<PAGE>
 
================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549
                                   FORM 10-Q

(Mark One)

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

     For the Quarterly Period Ended September 30, 1997

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 0-26922

                              COAST RESORTS, INC.

             (Exact name of registrant as specified in its charter)

                                        

NEVADA                                                 88-0345704            
(State or other jurisdiction of                        (I.R.S. Employer      
incorporation or organization)                         identification number)

4500 WEST TROPICANA AVENUE, LAS VEGAS, NEVADA          89103                 
(Address of principal executive offices)               (Zip code)            

                                 (702)365-7000

             (Registrant's telephone number, including area code)
                                     None
  (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
                                                             ---     ---

                     APPLICABLE ONLY TO CORPORATE ISSUERS:

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

          Shares of Common Stock outstanding as of September 30, 1997:
          1,494,352.94

================================================================================
<PAGE>
 
ITEM 1.  FINANCIAL STATEMENTS.

                     COAST RESORTS, INC. AND SUBSIDIARIES
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                   (AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                     SEPTEMBER 30,         DECEMBER 31,
                                                                                         1997                  1996
                                                                                     ------------          -----------  
<S>                                                                                    <C>                  <C>
ASSETS
 
CURRENT ASSETS:
   Cash and cash equivalents.............................................              $ 22,114             $ 53,381
   Restricted cash equivalents, in escrow account........................                    --                8,186
   Accounts receivable, net..............................................                 4,182                3,659
   Other current assets..................................................                17,540               13,660
                                                                                       --------             --------   
   TOTAL CURRENT ASSETS..................................................                43,836               78,886 
PROPERTY AND EQUIPMENT, net..............................................               302,326              286,580 
OTHER ASSETS                                                                              5,873                6,780 
                                                                                       --------             -------- 
                                                                                       $352,035             $372,246 
                                                                                       ========             ========   
LIABILITIES AND                                                                                             
STOCKHOLDERS' EQUITY                                                                                        
                                                                                                            
CURRENT LIABILITIES:                                                                                        
   Accounts payable......................................................              $  5,891             $ 36,996
   Accrued liabilities...................................................                39,378               23,864
   Current portion of long-term debt.....................................                 8,031                6,781
                                                                                       --------             --------         
   TOTAL CURRENT LIABILITIES.............................................                53,300               67,641 
                                                                                       --------             --------      
LONG-TERM DEBT, less current portion.....................................               192,334              195,764  
                                                                                       --------             --------    
DEFERRED RENT............................................................                 7,987                4,929  
                                                                                       --------             --------    
OTHER LIABILITIES........................................................                 4,924                4,863  
                                                                                       --------             --------    
COMMITMENTS AND CONTINGENCIES                                                                               
STOCKHOLDERS' EQUITY:                                                                                       
   Preferred Stock, $.01 par value, 500,000 shares authorized,                                              
   no shares issued and outstanding                                                          --                   --
   Common Stock, $.01 par value, 2,000,000 shares authorized,                                               
   1,494,353 shares issued and outstanding                                                   15                   15
   Additional paid-in capital............................................                95,398               95,398
   Retained earnings (deficit)...........................................                (1,923)               3,636
                                                                                       --------             --------    
   TOTAL STOCKHOLDERS' EQUITY............................................                93,490               99,049  
                                                                                       --------             --------    
                                                                                       $352,035             $372,246  
                                                                                       ========             ========     
</TABLE>
The accompanying notes are an integral part of these condensed consolidated
financial statements.
<PAGE>
 
                     COAST RESORTS, INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
    FOR THE THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996

                 (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                  THREE MONTHS ENDED           NINE MONTHS ENDED
                                                                     SEPTEMBER 30,               SEPTEMBER 30,
                                                            --------------------------------------------------------
                                                                  1997          1996          1997          1996
                                                               -----------   -----------   -----------   ----------

<S>                                                            <C>           <C>           <C>           <C>
OPERATING REVENUES:
        Casino.........................................        $   50,655    $   36,324    $  154,235    $  107,624
        Food and beverage..............................            15,233         9,248        45,416        28,637
        Hotel..........................................             6,475         3,577        20,811        10,594
        Other..........................................             4,937         2,597        14,112         7,511
                                                               ----------    ----------    ----------    ---------- 
          GROSS OPERATING REVENUES.....................            77,300        51,746       234,574       154,366
        Less: promotional allowances...................            (6,859)       (4,088)      (19,430)      (12,508)
                                                               ----------    ----------    ----------    ---------- 
          NET OPERATING REVENUES.......................            70,441        47,658       215,144       141,858
                                                               ----------    ----------    ----------    ---------- 
OPERATING EXPENSES:                                                                                      
        Casino.........................................            27,878        18,661        83,052        52,503
        Food and beverage..............................            11,429         7,222        36,651        21,894
        Hotel..........................................             3,022         1,753         9,154         5,238
        Other..........................................             4,114         1,954        11,709         5,652
        General and administrative.....................            13,694        10,035        44,161        27,728
        Land leases....................................             2,078           955         6,227         2,865
        Depreciation and amortization..................             4,743         1,969        14,227         5,591
                                                               ----------    ----------    ----------    ---------- 
TOTAL OPERATING EXPENSES...............................            66,958        42,549       205,181       121,471
                                                               ----------    ----------    ----------    ---------- 
          OPERATING INCOME.............................             3,483         5,109         9,963        20,387
                                                               ----------    ----------    ----------    ---------- 
OTHER INCOME (EXPENSES)                                                                                  
        Interest expense...............................            (6,577)       (5,884)      (19,607)      (16,061)
        Interest income................................                --           959            98         3,406
        Interest capitalized...........................               543         2,670           543         4,901
        Gain on disposal equipment and securities......                52            --           895             2
                                                               ----------    ----------    ----------    ---------- 
TOTAL OTHER INCOME (EXPENSES)..........................            (5,982)       (2,255)      (18,071)       (7,752)
                                                               ----------    ----------    ----------    ---------- 
                                                                                                         
INCOME (LOSS) BEFORE INCOME TAXES......................            (2,499)        2,854        (8,108)       12,635
                                                               ----------    ----------    ----------    ---------- 
INCOME TAX PROVISION (BENEFIT).........................              (848)          998        (2,549)        6,922
                                                               ----------    ----------    ----------    ---------- 
NET INCOME (LOSS)......................................        $   (1,651)   $    1,856    $   (5,559)   $    5,713
                                                               ==========    ==========    ==========    ========== 
                                                                                                         
NET INCOME (LOSS) PER SHARE OF COMMON STOCK............            $(1.10)        $1.24        $(3.72)        $3.90
                                                               ==========    ==========    ==========    ========== 
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING.............         1,494,353     1,494,353     1,494,353     1,465,486
                                                               ==========    ==========    ==========    ========== 
                                                                                                         
PRO FORMA DATA (reflecting change in tax status):                                                        
        Income tax provision (benefit).................              (848)          998        (2,549)        4,422
                                                               ----------    -----------   ----------    ---------- 
        Net income (loss)..............................        $   (1,651)   $    1,856    $   (5,559)   $    8,213
                                                               ==========    ===========   ==========    ========== 
     Net income (loss) per share of common stock.......        $    (1.10)   $     1.24    $    (3.72)   $     5.60
                                                               ==========    ===========   ==========    ========== 
</TABLE>

  The accompanying notes are an integral part of these condensed consolidated
  financial statements.

                                       3
<PAGE>
 
                     COAST RESORTS, INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
             FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
                            (AMOUNTS IN THOUSANDS)
                                  (UNAUDITED)


<TABLE>
<CAPTION>
                                                                                            NINE MONTHS ENDED
                                                                                               SEPTEMBER 30,
                                                                                     --------------------------------
                                                                                       1997                    1996
                                                                                     --------               ---------
<S>                                                                                  <C>                    <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
    Net income (loss).............................................................   $ (5,559)              $   5,713
                                                                                     --------               ---------
     ADJUSTMENTS TO RECONCILE NET INCOME (LOSS) TO NET
      CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES:
       Depreciation and amortization..............................................     14,227                   5,575
       Provision for bad debts....................................................        112                      49
       Gain on disposal of assets.................................................       (895)                     (2)
       Deferred income taxes......................................................        689                   2,500
       Other non-cash expenses....................................................      3,511                   1,675
       Changes in assets and liabilities:
             Net increase in accounts receivable and other assets.................     (5,078)                 (1,292)
             Net decrease in accounts payable and accrued liabilities.............         94                   8,403
                                                                                     --------               ---------
       TOTAL ADJUSTMENTS..........................................................     12,660                  16,908
                                                                                     --------               ---------
       NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES........................      7,101                  22,621
                                                                                     --------               ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
       Capital expenditures, net of construction accounts payable.................    (45,065)                (82,644)
       Proceeds from disposal of assets...........................................      1,143                      21
       Net reductions (additions) to restricted cash equivalents..................      8,186                 (56,378)
                                                                                     --------               ---------
       NET CASH USED IN INVESTING ACTIVITIES......................................    (35,736)               (139,001)
                                                                                     --------               ---------
CASH FLOW FROM FINANCING ACTIVITIES:
       Proceeds from issuance of long-term debt,
         net of discounts and commissions.........................................      3,200                 164,098
       Principal payments on long-term debt.......................................     (5,832)                 (1,505)
       Proceeds from borrowings under bank line of credit.........................         --                   1,045
       Principal payments on bank line of credit..................................         --                 (29,200)
       Payments for debt issue costs..............................................         --                  (1,236)
                                                                                     --------               ---------
       NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES........................     (2,632)                133,202
                                                                                     --------               ---------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS..............................    (31,267)                 16,822
CASH AND CASH EQUIVALENTS, at beginning of year...................................     53,381                  14,543
                                                                                     --------               ---------
CASH AND CASH EQUIVALENTS, at end of period.......................................   $ 22,114               $  31,365
                                                                                     ========               =========
</TABLE>

  The accompanying notes are an integral part of these condensed consolidated
  financial statements.

                                       4
<PAGE>
 
                     COAST RESORTS, INC. AND SUBSIDIARIES

             NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - BACKGROUND INFORMATION AND BASIS OF PRESENTATION

Background Information

     Coast Resorts, Inc. ("Coast Resorts" or the "Company") is a Nevada
corporation and serves as a holding Company for Coast Hotels and Casinos, Inc.
("Coast Hotels") and Coast West, Inc. ("Coast West").  Through Coast Hotels, the
Company owns and operates the following Las Vegas hotel-casinos:

            Gold Coast Hotel and Casino, approximately one mile west of the Las
            Vegas Strip on Flamingo Road.

            Barbary Coast Hotel and Casino, located on the Las Vegas Strip.

            The Orleans Hotel and Casino, located approximately one mile west of
            the Las Vegas Strip on Tropicana Avenue.

     Coast West has no operations but holds a long-term lease (the "Coast West
Lease") on approximately fifty acres of land in Las Vegas on which the Company
may develop and operate a future hotel-casino.

     The Gold Coast and Barbary Coast hotel-casinos had previously been owned
and operated independently by two partnerships, Gold Coast Hotel and Casino, a
Nevada limited partnership, and Barbary Coast Hotel and Casino, a Nevada general
partnership (collectively, the "Predecessor Partnerships").  On January 1, 1996,
the partners of the Predecessor Partnerships completed a reorganization (the
"Reorganization") with Coast Resorts.  Coast Resorts was formed in September
1995 for the purpose of effecting such Reorganization of the Predecessor
Partnerships.  Coast Resorts, Gold Coast and Barbary Coast were all related
through common ownership and management control.

     In the Reorganization, the partners of the Predecessor Partnerships each
transferred to Coast Resorts their respective partnership interests in the
Predecessor Partnerships in exchange for an aggregate of 1,000,000 shares of
common stock, par value $.01 per share, of Coast Resorts ("Coast Resorts Common
Stock").  Coast Resorts immediately contributed to Coast Hotels all of the
assets and liabilities of the Predecessor Partnerships other than those relating
to the Coast West Lease, which Coast Resorts contributed to Coast West. Coast
Resorts retained the liability for an aggregate principal amount of $51.0
million in notes payable to former partners and retained the liability for $1.5
million relating to demand notes due to a related party (the "Exchange
Liabilities").  On January 16, 1996, the Exchange Liabilities were exchanged for
494,353 shares of Coast Resorts Common Stock, based upon management's estimate
of the fair market value of such Coast Resorts Common Stock.

                                       5
<PAGE>
 
                     COAST RESORTS, INC. AND SUBSIDIARIES

             NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - BACKGROUND INFORMATION AND BASIS OF PRESENTATION 
     (CONTINUED)

Basis of Presentation

     The accompanying financial statements are unaudited and have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with Article 10 of Regulation S-X.  Accordingly, they
do not include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements.  The unaudited
financial statements should be read in conjunction with the audited financial
statements and footnotes for the year ended December 31, 1996.  In the opinion
of management, all adjustments and normal recurring accruals considered
necessary for a fair presentation of the results for the interim period have
been included.  The interim results reflected in the unaudited financial
statements are not necessarily indicative of expected results for the full year.

 
NOTE 2 - CONSTRUCTION COMMITMENTS

     In the first quarter of 1997, Coast Hotels began construction of Phase Two
of The Orleans.  The project,  expected to cost $35 to $40 million, will include
twelve movie theaters, a child care facility, additional restaurants, gaming
facilities and space for live entertainment. Management anticipates that the
first part of the project, including the movie theaters and child care facility,
will open in December 1997. In addition, in October 1997 Coast Hotels completed
and opened a new restaurant at the Barbary Coast, estimated to cost $1.9
million.  As of September 30, 1997, Coast Hotels had incurred $20.7 million and
$1.7 million, respectively, of costs related to the two construction projects.

 

NOTE 3 - INCOME TAXES

     Prior to the Reorganization, the Company operated as individual
partnerships which did not pay federal income taxes.  The partners of the
Predecessor Partnerships were taxed on their proportionate share of each of
their respective partnership's taxable income or loss.  Effective January 1,
1996 and in connection with the Reorganization, the Predecessor Partnerships
were terminated.  The change in status to a "C" corporation resulted in the
recognition of net deferred tax liabilities, and a corresponding charge to
earnings through the income tax provision of approximately $2.5 million for the
quarter ended March 31, 1996.  In addition, upon termination of the partnership
tax status on January 1, 1996, all undistributed earnings of the Predecessor
Partnerships were reclassified to additional paid-in capital.

     The pro forma provision for income taxes and the related pro forma net
income reflect adjustments to income taxes assuming that the recognition of net
deferred tax liabilities occurred prior to January 1, 1996.

                                       6
<PAGE>
 
ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
       RESULTS OF OPERATIONS


RESULTS OF OPERATIONS

     The following table sets forth, for the periods indicated, certain
financial information regarding the results of operations of the Company and
Coast Hotels:
 

<TABLE>
<CAPTION>
                                            THREE MONTHS ENDED                        NINE MONTHS ENDED
                                               SEPTEMBER 30,                             SEPTEMBER 30,
                                        ---------------------------------------------------------------------
                                          1997              1996                   1997                1996
                                        -------           -------                --------            --------         
 
GOLD COAST
<S>                                     <C>               <C>                    <C>                 <C>
Net operating revenues                  $29,994           $34,652                $ 93,950            $105,420
Operating income                        $ 4,822           $ 6,271                $ 16,847            $ 22,588
EBITDA (1)                              $ 6,029           $ 7,479                $ 20,455            $ 26,057
                                                                                                      
BARBARY COAST                                                                                         
Net operating revenues                  $10,884           $13,006                $ 33,509            $ 36,438
Operating income                        $   611           $   773                $    518            $  2,997
EBITDA (1)                              $ 1,008           $ 1,182                $  1,721            $  4,227
                                                                                                      
THE ORLEANS                                                                                           
Net operating revenues                  $29,563                 -                $ 87,686                   -
Operating income                        $   245                 -                $   (972)                  -
EBITDA (1)                              $ 3,628                 -                $  9,182                   -
EBITDAR (1)                             $ 4,153                 -                $ 10,757                   -
                                                                                                      
TOTAL (INCLUDING CORPORATE)                                                                           
Net operating revenues                  $70,441           $47,658                $215,144            $141,858
Operating income                        $ 3,483           $ 5,109                $  9,963            $ 20,387
EBITDA (1)                              $ 9,245           $ 7,518                $ 27,248            $ 27,298
EBITDAR (1)                             $10,304           $ 8,033                $ 30,417            $ 28,843
 
</TABLE>

(1)  "EBITDA" is defined as operating income plus depreciation, amortization and
     deferred (non-cash) rent. "EBITDAR" is defined as operating income plus
     depreciation, amortization and rent expense (both cash and deferred).
     EBITDA and EBITDAR should not be construed as alternatives to operating
     income as an indicator of the company's operating performance, or as
     alternatives to cash provided by operating activities as an indicator of
     cash flows or a measure of liquidity. EBITDA and EBITDAR are presented
     solely as supplemental disclosure because management believes that they are
     widely used measures of financial performance in the gaming industry.

                                       7
<PAGE>
 
ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
       OF OPERATIONS  (CONTINUED)

Three Months Ended September 30, 1997 Compared to Three Months Ended September
30, 1996 and Nine Months ended September 30, 1997 Compared to Nine Months Ended
September 30, 1996

COAST RESORTS, INC.

     Net revenues for the Company were $70.4 million in the third quarter of
1997 compared to $47.7 million in the third quarter of 1996, an increase of
$22.7 million (47.6%), and were $215.1 million in the nine months ended
September 30, 1997 compared to $141.9 million for the same period in 1996, an
increase of $73.2 million (51.6%). The increased revenues were due to the
opening of the Coast Hotels' newest hotel-casino, The Orleans, in December 1996.

     Operating income was $3.5 million in the quarter ended September 30, 1997
compared to $5.1 million in the same quarter in 1996 and $10.0 million in the
nine month period ended September 30, 1997 compared to $20.4 million in 1996.
The decreases were primarily due to lower-than-expected revenues at The Orleans,
as well as continued decreased revenues at the Gold Coast and the Barbary Coast
(discussed below).  The Company had a net loss of $1.7 million in the third
quarter of 1997 compared to net income of $1.9 million in the third quarter of
1996.  In the nine months ended September 30, 1997, the Company experienced a
net loss of $5.6 million compared to net income of $5.7 million in the same
period in 1996.  The decreases were due to the lower operating income at the
Gold Coast and Barbary Coast described below, the lower-than-expected operating
results at The Orleans and the increased interest expense (a portion of interest
was capitalized in 1996 during the construction of The Orleans).

 
COAST HOTELS AND CASINOS, INC.

     Net revenues for the Company's operating subsidiary were $70.4 million in
the quarter ended September 30, 1997, an increase of $22.7 million (47.6%) over
revenues of $47.7 million in the same quarter in 1996.  For the nine months
ended September 30, 1997, net revenues were $215.1 million, an increase of $73.2
million (51.6%) over revenues of $141.9 million in the first nine months of
1996.  The increases were due to the opening of the Coast Hotels' newest hotel-
casino, The Orleans, in December 1996.

     Operating income decreased $1.6 million (28.6%) to $4.0 million in the
quarter ended September 30, 1997 compared to $5.6 million in the third quarter
of 1996.  For the first nine months of 1997, operating income decreased $10.4
million (47.7%) to $11.4 million compared to $21.8 million in the same period in
1996.  The decreases were primarily due to lower-than-expected revenues at The
Orleans, as well as continued decreased revenues at the Gold Coast and the
Barbary Coast (discussed below).

     Net loss for the quarter ended September 30, 1997 was $1.3 million compared
to net income of $2.2 million in the quarter ended September 30, 1996.  For the
first nine months of 1997 net loss was $5.0 million compared to net income of
$6.6 million in the first nine months of 1996.  The decreases were due to
increased interest expense as well as the decreases in

                                       8
<PAGE>
 
ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
       AND RESULTS OF OPERATIONS (CONTINUED)
 

operating income at the Gold Coast and Barbary Coast described below and the
lower-than-expected operating results at The Orleans.

     Gold Coast.  Net revenues for the Gold Coast Hotel and Casino declined in
     ----------                                                               
the three months and nine months ended September 30, 1997 compared to revenues
in the same periods in 1996.  For the three months ended September 30, 1997, net
revenues were $30.0 million compared to $34.7 million in 1996, a decrease of
$4.7 million (13.5%).  For the nine months ended September 30, 1997, net
revenues were $94.0 million compared to $105.4 million in 1996, a decrease of
$11.4 million (10.8%).  Compared to 1996, third quarter casino revenues declined
$3.5 million (13.6%) and nine month casino revenues declined $9.4 million
(12.0%), primarily due to lower customer wagering volume.  Food and beverage
business decreased as a result of a decrease in customer traffic, causing
revenues to decline $856,000 in the third quarter and $2.7 million in the first
nine months of 1997, down 12.4% and 12.5%, respectively, compared to the same
two periods in 1996.  Lower hotel room occupancy rates contributed to a $277,000
(10.8%) decline in third quarter hotel revenues and a $125,000 (1.6%) decline in
hotel revenues for the nine months ended September 30, 1997.  Management
attributes the overall revenue decline at the Gold Coast to the increased
competition from the openings of new casinos (including The Orleans) and
expanded capacity in others. Gold Coast operating expenses were $25.2 million in
the third quarter compared to $28.4 million in the third quarter of 1996, a
reduction of 11.3%.  For the first nine months of 1997, operating expenses were
$77.1 million, down 6.9% from 1996 expenses of $82.8 million.  Due to the lower
revenues, operating income at the Gold Coast was $4.8 million in the third
quarter of 1997 compared to $6.3 million in the second quarter of 1996, down
23.8%.   For the nine months ended September 30, 1997, Gold Coast operating
income was $16.8 million compared to $22.6 million in 1996, down 25.7%.

     Barbary Coast.  Net revenues for the Barbary Coast Hotel and Casino were
     -------------                                                           
$10.9 million in the third quarter of 1997 compared to $13.0 million in the same
period in 1996, a decrease of 16.2%.  For the first nine months of 1997, net
revenues were $33.5 million, an 8.0% decrease from revenues of $36.4 million in
the first nine months of 1996.  The lower revenues were due to a decline in
casino revenues, down $2.1 million (19.8%) in the third quarter, primarily as a
result of lower pari-mutuel wagering in the race book.  For the nine months
ended September 30, 1997, casino revenues declined $3.2 million (10.2%) compared
to 1996, primarily as a result of an 8.5% decrease in table games wagering
volume and a lower table games win percentage than in the previous year.  Due to
the lower revenues, Barbary Coast operating income declined to $611,000 in the
third quarter of 1997, compared to $773,000 in 1996.  For the nine months ended
September 30, 1997, operating income was $518,000 compared to $3.0 million in
the first nine months of 1996

     The Orleans.  The three months ended September 30, 1997 represented the
     -----------                                                            
third full quarter of operations for The Orleans, which opened on December 18,
1996.  Net operating revenues for the three months and nine months ended
September 30, 1997 were $29.6 million and  $87.7 million, respectively.
Operating income was $245,000 in the third quarter of 1997 compared to operating
income of $1.3 million in the second quarter and an operating loss of $2.5
million in the first quarter.  Compared to the second quarter of 1997, third
quarter table

                                       9
<PAGE>
 
ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
       AND RESULTS OF OPERATIONS (CONTINUED)

 

games handle (wagering volume) decreased 7.3%, but slot wagering increased 6.8%.
Third quarter hotel revenues declined 10.5% compared to the second quarter,
reflecting a lower occupancy rate and lower average daily room rates.
Restaurant customer volume increased 9.4% in the third quarter, contributing to
a 4.9% increase in food and beverage revenues over the second quarter.

 
COAST WEST, INC.

     Coast West, Inc. has no operations but holds a lease on approximately fifty
acres of land held for future development.  The net loss before income tax
benefit for Coast West was $962,000 for the third quarter of 1997 compared to a
loss of $959,000 in 1996.  For the nine months ended September 30, 1997, the net
loss before income tax benefit was $2,886,000 compared to $2,869,000 for the
same period in 1996.  Lease expense was $955,000 in the third quarters of 1997
and 1996, including deferred rent of $425,000 in 1997 and $440,000 in 1996.  For
the nine months ended September 30, 1997 and 1996, lease expense was $2.9
million, including deferred rent of $1.3 million in each year.  As of September 
30, 1997, Coast West has incurred approximately $1.7 million in expenditures 
related to the future development of a hotel-casino on the Coast West land.


LIQUIDITY AND CAPITAL RESOURCES

     Coast Resorts, Inc. is a holding company without operations of its own.
The Company's principal sources of liquidity on a consolidated basis
have consisted of cash provided by the operating activities of Coast
Hotels and, until termination of its revolving credit facility in January 1996,
bank financing.  In connection with the reorganization in which the Barbary
Coast Hotel and Casino and the Gold Coast Hotel and Casino were combined with
the Company, the Company exchanged shares of common stock, par value $.01 per
share, of Coast Resorts for approximately $52.5 million principal amount of
notes payable to certain shareholders of Coast Resorts.  See Note 1 to Notes to
Condensed Consolidated Financial Statements.

     On January 30, 1996, Coast Hotels issued $175.0 million principal amount of
First Mortgage Notes to finance, in part, the development, construction,
equipping and opening of The Orleans.  The net proceeds from the issuance, after
deducting discounts and commissions, were approximately $164.1 million.  Of that
amount, (i) approximately $114.8 million was deposited in a construction
disbursement account for use by Coast Hotels to finance in part The Orleans,
(ii) approximately $19.3 million was used by Coast Hotels to purchase U.S.
Government Obligations which were deposited into an interest escrow account to
fund the interest payable on the First Mortgage Notes through December 15, 1996
and (iii) approximately $29.2 million was used by Coast Hotels to repay all
outstanding indebtedness under its revolving credit facility, which was
terminated upon repayment.  The balance of approximately $800,000 was used to
pay, in part, the offering expenses of approximately $2.4 million. Coast Hotels
also financed approximately $30 million of equipment for the Orleans project
through capital lease financing.  

     Coast Hotels is permitted by the indenture pursuant to which the First
Mortgage Notes were issued to borrow up to an

                                       10
<PAGE>
 
ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
       AND RESULTS OF OPERATIONS (CONTINUED)

 

additional $20 million for working capital purposes, and is in discussions with
respect to working capital financing.  In August 1997, Coast Hotels incurred
$3.2 million in equipment financing, resulting in an aggregate of $27.6 million
of equipment financing outstanding at September 30, 1997.

     The Company's consolidated cash requirements, in addition to debt service
on the First Mortgage Notes and equipment capital leases, include land lease
payments for its properties, ongoing maintenance capital expenditures at its
existing facilities and periodic enhancements to those facilities.  The
Company's capital expenditures (exclusive of those associated with the
development and construction of The Orleans) for 1996 were approximately $6.2
million, most of which related to normal maintenance capital expenditures.
Management expects that maintenance capital expenditures for 1997 will be
approximately $6.0 million.

     In the first quarter of 1997, Coast Hotels began construction of Phase
Two of The Orleans.  The project,  expected to cost $35 to $40 million, will
include twelve movie theaters, a child care facility, additional restaurants,
gaming facilities and space for live entertainment.  Management anticipates that
the first part of the project, including the movie theaters and child care
facility, will open in December 1997. Through September 30, 1997, Coast Hotels
had incurred $20.7 million of costs related to the project.  In October 1997,
Coast Hotels completed and opened a new restaurant at the Barbary Coast which
has an estimated total cost of $1.9 million. Both the Orleans and Barbary Coast
projects have been financed with existing cash reserves and cash from
operations.  
 
FORWARD LOOKING STATEMENTS

     The statements in this Management's Discussion and Analysis which are not
historical fact are forward looking statements that are made pursuant to the
Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995.
The statements are subject to risks and uncertainties, including, but not
limited to increased competition, both in Nevada and other jurisdictions,
dependence on the Las Vegas area and the Southern California region for a
majority of the Company's customers, uncertainties associated with construction
projects, including the related disruption of operations and the availability of
financing, if necessary, which could cause actual results to vary materially
from those discussed herein.

 

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

     Not Applicable

                                       11
<PAGE>
 
PART II.  OTHER INFORMATION
 

Item 1:  Legal Proceedings.
         ----------------- 

         None.

Item 2:  Changes in Securities.
         --------------------- 

         None.

Item 3:  Defaults Upon Senior Securities.
         ------------------------------- 

         None.

Item 4:  Submission of Matters to a Vote of Security Holders.
         --------------------------------------------------- 

         None.

Item 5:  Other Information.
         ----------------- 

         None.

Item 6:  Exhibits and Reports on Form 8-K:
         -------------------------------- 

         (a)  Exhibits.

              10.25 Employment Agreement dated January 1, 1997 between Coast
                    Hotels and Casinos, Inc. and Harlan Braaten.*

              27.  Financial Data Schedule.

         -------------------------------
         * Filed as Exhibit 10.25 to the Coast Hotels and Casinos, Inc. 
           Quarterly Report on Form 10-Q for the period ended June 30, 1997.

       
         (b)  Reports on Form 8-K.

              There were no reports filed on Form 8-K during the three months
              ended June 30, 1997.

                                       12
<PAGE>
 
SIGNATURES
----------

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Quarterly Report on Form 10-Q to be signed on
its behalf by the undersigned thereunto duly authorized.

Date:  November 14, 1997         COAST RESORTS, INC., a Nevada corporation

                                 By: /s/ Gage Parrish
                                     -----------------
                                     Gage Parrish
                                     Vice President and Chief Financial Officer

                                       13