UNITED STATES
                       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 June 30, 2000

                                       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 0-23173

                         OAO TECHNOLOGY SOLUTIONS, INC.
             (Exact name of registrant as specified in its charter)


          Delaware                                               52-1973990
(State or other jurisdiction of                               (I.R.S. Employer
incorporation or organization)                               Identification No.)


7500 Greenway Center Drive
Greenbelt, Maryland                                                    20770
(Address of principal executive offices)                             (Zip Code)


Registrant's telephone number, including area code (301) 486-0400


     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 [ ]


     As of August 7, 2000, the registrant had outstanding  18,406,460  shares of
its Common Stock, par value $0.01 per share.


                                       1

<PAGE>


                         OAO TECHNOLOGY SOLUTIONS, INC.

        Quarterly Report on Form 10-Q for the Three and Six Month Periods
                              Ended June 30, 2000


                                      INDEX


                                                                  Page Reference


COVER PAGE.....................................................................1


INDEX..........................................................................2


PART I - FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

        Condensed Consolidated Balance Sheets as of June 30, 2000 and
        December 31, 1999 (Unaudited)..........................................3

        Condensed Consolidated Statements of Operations and
        Comprehensive Income for the Three and Six Month Periods
        Ended June 30, 2000 and 1999 (Unaudited)...............................4

        Condensed Consolidated Statements of Cash Flows
        for the Six Months Ended June 30, 2000 and 1999 (Unaudited)............5

        Notes to Condensed Consolidated Financial Statements (Unaudited).......6

Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
        CONDITION AND RESULTS OF OPERATIONS....................................9

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK............14

PART II - OTHER INFORMATION...................................................15

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

        Item 6. Exhibits and Reports on Form 8-K

SIGNATURES....................................................................16


                                       2

<PAGE>


PART 1 - FINANCIAL INFORMATION
Item 1. Financial Statements


                                  OAO TECHNOLOGY SOLUTIONS, INC.
                               Condensed Consolidated Balance Sheets
                                            (Unaudited)
                           (Dollars in thousands, except share amounts)

                                                        June 30,    December 31,
                                                          2000          1999
                                                       ----------   ------------
ASSETS
Current assets:
    Cash and cash equivalents                            $  9,979     $ 13,142
    Accounts receivable:
      Billed, net of allowance of $531 and
        $1,014, respectively                               18,075       21,066
      Unbilled, net of allowance of $449
        and $493, respectively                              8,660        5,059
                                                         --------     --------
                                                           26,735       26,125
    Note receivable - OAO Corporation                       2,520        2,520
    Deferred income taxes                                   1,031        1,031
    Income tax receivable                                     876          934
    Other current assets                                    7,250        6,447
                                                         --------     --------
      Total current assets                                 48,391       50,199
Property and equipment, net                                 5,022        4,387
Purchased and developed computer software
  for sale, net                                             1,939        1,596
Deposits and other assets                                     954          192
Goodwill                                                    4,601        4,981
                                                         --------     --------
      Total assets                                       $ 60,907     $ 61,355
                                                         ========     ========

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
    Accounts payable                                     $  5,368     $  8,470
    Accrued expenses                                       11,532       11,718
    Income taxes payable                                      577          605
    Unearned revenue                                        1,076          797
    Current portion of capital lease obligations               24           54
                                                         --------     --------
      Total current liabilities                            18,577       21,644

Capital lease obligations, net of current portion              45           89

Commitments and contingencies                                --           --

Stockholders' equity :
    Preferred stock, par $.01 per share, 10,000,000
      shares authorized none issued and outstanding          --           --
    Common stock, par $.01 per share, 50,000,000 shares
      authorized; 18,405,499 and 18,101,124 shares
      issued and outstanding at June 30, 2000 and
      December 31, 1999, respectively                         184          181
    Additional paid-in capital                             41,973       40,743
    Deferred compensation                                     (44)        (131)
    Accumulated other comprehensive loss                     (353)        (249)
    Shareholders' receivable                               (2,933)      (2,933)
    Retained earnings                                       3,458        2,011
                                                         --------     --------
      Total stockholders' equity                           42,285       39,622
                                                         --------     --------
      Total liabilities and stockholders' equity         $ 60,907     $ 61,355
                                                         ========     ========

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


                                       3

<PAGE>


                         OAO TECHNOLOGY SOLUTIONS, INC.
    Condensed Consolidated Statements of Operations and Comprehensive Income
                                   (Unaudited)
           (Dollars and shares in thousands, except per share amounts)


<TABLE>
<CAPTION>
                                               Three months ended      Six months ended
                                                    June 30,                June 30,
                                              --------------------   -------------------
                                                2000        1999       2000        1999
                                              --------------------   -------------------
<S>                                           <C>         <C>        <C>        <C>
Revenues                                      $ 39,695    $ 39,219   $ 78,240   $ 74,936
Direct costs                                    32,369      35,127     65,564     66,994
                                              --------    --------   --------   --------
                                                 7,326       4,092     12,676      7,942
Selling, general and administrative expense      5,885       3,889     10,598      7,335
                                              --------    --------   --------   --------
Income from operations                           1,441         203      2,078        607
Interest and other income (expense), net          (158)        361        438        458
                                              --------    --------   --------   --------
Income before income taxes                       1,283         564      2,516      1,065
Provision for income taxes                         545         224      1,069        424
                                              --------    --------   --------   --------
Net income                                         738         340      1,447        641
Other comprehensive income :
    Foreign currency translation adjustment         72          26        104         59
                                              --------    --------   --------   --------
Comprehensive income                          $    810    $    366   $  1,551   $    700
                                              ========    ========   ========   ========
Net income per common share:
    Basic                                     $   0.04    $   0.02   $   0.08   $   0.04
                                              ========    ========   ========   ========
    Diluted                                   $   0.04    $   0.02   $   0.08   $   0.04
                                              ========    ========   ========   ========
Weighted average number
    of shares outstanding:
    Basic                                       17,755      16,737     17,695     16,715
                                              ========    ========   ========   ========
    Diluted                                     18,372      17,139     18,745     17,190
                                              ========    ========   ========   ========
</TABLE>

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


                                       4

<PAGE>


                          OAO TECHNOLOGY SOLUTIONS, INC
                 Condensed Consolidated Statements of Cash Flows
                                   (Unaudited)
                             (Dollars in thousands)

<TABLE>
<CAPTION>
                                                                Six months ended
                                                                    June 30,
                                                                2000        1999
                                                              --------    --------
<S>                                                           <C>         <C>
Cash Flows from Operating Activities:
    Net income                                                $  1,447    $    641
    Adjustment to reconcile net income to net
      cash (used in) provided by operating activities:
      Depreciation and amortization                              1,561         994
      Change in fair value of stock guarantee                      235        --
    Change in assets and liabilities:
      Accounts receivable, net                                    (610)     (1,785)
      Other current assets                                        (746)       (516)
      Deposits and other assets                                   (675)       (375)
      Accounts payable                                          (3,114)      1,201
      Income taxes payable                                         (28)       --
      Accrued expenses                                            (421)      1,902
      Unearned revenue                                             279        (372)
                                                              --------    --------
        Net cash (used in) provided by operating activities     (2,072)      1,690
                                                              --------    --------
Cash Flows from Investing Activities:
    Purchase of business, net of cash acquired                    --          (139)
    Capitalized sofware development costs                         (544)       --
    Expenditures for property and equipment                     (1,615)       (451)
                                                              --------    --------
        Net cash used in investing activities                   (2,159)       (590)
                                                              --------    --------
Cash Flows from Financing Activities:
    Proceeds from common stock transactions, net                 1,233         127
    Payments on capital lease obligations                          (74)       (207)
                                                              --------    --------
        Net cash provided by (used in) financing activities      1,159         (80)
                                                              --------    --------
Effect of exchange rate changes on cash                            (91)         59
Net (decrease) increase in cash and cash equivalents            (3,163)      1,079
Cash and cash equivalents, beginning of period                  13,142       9,615
                                                              --------    --------
Cash and cash equivalents, end of period                      $  9,979    $ 10,694
                                                              ========    ========

Supplemental cash flows information:
    Cash paid for interest                                    $     38    $     32
    Cash paid for income taxes                                $  1,168    $    333
</TABLE>

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


                                       5

<PAGE>


                         OAO TECHNOLOGY SOLUTIONS, INC.

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


1. Organization and basis of presentation

OAO  Technology   Solutions,   Inc.  (the  "Company"  or  "OAOT")  is  a  global
enterprise-wide  integrator of  information  technology  ("IT")  solutions.  The
Company,  along with its  wholly  owned  subsidiaries,  provides a wide range of
outsourced  information  technology solutions and professional  services.  These
services  include the  operation of  large-scale  service  delivery  centers and
networks;   distributed   systems  management;   custom  applications   software
development and maintenance;  professional IT services;  enterprise  application
solutions, integration, implementation and training services; web enablement and
e-business  solutions;  and proprietary  software solutions for the managed care
marketplace.  These services are provided  through four business lines:  Network
and Systems Business Solutions,  Professional  Services,  E-Business  Consulting
Solutions, and Healthcare IT Solutions.

The  condensed  consolidated  financial  statements  included  herein  have been
prepared by the Company without audit,  pursuant to the rules and regulations of
the Securities and Exchange  Commission  ("SEC") and include,  in the opinion of
the management,  all adjustments,  consisting of normal  recurring  adjustments,
necessary for a fair presentation of interim period results. Certain information
and footnote  disclosures  normally included in financial statements prepared in
accordance with generally accepted accounting  principles have been condensed or
omitted  pursuant to such rules and  regulations.  These condensed  consolidated
financial statements should be read in conjunction with the financial statements
and notes  thereto  included in the  Company's  Annual Report on Form 10-K filed
with the SEC for the year  ended  December  31,  1999  and the  Company's  other
filings  with the SEC.  The  results of  operations  for the three and six month
periods ended June 30, 2000, are not necessarily indicative of the results to be
expected for the full year.


2. New accounting pronouncements

In December  1999, the  Securities  and Exchange  Commission  (SEC) issued Staff
Accounting Bulletin No. 101, "Revenue Recognition in Financial Statements" ("SAB
101").  SAB 101  summarizes  certain of the SEC's  views on  applying  generally
accepted accounting  principles to revenue recognition in financial  statements.
The  Company is  required  to adopt SAB 101 no later than the fourth  quarter of
fiscal 2000.  The Company is currently  evaluating  the impact of SAB 101 on its
results of operations and financial position.

In  March  2000,   the   Financial   Accounting   Standard   Board  issued  FASB
Interpretation  No. 44,  "Accounting  for Certain  Transactions  Involving Stock
Compensation--an  interpretation  of APB  Opinion  No.  25" ("FIN  44").  FIN 44
clarifies the application of APB Opinion No. 25 and among other issues clarifies
the  following:  the  definition  of an employee  for  purposes of applying  APB
Opinion No. 25, the  criteria  for  determining  whether a plan  qualifies  as a
non-compensatory  plan, the accounting  consequence of various  modifications to
the terms of previously fixed stock options or awards, and the accounting for an
exchange of stock  compensation  awards in a business  combination.  The Company
does not expect that the  adoption of this  interpretation  will have a material
impact on its results of operations and financial position


3. Software Licenses for Resale

The Company entered into a Value Added Industry Remarketer agreement with Siebel
Systems,  Inc.  on August  31,  1999.  As part of this  agreement,  the  Company
purchased  software  licenses in the amount of $5.1  million for resale to third
parties.  The software  licenses  were  purchased  with cash of $2.8 million and
228,800 shares of the Company's  common stock. The common stock has a guaranteed
per share value of $10 at September 1, 2000. The difference, if any, between the
share price at September 1, 2000 and the guaranteed  price will be paid in cash.
The balance of the  licenses is  included in other  current  assets and the fair
value of the  guarantee  is  included in accrued  expenses  on the  accompanying
balance sheets.


                                       6

<PAGE>


                         OAO TECHNOLOGY SOLUTIONS, INC.

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)
                                   (Continued)


4. Earnings per share

Basic  earnings  per  share  has been  calculated  as net  earnings  divided  by
weighted-average common shares outstanding, while diluted earnings per share has
been  computed as net earnings  divided by weighted  average  common and diluted
shares   outstanding.   The  Company's  stock  options   outstanding   increased
outstanding  common  shares by 617,000  and  402,000  for total  diluted  shares
outstanding  of 18,372,000  and 17,139,000 for the three month period ended June
30, 2000 and 1999, respectively,  and by 1,050,000 and 475,000 for total diluted
shares  outstanding  of 18,745,000 and 17,190,000 for the six month period ended
June 30, 2000 and 1999, respectively.

5. Segment information

The Company manages its business segments primarily by service line. As reported
in  the   Company's   Annual   Report  on  Form  10K,   the  names  and  certain
classifications within the Company's reportable segments were changed in 1999 to
better  describe the services  provided.  The 1999  quarterly  results have been
reclassified to conform to 2000 presentation.  The Company's reportable segments
are Network and Systems Business Solutions,  Professional  Services,  E-Business
Consulting Solutions, and Healthcare IT Solutions.

Network  and  Systems  Business  Solutions;   includes  data-center   operations
management, distributed systems management, and other IT services.

Professional  Services;  are  provided  by OAO  Services,  Inc,  a wholly  owned
subsidiary.  Through OAO Services,  Inc. the Company  provides highly skilled IT
professionals to augment  customer's  staffing  requirements  nationwide.  These
services  are  provided  primarily  to  strategic  customers  and on a time  and
materials basis.

E-Business  Consulting  Solutions;  provides  entire  life  cycle  services  for
organizations.  These services range from initial  business process modeling and
development,  through system installation and implementation and custom software
application  development and maintenance.  The E-Business  Consulting  Solutions
segment is dedicated to implementing and supporting systems from Siebel Systems,
NCR, SAP and Microsoft.  This segment also provides third party vendor  packaged
software including Siebel Systems, SAP and Microsoft, IBM and Rational on both a
licensed and Application Service Provider ("ASP") basis.

Healthcare IT Solutions;  provides  proprietary  software  products and business
solutions for healthcare organizations.  Through OAO HealthCare Solutions, Inc.,
a wholly owned  subsidiary,  the Company provides full service solutions via its
proprietary  MC400 software on a one-time  license and ASP basis.  This includes
product development,  customer service, and installation  service,  training and
ongoing support.

The Company  evaluates the performance of each segment based on segment revenues
and gross  profit.  Segment gross profit  includes  only direct costs.  Selling,
general and administrative  expenses; net interest expense; and other income and
expenses are not allocated to segments.


                                       7

<PAGE>


                         OAO TECHNOLOGY SOLUTIONS, INC.

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)
                                   (Continued)


Segment information (Continued)

Summary information by segment is as follows:

<TABLE>
<CAPTION>
                                                             Three months ended       Six months ended
                                                                   June 30,                June 30,
                                                            --------------------    --------------------
    (Amounts in thousands):                                   2000        1999        2000        1999
                                                            --------    --------    --------    --------
<S>                                                         <C>         <C>         <C>         <C>
NETWORK and SYSTEMS BUSINESS SOLUTIONS
    Revenues                                                $ 16,183    $ 17,981    $ 32,912    $ 34,630
    Gross profit                                               3,289       3,234       6,412       6,610
PROFESSIONAL SERVICES
    Revenues                                                  13,825      17,401      28,169      33,488
    Gross profit                                               1,853       2,315       3,660       4,293
E-BUSINESS CONSULTING SOLUTIONS
    Revenues                                                   5,330       1,245       9,605       2,341
    Gross profit (loss)                                          233      (1,594)        (87)     (3,147)
HEALTHCARE IT SOLUTIONS
    Revenues                                                   4,357       2,592       7,554       4,477
    Gross profit                                               1,951         137       2,691         186
SEGMENT TOTALS
    Revenues                                                $ 39,695    $ 39,219    $ 78,240    $ 74,936
    Gross profit                                               7,326       4,092      12,676       7,942
Selling, general and administrative expenses unallocated       5,885       3,889      10,598       7,335
                                                            --------    --------    --------    --------
    Total consolidated income from operations                  1,441         203       2,078         607
     Interest and other income (expense), net unallocated       (158)        361         438         458
                                                            --------    --------    --------    --------
      Total consolidated income before income taxes         $  1,283    $    564    $  2,516    $  1,065
                                                            --------    --------    --------    --------
</TABLE>

6. Reclassification

Certain reclassifications have been made to the condensed consolidated financial
statements  for the three and six month  periods ended June 30, 1999 in order to
conform to the presentation used in 2000.


                                       8

<PAGE>


Item 2.
                         OAO TECHNOLOGY SOLUTIONS, INC.
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS


The following  discussion and analysis is provided to increase the understanding
of, and should be read in conjunction with, the Condensed Consolidated Financial
Statements of the Company and Notes thereto included elsewhere in this quarterly
report.  Historical  results and percentage  relationships  among any amounts in
these financial statements are not necessarily indicative of trends in operating
results for any future  period.  The statements  which are not historical  facts
contained in this quarterly report,  including this Management's  Discussion and
Analysis of Financial  Condition and Results of  Operations,  and Notes to these
Condensed   Consolidated  Financial  Statements,   constitute   "forward-looking
statements" within the meaning of the Private  Securities  Litigation Reform Act
of 1995. Such statements are based on currently available  operating,  financial
and competitive information, and are subject to various risks and uncertainties.
Future events and the Company's  actual results may differ  materially  from the
results reflected in these forward-looking statements.  Factors that might cause
such a difference  include,  but are not limited to, dependence on key strategic
and strategic  end-user  customers,  limited  ability to establish new strategic
customer relationships,  risks associated with fixed-price contracts, ability to
sustain and manage  growth,  variability  of quarterly  operating  results,  the
Company's  expansion and  development of new service lines,  marketing and other
business   development   initiatives,   the  commencement  of  new  engagements,
competition  in the industry,  general  economic  conditions,  dependence on key
personnel,  the ability to attract,  hire and retain  personnel  who possess the
technical  skills and experience  necessary to meet the service  requirements of
its  clients,  the  potential  liability  with  respect to actions  taken by its
employees,  risks associated with international sales, and other risks described
herein,  the  Company's  annual  report on Form 10K and in the  Company's  other
Securities and Exchange Commission filings.

Overview

The Company is a global  enterprise-wide  integrator of  information  technology
(IT) solutions. The Company provides a wide range of outsourced IT solutions and
professional  services,  including the operation of large-scale service delivery
centers  and  networks,  distributed  systems  management,  custom  applications
software  development  and  maintenance,  professional  IT services,  enterprise
application  solutions,  integration,  implementation and training services, web
enablement and e-business solutions,  and proprietary software solutions for the
managed care  marketplace.  These  services are provided  through four  business
segments:  Network  and  Systems  Business  Solutions;   Professional  Services;
E-Business Consulting Solutions and Healthcare IT Solutions.

The Company  provides  Network and Systems  Business  Solutions,  generally on a
long-term,  fixed-price  contractual basis, to strategic customers as part of an
IT outsourcing team,  providing services to a wide range of end-user  customers.
The  Company's   strategic  customers  include  IBM  and  Compaq  with  end-user
engagements  including:  Boeing,  Ames  Department  Stores,  United Health Care,
Campbell Soup,  Ryder Systems  Corporation,  Citibank and others.  The Company's
data center management  contract was renewed for ten years.  Management believes
that  revenues  from this  contract may increase  over the term of the contract;
however, there is no assurance that revenues from this contract will increase or
continue at historical revenue and profitability levels.

Professional  Services provides information  technology personnel primarily on a
time and materials basis, that are regularly utilized within engagements to meet
short  or  indefinite  term  requirements.  There  are also  instances  where an
engagement  has  started  on  a  time  and  materials  basis  and  evolved  to a
fixed-price basis, as the requirements became sufficiently defined. Professional
Services are offered as part of the Company's service offerings to its strategic
customers as well as non-strategic customers.


                                       9

<PAGE>


                         OAO TECHNOLOGY SOLUTIONS, INC.
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)


Overview (Continued)

E-Business  Consulting  Solutions are generally provided on a time and materials
contractual  basis.  The Company,  through its E-Business  Consulting  Solutions
services, provides entire life cycle services for organizations.  These services
range from initial business  process  modeling and  development,  through system
installation  and  implementation.  The  Company  also  provides a full suite of
continuous  support  services  to  help  maintain  and  upgrade  these  complex,
mission-critical   systems.  The  E-Business  Consulting  Solutions  segment  is
dedicated  to  implementing  and  supporting   third-party   designed   software
applications and systems sold on a licensed and ASP basis.

The Company's Healthcare IT Solutions practice provides proprietary managed care
software  application  solutions under software license agreements via its MC400
software.  The products  are provided on a one-time  license fee or a per member
per month (PMPM) long-term contractual basis and may include system development,
customer  service,  installation  services,  training,  and ongoing support.  In
addition,  other  services may be provided,  such as total  project  management,
hardware planning and implementation, and custom programming. MC400 is currently
installed at over 50 managed care sites in the United States and the Bahamas.

The Company focuses its efforts on middle market commercial  customers,  as well
as public  sector  customers.  In  support of these  efforts,  the  Company  has
established  strategic  relationships with third-party  software vendors such as
Siebel  Systems,  NCR, SAP,  Compaq and Microsoft.  The Company signed a special
Value Added Industry Remarketer (VAIR) agreement with Siebel Systems,  Inc. This
agreement  permits OAOT to design,  install,  resell and host,  on an ASP basis,
Siebel solutions for commercial and public sector customers in North America and
Europe.  The  Company has also hired teams of Siebel  consultants  to  implement
comprehensive CRM solutions.

Management  intends to reinvest  profits  from its Network and Systems  Business
Solutions and Professional  Services segments to continue to develop new service
offerings in the  E-Business  Consulting  Solutions and  Healthcare IT Solutions
segments. These offerings include e-business application solutions,  application
service provider  services (ASP),  custom software  application  development and
maintenance (ADM), and customer relationship management services (CRM) including
license sales, application hosting, and consulting.  Company management believes
that timely  investment in  internet-centric  businesses and digital  technology
infrastructure solutions will result in improved long-term stockholder value.


                                       10

<PAGE>


                         OAO TECHNOLOGY SOLUTIONS, INC.
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)


Results of Operations

The following table sets forth, for the periods indicated, selected statement of
operations data as a percentage of net revenue:

<TABLE>
<CAPTION>
                                                   For the three months ended          For the six months ended
                                                            June 30,                            June 30,
                                              ----------------------------------   ---------------------------------
     (in millions)                                  2000               1999              2000              1999
                                                    ----               ----              ----              ----
<S>                                           <C>       <C>      <C>      <C>      <C>      <C>      <C>      <C>
Revenues                                      $ 39.7    100.0%   $ 39.2   100.0%   $ 78.2   100.0%   $ 74.9   100.0%
Direct Costs                                    32.4     81.6%     35.1    89.6%     65.5    83.8%     67.0    89.5%
Selling, general and administrative expense      5.9     14.9%      3.9     9.9%     10.6    13.5%      7.3     9.7%
                                              ------    ------   ------   ------   ------   ------   ------   ------
Income from operations                           1.4      3.5%      0.2     0.5%      2.1     2.7%      0.6     0.8%
Interest and other income (expense), net        (0.2)    -0.5%      0.4     1.0%      0.4     0.5%      0.5     0.7%
                                              ------    ------   ------   ------   ------   ------   ------   ------
  Income before income taxes                     1.2      3.0%      0.6     1.5%      2.5     3.2%      1.1     1.5%
Provision for income taxes                       0.5      1.3%      0.2     0.5%      1.1     1.4%      0.4     0.6%
                                              ------    ------   ------   ------   ------   ------   ------   ------
  Net income                                  $  0.7      1.7%   $  0.4     1.0%   $  1.4     1.8%   $  0.7     0.9%
                                              ======    ======   ======   ======   ======   ======   ======   ======
</TABLE>

Comparison  of the three and six month  periods ended June 30, 2000 to the three
and six month periods ended June 30, 1999.

Revenues

The Company's revenues increased $ .5 million or 1.3 % to $ 39.7 million for the
three months ended June 30, 2000, compared to $ 39.2 million for the same period
in 1999. For the six months ended June 30, 2000 revenues increased $ 3.3 million
or 4.4 % to $ 78.2  million  from $ 74.9  million  for the same  period in 1999.
Revenue  increases  were  driven  by the  E-Business  Consulting  Solutions  and
Healthcare IT Solutions segments, and were partially offset by lower revenues in
the Network and Systems Business  Solutions and Professional  Services  segments
for both the three and six month  periods  ended June 30,  2000  compared to the
same periods in 1999.

Revenues for E-Business  Consulting Solutions increased $ 4.1 million or 341.7 %
to $ 5.3 million,  for the three  months  ended June 30, 2000  compared to $ 1.2
million for the same period in 1999.  The  increases  for the second  quarter of
2000 coupled with similar increases  reported for the first quarter of 2000 lead
to an increase  in  revenues of $ 7.3 million or 317.4% to $9.6  million for the
six months ended June 30, 2000  compared to $ 2.3 million for the same period in
1999.  The increase in revenues  for both the three month and six month  periods
ended June 30, 2000 was due  primarily  to  increased  activity in the ADM,  and
consulting  practices  compared with the same periods in 1999.  New and existing
contracts  continued to ramp up through the first half of 2000,  compared to the
first half of 1999 when the  contracts  had recently  been awarded and had lower
levels of activity.  Similarly,  the  consulting  practices were in the start-up
phase in the  first  two  quarters  of 1999  and had  little  revenues  in those
periods.  The first and second  quarters  of 2000  reflect  new  projects  and a
general increase in business volume  resulting in comparatively  higher revenues
from the same periods in 1999.

Revenues for the  Healthcare IT Solutions  segment  increased $ 1.8 million,  or
69.2 %, to $ 4.4 million for the three months ended June 30, 2000  compared to $
2.6  million  for the same period in 1999.  The  increase  in  revenues  was due
primarily  to the  continued  effect of the  recurring  "per-member,  per-month"
("PMPM") revenues which have occurred throughout 1999 and into the first half of
2000,  and license sales that occurred in the second  quarter of 2000.  The PMPM
sales  throughout  the first half of the year and the license  sales lead to and
increase  in  revenues  of $ 3.0  million or 66.7 % to $ 7.5 million for the six
months  ended June 30,  2000  compared  to $ 4.5  million for the same period in
1999.


                                       11

<PAGE>


                         OAO TECHNOLOGY SOLUTIONS, INC.
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)


Revenues (continued)

Revenues from Network and Systems Business Solutions  decreased by $ 1.8 million
or 10.0 % to $ 16.2 million for the three months ended June 30, 2000 compared to
$ 18.0 million for the same period in 1999.  The decrease in the second  quarter
was due primarily to delays in negotiations between a strategic customer and end
user customer for a contract renewal and continued  pricing and volume decreases
from another strategic customer. The volume and pricing decreases were partially
offset in the first quarter by projects from new customers and the effect of the
UK acquisition,  which occurred in the second quarter of 1999. Accordingly,  the
decrease in  revenues  of $ 1.7  million or 4.9 % to $ 32.9  million for the six
months  ended June 30, 2000  compared  to $ 34.6  million for the same period in
1999 was driven primarily by the events in the second quarter of 2000.

Revenues from Professional  Services decreased $ 3.6 million or 20.7 % to $ 13.8
million for the three months ended June 30, 2000  compared to $ 17.4 million for
the three  months  ended June 30,  1999.  The decrease in revenues is due to the
continued carry over effects of Y2K  constraints  resulting in a lower number of
staffing  requisitions  from a  strategic  customer.  The  continued  carry over
effects of the Y2K constraints lead to a decrease in revenues for the six months
ended June 30, 2000 of $ 5.3 million or 15.8 % to $ 28.2  million  compared to $
33.5 million for the same period in 1999.

Direct Costs

The  Company's  direct costs  decreased $ 2.7 million or 7.7 % to $ 32.4 million
for the three  months  ended June 30,  2000,  compared to $ 35.1 million for the
same period in 1999.  Direct costs also decreased as a percentage of revenues to
81.6 % for the three months ended June 30, 2000 versus 89.6 % for same period in
1999.  For the six months  ended June 30,  2000,  direct  costs  decreased $ 1.5
million or 2.2 % to $ 65.5  million  from $ 67.0  million for the same period in
1999.  Direct costs also decreased as a percentage of revenues to 83.8 % for the
six months  ended  June 30,  2000  versus  89.5 % for same  period in 1999.  The
decrease in direct costs as a percentage  of revenues for both the three and six
month  periods  ended June 30, 2000  compared to the same periods in 1999 is due
primarily to the E-Business Consulting Solutions and the Healthcare IT Solutions
segments.   The  other  business  segments   maintained  a  relatively  constant
relationship of direct costs to their respective revenues.

In the E-Business Consulting Solutions segment direct costs increased in dollars
by $ 2.3 million to $ 5.1 million for the three  months ended June 30, 2000 from
$ 2.8 million for the same period in 1999.  However, as a percent of the segment
revenues direct costs decreased from 233.3 % of sales in the second quarter 1999
to 96.2 % of sales in the  second  quarter  of 2000.  The  results in the second
quarter of 2000 are a continuation  of the same  experience in the first quarter
of 2000, which resulted in a increase in direct cost dollars of $ 4.2 million or
76.4 % to $ 9.7 million for the six months ended June 30, 2000 compared to $ 5.5
million for the same period  last year.  For the six months  ended June 30, 2000
direct costs as a percentage of revenues decreased to 101.0 % compared to 239.1%
for the same period in 1999.

In the Healthcare IT Solutions segment direct costs dollars remained  relatively
constant for both the three and six month  periods  ended June 30, 2000 compared
to the same  periods  in 1999.  However,  as a percent of the  segment  revenues
direct costs decreased from 96.2 % of sales in the second quarter 1999 to 54.5 %
of sales in the second  quarter of 2000.  For the six months ended June 30, 2000
direct costs as a percentage of segment  revenues  decreased  from 95.6 % in the
six month  period  ended June 30, 1999 to 65.3 % for the six month  period ended
June 30,  2000.  Direct  costs as a percent of sales  continue  to decrease as a
result of the recurring revenues from PMPM and license sales of software.


                                       12

<PAGE>


                         OAO TECHNOLOGY SOLUTIONS, INC.
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)


Selling, General and Administrative Expenses

Selling,  general  and  administrative  expenses  were $ 5.9  million  and $ 3.9
million for the three-month periods ended June 30, 2000 and 1999,  respectively.
OAOT's selling, general and administrative expenses increased as a percentage of
revenues  for the three  months  ended June 30, 2000 to 14.9 % compared to 9.9 %
for the same period in 1999.  For the six month  periods ended June 30, 2000 and
1999 selling,  general and administrative expenses were $ 10.6 million and $ 7.3
million or 13.5 % and 9.7 % of sales, respectively.  The increases were a result
of increased sales and marketing  efforts and the  continuation of the company's
infrastructure build-out to accommodate its growth. The Company expects selling,
general and  administrative  expenses  to increase in absolute  dollars and as a
percentage  of  revenues  as it  continues  to expand  its  sales and  marketing
expenditures to penetrate new markets and expand its client base.

Interest and Other Income (Expense) and Provisions for Income Taxes

For the three  month  period  ended  June 30,  2000  interest  and other  income
(expense) decreased to a loss of $ .2 million from income of $ .4 million in the
same period in 1999.  Interest income increased primarily due to a higher amount
of invested cash and interest earned on a note receivable from OAO  Corporation,
however  the income was offset by a negative  mark to market  adjustment  in the
amount of $ .5 million to the  obligation  incurred as a part of the Siebel VAIR
agreement.  The impact of the Siebel adjustment similarly affected the six month
period ended June 30, 2000 by decreasing  interest and other income (expense) to
$ .4 million  from $ .5 million in the same period in 1999.  The  effective  tax
rate increased to 42.5 % for the three and six month periods ended June 30, 2000
versus a 40 % rate in the same periods in 1999.

Liquidity and Capital Resources

Cash and cash equivalents were $ 10.0 million as of June 30, 2000, versus $ 13.1
million as of December 31, 1999.  Cash used in operations  was $ 2.1 million for
the six months ended June 30, 2000.  Cash used in operations  for the six months
ended June 30,  2000 was due to the  payment of  accounts  payable  and  accrued
expenses. OAOT's business segments of Network and Systems Business Solutions and
Professional  Services,  improved collections of accounts  receivable,  and cash
management.  These  increased  cash flows were used to fund the Company's  newer
Healthcare IT Solutions and E-Business  Consulting  Solutions business segments.
The  Company  expects  to  continue  to  invest in the  operations  of its newer
business segments including  E-Business  Consulting  Solutions and Healthcare IT
Solutions for projects  including ADM and  enhancement of its ASP product during
2000.  The Company  will also invest in sales and  marketing  as it develops its
demand  generation  capabilities for these newer business  services.  Such costs
will continue to be expensed as incurred and represent significant use of future
cash which is expected to be funded from Company  operations and available cash.
Cash  used  in  investing  activities  was $ 2.2  million  for the  purchase  of
computers and office equipment and certain software development costs associated
with the Healthcare IT segment.  The Company's business  operations will require
additional  capital  expenditures  as the  Company  continues  to expand its ADM
business and its other new business segments. Uses of cash were partially offset
by proceeds  from the sale of the  Company's  common stock  through stock option
exercises and purchases  under the employee stock purchase plan in the amount of
$ 1.2 million.

The Company entered into a $35 million  combined  revolving credit and term loan
agreement (the "Agreement") with Bank of America on June 30, 1999. The Agreement
provides a revolving line of credit "Revolver" in the amount of $15 million that
matures on May 31, 2002. The Revolver provides for a commitment fee based on the
unused balance, and at the Company's option,  interest at the prime rate, or the
LIBOR plus a 1.75% to 2.5% risk adjusted premium. The term loan facility, in the
amount of $20 million,  matures on May 31, 2001.  Borrowings under the Agreement
are limited to a multiple of earnings before interest, taxes, depreciation,  and
amortization  (EBITDA).  However,  the Company may convert,  at its option,  the
Revolver  portion of the  Agreement  into an  asset-based  loan whose  borrowing
availability would be a percentage of eligible billed and unbilled  receivables.
The  Agreement  also  requires   maintenance  of  certain  financial  covenants,
prohibits  the  payment of  dividends  among other  restrictions.  There were no
borrowings  outstanding  under this  Agreement  as of December  1999 or June 30,
2000.


                                       13

<PAGE>


                         OAO TECHNOLOGY SOLUTIONS, INC.
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)


Liquidity and Capital Resources (continued)

The Company  currently  anticipates  that its existing  cash balances as well as
cash generated from  operations will be sufficient to satisfy its operating cash
needs for the  foreseeable  future.  The Company has  announced  an  acquisition
program as part of its strategy to accelerate  revenues and earnings growth. The
Company expects to use bank credit to leverage the Company's financial position.
In addition,  the Company could consider  seeking  additional  public or private
debt or equity financing to fund future growth  opportunities.  No assurance can
be  given,  however,  that such  additional  debt or  equity  financing  will be
available to the Company on terms and conditions  acceptable to the Company,  if
at all.

Impact of the Year 2000 "Y2K" Issue

The Company  surveyed and  remediated  where  necessary  all of its business and
mission-critical  systems among other  procedures and tests,  as part of its Y2K
planning  process.  As of August 7, 2000,  the Company had not  experienced  any
significant Y2K related disruptions.

Item 3.

Quantitative and Qualitative Disclosures about Market Risk

The Company  conducts  business in foreign  countries,  primarily Canada and the
United Kingdom.  Foreign currency transaction gains and losses were not material
to the Company's results of operations for the three and six month periods ended
June 30,  2000 and 1999.  The Company  believes  its  foreign  currency  risk is
related  primarily to the difference  between  amounts the Company  receives and
disburses in Canada in U.S. Dollars from U.S. dollar denominated contracts.  The
Company  does not expect the amount of foreign  currency  risk to be material in
the future.  To date, the Company has not entered into any  significant  foreign
currency forward exchange contracts or other derivative financial instruments to
hedge the effects of adverse fluctuations in foreign currency exchange rates.


                                       14

<PAGE>


PART II - OTHER INFORMATION

Item 4. Submission Of Matters To A Vote Of Security Holders:


     A.   The Annual Meeting of Shareholders was held May 12, 2000 at the Latham
          Hotel in Washington, DC.

     B.   The  following  individuals  were  elected as  directors at the Annual
          Meeting:

                                             Votes For      Votes Withheld
          1.   Jerry L. Johnson              15,770,130        12,834
          2.   Cecile D. Barker              15,770,046        12,918
          3.   Gregory A. Pratt              15,770,616        12,348
          4.   Yvonne Brathwaite Burke       15,763,475        19,489
          5.   Frank B. Foster, III          15,767,826        15,138
          6.   John F. Lehman                15,770,476        12,488
          7.   Richard B. Lieb               15,770,206        12,758


     C.   Deloitte & Touche,  LLP,  independent  accountants,  were  selected as
          independent auditors for the fiscal year ending December 31, 2000 by a
          vote of 15,751,529 for, 28,510 against and 2,925 abstentions.


Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits
   Exhibit                                                                  Page
     No.                    Description                                      No.
-------------    ----------------------------------------
    27.1         Financial Data Schedule.  (1)                               17

(b)  No reports were filed on form 8-K during the quarter ended June 30, 2000.

---------------------------
(1)  Filed herewith.


                                       15

<PAGE>


                                   SIGNATURES

Pursuant to the  requirements  of the  Securities  and Exchange Act of 1934, the
Registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.

                              OAO Technology Solutions, Inc.
                              (Registrant)

Date: August 11, 2000     By: /s/ Gregory A. Pratt
                              --------------------------------------------------
                              Gregory A. Pratt
                              President and Chief Executive Officer

Date: August 11, 2000     By: /s/ J. Jeffry Fox
                              --------------------------------------------------
                              J. Jeffrey Fox
                              Vice President Finance and Chief Financial Officer

                                       16