SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

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

                                       OR

                 [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d)
                               OF THE EXCHANGE ACT

                FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1999

                                    333-6440
                            (Commission file number)

                              Q-SEVEN SYSTEMS, INC.
        (Exact Name of Small Business Issuer as Specified in its Charter)

             UTAH                                            87-0567618
(State or Other Jurisdiction of                     (IRS Employer Identification
Incorporation or Organization)                                  No.)

     MITTELSTRASSE 11-13                                 011-49-2173-39220
    40789 MONHEIM, GERMANY                          (Issuer's Telephone Number)
(Address of Principal Executive
           Offices)

                                  FROHNKAMP 18
                             40789 MONHEIM, GERMANY
                           (Former Address of Issuer)

     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
                                     ---      ---

                                                     SHARES OUTSTANDING
          CLASS                                      AT NOVEMBER 1, 1999
          -----                                      -------------------
       COMMON STOCK                                       12,500,000
$0.001 PAR VALUE PER SHARE

THIS REPORT  OMITS ITEM 1  (FINANCIAL  STATEMENTS)  AND CERTAIN  PARTS OF ITEM 2
(MANAGEMENT'S  DISCUSSION  AND  ANALYSIS)  OF  PART I AS WELL  AS  EXHIBIT  27.1
(FINANCIAL DATA SCHEDULE) PURSUANT TO RULE 12b-25(b)(i) UNDER THE EXCHANGE ACT.

<PAGE>

PART I.   FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS

          [TO BE PROVIDED]

ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS

     Recent  Developments.  During the third quarter of 1999,  Q-Seven  Systems,
Inc. (the "Company" or "Q-Seven")  completed the  development and testing of its
main server and the first  release of the online  gaming module which is part of
Q-Seven's  User  Management  Software  (the  "Software").   The  Software  is  a
modularized  suite  offering  users a system for the backend  administration  of
various types of  e-commerce  sites on the Internet,  including  online  gaming,
adult entertainment, and online shopping. In addition, the Company has developed
plans with respect to an online auction module and currently expects to commence
in November 1999 the software engineering in connection with this project.

     From September 14 through  September 16, 1999,  Q-Seven  attended the World
Gaming Congress and Expo in Las Vegas, the world's largest gambling  exhibition,
where it presented  the newly  developed  online  gaming module of the Software.
Contacts made by Q-Seven during the congress in Las Vegas led to discussions and
negotiations with potential new customers.  However, Q-Seven has not yet entered
into any specific  agreements as a result of such discussions and  negotiations.
Accordingly,  these new  contacts  had no impact on  Q-Seven's  revenues in this
quarter, and there can be no assurances that they will ever have such an impact.

     In early October 1999,  Q-Seven  completed  the  installation  of the first
casino  program for one of its clients.  This  required the  extraction  of data
previously collected on the client's online gambling site.

     On October  29,  1999,  Q-Seven  filed  with the  Securities  and  Exchange
Commission (the  "Commission") a registration  statement on Form 8-A to register
its Common Stock under Section 12(g) of the Securities Exchange Act of 1934.

     [RESULTS OF OPERATIONS -- TO BE PROVIDED]

     [LIQUIDITY AND CAPITAL RESOURCES -- TO BE PROVIDED]


                                        2

<PAGE>


     Year 2000. Many currently  installed computer systems and software products
are coded to accept  only two digit  entries  in the date code  field and cannot
distinguish  21st century dates from 20th century dates.  These date code fields
will need to  distinguish  21st century  dates from 20th century dates and, as a
result, many companies' software and computer systems may need to be upgraded or
replaced in order to comply with such "Year 2000" requirements.

     The Company,  earlier this year,  completed  assessing the Year 2000 issue.
During the third quarter of 1999, the Company has not incurred material costs in
the analysis of the Year 2000 issue,  and management  currently does not believe
that the cost of any  additional  actions  will  have a  material  effect on the
Company's  results of operations or financial  condition.  Management  currently
believes that the Company's  systems and products are Year 2000 compliant in all
material  respects;  however,  those systems and products may contain undetected
errors or defects  with Year 2000 date  functions  that may  result in  material
costs.  Although  management is not aware of any material  operational issues or
costs associated with preparing the Company's  systems and products for the Year
2000, the Company may experience  serious  unanticipated  negative  consequences
(such as significant downtime for one or more of the servers operated by X-Real,
the  Company's  subsidiary  that operates six adult  entertainment  websites) or
material costs caused by undetected  errors or defects in the technology used in
Q-Seven's  systems and products,  which could have a material  adverse effect on
the Company's business, results of operation and financial condition.

     In  addition,  the Company  utilizes  third-party  equipment,  software and
content,  including non-information  technology systems ("non-IT systems"), such
as the Company's  telephone system,  that might not be Year 2000 compliant.  The
Company has not yet  developed a plan to assess  whether these third parties are
adequately  addressing  the Year 2000  issue and  whether  any of the  Company's
non-IT  systems  have  material  Year  2000  compliance  problems.  The  cost of
developing and implementing such a plan may itself be material.  Failure of such
third-party  equipment,  software or content to operate  properly with regard to
the year 2000 and  thereafter  could require the Company to incur  unanticipated
expenses to remedy any problems,  which could have a material  adverse effect on
the Company's business, results of operation, and financial condition.


                                        3

<PAGE>

     The Company has not yet fully developed a comprehensive contingency plan to
address situations that may result if the Company is unable to achieve Year 2000
readiness of its critical  operations.  The cost of developing and  implementing
such a plan may itself be material.

     Forward-Looking  Statements.  The Company has made certain  forward-looking
statements  in this  report.  They use such  words as "may,"  "will,"  "expect,"
"believe,"  "plan"  and other  similar  terminology.  These  statements  reflect
management's   current   expectations   and   involve  a  number  of  risks  and
uncertainties.  Actual  results  could differ  materially  due to the success of
operating initiatives, advertising and promotional efforts, Year 2000 compliance
efforts,  as  well as  changes  in:  global  and  local  business  and  economic
conditions;  currency  exchange and interest  rates;  labor and other  operating
costs; political or economic instability in local markets; competition; consumer
preferences,   spending  patterns  and  demographic   trends;   legislation  and
government regulation; and accounting policies and practices.

PART II.  OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS

          Not applicable.

ITEM 2.   CHANGES IN SECURITIES AND USE OF PROCEEDS

          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

     Amendment  of  By-Laws.  The  Company,  on November  12, 1999 by  unanimous
written  consent of the Board of  Directors,  amended its By-Laws and inserted a
new  Section  12 in Article  II of the  By-Laws  regarding  the  transaction  of
business at  shareholders'  meetings.  For a complete  understanding  of the new
by-law provision, please read the By-Laws, as amended, which are attached hereto
as Exhibit 3.2 and incorporated herein by reference.


                                        4

<PAGE>

     2000 Annual Meeting of  Shareholders.  Nominations for Director may be made
only by the Board of  Directors  or by a  shareholder  entitled  to vote who has
delivered  written  notice to the  Secretary of the Company not earlier than 120
days, and not later than 90 days, prior to the Company's annual meeting.

     No business  may be brought  before an annual  meeting of the  shareholders
except as  specified  in the  notice of the  meeting  or as  otherwise  properly
brought  before the meeting by or at the  direction of the Board of Directors or
by a  shareholder  entitled  to vote who has  delivered  written  notice  to the
Secretary of the Company not earlier than 120 days,  and not later than 90 days,
prior to the Company's annual meeting.

     These  requirements  are  separate  and apart from and in  addition  to the
Commission's  requirements  that a  shareholder  must  meet in  order  to have a
shareholder  proposal included in the Company's proxy statement under Rule 14a-8
of the  Securities  Exchange Act of 1934.  For purposes of the Company's  annual
meeting of shareholders expected to be held on May 15, 2000, any shareholder who
wishes to submit a proposal for inclusion in the Company's  proxy materials must
submit such proposal to the  Secretary of the Company on or before  December 15,
1999.

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

          (a)  Exhibits

EXHIBIT NO.         DESCRIPTION

3.1                 Articles of Incorporation,  as amended:  Incorporated herein
                    by reference to Exhibit 3.1 to the Report on Form 10-QSB for
                    the quarter ended June 30, 1999.

3.2                 By-laws, as amended.*

3.3                 Form of Stock Certificate:  Incorporated herein by reference
                    to Exhibit 3.3 to the  Registration  Statement  on Form 8-A,
                    filed on October 29, 1999.

10.1                License  Agreement  between Q-Seven Systems GmbH and Q-Seven
                    Nevada:  Incorporated herein by reference to Exhibit 10.1 to
                    the  Report on Form  10-QSB for the  quarter  ended June 30,
                    1999.


                                        5

<PAGE>

27.1                Financial Data Schedule.**

----------
*  Filed herewith.
** To be provided.

          (b)  Reports on Form 8-K

     On November 15, 1999, the Registrant filed with the Commission an amendment
to its report on Form 8-K,  which was  originally  filed with the  Commission on
June 8, 1999, to amend and restate certain financial  statements that were filed
as exhibits to such report.


                                        6

<PAGE>

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


     Date: November 15, 1999			  /s/ Philipp Kriependorf
				                  ____________________________
                                                  Philipp Kriependorf
                                                  President


     Date: November 15, 1999			  /s/ Philip Kamp
				                  ____________________________
                                                  Philip Kamp
                                                  Vice President and Treasurer

                                        7
<PAGE>

                                INDEX TO EXHIBITS


EXHIBIT NUMBER      DESCRIPTION OF EXHIBIT

3.1                 Articles of Incorporation,  as amended:  Incorporated herein
                    by  reference  to Exhibit  3.1 to the report on Form 10- QSB
                    for the period ended June 30, 1999.

3.2                 By-laws, as amended.*

3.3                 Form of Stock Certificate:  Incorporated herein by reference
                    to Exhibit 3.3 to the  Registration  Statement  on Form 8-A,
                    filed on October 29, 1999.

10.1                License  Agreement  between Q-Seven Systems GmbH and Q-Seven
                    Nevada:  Incorporated herein by reference to Exhibit 10.1 to
                    the  report on Form 10- QSB for the  period  ended  June 30,
                    1999.

27.1                Financial Data Schedule.**

----------
*  Filed herewith.
** To be provided.

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