UNITED STATES
               SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C. 20549
                           FORM 10-QSB

(x)  Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

          For Quarterly Period Ended December 31, 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 of             (IRS Employer
   incorporation or organization)           Identification No.)

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

                         (801) 432-8132
       (Registrant's telephone number including area code)

                         Note Applicable
  (Former name, address, and fiscal year if changed since last report)


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

/PAGE/


              International Automate Systems, Inc.

                        Table of Contents


PART I    FINANCIAL INFORMATION


Item 1    Financial Statements

          Condensed Balance Sheets - December 31, 2000
           (Unaudited) and June 30, 2000

          Condensed Statements of Operations for the Three and
           Six Months Ended December 31, 2000 and 1999 and for the
           Cumulative Period September 26, 1986 (Date of Inception)
           Through December 31, 2000, (Unaudited)

          Condensed Statements of Cash Flows for the Six Months
           Ended December 31, 2000 and 1999 and for the
           Cumulative Period September 26, 1986 (Date of Inception)
           Through December 31, 2000 (Unaudited)

          Notes To Condensed Financial Statements

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


PART II   OTHER INFORMATION


Item 1    Legal Proceedings

Item 2    Changes in Securities

Item 3    Defaults Upon Senior Securities

Item 4    Submission of Matters to a Vote of Security
            Holders

Item 5    Other Information

Item 6    Exhibits and Reports on Form 8-K

PART I    FINANCIAL INFORMATION

Item 1         Financial Statements

/2/

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


                             ASSETS
                                         December 31,      June 30,
                                                2000          2000
                                         -----------    ----------
                                         (Unaudited)

Current Assets
   Cash and cash equivalents             $         -    $    8,915
   Net investment in direct financing
     leases - related party - current
     portion                                  27,347        27,118
                                         -----------    ----------
      Total Current Assets                    27,347        36,033
                                         -----------    ----------
Property and Equipment
   Computer and electronic equipment         149,506       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           222,147       221,505
   Accumulated depreciation                 (184,413)     (174,455)
                                         -----------     ----------
      Net Property and Equipment              37,734         47,050
                                         -----------     ----------
Other Assets
   Related party receivable                1,109,209        819,050
   Net investment in direct financing
     leases - related party                   50,638         62,845
   Patents, net of accumulated
     amortization of $61,636                 312,082        291,230
   Escrow deposit                            126,585              -
   Deposit on land held for future
     construction                             60,000          6,000
                                         -----------     ----------
      Total Other Assets                   1,658,514      1,179,125
                                         -----------     ----------

Total Assets                             $ 1,723,595     $1,262,208
                                         ===========     ==========

See the accompanying notes to the condensed financial statements.

/F-1/


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

                                           December 31,     June 30,
                                                  2000         2000
                                           -----------   ----------
                                           (Unaudited)

              LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities
   Funds drawn in excess of cash in bank   $     9,922   $        -
   Accounts payable                            109,634       92,833
   Current portion of long term debt             2,069        4,424
   Accrued payroll expenses                    126,502       82,877
   Obligation under capital leases -
     current portion                            27,347       27,118
                                           -----------   ----------
      Total Current Liabilities                275,474      207,252
                                           -----------   ----------
Long Term Liabilities
   Obligation under capital leases -
     long term                                  50,638       62,845
                                           -----------   ----------

Total Liabilities                              326,112      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, 16,179,961 and
     15,646,361 shares issued and
     outstanding, respectively               7,692,156    6,430,872
   Deficit accumulated during the
     development stage                      (6,589,459)  (5,731,547)
                                           ------------  ----------
         Total Stockholders' Equity           1,397,483     992,111
                                           ------------  ----------

Total Liabilities and Stockholders'
  Equity                                   $  1,723,595  $1,262,208
                                           ============  ==========
/F-2/

                  INTERNATIONAL AUTOMATED SYSTEMS, INC.
                      (A Development Stage Company)
                   CONDENSED STATEMENTS OF OPERATIONS
                               (Unaudited)
<TABLE>
<CAPTION>
                                                                              Cumulative
                                                                          For the Period
                                                                           September 26,
                                                                                    1986
                           For the Three Months       For the Six Months      (Inception)
                             Ended December 31,        Ended December 31,         Through
                          -----------------------   -----------------------   December 31,
                                2000         1999         2000         1999          2000
                          ----------   ----------   ----------   ----------   -----------
<S>                       <C>          <C>          <C>          <C>          <C>

Revenue
  Sales                   $        -   $        -   $        -   $        -   $   111,226
  Equipment lease income
    from related party             -            -            -            -        32,348
                          ----------   ----------   ----------   ----------   -----------
     Total Revenue                 -            -            -            -       143,574
                          ----------   ----------   ----------   ----------   -----------

Cost of Sales
  Cost of sales                    -            -            -            -        81,927
  Write down of carrying
    value of inventories           -            -            -            -       216,186
                          ----------   ----------   ----------   ----------   -----------

     Total Cost of Sales           -            -            -            -       298,113
                          ----------   ----------   ----------   ----------   -----------
Gross Profit/(Loss)                -            -            -            -      (154,539)
                          ----------   ----------   ----------   ----------   -----------

Operating Expenses
  General and adminis-
    trative                   93,130      132,802      726,780      184,437     3,425,152
  Research and development
    expense                   66,569       65,952      124,780      195,983     2,774,102
  Amortization expense         2,647        1,184        5,294        2,368        63,516
  Stockholder class action
    settlement expense             -            -            -            -       170,634
                          ----------   ----------   ----------   ----------   -----------

     Total Operating
       Expenses              162,346      199,938      856,854      382,788     6,433,404
                          ----------   ----------   ----------   ----------   -----------

Loss From Operations        (162,346)    (199,938)    (856,854)    (382,788)   (6,587,943)

Other Income and (Expense)
  Interest income                  -            -            -           46        22,227
  Interest expense               (791)       (144)      (1,058)        (467)      (23,743)
                          -----------   ---------   ----------   ----------   -----------

     Net Other Income
       (Expense)                 (791)       (144)      (1,058)        (421)       (1,516)
                          -----------   ---------   ----------   ----------   -----------

Net Loss                  $  (163,137)  $(200,082)  $ (857,912)  $ (383,209)  $(6,589,459)
                          ===========   =========   ==========   ==========   ===========
Basic and Diluted Loss
  Per Share               $     (0.01)  $   (0.01)  $    (0.04)  $    (0.02)
                          ===========   =========   ==========   ==========

Common and Preferred
  Shares Used in
  Per Share Calculation   19,622,161    16,630,057  19,190,523   16,588,438
                          ==========    ==========  ==========   ==========
</TABLE>

See the accompanying notes to the condensed financial statements.

/F-3/

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

                                                            Cumulative
                                                        For the Period
                                                          September 26,
                                                                  1986
                                       For the Six Months   (Inception)
                                       Ended December 31,       Through
                                      --------------------  December 31,
                                           2000       1999         2000
                                      ---------  ---------  -----------
Cash Flows From Operating Activities
 Net loss                             $(857,912) $(383,209) $(6,589,459)
 Adjustments to reconcile net
   income to net cash provided
   by operating activities:
   Amortization                           5,294      2,368       63,516
   Depreciation                           9,958     19,526      184,413
   Stock based compensation             649,000     63,147    1,050,644
 Change in assets and liabilities:
   Prepaid expenses                           -       (400)           -
   Accounts payable                      16,801      5,536      109,634
   Accrued liabilities                   43,625     49,240      126,502
                                      ---------  ---------  -----------

   Net Cash Used By Operating
     Activities                        (133,234)  (243,792)  (5,054,750)
                                      ---------  ---------  -----------
Cash Flows From Investing Activities
 Purchase of property and equipment        (642)    (3,509)    (197,026)
 Purchase of rights to technology       (26,146)       103     (373,718)
      Organization costs                      -          -       (1,880)
 Net cash loaned to related party      (290,159)  (226,559)  (1,162,463)
 Proceeds from capital lease
   receivable                                 -     12,419       44,220
 Repayment of cash loaned to related
   party                                      -          -       53,254
                                      ---------  ---------  -----------
   Net Cash Used By Investing
     Activities                        (316,947)  (217,546) (1,637,613)
                                      ---------  ---------  ----------
Cash Flows From Financing Activities
 Proceeds from issuance of common
   stock                                 32,000          -   1,394,346
 Cash from controlling shareholder      401,699     491,716  5,343,100
 Payments for treasury stock                  -           -     (3,325)
 Payments for stock offering costs            -           -    (56,509)
 Increase (decrease) in bank overdraft    9,922      (7,084)     9,922
 Proceeds from net borrowings from
   related party                              -           -     78,101
 Payments on note payable and
   obligations under capital lease       (2,355)    (16,851)   (73,272)
                                      ---------  ----------  ---------

   Net Cash Provided By Financing
     Activities                         441,266     467,781  6,692,363
                                      ---------  ----------  ---------
Net Increase (Decrease) In Cash
  and Cash Equivalents                   (8,915)      6,443          -

Cash and Cash Equivalents at
  Beginning of Period                     8,915           -          -
                                      ---------  ----------  ---------
Cash and Cash Equivalents at
  End of Period                       $       -  $    6,443  $       -
                                      =========  ==========  =========

Supplemental Cash Flow Information
 Cash Paid for Interest               $   1,058  $      467
 Value of common stock held in escrow   126,585           -
 Value of stock issued for deposits on
   land held for future construction     54,000           -

See the accompanying notes to the condensed financial statements.

/F-4/

              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 six months ending December 31, 2000 and 1999, the
controlling shareholder, Neldon Johnson, contributed $401,699 and
$491,716 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, $819,050. For
the six months ended December 31, 2000, the Company has advanced
this same corporation an additional $290,159, resulting in a
balance due of $1,109,209. These receivables consist of
construction, labor costs and operating 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.

/F-5/


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 six month periods ended December 31, 2000
and 1999, the Company incurred net losses of $857,912 and
$383,209, respectively. As of December 31, 2000, the Company's
losses accumulated from inception totaled $6,589,459. 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 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 18,000 shares of common
stock for services rendered valued at $40,500 or $2.25 per share.

/F-6/

     During the six months ended December 31, 2000, the Company
placed 500,000 shares of common stock in escrow with an attorney
to be sold.  Proceeds of the stock sales from the escrow account
are placed in a separate escrow account to be used at the
Company's, and the attorney's, discretion.  At December 31, 2000,
155,600 shares had been sold for proceeds of $202,585 at prices
ranging from $1.00 to$2.00 per share.  Of the $202,585 of
proceeds, $44,000 was used to cover legal fees, $32,000 was
returned to the Company and the remaining $126,585 is being held
in escrow.

     In November 2000, the Company agreed to issue 200,000 shares
of common stock to an individual who has agreed to guarantee a
$3,000,000 loan in connection with a building project.  The
shares are to be issued in quarterly installments over an 18
month period.  The amount of shares will be increased
proportionately to the extent that the amount of the loan
guaranteed exceeds $3,000,000.  At the time of the agreement, the
Company issued 50,000 shares to the guarantor. Also, in November
2000, the Company issued 10,000 shares of common stock to an
individual for a Sellers Financing Agreement in connection with
the building project.  On the date of issuance, the 50,000 shares
issued to the guarantor and the 10,000 shares issued to the
individual for the Sellers Financing Agreement had a fair value
of $54,000 or $0.90 per share.  The value of the shares has been
capitalized as part of the costs of the building project.

     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 - PRIOR PERIOD ADJUSTMENT

     The accompanying financial statements for the year
ending June 30, 2000 have been adjusted to reflect the
issuance of 50,000 common shares valued at $63,147 ($1.27 per
share) to an individual in October 1999 for services rendered.
Prior to this adjustment general and administrative and net loss
were understated by $63,147.

/F-7/

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

Forward Looking Statements

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.

Liquidity and Capital Resources

As of December 31, 2000, Registrant had cash of $0 compared to
cash of $8,915 as of June 30, 2000.  Cash decreased because of
continued financial obligations by the Company.  As of December
31, 2000, total current assets were $27,347 and total assets were
$1,723,595 compared to total current assets $36,033 and total
assets $1,262,208 as of June 30, 2000.

As of December 31, 2000, Registrant had total liabilities of
$326,112 and shareholders' equity of $1,397,483 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 $6,589,459 as of December 31, 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 change in stockholders' equity is attributable
primarily to the Company issuing 483,600 shares of common stock
and 2,700,000 shares of preferred stock and to continuing
operating leases.  The Company's operations have significant
risks involving the development of technology and the development
of products that may be commercially acceptable and profitable.
As of December 31, 2000, the ratio of current assets to current
liabilities was approximately 0.10 to one.

For the six months ended December 31, 2000, Registrant had total
revenues of $0 compared to total revenues of $0 for the same
period a year earlier. For the six months ended December 31,
2000, registrant had total operating expenses of $856,854
compared to expenses of $382,788 during the same six month period
for a year earlier. Cost of sales was $0 compared to cost sales
of $0 during the six months ended December 31, 2000 and 1999
respectively. For the six months ended December 31, 2000, general
and administrative expenses were $726,780 compared to $184,437
and research and development expenses were $124,780 compared to
$195,983 a year earlier. For the six months, the Registrant had a
net loss of $857,912 compared to a net loss of $383,209 for the
same six month period a year earlier. The increase in general and
administrative expenses is a result of  increased compensation
expense for the issuance of 268,000 shares of common stock to
employees. For the six months, the net loss per share was $(0.04)
compared to $(0.02) for the same six month period a year earlier.

Results of Operations

For the quarter ended December 31, 2000, Registrant had total
revenues of $0 compared to total revenues of $0 for the same
period a year earlier.  For the quarter ended December 31, 2000,
registrant had total operating expenses of $162,346 compared to
expenses of $199,938 during the same quarter of a year earlier.
As of December 31, 2000, cost of sales was $0 as compared to cost
of sales of $0 during the same quarter a year earlier.  For the
quarter Registrant had a net loss of $163,137 compared to a net
loss of $200,082 for the same quarter a year earlier.  The
decrease in net loss is attributable to the decrease in general
and administrative expenses.  For the quarter, the net loss per
share was $(0.01) compared to $(0.01) for the same quarter a year
earlier.  For the quarter ended December 31, 2000, general and
administrative expenses were $93,130 compared to $132,802 and
research development expenses were $66,569 compared to $65,952 a
year earlier.

<PAGE>

Future Business

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 II - OTHER INFORMATION

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.

Item 2.  Changes in Securities

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

In August 2000, the Company issued 18,000 shares of common stock
for services rendered, valued at $40,500 or $2.25 per share.

Preferred Stock - In July 2000, the Company issued to key
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 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.

<PAGE>

Options - In August 2000, the Company issued options to purchase
1,000,000 shares of restricted common stock as part of employment
agreements.  These options are exercisable at $3.00 per share,
vest100,000 shares per year over a ten year period, and expire
ten years from the date of issuance.

During the six months ended December 31, 2000, the Company placed
500,000 shares of common stock in escrow with an attorney to be
sold.  As of December 31, 2000, 155,600 shares had been sold at
prices ranging from $1 to $2 per share for a total of $202,585.
Part of the money was used for legal fees, part was returned to
the company, and part remained in an escrow account to be used at
the Company's and the attorney's discretion.

In November 2000, the Company agreed to issue 200,000 shares of
restricted common stock over an 18 month period to an individual
in exchange for a $3,000,000 loan guarantee for a building
project.  The amount of shares may increase proportionately to
the extent the loan guaranteed exceeds $3,000,000.  At the time
of the agreement, 50,000 shares had been issued by the company.

Also in November 2000, the Company issued 10,000 shares of
restricted common stock to an individual for a Sellers Financing
Agreement in connection with the building project.

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 and 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: November 20, 2000

                                   International Automated Systems, Inc.


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


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