SECURITIES AND EXCHANGE COMMISSION

              Washington, D.C. 20549

                     FORM 10-Q

 QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
        THE SECURITIES EXCHANGE ACT OF 1934

       For the quarter ended October 31, 2001

          Commission File Number: 0-5105



                  MILASTAR CORPORATION
(Exact name of registrant as specified in its charter)



            DELAWARE                          13-2636669
(State or other jurisdiction of            (I.R.S. Employer
 incorporation or organization)           Identification No.)


7317 West Lake Street, Minneapolis, MN               55426
(Address of principal executive offices)           (Zip code)


Registrant's telephone number, including area code (952) 929-4774


Not Applicable

Former name, former address and former 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 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


At October 31, 2001, 2,723,264 shares of common stock of the Registrant
were issued and outstanding.



  MILASTAR CORPORATION AND SUBSIDIARIES



PART I

Item 1.
    Financial Statements

    The condensed financial statements included herein have been
prepared by Milastar Corporation (the "Company") without audit,
pursuant to the rules and regulations of the Securities and
Exchange Commission.  Certain information and footnote
disclosures normally included in financial statements prepared
in accordance with accounting principles generally accepted in
the United States of America have been condensed or omitted
pursuant to such rules and regulations. However, the Company
believes that the disclosures are adequate to make the
information presented not misleading.  It is suggested that
these condensed financial statements be read in conjunction with
the financial statements and the notes thereto included in the
Company's annual report on Form 10-K for the fiscal year ended
April 30, 2001.

    The condensed financial statements included herein, which are
unaudited, include, in the opinion of management, all
adjustments (consisting only of normal recurring accruals)
necessary to present fairly the financial position and results
of operations of the Company for the periods presented.


<TABLE>
<CAPTION>
              MILASTAR CORPORATION AND SUBSIDIARIES
                   CONSOLIDATED BALANCE SHEETS

                              ASSETS
                                                  October 31,      April 30,
                                                      2001           2001
                                                  (unaudited)      (audited)
Current assets:                              <C>             <C>
Cash and cash equivalents. . . . . . . .             69,000         229,000
Accounts receivable:
 Trade, less allowance for doubtful
 accounts of $59,000 (October 31, 2001)
 and $50,000 (April 30, 2001). . . . . .          1,075,000       1,025,000
Inventory. . . . . . . . . . . . . . . .            191,000         120,000
Prepaid expenses and other . . . . . . .            258,000         227,000

    Total current assets . . . . . . . .          1,593,000       1,601,000

Property, plant and equipment:
 Land. . . . . . . . . . . . . . . . . .            420,000         420,000
 Buildings and improvements. . . . . . .          2,994,000       2,851,000
 Equipment . . . . . . . . . . . . . . .          9,334,000       8,962,000
                                                 12,748,000      12,233,000
  Less accumulated depreciation. . . . .         (5,228,000)     (4,781,000)
                                                  7,520,000       7,452,000
Other assets:
Non-compete agreement, net of
  accumulated amortization of
  of $323,000 & $287,000 respectively. .            123,000         159,000

    Total assets . . . . . . . . . . . .          9,236,000       9,212,000
</TABLE>
<TABLE>
<CAPTION>

               LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:                         <C>             <C>
Current maturities of long-term debt . .            543,000         543,000
Notes payable to bank  . . . . . . . . .            350,000
Accounts payable . . . . . . . . . . . .            503,000         457,000
Accrued payroll and benefits . . . . . .            269,000         329,000
Accrued real estate taxes. . . . . . . .             46,000         108,000
Other accrued liabilities. . . . . . . .             63,000         101,000

    Total current liabilities. . . . . .          1,774,000       1,538,000

Long-term debt,
 less current maturities . . . . . . . .          2,528,000       2,800,000

    Total liabilities. . . . . . . . . .          4,302,000       4,338,000

Stockholders' equity:
Preferred stock, $1.00 par value;
 authorized 5,000,000 shares, none
 issued. . . . . . . . . . . . . . . . .
Common stock,  $.05 par value;
 authorized 7,500,000 shares, issued
 and outstanding 2,723,264 shares at
 October 31, 2001 and April 30, 2001 . .            136,000         136,000
Additional paid-in capital . . . . . . .          1,647,000       1,647,000
Retained earnings. . . . . . . . . . . .          3,151,000       3,091,000

   Total stockholders' equity. . . . . .          4,934,000       4,874,000

   Total liabilities and
    stockholders' equity . . . . . . . .          9,236,000       9,212,000
</TABLE>
See accompanying notes to condensed consolidated financial statements
<TABLE>
<CAPTION>
                   MILASTAR CORPORATION AND SUBSIDIARIES
                   CONSOLIDATED STATEMENTS OF OPERATIONS
                                (Unaudited)


                                             Three Months Ended         Six Months Ended
                                                 October 31,               October 31,
                                             2001          2000        2001          2000

                                         <C>          <C>          <C>          <C>
   Net Sales . . . . . . . . . . . . . .   2,157,000    2,309,000    4,221,000    4,798,000
   Cost of Sales . . . . . . . . . . . .   1,512,000    1,542,000    2,965,000    3,224,000

   Gross margin. . . . . . . . . . . . .     645,000      767,000    1,256,000    1,574,000
   Selling general and administrative
    expenses . . . . . . . . . . . . . .     497,000      543,000      984,000    1,103,000
   Amortization of non-compete
    agreements . . . . . . . . . . . . .      23,000       24,000       37,000       48,000

   Operating income. . . . . . . . . . .     125,000      200,000      235,000      423,000

   Other income (expense):
    Dividend and interest income . . . .                    9,000                     9,000
    Interest expense . . . . . . . . . .     (65,000)     (63,000)    (128,000)    (130,000)
    Net loss on disposal of property
      and equipment  . . . . . . . . . .     (21,000)                  (42,000)
    Other            . . . . . . . . . .                   68,000                    68,000
   Total other income (expense). . . . .     (86,000)      14,000     (170,000)     (53,000)

   Income before income taxes . . . . .       39,000      214,000       65,000      370,000
   Provision for income taxes.  . . . .        3,000        3,000        5,000        5,000

   Net income        . . . . . . . . . .      36,000      211,000       60,000      365,000

   Net income per common share-basic . .         .01          .08          .02          .13

   Net income per common share-diluted .         .01          .07          .02          .13
</TABLE>
See accompanying notes to condensed consolidated financial statements
<TABLE>
<CAPTION>
              MILASTAR CORPORATION AND SUBSIDIARIES
               CONSOLIDATED STATEMENT OF CASH FLOWS
                   Six Months Ended October 31,
                           (Unaudited)


                                                     2001            2000
                                             <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income . . . . . . . . . . . . . . .             60,000         365,000
  Adjustments to reconcile net income
   to net cash provided by operating
   activities:
   Depreciation and amortization . . . .            485,000         492,000
   Net loss on disposal of property
    and equipment. . . . . . . . . . . .             42,000
   Gain on sale of the net assets
    of a business. . . . . . . . . . . .                            (68,000)

  Changes in operating assets and
   liabilities, net of the effect of the
   sale of the net assets of a business:
   Accounts and other receivables. . . .            (50,000)         (3,000)
   Inventory . . . . . . . . . . . . . .            (71,000)         (2,000)
   Prepaid supplies and other. . . . . .            (32,000)        (18,000)
   Accounts payable and accrued
    expenses . . . . . . . . . . . . . .           (114,000)       (167,000)

 Net cash provided by operating
  activities . . . . . . . . . . . . . .            320,000         599,000

CASH FLOWS FROM INVESTING ACTIVITIES:
 Purchases of property, plant and
  equipment: . . . . . . . . . . . . . .           (558,000)       (696,000)
 Proceeds from the sale of the net
  assets of a business . . . . . . . . .                            615,000
 Net cash used in investing
  activities . . . . . . . . . . . . . .           (558,000)        (81,000)

CASH FLOWS FROM FINANCING ACTIVITIES:
 Proceeds (repayments) from bank
  line of credit . . . . . . . . . . . .            350,000        (250,000)
 Principal payments on long-term debt. .           (272,000)       (612,000)
 Proceeds from issuance of
  long-term debt . . . . . . . . . . . .                            825,000
 Net cash privided by (used in)
  financing activities . . . . . . . . .             78,000         (37,000)

NET INCREASE (DECREASE) IN CASH AND
 CASH EQUIVALENTS. . . . . . . . . . . .           (160,000)        481,000

CASH AND CASH EQUIVALENTS BALANCE
 AT BEGINNING OF YEAR. . . . . . . . . .            229,000          56,000

CASH AND CASH EQUIVALENTS BALANCE
 AT END OF THE SECOND QUARTER. . . . . .             69,000         537,000


Supplemental disclosures of cash flow information:
 Cash paid during the first six months for:
  Interest . . . . . . . . . . . . . . . .          128,000         130,000

  Income taxes . . . . . . . . . . . . . .                            5,000
</TABLE>
See accompanying notes to condensed consolidated financial statements

       MILASTAR CORPORATION AND SUBSIDIARIES

    CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        (Unaudited)


1   CONSOLIDATED FINANCIAL STATEMENTS

    The consolidated financial statements of Milastar Corporation
(the "Company") reflect the financial position and results of
operations of the Company and its wholly owned subsidiaries,
after elimination of all material intercompany transactions and
balances.

    The consolidated financial statements as of October 31, 2001 and
for the three and six month periods ended October 31, 2001 and
October 31, 2000, included herein are unaudited and have been
prepared by the Company pursuant to the rules and regulations of
the Securities and Exchange Commission. Certain information and
footnote disclosures normally included in financial statements
prepared in accordance with accounting principles generally
accepted in the United States of America have been condensed or
omitted pursuant to such rules and regulations, although the
Company believes that the disclosures are adequate to make the
information presented not misleading.  The interim financial
statements reflect all adjustments (consisting of normal
recurring accruals) that are, in the opinion of management,
necessary for a fair statement of the results for the interim
periods.  These consolidated financial statements should be read
in conjunction with the consolidated financial statements and
the note thereto included in the Company's 2001 Annual Report to
Shareholders and incorporated by reference in the Company's
annual report on Form 10-K filed with the Securities and
Exchange Commission.  The result of operations for the interim
period should not be considered indicative of the results to be
expected for the entire year.


2   INCOME PER COMMON SHARE

    The following table presents a reconciliation of the
denominators used in the computation of net income per common
share - basic and net income per common share - diluted for the
three and six month periods ended October 31, 2001 and 2000:


                             Three Months Ended       Six Months Ended
                                October 31,             October 31,
                              2001        2000        2001        2000
Weighted shares
 outstanding - basic. . .   2,723,264   2,738,264   2,723,264   2,738,264

Weighted shares assumed
 upon exercise of
 stock options. . . . . .      83,831      91,354     102,140      51,178

Weighted shares
 outstanding - diluted. .   2,807,095   2,829,618   2,825,404   2,789,442


3     INCOME TAXES

      The low effective tax rate for the three and six months ended
October 31, 2001 and 2000, compared to the federal statutory
rate, is due to a reduction of the valuation allowance resulting
from the utilization of net operating loss carryforwards. The
income tax expense in the three and six month periods ended
October 31, 2001 and 2000 is due to minimum state income tax
fees.



4     REVENUE RECOGNITION

      In fiscal 2001, the Company adopted the provisions of Emerging
Issues Task Force Issue 00-10 (EITF 00-10), Accounting for
Shipping and Handling Fees and Costs.  As required by EITF 00-
10, the Company has historically classified shipping and
handling costs billed to customers as revenue.  Prior to the
adoption of EITF 00-10, the Company accounted for the associated
revenues as a reduction in costs of sales.  Effective with the
adoption of EITF 00-10, $2,000 and $7,000 of shipping and
handling fees were reclassified from cost of sales to revenues
for the three months and six months ended October 31, 2000,
respectively.  The Company included all fees associated with
shipping and handling in revenue for the three months and six
months ended October 31, 2001.



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


Results of Operations

    Three Months Ended October 31, 2001 as Compared with the Three
Months Ended October 31, 2000.  The Company recorded sales of
$2,157,000 during the second quarter of fiscal year 2001 as
compared with $2,309,000 for the same period last year, a
$152,000 (7%) decrease.  The decrease in sales were primarily
attributable to a weaker economy for the heat treating industry
in the Midwest and the loss of revenue from the sale of New
England Metal Treating.

    Cost of sales of $1,512,000 (70% of net sales) during the second
quarter of fiscal year 2001 decreased $30,000 (2%) from
$1,542,000 (67% of net sales) for the same period a year
earlier.  Gross margin decreased to $645,000 as compared with
$767,000 for the prior year second quarter. The increase in cost
of sales as a percent of net sales from 67% to 70% and the
decrease in gross margin was primarily the result of lower sales
in the Midwest.

    Selling, general and administrative (SG&A) expenses of $497,000
(23% of net sales) decreased $46,000 (8%) from $543,000 (24% of
net sales) for the same period a year earlier.  The change in
SG&A expenses is primarily due to a decrease in legal expenses.

    The Company recorded operating income of $125,000 in the second
quarter of fiscal 2001 as compared with operating income of
$200,000 recorded in the prior year second quarter.  The
decrease in operating income in the second quarter of fiscal
year 2001 is primarily attributable to lower sales and
relatively fixed costs.

    Total other expense amounted to $86,000 in the second quarter of
fiscal 2001 as compared with other income of $14,000 in the
second quarter of last year.  Other expense consisted of
interest expense and a net loss on the disposal of equipment at
the Bloomington facility.  The other income reported in the
prior year second quarter was primarily the result of a $68,000
gain on the sale of New England Metal Treating and interest
expense of $63,000.

    The Company recorded net income of $36,000 in the second quarter
of fiscal 2001 as compared with net income of $211,000 in the
prior year second quarter.


    Six Months Ended October 31, 2001 as Compared with the Six
Months Ended October 31, 2000.  The Company recorded sales of
$4,221,000 during the first six months of fiscal year 2001 as
compared with $4,798,000 for the same period last year, a
$577,000 (12%) decrease.  The sales decrease was primarily
attributable to a weaker economy for the heat treating industry
in the Midwest and by the loss of revenue from the sale of New
England Metal Treating in the second quarter of fiscal 2000.

    Cost of sales of $2,965,000 (70% of net sales) during the first
six months of fiscal year 2001 decreased $259,000 (8%) from
$3,224,000 (67% of net sales) for the same period a year
earlier. The decrease in total dollars was primarily
attributable to the sale of New England Metal Treating.  The
increase in cost of sales as a percent of net sales from 67% to
70% was primarily the result of lower sales in the Midwest.
Gross margin decreased to $1,256,000 as compared with $1,574,000
for the prior year six months.

    Selling, general and administrative (SG&A) expenses of $984,000
(23% of net sales) decreased $119,000 from $1,103,000 (23% of
net sales) for the same period a year earlier. The change in
SG&A expenses is primarily due to a decrease in the provision
for incentive compensation and a reduction in legal expenses.

    The Company recorded operating income of $235,000 in the first
six months of fiscal 2001 as compared with operating income of
$423,000 recorded in the prior year six months.  The decrease in
operating income in the first six months of fiscal year 2001 is
primarily attributable to lower sales and relatively fixed
costs.

    Total other expense amounted to $170,000 in the first six months
of fiscal 2001 as compared with other expense of $53,000 in the
same period of last year.  Other expense consisted of interest
expense and a net loss on the disposal of equipment at the
Bloomington facility.  The other income reported in the prior
year six months was primarily the result of a $68,000 gain on
the sale of New England Metal Treating being primarily offset by
interest expense.

    The Company recorded net income of $60,000 in the first six
months of fiscal 2001 as compared with net income of $365,000 in
the prior year six months.






Income Taxes

    The provision for income taxes for the six months ended October
31, 2001 was $5,000, or an effective tax rate of 7.7%, compared
to a provision for income taxes of $5,000, or an effective tax
rate of 1.4%, for the six months ended October 31, 2000.  The
low effective income tax rate, compared to the federal statutory
rate of 34% plus state and local taxes for the six months ended
October 31, 2001 and 2000, is due to a reduction in the
valuation allowance resulting from the utilization of net
operating loss carryforwards in each respective period.


Liquidity and Capital Resources

    At October 31, 2001, the Company had negative working capital of
$181,000 compared with $63,000 of working capital at April 30,
2001.  Cash and accounts receivables represented 72% (78% at
April 30, 2001) and 12% (14% at April 30, 2001) of total current
assets and total assets, respectively.  During the first six
months of fiscal 2002, net cash provided by operating activities
amounted to $320,000 compared to $599,000 provided by operating
activities in the first six months of fiscal 2001.  The decrease
is primarily due to lower net income.  Working capital
requirements for the first six months of fiscal 2002 was funded
primarily from available cash, cash generated from operations
and short-term borrowings under the line of credit.  The Company
believes anticipated cash flows from operations and the $150,000
available on the line of credit will be adequate to satisfy
projected operating requirements through the foreseeable future.


Forward-Looking Statements

    Certain statements contained in Management's Discussion and
Analysis and elsewhere in the 10-Q are forward-looking
statements.  These statements may discuss, among other things,
expected growth, future revenues and future performance.  The
forward-looking statements are subject to risks and
uncertainties, including, but not limited to, competitive
pressures, inflation, consumer debt levels, currency exchange
fluctuations, trade restrictions, changes in tariff and freight
rates, capital market conditions and other risks indicated in
the Company's filings with the Securities and Exchange
Commission.  Actual results may materially differ from
anticipated results described in these statements.


Impact of Recently issued Accounting Standards

      In July 2001, the FASB issued Statement No. 141, Business
Combinations, and Statement No. 142, Goodwill and Other
Intangible Assets.  Statement 141 requires that the purchase
method of accounting be used for all business combinations
initiated after June 30, 2001 as well as all purchase method
business combinations completed after June 30, 2001.  Statement
141 also specifies criteria intangible assets acquired in a
purchase method business combination must meet to be recognized
and reported apart from goodwill, noting that any purchase price
allocable to an assembled workforce may not be accounted for
separately.  Statement 142 will require that goodwill and
intangible assets with indefinite useful lives no longer be
amortized, but instead tested for impairment at least annually
in accordance with the provisions of Statement 142.  Statement
142 will also require that intangible assets with definite
useful lives be amortized over their respective estimated useful
lives to their estimated residual values, and reviewed for
impairment in accordance with SFAS No. 121, Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be
Disposed Of.

     The Company is required to adopt the provisions of Statement
141 immediately, except with regard to business combinations
initiated prior to July 1, 2001, and Statement 142 effective May
1, 2002.  Furthermore, any goodwill and any intangible asset
determined to have an indefinite useful life that are acquired
in a purchase business combination completed after June 30, 2001
will not be amortized, but will continue to be evaluated for
impairment in accordance with the appropriate pre-Statement 142
accounting literature.  Goodwill and intangible assets acquired
in business combinations completed before July 1, 2001 will
continue to be amortized prior to the adoption of Statement 142.

Upon adoption of Statement 142, the Company will be required to
reassess the useful lives and residual values of all intangible
assets acquired in purchase business combinations, and make any
necessary amortization period adjustments by the end of the
first interim period after adoption.  In addition, to the extent
an intangible asset is identified as having an indefinite useful
life, the Company will be required to test the intangible asset
for impairment in accordance with the provisions of Statement
142 within the first interim period.  Any impairment loss will
be measured as of the date of adoption and recognized as the
cumulative effect of a change in accounting principle in the
first interim period.

As of October 31, 2001, the Company has  unamortized
identifiable intangible assets in the amount of $123,000 which
will be subject to the transition provisions of Statements 141
and 142.  Amortization expense related to intangible assets,
consisting of a non-compete agreement was $96,000 and $36,000
for the year ended April 30, 2001 and the six months ended
October 31, 2001, respectively.  The Company has determined that
the impact of the statements will not be significant to the
financial statements.

In October 2001, the FASB issued Statement No. 144, Accounting
for the Impairment or Disposal of Long-Lived Assets, which
addresses financial accounting and reporting for the impairment
or disposal of long-lived assets.  While SFAS No. 144 supercedes
SFAS No. 121, Accounting for the Impairment of Long-Lived Assets
and for Long-Lived Assets to Be Disposed Of, it retains many of
the fundamental provisions of that Statement.  SFAS No. 144
becomes effective for fiscal years beginning after December 15,
2001.  The Company is evaluating SFAS No. 144 to determine the
impact on its financial condition and results of operations.


Item 3.  Qualitative and Quantitative Disclosures About Market
Risk.


Market Risks

    The Company is exposed to certain market risks with its $500,000
line of credit of which $350,000 is outstanding at October 31,
2001.  The line bears interest at the bank's reference rate.



                       PART II

Items 1 thru 5

    No response to these items is furnished, since in each case the
    appropriate response would be either not applicable or none.

Item 6.  Exhibits and Reports on Form 8-K

   (a) Exhibits:  None

   (b) Reports on Form 8-K:  None



                     S I G N A T U R E


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


        MILASTAR CORPORATION



        /s/ J. RUSSELL DUNCAN                  /s/ DENNIS J. STEVERMER
          J. Russell Duncan                      Dennis J. Stevermer
Chairman of the Board, Chief Executive   Vice President Treasurer, Principal
        Officer and Director               Financial and Accounting Officer


      Dated: December 14, 2001