SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C.  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
                              January 31, 2001
   OR

[  ]            TRANSITION REPORT PURSUANT TO SECTION 13 OR
               15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
                      For the transition period from
                                      to


                      Commission file number 0-27759

                       Stearman Enterprises Inc.
        ---------------------------------------------------------
          (Exact name of registrant as specified in its charter)



     Delaware                                           13-4082816
-------------------------------                 -----------------------
(State or other jurisdiction of                     (I.R.S. Employer
incorporation or organization)                      Identification No.)


           1501 Broadway, Suite 1807, New York, New York 10036
        ----------------------------------------------------------
           (Address of principal executive offices  (zip code))

                              212 768-2383
        -----------------------------------------------------------
           (Registrant's telephone number, including area code)


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


Indicate the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date.


         Class                        Outstanding at January 31, 2001

Common Stock, par value $0.0001                    1,623,000

                      PART I -- FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS




                        STEARMAN ENTERPRISES INC.
                        (A Delaware Corporation)
                      (A development stage company)
                              Balance Sheet
                              (U.S. DOLLARS)

                                         6 months ended           Fiscal year
                                         January 31,              ended July 31,
                                         2001                     2000
                                                                  (Unaudited)


                                  Assets
Current assets
Cash and bank                            $        300              $        300
-------------------------------------------------------------------------------
Incorporation costs                               403                       403
-------------------------------------------------------------------------------
Total Assets                             $        703              $        703
===============================================================================


Liabilities
Current liabilities
Accounts payable                         $     2,718               $      2,418
Convertible Debenture                              -                          -
-------------------------------------------------------------------------------
Total Liabilities                              2,718                      2,418
-------------------------------------------------------------------------------

Shareholders' equity (deficit)

Share Capital
Authorized:
 100,000,000 common shares
  with a par value of $.0001 each
Issued and outstanding
1,623,000 common shares with a par
  value of $0.0001 at January 31,
  2001 at July 31, 200                          1,104                     1,104
-------------------------------------------------------------------------------
                                                1,104                     1,104
Accumulated Deficit                            (3,119)                   (2,819)
-------------------------------------------------------------------------------
                                               (2,015)                   (1,715)
-------------------------------------------------------------------------------
                                         $        703              $        703
===============================================================================

CONTINUING OPERATIONS (NOTE 1)





                        STEARMAN ENTERPRISES INC.
                        (A Delaware Corporation)
                      (A development stage company)
                            Statement of Loss
                              (U.S. DOLLARS)
                                (Unaudited)




                                 6 months    3 months    6 months    3 months
                                 ended       ended       ended       ended
                                 January 31, October 31, January 31, October 31,
                                 2001        2000        2000        1999

Expenses
Legal                            $ 300       $ 150     $ 1,562       $   -
Interest and bank charges           -              -       5             5
Filing fees                         -              -       -             -
-------------------------------------------------------------------------------
Net earnings (loss) for
  the period                     $ (300)     $ (150)     $ (1,567)   $   (5)
===============================================================================
Basic and diluted loss per share $(0.0002)  $ (0.0001)   $ (0.00134) $(0.00001)
-------------------------------------------------------------------------------
Weighted average shares
  Outstanding                     1,623,000    1,623,000   1,165,348  707,696
-------------------------------------------------------------------------------




                        STEARMAN ENTERPRISES INC.
                        (A Delaware Corporation)
                      (A development stage company)
                         Statement of Cash Flow
                              (U.S. DOLLARS)
                                (Unaudited)



                                 6 months    3 months    6 months    3 months
                                 ended       ended       ended       ended
                                 January 31, October 31, January 31, October 31,
                                 2001        2000        2000        1999


Cash provided by (used in)

Operations
Net Loss for period              $ (300)      $  (150)    $(1,567)     $(5)
-------------------------------------------------------------------------------
                                   (300)         (150)     (1,567)      (5)
Net change in non-cash working
   capital balances

Accounts payable                    300          150       1,562        -
Accrued interest                     -            -        (49)         (49)
Convertible Debenture                -            -        (500)         (500)
-------------------------------------------------------------------------------
Net cash used in operating
  activities                         -            -        (554)         (554)

Financing
Issuance of capital stock            -            -         554           554
-------------------------------------------------------------------------------
Net cash generated
 by financing activities             -            -          -             -
-------------------------------------------------------------------------------
Change in cash for period            -           -           -             -

Cash, beginning of period           300          300        300            300
-------------------------------------------------------------------------------
Cash, end of period              $  300      $   300     $  300      $     300
===============================================================================










                        STEARMAN ENTERPRISES INC.
                        (A Delaware Corporation)
                      (A development stage company)

                      Notes to Financial Statements

                             (U.S. DOLLARS)





1.   CONTINUING OPERATIONS

     Stearman Enterprises Ltd. was incorporated on March 13, 1992 in the
     state of Delaware, U.S.A.

     The Company has negative working capital and a deficit.  The ability for
     the Company to continue as a going concern is dependent upon its ability
     to obtain adequate financing to reach profitable levels of operations.
     It is not possible to predict whether financing efforts will be
     successful or if the Company will attain profitable levels of
     operations.

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     These financial statements have been prepared in accordance with
     generally accepted accounting principles in the United States and
     reflect the following significant accounting principles:

     a.  ESTIMATES AND ASSUMPTIONS

         The preparation of financial statements in conformity with generally
         accepted accounting principles requires management to make
         assumptions that affect the reported amounts of assets and
         liabilities and disclosure of contingent assets and liabilities at
         the date of the financial statements and the reported amount of
         revenues and expenses during the reporting period.  Actual results
         could differ from those estimates.

     b.  EARNINGS (LOSS) PER COMMON SHARE

         In February, 1997, the Financial Accounting Standards Board issued
         Statement No. 128, Earnings Per Share (SFAS 128), which established
         new standards for computing and presenting earnings per share
         effective for fiscal years ending after December 15, 1997.  With
         SFAS 128, primary earnings per share is replaced by basic earnings
         per share, which is computed by dividing income available to common
         shareholders by the weighted average number of shares outstanding
         for the period.  In addition, SFAS 128 requires the presentation of
         diluted earnings per share, which includes the potential dilution
         that could occur if dilutive securities were exercised or converted
         into common stock.  The computation of diluted EPS does not assume
         the conversion or exercise of securities if their effect is anti
         dilutive.  Common equivalent shares consist of the common shares
         issuable upon the conversion of the convertible loan notes and
         special warrants (using the if-converted method) and incremental
         shares issuable upon the exercise of stock options and share
         purchase warrants (using the treasury stock method).

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Page 6

     c.  CASH AND CASH EQUIVALENTS

         Cash and cash equivalents consist of cash on hand, deposits in banks
         and highly liquid investments with an original maturity of three
         months or less.


3.   CONVERTIBLE DEBENTURE

     On April 17, 1997 the Company issued a 5% Convertible Debenture in the
     amount of $500 U.S. due April 17, 2002 in partial settlement of
     outstanding legal fees.  The debenture principle bears interest at 5%
     per annum and the accrued interest and the principle shall be
     convertible, in part or in whole on the basis of 1 share for every $1.00
     U.S. ($0.0005 U.S. post forward split shares) of debt.  The debenture
     conversion may be exercised at the holder's option by giving the Company
     10 days notice.  The Convertible debenture was converted on October 15,
     1999.

4.   SHARE CAPITAL

     a. On May 4, 1999, the Company amended its certificate of incorporation
        by subdividing the authorized capital stock of the corporation so
        that each share was subdivided into two thousand shares.  The
        certificate of incorporation was further amended by increasing the
        authorized capital stock of the company to 20,000,000 shares with a
        par value of $0.01 each.

     b.  On October 20, 1999, the Company amended its certificate of
         incorporation by increasing its authorized capital stock to
         100,000,000 shares of common stock and changing the par value of its
         common shares to $.0001 par value per share.

     c.  On October 15, 1999, the Company issued 1,108,000 common shares on
         the conversion of the debt and accrued interest of $54 at 1 share
         for every $0.0005 U.S. debt.

5.   RELATED PARTY TRANSACTIONS

     a.  At January 31, 2001, 2000, members of Maitland & Company, the Company's
         Canadian legal counsel owned 125,000 shares of the Company's common
         stock.

     b.  At January 31, 2001, 2000, members of the Company's U.S. legal counsel
         owned 1,108,000 shares of the Company's common stock

6.   INCOME TAXES

     The Company has net operating losses, which may give rise to
     future tax benefits of approximately $2,060, $229, $25 and $505 as
     of July 31, 2000, July 31, 1999, July 31, 1998 and July 31, 1997
     respectively.  To the extent not used, net operating loss carry
     forwards expire in varying amounts beginning in the year 2012.
     Income taxes are accounted for in accordance with Statement of
     Financial Accounting Standards No.109 (SFAS 109).  Under this
     method, deferred income taxes are determined based on differences
     between the tax basis of assets and liabilities and their financial
     reporting amounts at each year end, and are measured based on
     enacted tax rates and laws that will be in effect when the
     differences are expected to reverse.  Valuation allowances are
     established, when necessary, to reduce deferred tax assets to the
     amount expected to be realized.  No provision for income taxes is
     included in the statement due to its immaterial amount.


<PAGE>
Page 7



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

   The Company has registered its common stock on a Form 10-SB registration
statement filed pursuant to the Securities Exchange Act of 1934 (the
"Exchange Act") and Rule 12(g) thereof.  The Company files with the
Securities and Exchange Commission periodic and episodic reports under Rule
13(a) of the Exchange Act, including quarterly reports on Form 10-QSB and
annual reports Form 10-KSB.  As a reporting company under the Exchange Act,
the Company may register additional securities on Form S-8 (provided that it
is then in compliance with the reporting requirements of the Exchange Act)
and on Form S-3 (provided that is has during the prior 12 month period timely
filed all reports required under the Exchange Act).

   The Company was formed to engage in a merger with or acquisition of an
unidentified foreign or domestic private company which desires to become a
reporting company whose securities have been registered under the Exchange
Act.  The Company may be deemed to meet the definition of a "blank check"
company contained in Section (7)(b)(3) of the Securities Act of 1933, as
amended.

   Management believes that there are perceived benefits to being a reporting
company which may be attractive to foreign and domestic private companies.

   These benefits are commonly thought to include

   (1) the ability to use securities to make acquisition of assets or
       businesses;
   (2) increased visibility in the financial community;
   (3) the facilitation of borrowing from financial institutions;
   (4) improved trading efficiency;
   (5) the potential for shareholder liquidity;
   (6) greater ease in subsequently raising capital;
   (7) compensation of key employees through options for stock
       for which there may be a public market;
   (8) enhanced corporate image; and,
   (9) a presence in the United States capital market.

   A private company which may be interested in a business combination
with the Company may include

   (1) a company for which a primary purpose of becoming a reporting
       company is the use of its securities for the acquisition of
       assets or businesses;
   (2) a company which is unable to find an underwriter of its securities
       or is unable to find an underwriter of securities on terms
       acceptable to it;
   (3) a company which wishes to become a reporting company with less
       dilution of its common stock than would occur normally upon an
       underwriting;
   (4) a company which believes that it will be able obtain
       investment capital on more favorable terms after it has become
       a reporting company;

<PAGE>
Page 8


   (5) a foreign company which may wish an initial entry into the
       United States securities market;
   (6) a special situation company, such as a company seeking to satisfy
       redemption requirements under a qualified Employee Stock Option
       Plan; and,
   (7) a company seeking one or more of the other benefits believed to
       attach to a reporting company.

   Management is actively engaged in seeking a qualified private company
as a candidate for a business combination.  The Company is authorized to
enter into a definitive agreement with a wide variety of private businesses
without limitation as to their industry or revenues.  It is not possible at
this time  to predict with which private company, if any, the Company will
enter into a definitive agreement or what will be the industry, operating
history, revenues, future prospects or other characteristics of that company.

   As of the date hereof, management has not made any final decision
concerning or entered into any agreements for a business combination.  When
any such agreement is reached or other material fact occurs, the Company will
file notice of such agreement or fact with the Securities and Exchange
Commission on Form 8-K.  Persons reading this Form 10-QSB are advised to see
if the Company has subsequently filed a Form 8-K.

   The Company does not intend to trade its securities in the secondary
market until completion of a business combination.  It is anticipated that
following such occurrence the Company will take the steps required to cause
its common stock to be admitted to quotation on the NASD OTC Bulletin Board
or, if it then meets the financial and other requirements thereof, on the
Nasdaq SmallCap Market, National Market System or regional or national
exchange.


<PAGE>
Page 9


                         PART II -- OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

   There are no legal proceedings against the Company and the Company is
unaware of such proceedings contemplated against it.

ITEM 2.  CHANGES IN SECURITIES

   Not applicable.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

   Not applicable.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

   Not applicable.

ITEM 5.  OTHER INFORMATION

   Not applicable.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

   (a)     Exhibits

   Not applicable.

   (b)     Reports on Form 8-K

   There were no reports on Form 8-K filed by the Company during the
quarter.

_                                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.

                          STEARMAN ENTERPRISES LTD.


                          By:  /s/ Herbert Maxwell
                         ---------------------------------
                           Herbert Maxwell, President

Dated:  June 25, 2001