,952

 See the accompanying notes to the condensed financial statements.

                              5

              INTERNATIONAL AUTOMATED SYSTEMS, INC.
             NOTES TO CONDENSED FINANCIAL STATEMENTS


NOTE 1--INTERIM FINANCIAL STATEMENTS

     The accompanying financial statements have been prepared by
the Company, and are unaudited. In the opinion of management, the
accompanying unaudited financial statements contain all necessary
adjustments for fair presentation, consisting of normal recurring
adjustments except as disclosed herein.

     The accompanying unaudited interim financial statements have
been condensed pursuant to the rules and regulations of the
Securities and Exchange Commission; therefore, certain
information and disclosures generally included in financial
statements have been condensed or omitted. These financial
statements should be read in connection with the Company's annual
financial statements included in the Company's annual report on
Form 10-KSB as of June 30, 2000. The financial position and
results of operations of the interim periods presented are not
necessarily indicative of the results to be expected for the year
ended June 30, 2001.

NOTE 2--RELATED PARTY TRANSACTIONS

     For the three months ending September 30, 2000 and 1999, the
controlling shareholder, Neldon Johnson, contributed $227,890 and
$205,000 for research as additional paid-in capital,
respectively. No additional preferred or common stock was issued.

     As of June 30, 2000, the Company loaned U-Check, Inc. (U-
Check), a corporation solely owned by Mr. Johnson, $819,000.  For
the three months ended September 30, 2000, the Company has
advanced this same corporation an additional $138,191, resulting
in a balance due of $957,241. These receivables consist of
construction and labor costs paid for by the Company on behalf of
U-Check.  No terms for repayment have been established.

NOTE 3--CONTINGENCIES

     On September 23, 1998, the Company was notified by the U.S.
Securities and Exchange Commission (SEC) of formal action against
the Company, its president, and members of his family for
possible securities violations. The action stems from alleged
material misrepresentations by the company regarding new
technology developed by the Company. The SEC is seeking
disgorgement of the proceeds from the sale of stock by the
company and its principles that occurred between June 1995 and
June 1996. This figure is believed to be in excess of $3,000,000.
The SEC is also seeking the imposition of fines and attorney's
fees. The ultimate outcome of the action cannot presently be
determined. Accordingly, no provision for any liability that may
result has been made in the accompanying financial statements,
and the possible effect that action will have on future financial
statements is unknown.

                              6

NOTE 4--BUSINESS CONDITION

     The accompanying financial statements have been prepared on
a going concern basis, which contemplates the realization of
assets and the satisfaction of liabilities in the normal course
of business. During the three month periods ended September 30,
2000 and 1999, the Company incurred net losses of $676,006 and
$183,127, respectively. As of September 30, 2000, the Company's
losses accumulated from inception totaled $6,374,726. These
factors, among others, indicate that the Company may be unable to
continue as a going concern for a reasonable period of time. The
financial statements do not include any adjustments relating to
the recoverability and classification of recorded asset amounts
or the amount and classification of liabilities that might be
necessary should the Company be unable to continue as a going
concern. The Company's ability to continue as a going concern is
dependent upon its ability to generate sufficient cash flow to
meet its obligations on a timely basis, to obtain additional
financing as may be required, and ultimately to attain successful
operations. Management is in the process of negotiating various
sales agreements and is hopeful these sales will generate
sufficient cash flow for the Company to continue as a going
concern.

NOTE 5 -EQUITY

     Series A Preferred Stock - In July 2000, the Company issued
to certain Employees /Directors 2,000,000 shares of preferred
stock in leu of a $2,000 bonus. The preferred shares have equal
dividend rights to the common shares, are not convertible into
common shares, have no dividend requirements, and have no
liquidation preferences to the common shares. Each preferred
share is entitled to the voting rights of ten common shares.

          In August 2000, the Company entered into employment
agreements with certain employees. In connection with these
agreements, the Company issued 300,000 shares of preferred stock.
The preferred shares have equal dividend rights to the common
shares, are not convertible into common shares, have no dividend
requirements, and have no liquidation preferences to the common
shares. Each preferred share is entitled to the voting rights of
ten common shares.  Due to the shares having only voting rights,
the shares are deemed to have been issued with no value.;

     Series B Preferred Stock - In connection with the employment
agreements, the Company issued 300,000 shares of convertible
preferred stock.  Each preferred share has equal dividend rights
to the common shares,  has no dividend requirements, has no
liquidation preferences to the common shares, and is entitled to
the voting rights of ten common shares. Each share of the
convertible preferred stock is exchangeable into two options to
purchase common stock at $3.00 per share, exercisable immediately
and the options expire ten years from the date the preferred
stock is exchanged.  The Company is accounting for these shares
as though they were an issuance of a stock option. See below for
the Company's accounting policy for the issuance of stock
options.

     Common Stock - In August 2000, the Company put 400,000
shares of common stock into escrow to be sold as needed to cover
legal and other expenses. As of September 30, 2000, no shares
have been sold.

                              7

     In August 2000, the Company entered into employment
agreements with certain employees.  In connection with these
agreements, the Company issued; 250,000 shares of common stock
valued at $562,500 or $2.25 per share.

     In August 2000, the Company issued 5,000 shares of common
stock for services rendered valued at $11,250 or $2.25 per share.

     Options - In August 2000, as part of employment agreements,
the Company issued options to purchase 1,000,000 shares of common
stock.  These options are exercisable at $3.00 per share, vest
100,000 shares per year over a ten year period and expire ten
years from the date of issuance.  The exercise price of $3.00 per
share was greater than the market value of the shares on the date
of issuance.  Accordingly, no compensation expense will be
recognized for the options.

     The Company accounts for its stock issued to directors,
officers and employees under Accounting Principles Board Opinion
No. 25 and related interpretations ("APB 25"). Under APB 25,
compensation expense is recognized if an option's exercise price
on the measurement date is below the fair value of the Company's
common stock. The Company accounts for options and warrants
issued to non-employees in accordance with SFAS No. 123,
Accounting for Stock-Based Compensation" (SFAS 123) which
requires these options and warrants to be accounted for at their
fair value.  There will be no compensation expense recognized for
the options under APB 25.

NOTE 6 - RESTATEMENT

     The accompanying financial statements as of June 30, 2000
and for the year then ended have been restated to reclassify
$2,166 of depreciation from accumulated depreciation and general
administrative expense; $28,154 of legal accruals from accounts
payable and legal expense; and to record the issuance of 50,000
shares of restricted common stock valued at $63,147 or $1.26 per
share. As a result of these changes, net loss for the year ended
June 30, 2000 increased by $32,827, or $0.00 per share.

ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

Liquidity and Capital Resources. As of September 30, 2000,
Registrant had cash of $3,724 compared to cash of $8,915 as of June
30, 2000. Cash decreased because of continued financial obligations
by the Company. As of September, 2000, total current assets were
$27,538 and total assets were $1,391,887 compared to total current
assets $36,033 and total assets $1,262,208 as of June 30, 2000.

As of September 30, 2000, Registrant had total liabilities of
$261,666 and shareholders' equity of $1,130,226 as compared to total
liabilities of $270,097 and shareholders' equity of $992,111 as of
June 30, 2000. The deficit accumulated during the development stage
was $6,426,322 as of September 30, 2000, compared to $5,731,547 as
of June 30, 2000. At this time the Company is not generating
sufficient funds to sustain its operations. The decrease in
shareholders' equity is attributable primarily to the continuing
operating losses. These activities have significant risks involving
the development of technology and the development of products that
may be commercially acceptable and profitable. As of September 30,
2000, the ratio of current assets to current liabilities was
approximately .14 to one.

Results of Operations. For the quarter ended September 30, 2000
registrant had total revenues of $0 compared to total revenues to $0
for the same period a year earlier. For the quarter ended September
30, 2000, registrant had total operating expenses of $694,508
compared to expenses of $177,110 during the same quarter of a year
earlier. As of September 30, 2000, cost of sales was $0 as compared
to cost of sales of $5,740 during the same quarter a year earlier.
For the quarter registrant had a net loss of $694,775 compared to a
net loss of $183,127 for the same quarter a year earlier. The
increase in net loss is attributable to the increase in general and
administrative expenses. For the quarter, the net loss per share was
$(0.04) compared to $(0.01) for the same quarter a year earlier. For
the quarter ended September 30, 2000, general and administrative
expenses were $633,650 compared to $51,635 and research and
development expenses were $58,211 compared to $124,291 a year
earlier.


The Company's ability to continue its activities is dependent on it
receiving funds either as loans, advances or sales of equity.
Previously the major shareholder has provided funds, but there is no
formal agreement between the Company and the majority shareholder to
continue providing funds in the future. If the Company had to seek
funds from another source there is no assurance that funds would be
available at all or on terms acceptable to the Company. PART 88.


Part II
Item 1. Legal Proceedings

On September 23, 1998, the Company was notified by the U.S.
Securities and Exchange Commission (SEC) of formal action against
the Company, its president and members of his family for possible
securities violations. The action stems from alleged material
misrepresentations by the Company regarding new technology developed
by the Company.  The SEC is seeking disgorgement of the proceeds
from the sale of stock by the Company and its principles that
occurred between June 1995 and June 1996.  This figure is believed
to be in excess of $3,000,000.  The SEC is also seeking the
imposition of fines and attorney's fees. Though the Company and the
principles named in the complaint deny any wrong doing and intend on
vigorously defending the lawsuit, the ultimate outcome of the
action cannot presently be determined. Accordingly, no provision for
any liability that may result has been made in the accompanying
financial statements, and the possible effect the action will have
on future financial statements is unknown.

The Company has filed a civil action complaint in the United States
District Court for the District of Utah Central Division against
Optimal Robotics Corp. and PSC, Inc. alleging patent infringement
arising under the patent laws of the United States, and more
specifically, under Title 35,U.S.C. Sections 271, 281, 283, 284 and
285. Discovery is presently in progress.

The Company has filed a civil action complaint in the United States
District Court for the district of Utah Central division against The
Kroger Company alleging patent infringement arising under the patent
infringement arising under the patent laws of the United States, and
more specifically, under Title 35, U.S.C., section 271, 281, 283,
284, and 285.
                              9

Item 2. Changes in Securities

Common Stock- In August 2000, the Company put 400,000 shares of
common stock into escrow to be sold as needed to cover legal and
other expenses. As of September 30, 2000, no shares have been
sold.

In August 2000, the Company entered into employment agreements with
certain key employees.  In connection with these agreements, the Company
issued 250,000 shares.

In August 2000, the Company issued 5,000 shares of common stock for
services rendered.

Preferred Stock- In July 2000, the Company issued to key Employees/
Directors 2,000,000 shares of preferred stock in leu of a bonus. The
preferred shares have equal dividend rights to the common shares,
are not convertible into common shares, have no dividend
requirements, and have no  liquidation preferences to the common
shares. Each preferred share is entitled of the voting rights of
ten common shares.

In August 2000, the Company issued 300,000 shares of preferred
stock, which has no value, as part of an employee agreement with
certain employees. The preferred shares have equal dividend rights
to the common shares, are not convertible into common shares, have
no dividend requirements, and have no liquidation preferences to the
common shares. Each preferred share is
entitled to the voting rights of ten common shares.

In August 2000, the Company issued 300,000 shares of convertible
preferred shares to certain key employees as part of an employee
agreement. Each preferred share has equal dividend rights to the
common shares, have no  dividend requirements, and have no
liquidation preferences to the common shares, and is entitled to the
voting rights of ten common shares. Each share  can be converted to
two options to purchase common stock at $3.00 per share.

Options - In August 2000, the Company issued options to purchase
1,000,000 shares of restricted common stock over a ten year period
at $3.00 per share  as part of employment agreements. This report
contains forward looking statements regarding the Company's plans,
objectives, expectations and intentions.  All forward looking
statements are subject to risks and uncertainties that could cause
the Company's actual results and experience to differ materially
from such projections.  Such risks include delays in product
development, the development of marketing and distribution channels,
and market acceptance of its products. Other risks may be beyond the
control of the Company.


                              10


Item 3. Defaults Upon Senior Securities.

       None.

Item 4. Matters Submitted to a Vote of the Company's Shareholders.

       None.

Item 5. Other Information.

       None.

Item 6. Exhibits, Financial Statements, Schedules and Reports on
Form 8-K.

       A.      Exhibits.

               Ex. 27 Financial Data Summary.

       B.      Reports on Form 8-K.

        None.

SIGNATURES

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


Date:  March 2, 2001

                                 International Automated Systems, Inc.

                                 By: \s\ Neldon Johnson
                                 -------------------------------------
                                 Neldon Johnson
                                 President and Chief Executive Officer


                              11