FORM 10-QSB

                       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 August 31, 2001 Commission File Number  0-7405

                          MEDISCIENCE TECHNOLOGY CORP.
--------------------------------------------------------------------------------
  (Exact Name of Registrant as Specified in its Certificate of Incorporation)


                                   New Jersey
--------------------------------------------------------------------------------
         (State or other jurisdiction on incorporation or organization)


                                   22-1937826
--------------------------------------------------------------------------------
                    (I.R.S. Employer Identification Number)


               1235 Folkestone Way, Cherry Hill, New Jersey 08034
--------------------------------------------------------------------------------
                    (Address of principal executive offices)


(Registrant's telephone number, including area code)  609-428-7952
                                                      ------------

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X   No ___

Registrant has not been involved in bankruptcy proceedings during the preceding
five years.

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of August 31, 2001.

Title of Class                                Number of Shares Outstanding
--------------                                ----------------------------

Common Stock, par value
$.01 per share                                        36,676,130

Preferred Stock, par value
$.01 per share                                             2,074


<PAGE>

                          MEDISCIENCE TECHNOLOGY CORP.
                                 AUGUST 31, 2001
                                 ---------------

                                      INDEX
                                      -----

                                                                           PAGE
                                                                           ----

PART I.  Financial Information

Item 1.  Consolidated Financial Statements

         Consolidated Balance Sheets as at August 31, 2001 (Unaudited)
         and February 28, 2001 (Audited)                                    1

         Consolidated Statement of Operations for the Six Months Ended
         August 31, 2001 (Unaudited) and August 31, 2000 (Unaudited)        2

         Consolidated Statement of Cash Flows for the Six Months Ended
         August 31, 2001 (Unaudited) and August 31, 2000 (Unaudited)        3

         Consolidated Statement of Stockholders' Deficiency for the Six
         Months Ended August 31, 2001 (Unaudited)                           4

         Consolidated Statement of Stockholders' Deficiency for the Six
         Months Ended August 31, 2000 (Unaudited)                           5

         Exhibit to Statements of Operations                                6

         Notes to Financial Statements                                      7

Item 2.  Management's Plan of Operation                                    8-9

PART II. Other Information                                                 10

Item 1.  Legal Proceedings

Item 2.  Changes in Securities

Item 3.  Defaults Upon Senior Securities

Item 4.  Submission of Matters to Vote of Security Holders

Item 5.  Other Information

Item 6.  Exhibits and Reports on Form 8-K


<PAGE>

                           MEDISCIENCE TECHNOLOGY CORP.
                           CONSOLIDATED BALANCE SHEETS

                                     ASSETS
                                     ------

<TABLE>
<CAPTION>
                                                                         August 31, 2001        February 28, 2001
                                                                           (Unaudited)             (Audited)
                                                                          -------------           ------------
CURRENT ASSETS
--------------
<S>                                                                       <C>                     <C>
      Cash and Cash Equivalents                                           $      6,155            $      7,120
      Other Assets                                                                --                      --
                                                                          ------------            ------------
                  Total Current Assets                                           6,155                   7,120
                                                                          ------------            ------------
PROPERTY, PLANT AND EQUIPMENT
-----------------------------
      Net of Accumulated Depreciation $200,933 -
       August 31, 2001; $199,178 - February 28, 2001                             3,044                   4,800
                                                                          ------------            ------------

TOTAL ASSETS                                                              $      9,199            $     11,920
------------                                                              ============            ============

                    LIABILITIES AND STOCKHOLDERS' DEFICIENCY
                    ----------------------------------------

CURRENT LIABILITIES
-------------------
      Accounts Payable                                                    $      2,951            $     14,943
      Other Accrued Liabilities                                              2,397,587               2,127,028
      Officer and Other Loans                                                  167,044                 152,229
                                                                          ------------            ------------
                  Total Current Liabilities                                  2,567,582               2,294,200
                                                                          ------------            ------------
STOCKHOLDERS' DEFICIENCY
------------------------
      Preferred Stock - $.01 Par Value; Authorized
       50,000 Shrs; Outstanding 2,074 Shrs;
       (Preference on Liquidation $20,740)                                          21                      21
      Common Stock $.01 Par Value, Authorized
       39,950,000 Shares; Outstanding 36,676,130 Shares                        366,761                 362,761
      Additional Paid-in Capital                                            18,315,977              18,274,977
      Accumulated Deficit                                                  (21,241,142)            (20,920,039)
                                                                          ------------            ------------
                  Total Stockholders' Deficiency                            (2,558,383)             (2,282,280)
                                                                          ------------            ------------
TOTAL LIABILITIES & STOCKHOLDERS' DEFICIENCY                              $      9,199            $     11,920
--------------------------------------------                              ============            ============
</TABLE>


                "See Accompanying Notes to Financial Statements."

                                       1

<PAGE>

                          MEDISCIENCE TECHNOLOGY CORP.
                      CONSOLIDATED STATEMENT OF OPERATIONS
                FOR THE SIX MONTHS ENDED AUGUST 31, 2001 AND 2000
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                          SIX MONTHS                            THREE MONTHS
                                               --------------------------------        ---------------------------------
                                                   2001                2000              2001                2000
                                                   ----                ----              ----                ----
<S>                                            <C>                 <C>                 <C>                 <C>
Net Sales                                      $       --          $       --          $       --          $       --

Cost of Sales                                          --                  --                  --                  --
                                               ------------        ------------        ------------        ------------

   Gross Profit                                                                                --                  --

General and Administrative Expense                  287,223             362,224             127,709             187,618
Product Development Expense                            --                  --                  --                  --
Advertising, Travel and Marketing                    34,005              35,541              26,869              17,123
                                               ------------        ------------        ------------        ------------

   Total Expenses                                   321,228             397,765             154,578             204,741
                                               ------------        ------------        ------------        ------------

Other Income                                            125                 388                  58                 164
                                               ------------        ------------        ------------        ------------

Net Loss                                       $   (321,103)       $   (397,377)       $   (154,520)       $   (204,577)
                                               ============        ============        ============        ============

Net Loss Per Common Share, Basic
  and Diluted                                  $       (.01)       $       (.01)       $       (.01)       $       (.01)
                                               ============        ============        ============        ============

Weighted Average Number of Shares
  of Common Stock Outstanding                    36,409,463          36,159,463          36,542,797          36,226,130
                                               ============        ============        ============        ============
</TABLE>


          "See Accompanying Notes to Financial Statements."

                                 2

<PAGE>


                          MEDISCIENCE TECHNOLOGY CORP.
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                FOR THE SIX MONTHS ENDED AUGUST 31, 2001 AND 2000
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                        2001                   2000
                                                                        ----                   ----
CASH FLOWS FROM OPERATING ACTIVITIES
------------------------------------
<S>                                                                  <C>                    <C>
   Net Loss                                                          $(321,103)             $(397,377)
   Adjustment for Item Not Requiring Cash Outlay
        Depreciation                                                     1,756                  1,894
        Stock Issued for Services                                         --                   65,000
                                                                     ---------              ---------
        Subtotal                                                      (319,347)              (330,483)

   Changes in Assets and Liabilities:
        Decrease in Other Assets                                          --                   20,191
        Increase (Decrease) in Accounts Payable                        (11,992)                (1,586)
        Increase (Decrease) in Other Accrued Liabilities               270,559                259,886
        Increase (Decrease) In Officer and Other Loans                  14,815                  1,237
                                                                     ---------              ---------
             Net Cash Flows (Used for) Operating Activities            (45,965)               (50,755)
                                                                     ---------              ---------

CASH FLOWS FROM INVESTING ACTIVITIES                                      --                     --
------------------------------------                                 ---------              ---------


CASH FLOWS FROM FINANCING ACTIVITIES
------------------------------------

   Proceeds from Issuance of Common Stock                               45,000                 37,500
                                                                     ---------              ---------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                          (965)               (13,255)
------------------------------------------------

CASH AND CASH EQUIVALENTS
-------------------------

   Beginning Balance                                                     7,120                 17,066
                                                                     ---------              ---------
   Ending Balance                                                    $   6,155              $   3,811
                                                                     =========              =========
</TABLE>

          "See Accompanying Notes to Financial Statements."

                                 3

<PAGE>

                          MEDISCIENCE TECHNOLOGY CORP.
               CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIENCY
                    FOR THE SIX MONTHS ENDED AUGUST 31, 2001
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                         Preferred
                                          Stock                         Common Stock
                                         Number of       Preferred        Number of
                                          Shares           Stock            Shares
                                       ------------     ------------    ---------------
<S>                                         <C>          <C>              <C>
Balance February 28, 2001                   2,074        $       21       36,276,130

Issuance of Stock for Cash                400,000

Net Loss for the Six Months Ended
    August 31, 2001                          --                --               --
                                       ----------        ----------       ----------
Balance August 31, 2001                     2,074        $       21       36,676,130
                                       ==========        ==========       ==========

<CAPTION>

                                         Common      Additional Paid      Accumulated
                                          Stock        in Capital           Deficit
                                     --------------  ---------------     --------------
<S>                                   <C>              <C>               <C>
Balance February 28, 2001             $    362,761     $ 18,274,977      $(20,920,039)

Issuance of Stock for Cash                   4,000           41,000                --

Net Loss for the Six Months Ended
    August 31, 2001                           --               --            (321,103)
                                      ------------     ------------      ------------
Balance August 31, 2001               $    366,761     $ 18,315,977      $(21,241,142)
                                      ============     ============      ============
</TABLE>

               "See Accompanying Notes to Financial Statements."

                                 4

<PAGE>

                          MEDISCIENCE TECHNOLOGY CORP.
               CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIENCY
                    FOR THE SIX MONTHS ENDED AUGUST 31, 2000
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                         Preferred
                                          Stock                       Common Stock
                                         Number of    Preferred        Number of
                                          Shares        Stock            Shares
                                       ------------  ------------   ---------------
<S>                                        <C>       <C>              <C>
Balance February 29, 2000                  2,074           $21          35,976,130

Issuance of Stock for Cash                   -              -            150,000

Issuance of Stock for Services               -              -            100,000

Net Loss for the Six Months Ended
   August 31, 2000                           -              -               -
                                       ------------  ------------   ---------------
Balance August 31, 2000                   2,074           $21          36,226,130
                                       ============  ============   ===============

<CAPTION>

                                         Common       Additional Paid      Accumulated
                                          Stock         in Capital           Deficit
                                      --------------  ---------------   ------------------
<S>                                   <C>              <C>               <C>
Balance February 29, 2000                $359,761         $18,215,977       $(20,588,721)

Issuance of Stock for Cash                1,500              36,000               -

Issuance of Stock for Services            1,000              64,000               -

Net Loss for the Six Months Ended
   August 31, 2000                          -                  -              (397,377)
                                      --------------   --------------   ------------------
Balance August 31, 2000                 $362,261         $18,315,977       $(20,986,098)
                                      ==============   ==============   ==================
</TABLE>

                "See Accompanying Notes to Financial Statements."

                                       5

<PAGE>

                       EXHIBIT TO STATEMENTS OF OPERATIONS
                  WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING


<TABLE>
<CAPTION>

                     Common Stock
                    $.01 Par Value                                  Number of             Weighted Average
                      Issued and             Common Stock             Shares              Number of Shares
                     Outstanding             Equivalents           Outstanding              Outstanding
                  -------------------       ---------------      -----------------       -------------------
<S>                   <C>                        <C>                <C>                      <C>
 March 2001           36,276,130                  -                 36,276,130

 April 2001           36,276,130                  -                 36,276,130

  May 2001            36,276,130                  -                 36,276,130

 June 2001            36,276,130                  -                 36,276,130

 July 2001            36,676,130                  -                 36,676,130

August 2001           36,676,130                  -                 36,676,130               36,409,463
</TABLE>


                                       6

<PAGE>

                          MEDISCIENCE TECHNOLOGY CORP.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                 AUGUST 31, 2001
                                   (UNAUDITED)


NOTE 1  RESULTS OF OPERATIONS
------  ---------------------

        The  financial  statements,  in the opinion of  management,  include all
        adjustments and accruals necessary for a fair presentation.

        The results of operations  for each interim  period are not  necessarily
        indicative   of  results  to  be  expected  for  the  year  due  to  the
        unpredictability of market factors, product development, competition and
        sales in general.

        These  financial  statements  should  be read in  conjunction  with  the
        Company's most recent audited  financial  statements  dated February 28,
        2001.

NOTE 2  OTHER ACCRUED LIABILITIES
------  -------------------------

        Other accrued liabilities consist of the following:

                                         August 31, 2001    February 28, 2001
                                         ---------------    -----------------
        Legal and Professional Fees        $  230,100          $  180,100
        Research and Development            1,044,065             962,399
        Salaries and Wages                  1,075,083             943,833
        Other                                  48,339              40,696
                                           ----------          ----------
                Total                      $2,397,587          $2,127,028
                                           ==========          ==========


                                       7

<PAGE>

                         MANAGEMENT'S PLAN OF OPERATION

The  Company is engaged in the design  and  development  of  diagnostic  medical
devices  that detect  cancer  using light  induced  native  tissue  fluorescence
spectroscopy  to distinguish  between  pre-malignant,  malignant,  and normal or
benign  tissue.  Both  pre-clinical  and  clinical  study  results  support  the
Company's belief that its proprietary technology,  when fully developed, will be
a useful and  commercially  viable  adjunct to the  physician  for screening and
diagnosis of cancer.

While we  believe  that our  diagnostic  technology  will be  broadly  useful in
multiple organ systems, each approved indication will require a separate, costly
and time-consuming pre-marketing approval (PMA). We plan to carefully select and
prioritize our targeted  indications  to maximize the return on development  and
clinical investments. We regard our seminal U.S. "516" and other related patents
(such as 5, 131, 398) as pioneering, blocking and dominant in the area of cancer
diagnosis using fluorescence spectroscopy both in-vivo and in-vitro.

Until  July,   1998,  the  Company   provided   annual  funding  grants  to  the
Mediphotonics Laboratory of the City University of New York in accordance with a
budget of activities  and  expenditures  negotiated  between the Company and the
University.  The  arrangement  was  renewable  annually and could be  terminated
without  cause by either party upon 90 days prior written  notice.  The contract
with CUNY was extended by agreement at no cost until October 1, 1998. Because of
funding  limitations,  the  Company was unable to renew its  contract  following
expiration  of the  October,  1998  extension.  The Company  plans to resume its
support of relevant  programs  when,  and if,  current fund raising  efforts are
successful.

In April,  1999,  the Company and the City  University  initiated a joint effort
with  Sarnoff  Corporation  of  Princeton  NJ for the  purpose of  developing  a
commercial  imaging  system  based  on  the  Company's  technology,  and  on the
engineering  background and  expertise,  and certain  proprietary  technology of
Sarnoff.

In November,  1999, Frank S. Castellana,  M.D., Eng. Sc. D. joined its executive
team as President and Chief Executive  Officer,  effective February 1, 2000. The
Company announced that it was seeking investment partners to support the funding
of a joint effort between itself,  Sarnoff  Corporation,  and the  Mediphotonics
Laboratory of the City  University of New York to develop and  commercialize  an
advanced,   second  generation   version  of  its  proprietary   two-dimensional
fluorescence  imaging system for early cancer detection.  Effective June 1, 2001
with notice to the Board of Directors Dr. Castellana  voluntarily terminated his
employment  agreement and  additionally  waived all salary to that date. He felt
that he could not satisfy  the  Company's  needs and choose to step  aside.  Dr.
Castellana now has a full time  consulting  business and the Company  expects to
use his consulting services in the future.

Effective  July 9th 2001 Peter  Katevatis,  Esq.  Chairman  CEO on behalf of the
Company entered into an employment relationship with Mr. Sidney Braginsky as the
new President and COO. Mr.  Braginsky was formerly with OLYMPUS  OPTICAL LTD for
27 years most recently as President CEO of OLYMPUS AMERICA, Inc., the Olympus US
subsidiary.  OLYMPUS LTD. is a multi-national corporation headquartered in Tokyo
Japan and a world leader in microscopes,  endoscopes,  automatic blood and fluid
chemistry analyzers measuring  research,  industrial and consumer products.  The
Company will seek investment and/or corporate partners to support the funding of
a joint  effort  between  itself,  Sarnoff  Corporation,  and the  Mediphotonics
Laboratory of the City  University of New York to develop and  commercialize  an
advanced,   second  generation   version  of  its  proprietary   two-dimensional
fluorescence  imaging  system for early  cancer  detection.  Mr.  Braginsky is a
present  board  member  of,  NOVEN   Pharmaceuticals,   REDOX   Pharmaceuticals,
ELECTRO-OPTICAL  SYSTEMS,  Inc., ESTEK CARDIOLOGY,  Chairman of Double D Venture
Funds  LLC and  Chairman  of the  Board of City  College  of New  York's  Robert
Chambers Laboratory.


<PAGE>


On June 14, 2001 Peter  Katevatis,  Esq.  Chairman CEO entered into an agreement
with  Drexel  University,   a  Pennsylvania  non-profit  institution  of  higher
education  wherein  the  parties  agreed  to  explore  a  mutually  satisfactory
arrangement or collaboration to develop uses for Mediscience's technology in the
field of fluorescence  medical imaging.  Drexel's  successful efforts leading to
such funding would provide Drexel with compensation  and/or equity interest from
Mediscience.

The  principal  issue  currently  facing the Company is a lack of the  financial
resources and liquidity  required to maintain  business momentum and to properly
leverage  intellectual  property  assets;  the  resolution  of this issue is the
highest  priority  of  management.  In the absence of the  availability  of such
financing on a timely basis, the Company may be forced to materially  curtail or
cease its operations.

Two important  derivative issues relate to the Company's  research and licensing
agreements  with the City University of New York. The Company has an outstanding
financial  obligation to the  University  for work  conducted  during the period
August 1997 through July 1998.  In 1999,  an agreement was reached to extend the
time for payment until June 30, 2000. In October 2000,  the Company and the City
University entered into a second agreement,  which further extended the time for
payment  until  October  31,  2001.  The time period for  negotiating  a minimum
royalty  agreement  on certain  patents,  which have or will pass the  five-year
period for commercialization, was also extended until October 31, 2001. While we
are  actively  working  to  negotiate  additional  time  extensions  there is no
guarantee that we will be successful,  and if so, that any subsequent agreements
will be on terms favorable to the Company.  In addition,  according to the terms
of our research and licensing  agreement with the  University,  the Company must
negotiate a minimum royalty  Agreement  within 5 years of the date of filing for
all licensed patents for which product  commercialization  has not yet occurred.
As of the date of this  filing,  nine  patents  for  which  the  Company  has an
exclusive  license  from the  Research  Foundation  have  passed  the  five-year
commercialization   window.   The  Company  has  negotiated  with  the  Research
Foundation  and  extended  the  period  of  exclusivity  for  this  intellectual
property.  If the Company is unsuccessful in future negotiations,  it could lose
rights to several of its key patents. The Company holds and totally owns certain
patents  independent  of CUNY that are not so affected  which are seminal to its
basic technology.

We believe that the Company is eligible to receive  benefits  under the State of
New Jersey  Technology  Business Tax Certificate  Program (which allows emerging
technology and biotechnology  businesses to sell their unused Net Operating Loss
(NOL)  carryover to any corporate  taxpayer in the state for at least 75% of the
tax benefits)  through the sale of its New Jersey Net Operating Loss  carryover.
On June 28, 2000, the Company  submitted an application  for benefits under this
program.  This application was approved and the Company received $237,556 in net
proceeds  from the sale.  The Company has applied  again as of June 25, 2001 and
continues in its belief that it is eligible for  participation  in this program.
It is our intention to use any proceeds derived to fully fund the payment of our
obligation  to the City  University  and to support other  relevant  development
activity.  The Company has entered into a three-year agreement on very favorable
terms  (83.3%)  with a New Jersey  corporate  taxpayer to  purchase  the NOL. On
September 27, 2001 Peter Katevatis  successfully  re-negotiated  this percentage
increasing it from 83.3% to 87.3%.


<PAGE>


                           PART II - OTHER INFORMATION
                           ---------------------------


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

        None

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

        None

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

        None

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

        None

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

        None

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

        None


<PAGE>


                                   SIGNATURES


PURSUANT TO THE  REQUIREMENTS  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.

                          MEDISCIENCE TECHNOLOGY CORP.
                          ----------------------------
                                  (REGISTRANT)



DATE:  October 15, 2001              By:  /s/ Peter Katevatis
     ---------------------------        ------------------------------------
                                              PETER KATEVATIS
                                              Chairman/CEO

                                     By: /s/  John M. Kennedy
                                        ------------------------------------
                                              JOHN M. KENNEDY
                                              Treasurer
                                              Chief Accounting Officer