UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB
(Mark One)

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

                  For the Quarterly Period Ended March 31, 2002

                                       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:    0-22809
                                   --------

                                   AZUREL LTD.
        (Exact Name of Small Business Issuer as Specified in its Charter)

                   Delaware                                       13-3842844
         -------------------------------                    --------------------
         State or other jurisdiction of                       (I.R.S. Employer
         incorporation or organization                       Identification No.)

                     23-F Commerce Road, Fairfield, NJ 07004
                     ---------------------------------------
               (Address of principal executive office) (Zip Code)

                                 (973) 575-9500
                                 ---------------
                 (Issuer'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
                      -------                                             ------

The number of shares of registrant's Common Stock, $.001 par value, outstanding
as of May 14, 2002 was 6,931,697 shares.
Transitional Small Business Disclosure Format (check one)

                  Yes                                                  No   X
                      ------                                             -------

<PAGE>
                          AZUREL LTD. AND SUBSIDIARIES

                                      INDEX


                                                                        Page
                                                                        Number
                                                                      ----------

PART I - FINANCIAL INFORMATION

Item 1 - Financial Statements

      Consolidated Balance Sheets                                         1
      Consolidated Statements of Operations                               2
      Consolidated Statements of Cash Flows                               3
      Notes to Financial Statements                                       4

Item 2 - Management's Discussion and Analysis or
         Plan of Operation                                                5-7

PART II - OTHER INFORMATION

Item 5 - Other Information                                                8


SIGNATURE                                                                 9



<PAGE>
                          AZUREL LTD. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEET

                                 MARCH 31, 2002
                                   (UNAUDITED)

                                     ASSETS
             CURRENT ASSETS:
                 Cash                                         $         259,652
                 Accounts receivable, net of allowance for
                    doubtful accounts of $15,000                         64,707
                 Inventory                                              201,497
                 Prepaid expenses and other current assets                1,203
                                                                 ---------------
                    TOTAL CURRENT ASSETS                                527,059

             OTHER ASSETS                                                 8,704
                                                                 ---------------
                                                              $         535,763
                                                                 ===============

                    LIABILITIES AND STOCKHOLDERS' DEFICIENCY

             CURRENT LIABILITIES:
                 Accounts payable                             $         327,472
                 Payroll Taxes payable                                  425,277
                 Reorganization liabilities - short term                187,837
                                                                 ---------------
                    TOTAL CURRENT LIABILITIES                           940,585
                                                                 ---------------
             LIABILITIES NOT SUBJECT TO COMPROMISE                       65,157
                                                                 ---------------
             REORGANIZATION LIABILITIES - LONG TERM                   1,289,660
                                                                 ---------------

             STOCKHOLDERS'  DEFICIENCY:
                 Preferred stock, $.001 par value, authorized
                    4,000,000 shares; issued and outstanding
                       1,001,500 shares                               2,237,587
                 Common stock, $.001 par value, authorized
                    24,000,000 shares, issued and outstanding
                       6,931,697 shares                                   6,932
                 Additional paid-in-capital                           8,998,963
                 Accumulated deficit                                (13,003,122)
                                                                 ---------------
                    TOTAL STOCKHOLDERS'  DEFICIENCY                  (1,759,640)
                                                                 ---------------
                                                              $         535,763
                                                                 ===============

                 See notes to consolidated financial statements.

                                       -1-
<PAGE>


                          AZUREL LTD. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)
<TABLE>
<CAPTION>

                                                                               Three Months Ended March 31,
                                                                          -------------------------------------
                                                                                2002                2001
                                                                          -----------------   -----------------
<S>                                                                     <C>                 <C>
     NET SALES                                                          $           12,837  $          347,322

     COST OF GOODS SOLD                                                              6,029             (21,432)
                                                                          -----------------   -----------------
     GROSS PROFIT (LOSS)                                                             6,808             368,754

     SELLING, GENERAL AND ADMINISTRATIVE EXPENSES                                  136,750             433,258
                                                                          -----------------   -----------------
     LOSS FROM OPERATIONS                                                         (129,942)            (64,504)

     INTEREST EXPENSE                                                                           -      (44,587)

     OTHER INCOME (EXPENSE)                                                         60,775             (82,523)

     REORGANIZATION COSTS                                                          (11,267)                         -
                                                                          -----------------   -----------------
     NET LOSS BEFORE EXTRAORDINARY ITEM                                            (80,434)           (191,614)

     EXTRAORDINARY ITEM:
        Gain on extinguishment of debt                                           5,195,027                          -
                                                                          -----------------   -----------------
     NET INCOME (LOSS)                                                  $        5,114,593  $         (191,614)
                                                                          =================   =================
     BASIC INCOME (LOSS) PER COMMON SHARE:
        LOSS BEFORE EXTRAORDINARY ITEM                                  $            (0.01) $            (0.03)
        EXTRAORDINARY ITEM                                                            0.75           --
                                                                          -----------------   -----------------
     BASIC INCOME (LOSS) PER COMMON SHARE                               $             0.74  $            (0.03)
                                                                          =================   =================
     WEIGHTED AVERAGE COMMON SHARES OUTSTANDING                                  6,931,697           6,211,797
                                                                          =================   =================

</TABLE>

                 See notes to consolidated financial statements.


                                       -2-

<PAGE>

                          AZUREL LTD. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)
<TABLE>
<CAPTION>

                                                                                         Three Months Ended March 31,
                                                                                      --------------------------------
                                                                                          2002              2001
                                                                                      --------------   ---------------

CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                                <C>              <C>
    Net income (loss)                                                              $      5,114,593 $        (192,328)
                                                                                      --------------   ---------------

    Adjustments to reconcile net income (loss) to net cash used in operating
    activities:
       Gain on extinguishment of debt                                                    (5,195,027)               --
       Depreciation                                                                              --            12,052
       Amortization                                                                              --           135,197
       Gain on disposal of fixed assets                                                          --            (8,818)
       Decrease in minority interest                                                             --              (357)

    Changes in assets and liabilities:
       Accounts receivable                                                                   29,077           263,019
       Inventories                                                                           (6,779)          410,599
       Prepaid expenses and other current assets                                              1,799            18,049
       Other assets                                                                              --            (5,831)
       Accounts payable and accrued expenses                                                291,588          (634,109)
       Taxes payable                                                                        (16,341)               --
       Liabilities not subject to compromise                                                (30,343)               --
                                                                                      --------------   ---------------
       NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES                                  188,567            (2,527)
                                                                                      --------------   ---------------
CASH FLOWS FROM INVESTING ACTIVITIES:
       Disposal of property and equipment                                                        --            38,458
                                                                                      --------------   ---------------
       NET CASH PROVIDED BY  INVESTING ACTIVITIES                                                --            38,458
                                                                                      --------------   ---------------

       Effect of exchange rate                                                                   --               714
                                                                                      --------------   ---------------
NET INCREASE IN CASH                                                                        188,567            36,645

CASH, beginning of period                                                                    71,085            13,911
                                                                                      --------------   ---------------
CASH, end of period                                                                $        259,652 $          50,556
                                                                                      ==============   ===============

</TABLE>

                 See notes to consolidated financial statements.

                                       -3-



<PAGE>

                          AZUREL LTD. AND SUBSIDIARIES

                          NOTES TO FINANCIAL STATEMENTS

                        THREE MONTHS ENDED MARCH 31, 2002

                                   (Unaudited)


1.       BASIS OF PRESENTATION

         The accompanying consolidated financial statements as of March 31, 2002
         have not been audited by independent auditors, but in the opinion of
         management, such unaudited statements include all adjustments
         consisting of normal recurring accruals necessary for a fair
         presentation of the financial position, the results of operations and
         cash flows for the three months ended March 31, 2002.

         The consolidated financial statements should be read in conjunction
         with the financial statements and related notes concerning the
         Company's accounting policies and other matters contained in the
         Company's annual report on Form 10-KSB. The results for the three
         months ended March 31, 2002 are not necessarily indicative of the
         results expected for the full year ending December 31, 2002.

         As discussed in Note 3 below, in February 2001 the Company filed for
         voluntary protection under Chapter 11 of the U.S. Federal Bankruptcy
         Code. The financial statements as of March 31, 2001 and for the three
         months then ended were not reviewed by the Company's independent
         accountants.

2.         BANKRUPTCY FILING AND GOING CONCERN

         The accompanying financial statements have been prepared assuming the
         Company will continue as a going concern. On February 2, 2001, the
         Company, due to substantial recurring losses and working capital
         deficiencies, voluntarily filed for protection under Chapter 11 of the
         U.S. Federal Bankruptcy Code. Under such protection, a Plan of
         Reorganization (the "Plan") was formed to allow the Company to
         restructure its debt with various creditors. On February 13, 2002, the
         Plan was confirmed by the bankruptcy court, which became effective on
         February 27, 2002. As of March 31, 2002, the Company received
         approximately $280,000 from one of its secured creditors to fund the
         Plan. The creditor agreed to fund up to $300,000, in exchange for 10
         shares of the Company's common stock for each dollar contributed to
         fund the Plan. On March 27, 2002, the Company signed a letter of intent
         to merge with an entity that manufactures and distributes luxury
         evening apparel, although there is no assurance that such a merger will
         be consummated. The Company is also considering raising additional
         funds through the sale of additional shares of its common stock. The
         accompanying consolidated financial statements do not include any
         adjustments that might be necessary should the Company be unable to
         continue as a going concern.



                                       4
<PAGE>


3.          EXRTAORDINARY ITEM

         In accordance with the confirmed Plan, creditors had the option to
         receive cash or common stock as settlement of their claims. For those
         creditors who elected to receive cash, the Company will pay 45% of the
         dollar amount owed. For creditors who elected to receive stock, the
         Company will issue one share of common stock for each dollar owed and,
         in addition, pay such creditors cash equal to 20% of their outstanding
         dollar amount. Settlement of these claims are payable over a defined
         period as disclosed in the Company's Form 10-KSB. At March 31, 2002,
         the total amount owed to such creditors was approximately $1,479,000.

         The Company had recorded pre-petition liabilities subject to compromise
         that were in excess of the submitted claim amounts. During March 2002,
         upon finalization of the claim agreements referred to above, the
         Company wrote off such excess liabilities in its financial statements
         and for the three months ended March 31, 2002, recorded a gain on
         extinguishment of debt of approximately $5,195,000. Such amount was
         treated as an extraordinary item in the Company's financial statements.

4.         STOCKHOLDERS' DEFICIENCY

         The Company adjusted its outstanding common stock by 20,000 to reflect
         shares issued to a certain individual in October 2000 that was not
         previously recorded in the Company's financial statements.


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

FORWARD LOOKING STATEMENTS AND ASSOCIATED RISKS

This Quarterly Report on Form 10-QSB contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. The Company's actual results could differ
materially from those set forth in the forward-looking statements.

The following discussion should be read in conjunction with the attached
consolidated financial statements and notes thereto and with the Company's
audited financial statements and notes thereto for the fiscal year ended
December 31, 2001.


FOR THE THREE MONTHS ENDED MARCH 31, 2002 AND 2001

Azurel, Ltd.,  hereinafter  "Azurel" or "the Company",  through its wholly-owned
subsidiaries,  markets, and sells private label cosmetics and fragrances.

                                       5
<PAGE>

In February, 2001, the Company filed for protection under the federal bankruptcy
laws (Chapter 11). Management plans were to restructure the Company and develop
a viable business plan for its creditors, allowing Azurel to emerge from
bankruptcy and operate as a solvent business. The accompanying financial
statements include all adjustments required based on bankruptcy filing.

On February 13, 2002, subsequent to the ratification of the First Modified Plan,
the Order of Confirmation was issued by the Bankruptcy Court, and became
effective February 27, 2002. The Plan provided two options to the unsecured
creditors: One is a combination of one share of stock for each dollar of
liability plus a 20% cash payout over 4 years. The other is a 45% payout over 3
years. Each unsecured creditor that filed a claim was permitted to select either
of the two options.

On March 27, 2002, the Company signed a letter of intent to merge with Romantic
Moments, Inc. ("Romantic"), a manufacturer and distributor of high end evening
apparel. The consideration of the merger of Azurel and Romantic shall be the
issuance of an aggregate of 1,300,000 of Common Stock of Azurel to the owners of
Romantic and 1,350 shares of convertible preferred stock, which convert to
6,700,000 shares of common stock. In addition, Azurel's investment banker will
seek  to  raise  approximately  $300,000  by selling 1,000,000 shares of common
stock. The funds are anticipated to be used for working capital. The merger is
expected to be consummated by the end of the second quarter of 2002. Two of
Romantic's executive officers are expected to be named Chief Executive Officer
and President of the merged company.  The  merger  is  subject to shareholder
approval of the Company, due diligence, and customary regulatory approval. The
Company expects the merger to result in expansion into new retail markets.

As a result of the extinguishments of debt, the Company realized a gain of
approximately $5,195,000. The gain reflects the difference between existing
liabilities at the time of the filing for bankruptcy protection under Chapter 11
of the federal bankruptcy laws in February 2001 and claims filed and ratified
under the First Modified Plan in February 2002 .

Results of Operations

Total revenues for the three months ended March 31, 2002 (the "2002 Period")
were $ 12,837 compared to $347,031 for the three months ended March 31, 2001
(the "2001 Period"). The $334,485 decrease is largely attributable to the
following factors: 1. The 2001 Period contained one month of sales prior to
filing for protection under Chapter 11 of the Federal Bankruptcy Law; 2. The
2001 Period contained substantial close-out sales, and 3. The Company was in the
process of seeking additional distribution sources in the 2002 Period.

Cost of goods sold were $6,029 and ($21,432) for the 2002 Period and the 2001
Period, respectively. Cost of goods sold for the 2001 Period reflects an
inventory reserve reduction for shortages of approximately $227,000 recorded at
the time of the physical inventory. The gross profit as a percentage of revenue
was 53.0% for the 2002 period as compared to 106.2% for the 2001 period.
Excluding the aforementioned adjustment, the 2001 period gross profit would have
been approximately $141,000 or 40.7%. The lower margins in the 2001 period, is
the result of selling a higher percentage of closeout products.

                                       6
<PAGE>

Selling, general and administrative (S,G&A) expenses for the 2002 period and the
2001 period were $ 136,750 and $433,258 respectively. The $296,508 decrease
(68.4%) is primarily a reflection of lower payroll and rent costs. The Company
significantly downsized in February 2001 upon filing for protection under
Chapter 11. Thus, the 2001 Period contained one month of significantly higher
payroll costs. Furthermore, the Company moved into a lower cost facility toward
the end of the 2001 Period, resulting in substantial rent savings in the 2002
Period.

Interest expense was $ 44,507 for the 2001 period and zero for the 2002 period.
Interest obligations were frozen at the time of the bankruptcy filing in
February 2001.

Liquidity and Capital Resources

The Company's primary source of liquidity is cash of $259,652.

The Company has funded its operations to date primarily through a combination of
debt and equity financing.

The Company anticipates funding its future operations primarily through the
equity financing obtained through the merger with Romantic .

Cash provided by operating activities for the 2002 Period was $188,567 as
compared to $6,006 provided by operating activities for the 2001 Period. An
increase in accounts payable of $291,588 in the 2002 Period was more than
sufficient to fund net losses of $80,434 before non-cash reorganization income.
The unfavorable cash flow impact of net losses before non-cash expenses of
$54,254 in the 2001 Period and a $567,012 decrease in accounts payable and
accrued expenses were essentially offset by the favorable cash flow impact of a
decrease in inventories, $392,015 and accounts receivable, $243,960.

Cash provided by investing activities amounted to $38,458 in the 2001 Period as
compared to zero in the 2,002 period. In the 2001 Period, the Company disposed
of many of its fixed assets as part of the downsizing of its operations.



                                       7
<PAGE>

PART II - OTHER INFORMATION



Item 5.  Other Information


In February 2001, the Company filed for protection under the federal bankruptcy
laws (Chapter 11).





Item 3.           Item 6.  Exhibits and Reports on Form 8-K
                           --------------------------------
( a.)                      Exhibit              Description
                           -------              -----------
                           None

( b.)       Reports on Form 8-K
            No reports on Form 8-K were filed during the quarter ended March 31,
            2002.



<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.


                                                       AZUREL LTD.




                                                  /s/ Edward Adamcik
                                                      --------------------------
                                                      Edward Adamcik
                                                      Vice President, Operations







         Dated : May 20, 2002


                                       9