1

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549
                                   FORM 10-QSB

(Mark One)
  X      QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
 ---     ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2001

__       TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
         ACT OF 1934 FOR THE TRANSITION PERIOD FROM ____________ TO ____________

Commission File Number 2-93277-D



                          MEDIZONE INTERNATIONAL, INC.
        (Exact name of small business issuer as specified in its charter)

       Nevada                                           87-0412648
(State or other jurisdiction                (I.R.S. Employer Identification No.)
of incorporation or organization)

                                 144 Buena Vista
                                  P.O. Box 742
                             Stinson Beach, CA 94970
               (Address of principal executive offices, Zip Code)

                                 (415) 868-0300
              (Registrant's telephone number, including area code)

 Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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 May 10, 2001, there were 155,338,019 shares of the registrant's common stock
issued and outstanding.

Transitional Small Business Disclosure Format
(Check one):
Yes __ No X
         ---


                                       1


<PAGE>


                          MEDIZONE INTERNATIONAL, INC.
                                   FORM 10-QSB
                                      INDEX
                                 March 31, 2001

                                                                          Page
                                                                          Number
Part I - Financial Information

Item 1 - Financial Statements

  Condensed Consolidated Balance Sheet:
   March 31, 2001 (Unaudited) and December 31, 2000............................3

  Condensed Consolidated Statement of Operations (Unaudited):
   For the Three Months Ended March 31, 2001 and 2000..........................4

  Condensed Consolidated Statement of Cash Flow (Unaudited)
   For the Three Months Ended March 31, 2001 and 2000..........................5

       Notes to Condensed Consolidated Financial Statements....................6

Item 2 - Management's Discussion and Analysis or Plan of Operation.............7



                                       2


<PAGE>


                   MEDIZONE INTERNATIONAL, INC. AND SUBSIDIARY
                          (A Development Stage Company)
                      CONDENSED CONSOLIDATED BALANCE SHEET
                      March 31, 2001 and December 31, 2000


<TABLE>
<CAPTION>
                                                                  March 31,      December 31,
                                                                    2001             2000
                                                               ---------------  ---------------
                                                                 (Unaudited)
Assets
<S>                                                            <C>              <C>
                   Cash and Cash Equivalents $ 1,229 $ 2,368
                                                               ---------------  ---------------
     Total Cash and Cash Equivalents                                    1,229            2,368
                                                               ---------------  ---------------
Other Current Assets
   Payroll deposits                                                    42,277                -
                                                               ---------------  ---------------
     Total Other Current Assets                                        42,277                -
                                                               ---------------  ---------------
     Total Current Assets                                              43,506            2,368
                                                               ---------------  ---------------

                                                                       13,463           14,977
                                                               ---------------  ---------------
                                                               $       56,969   $       17,345
                                                               ===============  ===============
Liabilities and Stockholders' Equity (Deficit)
Accounts payable                                               $      331,347   $      339,774
Accrued expenses                                                      461,766          371,651
Current portion of long-term obligations                              280,491          280,491

Total Current Liabilities                                           1,073,604          991,916
                                                               ---------------  ---------------
Common stock                                                          154,616          153,916
Additional paid-in capital                                         15,330,960       15,201,661
Deficit accumulated during the development stage                  (16,502,211)     (16,330,148)
                                                               ---------------  ---------------
     Total Stockholders' Equity (Deficit)                          (1,016,635)        (974,571)
                                                               ---------------  ---------------
                                                               $       56,969   $       17,345
                                                               ===============  ===============
</TABLE>









                             See accompanying notes.

                                       3

<PAGE>


                   MEDIZONE INTERNATIONAL, INC. AND SUBSIDIARY
                          (A Development Stage Company)
                 CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
                                  (Unaudited)

<TABLE>
<CAPTION>
                                                                   Three           Three          Inception
                                                                   Months          Months          1/31/86
                                                                   Ended           Ended           Through
                                                                  3/31/01         3/31/00          3/31/01
                                                               --------------- --------------- ----------------
<S>                                                            <C>              <C>            <C>
REVENUE                                                        $            -   $           -  $       133,349
COST OF SALES                                                               -               -          103,790
                                                               --------------- --------------- ----------------
   Gross Profit                                                             -               -           29,559
                                                               --------------- --------------- ----------------
COSTS AND EXPENSES
    Research and development                                           22,553               -        2,600,406
   Depreciation and amortization                                        1,514             835           34,533
   Bad Debt Expense                                                         -               -           48,947
    Expense on extension of warrants                                        -               -        1,866,857
   General and administrative                                         142,386         210,873       12,258,870
                                                               --------------- --------------- ----------------
      Total Costs and Expenses                                        166,453         211,708       16,809,611
                                                               --------------- --------------- ----------------
LOSS BEFORE OTHER INCOME (EXPENSE)                                   (166,453)       (211,708)     (16,780,052)
                                                               --------------- --------------- ----------------
OTHER INCOME (EXPENSE)
   Minority interest in loss                                                -               -           26,091
   Gain on sale of subsidiary                                               -               -          208,417
   Interest expense                                                    (5,610)         (5,610)        (871,185)
   Other income                                                             -               -           19,780
                                                               --------------- --------------- ----------------
      Total Other Income (Expense) - net                               (5,610)         (5,610)        (616,895)
                                                               --------------- --------------- ----------------
LOSS BEFORE EXTRAORDINARY ITEMS                                      (172,063)       (217,318)     (17,396,419)

EXTRAORDINARY ITEMS
   Lawsuit settlement                                                       -         415,000          415,000
   Debt forgiveness                                                         -               -          479,738
                                                               --------------- --------------- ----------------
      Total Extraordinary Items                                             -         415,000          894,738
                                                               --------------- --------------- ----------------
NET INCOME (LOSS)                                              $     (172,063) $      197,682  $   (16,502,211)
                                                               =============== =============== ================
BASIC INCOME (LOSS) PER SHARE
   Loss from operations                                                 $0.00           $0.00
   Extraordinary items                                                   0.00            0.00
                                                               --------------- ---------------
      Basic Income (Loss) Per Share                                     $0.00           $0.00
                                                               =============== ===============
AVERAGE COMMON AND EQUIVALENT SHARES
   Basic                                                          154,382,465     155,342,465
                                                               =============== ===============
</TABLE>


<TABLE>
<CAPTION>
                                                                   Three           Three
                                                                   Months          Months
                                                                   Ended           Ended
                                                                  3/31/01         3/31/00
                                                               --------------- ---------------
<S>                                                            <C>             <C>
      Net income (loss) available to common shareholders       $     (172,063) $      197,682
Weighted average shares                                           154,382,465     155,342,465
Effect of dilutive securities                                               -               -
                                                               --------------- ---------------
                                                                  154,382,465     155,342,465
                                                               =============== ===============
Basic income (loss) per share (based on weighted average
                            shares)                            $         0.00  $         0.00
</TABLE>




                             See accompanying notes.

                                       4

<PAGE>


                   MEDIZONE INTERNATIONAL, INC. AND SUBSIDIARY
                          (A Development Stage Company)
                 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
               For the Three Months Ended March 31, 2001 and 2000
                                  (Unaudited)

<TABLE>
<CAPTION>
                                                                                                  Inception
                                                                                                   1/31/86
                                                                 March 31,       March 31,         Through
                                                                   2001            2000            3/31/01
CASH FLOWS FROM OPERATING ACTIVITIES
<S>                                                            <C>             <C>             <C>
    Net income (loss)                                          $     (172,063) $      197,682  $   (16,502,211)
    Adjustments to reconcile net loss to net
            cash provided by operating activities
        Depreciation and amortization                                   1,514             835           34,533
        Issuance of stock for services                                      -         272,600        3,015,916
        Expense for extension of warrants                                   -               -        1,866,857
        Bad debt expense                                                    -               -           48,947
        Minority interest in loss                                           -               -          (26,091)
        Loss on disposal of assets                                          -               -          693,752
        Gain on settlement of debt                                          -               -         (188,510)
        Gain on lawsuit settlement                                          -               -         (415,000)

    Change in operating assets and liabilities
        Deposits                                                      (42,277)              -          (91,224)
        Accounts payable and other liabilities                         81,687        (371,079)       1,571,216
                                                                     (131,139)        100,038       (9,991,815)
CASH FROM INVESTING ACTIVITIES
    Organization costs                                                      -               -           (8,904)
    Acquisition of property and equipment                                   -         (14,931)         (39,090)
                                                                            -         (14,931)         (47,994)
CASH FROM FINANCING ACTIVITIES
    Proceeds from lawsuit settlement                                        -               -          415,000
    Principal payments on notes payable                                     -               -         (192,774)
    Cash received from notes payable                                        -               -        1,106,516
    Capital contributions                                                   -               -          421,847
    Stock issuance costs                                                    -               -         (105,312)
    Increase in minority interest                                           -               -           14,470
    Proceeds from issuance of common stock                            130,000         220,000        8,381,291
                                                                      130,000         220,000       10,041,038

NET CHANGE IN CASH AND CASH EQUIVALENTS                                (1,139)        305,107            1,229

CASH AND CASH EQUIVALENTS
    Beginning of period                                                 2,368           4,388                -
    End of period                                              $        1,229  $      309,495  $         1,229

SUPPLEMENTAL CASH FLOW INFORMATION
     Cash paid during the period for:
        Interest                                               $            -  $            -  $        26,483
        Income taxes                                           $            -  $            -  $             -

NON-CASH INVESTING AND FINANCING ACTIVITIES
    Issuance of common stock for services                      $            -  $      272,600  $     3,015,916
    Stock issued for debt conversion                           $            -  $            -  $     4,071,493
    Stock issued for license agreement and patent              $            -  $            -  $       693,752
</TABLE>


                             See accompanying notes.


                                       5

<PAGE>


                   MEDIZONE INTERNATIONAL, INC. AND SUBSIDIARY
                          (A Development Stage Company)
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1 - Basis of Presentation

The financial information included herein is unaudited and has been prepared
consistent with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-QSB and Item 310(b) of
Regulation S-B. Accordingly, these financial statements do not include all
information and footnotes required by generally accepted accounting principles
for complete financial statements. These statements should be read in
conjunction with the audited financial statements and notes thereto included in
the Company's annual report on Form 10-KSB for the year ended December 31, 2000.
In the opinion of management, these financial statements contain all adjustments
(consisting solely of normal recurring adjustments), which are, in the opinion
of management, necessary for a fair statement of results for the interim period
presented.

The results of operations for the three months ended March 31, 2001 and 2000 are
not necessarily indicative of the results to be expected for the full year.

2 - Income (Loss) Per Share

Following is a reconciliation of the numerators of the basic and diluted loss
per share for the three months ended March 31, 2001 and 2000:

3 - Capital Stock

                                                  Three           Three
                                                  Months          Months
                                                  Ended           Ended
                                                 3/31/01         3/31/00

Net Income (loss) available to common
   shareholders                                $   (172,063)   $    197,682
                                               =============   =============

Weighted average shares                         154,382,465     155,342,465
Effect of dilutive securities                             -               -

                                                154,382,465     155,342,465
                                               =============   =============

Basic income (loss) per share (based on
   weighted average shares)                    $       0.00    $       0.00
                                               =============   =============


During the quarter ended March 31, 2001, the Company issued 700,000 common
shares for $130,000 at $0.18 per share.

4 - Subsequent Events

On April 19, 2001, the Company issued 555,555 common shares for $99,996 at $0.18
per share. Warrants were also issued with the right to acquire 555,555
additional shares at $0.18 per share over a two-year term beginning April 19,
2001. On April 4, 2001, the Company issued 166,666 shares for $24,985 at $0.15
per share.


                                       6

<PAGE>


Item 2 - Management's Discussion and Analysis or Plan of Operation

The following discussion and analysis of financial condition and results of
operations should be read in conjunction with the unaudited Condensed
Consolidated Financial Statements and Notes thereto appearing elsewhere in this
Quarterly Report on Form 10-QSB.

Medizone International is a development stage company, primarily engaged in
research and development of ozone-based treatment for diseases and health
problems caused by lipid enveloped viruses, including, for example, Acquired
Immune Deficiency Syndrome (AIDS), Hepatitis B, Hepatitis C and Herpes, and in
the development of technology for the decontamination of blood, blood products
and veterinarian serum products. We are also pursuing the development of
external applications of its technology for medical purposes.


We have not generated, and cannot predict when or if we will generate,
significant revenues or sufficient cash flow to fund continuing operations. We
have funded operations to date primarily through the sale of our securities. Our
technology and its uses are subject to regulations of the U.S. Food and Drug
Administration ("FDA") and its counterparts in foreign countries. We do not
intend to sell equipment or supplies for ozone-generating purposes in a
particular jurisdiction until we receive required government approvals for that
jurisdiction.


Beginning in 1998 and  concluding  in 2000, we  accumulated  patient data for 40
participants in a developmental  human pilot trial investigating ozone treatment
of hepatitis C. This trial was conducted during the normal course of practice by
William Hitt, Ph.D.,  M.D., at his clinic,  The William Hitt Center, in Tijuana,
Mexico.  Dr. Hitt is a former member of the Medizone  board of directors.  While
this trial was not  conducted  as a blind  study as  required by the FDA and the
results can serve only as anecdotal  information,  we are very encouraged by the
results.


In this developmental ozone trial, patients were treated using major
autohemotherapy, a blood therapy treatment protocol, on an outpatient basis. The
average treatment period was 30 days. Viral load testing (detecting the levels
of the virus present), as well as standardized SGOT and SGPT tests of liver
enzyme levels were conducted before the start of the treatment, immediately
following treatment, and six months after treatment without any further medical
intervention during the post-treatment period. No adverse side effects were
observed or reported in any of the participants. SGOT and SGPT scores returned
to normal ranges and viral load reductions averaged 5 log or 99.9% reduction. In
the six-month post-treatment follow up testing, 38 of the 40 patients tested at
inactive viral levels for hepatitis C virus, indicating the possibility that the
disease had been cleared by the ozone therapy they received. Two of the patients
had increased viral levels at the end of the treatment test period; however,
even those patients enjoyed significantly reduced viral load levels when
compared to pre-treatment test results.


We have entered into a research agreement with the national research center of a
foreign country to proceed with a Phase I/II human hepatitis C trial. The
protocols for the proposed testing are designed with the intention of producing
a peer-reviewed, journal-published article on our ozone therapy for the
hepatitis C virus. The trial will be blind and the data produced will be shared
by the country of origin and laboratories in Canada. We intend to pursue future
research initiatives in Canada in the near future and this proposed trial is
considered a major step toward that objective. There will be substantial
collaborative efforts made to share information with appropriate regulatory
bodies in both countries. We will not be able to pursue this additional testing
without additional financing.


Results of Operations


General


From its inception in January 1986, Medizone International has been a
development stage company primarily engaged in research into the medical uses of
ozone. We have not generated, and cannot predict when or if we will generate
revenues or sufficient cash flow to fund our continuing operations.


Three Months Ended March 31, 2001 compared to the Three Months Ended March 31,
2000:


There were no sales during the quarters ended March 31, 2001 or 2000. We made
expenditures for research and development of $22,553 in the first quarter of
2001, compared to no research and development expenditures during the first
quarter of 2000. Since inception we have spent a total of $2,600,416 for
research and development.


                                       7

<PAGE>

General and administrative expenses in the first quarter of 2001 were $142,388
compared to $210,873 during the first quarter of 2000. These expenses include
professional fees, payroll, insurance costs and travel expenses.


Interest expense accrued during the three months ended March 31, 2001 was
$5,610, compared to $5,609 in the three months ended March 31, 2000.


Liquidity and Capital Resources


At March 31, 2001, we had a working capital deficiency of $1,030,098 and
stockholders' deficiency of $1,016,635. At December 31, 2000, we had a working
capital deficiency of $976,939 and stockholders' deficiency of $974,571.


Net cash used in operating activities was $131,139 for the three months ended
March 31, 2001. Cash of $130,000 was provided during the first quarter of 2001
from the issuance of common stock. During the three months ended March 31, 2000,
there was a net increase in cash flows from operating activities of $100,038.
Cash of $415,000 was provided in the first three months of 2000 by the receipt
of restitution payments from a former officer and director and $220,000 was
provided by the sale of common stock through the exercise of outstanding stock
purchase warrants.


We will continue to require additional funding to enable us to fund research
necessary to make the appropriate regulatory application and continue
operations. We expect that these funds will be provided by the sale of our
securities. We recognize that, if we are unable to raise additional capital, we
may find it necessary to substantially reduce, or cease operations.


Forward-Looking Statements and Risks Affecting the Company


The statements contained in this Report on Form 10-QSB that are not purely
historical are "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995 and Section 21E of the Securities
Exchange Act. These statements regard our expectations, hopes, beliefs,
anticipations, commitments, intentions and strategies regarding the future. They
may be identified by the use of the words or phrases "believes," "expects,"
"anticipates," "should," "plans," "estimates," and "potential," among others.
Forward-looking statements include, but are not limited to, statements contained
in Management's Discussion and Analysis of or Plan of Operation regarding our
financial performance, revenue and expense levels in the future and the
sufficiency of existing assets to fund future operations and capital spending
needs. Actual results could differ materially from the anticipated results or
other expectations expressed in such forward-looking statements for the reasons
detailed in our Annual Report on Form 10-KSB for the year ended December 31,
2000 under the headings "Description of Business" and "Risk Factors." The fact
that some of the risk factors may be the same or similar to past reports filed
with the Securities and Exchange Commission means only that the risks are
present in multiple periods. We believe that many of the risks detailed here and
in our SEC filings are part of doing business in the industry in which we
operate and compete and will likely be present in all periods reported. The fact
that certain risks are endemic to the industry does not lessen their
significance. The forward-looking statements contained in this report are made
as of the date of this Report and we assume no obligation to update them or to
update the reasons why actual results could differ from those projected in such
forward-looking statements. Among others, risks and uncertainties that may
affect our the business, financial condition, performance, development, and
results of operations include:

        o        Rigorous government scrutiny and regulation of our products and
                 planned products;

        o        Potential effects of adverse publicity regarding ozone and
                 related technologies or industries;

        o        Failure to sustain or manage growth including the failure to
                 continue to develop new products; and

        o        The ability to obtain needed financing.


                                       8

<PAGE>


                                   SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                                 MEDIZONE INTERNATIONAL, INC.
                                 (Registrant)

                                  /s/ Edwin G. Marshall
                                 ------------------------------
                                 Edwin G. Marshall, Chairman and Chief Executive
                                 Officer (Principal Executive Officer)

                                 /s/ Kevin R. Andersen
                                 -----------------------------------------------
                                 Kevin R. Andersen, Chief Financial Officer
                                 (Principal Accounting Officer)



May 18, 2001