FILER:

COMPANY DATA:
------------

COMPANY CONFORMED NAME:              YP.NET, INC.
CENTRAL INDEX KEY:                   0000875711
STANDARD INDUSTRIAL CLASSIFICATION:  INTERNET ADVERTISING
IRS NUMBER:                          85-0206668
STATE OF INCORPORATION:              NEVADA
FISCAL YEAR END:                     930

FILING VALUES:
-------------

FORM TYPE:                          10-QSB
SEC ACT:
SEC FILE NUMBER:                    00-24217
FILM NUMBER:

BUSINESS ADDRESS:
----------------

STREET 1:                            4840 EAST JASMINE STREET, SUITE 105
CITY:                                MESA
STATE:                               AZ
ZIP:                                 85205
BUSINESS PHONE:                      480-654-9646

MAIL ADDRESS:
-------------

STREET 1:                            4840 EAST JASMINE STREET, SUITE 105
CITY:                                MESA
STATE:                               AZ
ZIP:                                 85205


<PAGE>
                     U.S. Securities and Exchange Commission
                             Washington, D.C. 20549

                              ____________________

                                   FORM 10-QSB
                              ____________________

(Mark  One)
            [X] Quarterly Report Pursuant to Section 13 or 15(d) of
                      the Securities Exchange Act of 1934

            For  the  quarterly  period  ended  March  31,  2001

            [X] Transition  Report  Pursuant  to  Section  13  or  15(d)
                         of the Securities Exchange Act

            For the transition period from _____________ to _______________

                              ____________________

                         Commission File Number 0-24217
                              ____________________

                                  YP.NET, INC.
        (Exact name of small business issuer as specified in its charter)

           Nevada                                          85-0206668
(State  or  other  jurisdiction  of            (IRS Employer Identification No.)
incorporation or organization)

                         4840 East Jasmine St. Suite 105
                               Mesa, Arizona 85205
                    (Address of principal executive offices)

                                 (480) 654-9646
                           (Issuer's telephone number)

     Check whether the issuer (1) filed all reports required to be filed by
 Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
 shorter period that the registrant was required to file such reports), and (2)
       has been subject to such filing requirements for the past 90 days.

Yes     X          No
       ---               ---

     The  number of shares of the issuer's common equity outstanding as of March
31,  2001  was  41,450,798  shares  of  common  stock,  par  value  $.001.

     Transitional  Small  Business  Disclosure  Format  (check  one):

Yes               No      X
       ---               ---


<PAGE>


                                  YP.NET, INC.
                           INDEX TO FORM 10-QSB FILING
                      FOR THE QUARTER ENDED MARCH 31, 2001

     TABLE  OF  CONTENTS

     PART  I
     FINANCIAL  INFORMATION     PAGE

Item  1.  Financial  Statements
          Consolidated  Comparative  Balance  Sheets
               as  of  March  31,  2001 . . . . . . . . . . . . . . . . . .    2
          Consolidated  Statements  of  Operations
               for the Three Months and Six Months Ended
               March  31, 2001 (unaudited) and  2000 (unaudited). . . . . .    3
          Consolidated  Statements  of  Cash  Flows
               for  the  Three  Months  and  Six  Months
               Ended March 31, 2001 (unaudited) and 2000 (unaudited). . . .    4

          Notes  to  the  Consolidated  Financial  Statements . . . . . . .  5-7

Item  2.  Management's Discussion and Analysis of Financial Condition and
              Results  of  Operations . . . . . . . . . . . . . . . . . . . 8-11

                                     PART II
                                OTHER INFORMATION

Item  1.  Legal  Proceedings . . . . . . . . . . . . . . . . . . . . . . . 11-12
Item  2.  Changes  in  Securities. . . . . . . . . . . . . . . . . . . . .    12
Item  6.  Exhibits  and  Reports  on  Form  8-K. . . . . . . . . . . . . .    12


                                   SIGNATURES


<PAGE>
<TABLE>
<CAPTION>
                         PART I - FINANCIAL INFORMATION
ITEM  1.  FINANCIAL  STATEMENTS

                                  YP.NET, INC.
                                  CONSOLIDATED
                                 BALANCE SHEETS
                              AS OF MARCH 31, 2001
                                     ASSETS

                                                                      MARCH 31,
                                                                        2001
                                                                     (unaudited)
<S>                                                                  <C>
CURRENT ASSETS:
  Cash and Cash Equivalents                                          $  271,962
  Accounts Receivable                                                 2,817,783
  Prepaid Expenses                                                      118,280
  Direct Response Marketing - Net                                       151,753
  Deferred income taxes                                                 836,488
                                                                     -----------
     TOTAL CURRENT ASSETS                                             4,196,267
                                                                     -----------
PROPERTY AND EQUIPMENT:
  Furniture and Fixtures                                                197,260
  Equipment & Computer Equipment                                        258,183
  Leasehold Improvements                                                317,507
LESS: Accumulated Depreciation and Amortization                        (337,762)
                                                                     -----------
     TOTAL PROPERTY AND EQUIPMENT                                       435,188
                                                                     -----------
OTHER ASSETS:
  Intangible Assets                                                   5,010,000
  Deposits                                                               23,287
LESS: Accumulated Amortization                                         (858,333)
                                                                     -----------
     TOTAL OTHER ASSETS                                               4,174,954
                                                                     -----------
     TOTAL ASSETS                                                     8,806,410
                                                                     -----------
                      LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
  Trade Accounts Payable                                                 63,578
  Income Taxes Payable                                                  841,363
  Accrued Expenses                                                       46,494
  Finova Line-Of-Credit - Note 1                                        499,992
  Short-Term Notes Payable - Note 2                                     524,726
  Short-Term Notes Payables - Note 3                                    863,216
                                                                     -----------
     TOTAL CURRENT LIABILITIES                                        2,839,370
                                                                     -----------
LONG-TERM LIABILITIES:

  Deferred income taxes                                                 105,868
                                                                     -----------
     TOTAL LONG-TERM LIABILITIES                                        105,868
                                                                     -----------
     TOTAL LIABILITIES                                                2,945,238
                                                                     -----------
STOCKHOLDER' EQUITY:
  Common Stock $.001 par value, 50,000,000 shares                        40,836
    40,615,464 and 40,560,464 issued and outstanding
    For March 31, 2001.
  Additional Paid In Capital                                          5,445,587
  Treasury Stock                                                       (179,822)
  Retained Earnings                                                     554,572
                                                                     -----------
     TOTAL STOCKHOLDERS' EQUITY                                       5,861,173
     TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                      $8,806,410
                                                                     -----------
</TABLE>

       See the accompanying notes to these unaudited financial statements


                                        2
<PAGE>
<TABLE>
<CAPTION>
                                                        YP.NET,  INC.
                                        CONSOLIDATED  STATEMENTS  OF OPERATIONS
                  FOR THE THREE MONTHS AND SIX MONTHS  ENDED  MARCH  31,  2001  AND  MARCH  31,  2000

                                              Three  Month       Six Month       Three  Month         Six Month
                                                 Ended             Ended            Ended               Ended
                                            March 31, 2000    March 31, 2000    March 31, 2000    March 31, 2000
                                           ----------------------------------------------------------------------
                                                                          (unaudited)
<S>                                        <C>               <C>               <C>               <C>
INCOME
  Revenue                                  $     4,138,223   $     8,664,846   $     3,826,077   $     6,123,557
COST OF SALES                                    2,440,354         5,320,758         1,653,116         2,728,601
                                           ----------------  ----------------  ----------------  ----------------
GROSS PROFIT                                     1,697,869         3,344,088         2,172,961         3,394,956
                                           ----------------  ----------------  ----------------  ----------------

  SELLING EXPENSES                                  24,666            35,472               985            20,783

  GENERAL AND ADMINISTRATIVE                       564,800         1,138,504           777,242         2,312,101

  DEPRECIATION AND AMORTIZATION                    158,803           304,715           156,006           311.254
                                           ----------------  ----------------  ----------------  ----------------
    TOTAL EXPENSES                                 748,269         1,478,692           934,233         2,644,138
                                           ----------------  ----------------  ----------------  ----------------

    EARNINGS (LOSS) FROM OPERATIONS                949,599         1,865,397         1,238,728           750,818
                                           ----------------  ----------------  ----------------  ----------------

OTHER INCOME (EXPENSE)
  Other Income                                       6,776            16,212            13,204            35,247
  Interest Income/(Expense)                        (99,572)         (268,398)         (200,506)         (372,154)
                                           ----------------  ----------------  ----------------  ----------------
    TOTAL OTHER INCOME (EXPENSE)                   (92,796)         (252,186)         (187,302)         (336,907)
                                           ----------------  ----------------  ----------------  ----------------

  Net Income (Loss) Before Income Taxes            856,804         1,613,210         1,051,426           413,911

  Provisions for Income Taxes                      277,819           515,830          (100,494)              -0-
                                           ----------------  ----------------  ----------------  ----------------

NET INCOME (LOSS)                          $       578,984   $     1,097,380   $     1,151,920   $       413,907
                                           ================  ================  ================  ================

     EARNINGS (LOSS) PER SHARE:

       Basic Earnings (Loss) Per Share     $          0.01   $          0.03   $          0.03   $          0.01
                                           ================  ================  ================  ================

WEIGHTED AVERAGE NUMBER OF COMMON               39,667,871        40,108,701        40,695,622        40,230,409
                                           ================  ================  ================  ================
    SHARES OUTSTANDING

Diluted Earnings (Loss) Per Share          $          0.01   $          0.03   $          0.03   $          0.01
                                           ================  ================  ================  ================

WEIGHTED AVERAGE NUMBER OF COMMON               39,667,871        40,108,701        40,695,622        40,230,409
                                           ================  ================  ================  ================
AND COMMON SHARE EQUIVALENTS OUTSTANDING
</TABLE>

      See the accompanying notes to these unaudited financial statements


                                        3
<PAGE>
<TABLE>
<CAPTION>
                                                                YP.NET,  INC.
                                                 CONSOLIDATED  STATEMENTS  OF  CASH  FLOWS
                          FOR  THE  THREE  MONTHS  AND  SIX MONTHS ENDED MARCH 31, 2001 AND MARCH 31, 2000

                                                                Three           Six  Months           Three        Six  Months
                                                                Months             Ended              Months          Ended
                                                                Ended             March 31,       Ended  March      March 31,
                                                              March 31,             2001            31, 2000          2000
                                                                2001
                                                           ----------------------------------------------------------------------
<S>                                                        <C>               <C>               <C>               <C>
CASH FLOWS FROM OPERATING ACTIVITIES                            (unaudited)
  Net Income                                               $       578,984   $     1,097,380   $     1,151,920   $       413,911
  Adjustments to reconcile net income to net cash used by
  operating activities.
    Depreciation and amortization                                   45,045            77,208            36,006            71,254
    Officers & Consultants paid with common stock                      -0-            59,700            25,691           763,169
    Common stock surrendered                                      (384,310)         (494,310)          120,000           240,000
    Amortization of intellectual property                          113,750           227,500               -0-               -0-
    Income tax benefit                                             277,819           515,830          (100,494)              -0-

  (Increase) decrease in assets
    Trade accounts receivable                                    1,140,986           888,099        (1,135,405)       (1,706,357)
    Customer acquisition costs                                         -0-           138,846           (45,237)          147,588
    Other Receivables                                                  -0-               -0-               -0-            77,182
    Prepaid and other current assets                               127,150           (57,503)              -0-          (116,231)
    Other assets                                                   (10,000)          (10,000)           (3,081)           31,368

  Increase (decrease) in liabilities
    Trade accounts payable                                        (547,225)          (39,439)              311            16,469
    Accrued liabilities                                            (92,241)         (281,707)          (69,222)         (195,226)
    Deferred revenue                                                   -0-               -0-               -0-           (81,190)
                                                           ----------------  ----------------  ----------------  ----------------
        NET CASH PROVIDED (USED) IN
        OPERATING ACTIVITIES                                     2,121,604           (19,511)         (338,062)        1,249,959
CASH FLOWS FROM INVESTING ACTIVITIES
  Purchases of property and equipment                               (9,697)           (9,697)           (3,349)         (159,594)
                                                           ----------------  ----------------  ----------------  ----------------
        NET CASH USED BY INVESTING
        ACTIVITIES                                                  (9,697)           (3,349)         (159,594)           (9,697)
CASH FLOWS FROM FINANCING ACTIVITIES
    Advances from line of
    credit                                                             -0-               -0-            65,940           897,648
    Principal repayments on notes payable                       (1,237,631)       (2,059,559)         (100,000)         (550,665)
                                                           ----------------  ----------------  ----------------  ----------------
         NET CASH PROVIDED (USED) BY
         FINANCING ACTIVITIES                                   (2,059,559)          (34,060)          346,983        (1,237,631)
    NET INCREASE (DECREASE) IN CASH                                  2,630            52,349           (56,920)         (147,673)

       CASH AT BEGINNING OF PERIOD                                 269,331           219,613           164,570           255,323
                                                           ----------------  ----------------  ----------------  ----------------
          CASH AT END OF PERIOD                            $       271,961   $       271,961   $       107,650   $       107,650
                                                           ================  ================  ================  ================
</TABLE>

       See the accompanying notes to these unaudited financial statements


                                        4
<PAGE>
NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
FOR  THE  THREE  AND  SIX  MONTHS  ENDED  MARCH  31,  2001  AND  MARCH  31, 2000

1.  Basis  of  Presentation

The  accompanying  unaudited  financial  statements  represent  the consolidated
financial  position of YP.Net, Inc. ("the Company") for the three and six months
ended  March  31, 2001 and 2000 include results of operations of the Company and
Telco  Billing,  Inc. ("Telco"), its wholly owned subsidiary, and cash flows for
the  three  and six months ended March 31, 2001 and 2000.  These statements have
been  prepared  in  accordance  with  generally  accepted  accounting principles
("GAAP")for  interim financial information and the instructions for Form 10-QSB.
Accordingly,  they  do not include all the information and footnotes required by
generally  accepted accounting principles for complete financial statements.  In
the  opinion  of  management,  all  adjustments  to  these  unaudited  financial
statements  necessary  for  a  fair  presentation of the results for the interim
period  presented  have  been  made.  The  results  for the three and six months
period ended March 31, 2001 may not necessarily be indicative of the results for
the  entire  fiscal  year.  These  financial  statements  should  be  read  in
conjunction  with  the  Company's  Form  10-KSB for the year ended September 30,
2000,  including  specifically  the  financial  statements  and  notes  to  such
financial  statements  contained  therein.

2.  Summary  of  Significant  Accounting  Policies

The  accounting  policies  followed  by the Company, and the methods of applying
those  policies,  which  affect  the  determination  of  its financial position,
results  of  operations  and  cash  flows  are  summarized  below:

Cash  and  Cash  Equivalents
----------------------------

Cash  and  cash  equivalents  include all short-term liquid investments that are
readily  convertible  to  known  amounts of cash and have original maturities of
three  months  or  less.  At  times  cash deposits may exceed government insured
limits.

Principles  of  Consolidation
-----------------------------

The  consolidated  financial statements include the Company and its wholly owned
subsidiary,  Telco.  All  intercompany  accounts  in  consolidation  have  been
eliminated.

Revenue  Recognition
--------------------

The  Company's  revenue  is  generated by customer subscription of directory and
advertising  services.  Revenue is recognized monthly for services subscribed in
that specific month.  The Company utilizes outside billing companies to transmit
billing  data  that  is  forwarded to Local Exchange Carriers ("LECs").  Monthly
subscription fees are included on the telephone bills of the LEC customers.  The
Company  recognizes  revenue  based  on  net billings accepted by the LECs.  Net
billings result from gross submittals reduced by billing records rejected by the
LEC's  and adjusted for resubmittals.  Revenue is reported gross of fees charged
by  the  billing  company  and  the  LEC's.

Fair  Value  of  Financial  Instruments
---------------------------------------


                                        5
<PAGE>
The  carrying  amounts  for investments in marketable securities, trade accounts
receivable,  trade  accounts  payable,  accrued  liabilities  and notes payable,
approximate  their  fair  value  due to the short maturity of these instruments.
The  Company  has  determined  that the recorded amounts approximate fair value.

Net  Earnings  Per  Share
-------------------------

Net  earnings  per  share  are  calculated  using the weighted average number of
shares of common stock outstanding during the year.  The Company has adopted the
provisions  of Statement of Financial Accounting Standards No. 128, Earnings Per
Share.

Use  of  Estimates
------------------

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

Stock-Based  Compensation
-------------------------

Statements of Financial Accounting Standards No. 123, Accounting for Stock-Based
Compensation  ("SFAS  123"),  established accounting and disclosure requirements
using  a  fair-value  based  method  of  accounting  for  stock-based  employee
compensation.  In  accordance with SFAS 123, the Company has elected to continue
accounting  for  stock  based  compensation  using  the  intrinsic  value method
prescribed  by  Accounting  Principles  Board  Opinion  No.  25.

3.  Business  Combination

On  June  16,  1999, the Company exchanged 17,000,000 shares of its common stock
for  all  of  the  common  stock  of  Telco  (2,000  shares).

4.  Intangible  Asset

In  connection  with the Company's acquisition of Telco, the Company is required
to  provide payment of licensing fees for the use of the Internet domain name or
Universal  Resource Locator ("URL") Yellow-Page.Net.  The URL is recorded at its
                                    ---------------
cost  net  of  accumulated amortization.  The Company's management believes that
the Company's business is dependent on its ability to utilize this URL given the
recognition  of  the "yellow page" term.  The Company's management believes that
the  current  revenue  and  cash  flow  generated  using the URL Yellow-Page.Net
                                                                 ---------------
substantiates  the  net  book value of the asset.  The Company will periodically
analyze  the  net  book  value  of  this  asset  and determine if impairment has
incurred.  The  URL  is  amortized  on an accelerated basis over the twenty-year
term  of  the  licensing  agreement.

5.  Notes  Payable  and  Line  of  Credit

Notes  payables  are  recorded  and  interest  is accrued in accordance with the
individual terms of each note.  Notes payable at March 31, 2001 were as follows:

Note  1:  The  Company entered into an agreement with Finova Capital Corporation
-------
("Finova")  for  a  $3,000,000 revolving line of credit with interest payable at
the  prime  rate plus three percent.  The amount available to be drawn under the
line  of credit is limited to 80% of eligible accounts receivable.  At March 31,
2001  the  line of credit had an outstanding balance of $499,992.  Assets of the
Company, specifically accounts receivables, secure the line of credit.  The line
of  credit expires on August 31, 2003, and the institution may withdraw the line
with  a  notification  within  90  days.  Finova  gave notice that it desires to
withdraw  its  line  of  credit.  Since  that  time the Company has executed six
forbearance agreements dated August 15, 2000, November 3, 2000, January 3, 2001,


                                        6
<PAGE>
February 8, 2001, March 8, 2001, and May 8, 2001 respectively.  Each Forbearance
Agreement  has reduced the availability of funds to the Company from the Line of
Credit.  The  January  3,  2001  forbearance  reduced  the  line  of credit from
$1,500,000  to $1,000,000.  The February 8, 2001 forbearance reduced the line of
credit  from  $1,000,000 to a ceiling of $750,000. The March 8, 2001 forbearance
reduced the line of credit from $750,000 to a ceiling of $500,000, April 8, 2001
reducing  the  line of credit from $500,000 to a ceiling of $250,000, and in May
8,  2001 again forbearance reduced the line of credit from $250,000 to a ceiling
of  $125,000.  Management,  with  the co-operation of Finova had already reduced
the  outstanding  Balance  below  the  new  ceiling  prior  to  signing  the new
forbearance.  The Company can draw funds against the ceiling so long as eligible
accounts  receivable,  as  collateral  exceeds  the  ceiling.  This  existing
forbearance  expires  June  8,  2001

Note  2:  The  Company  entered into a loan agreement with Mr. Joseph Van Sickle
-------
during  the  acquisition  of Telco under which Mr. Van Sickle lent $2,000,000 to
the  Company.  At March 31, 2001 this note payable had an outstanding balance of
$524,726.  Mr. Van Sickle is a shareholder of the Company and owns approximately
one  percent of the Company's outstanding stock.  Mr. Van Sickle is not a member
of  management  and  currently  has no position on the Board of Directors of the
Company.

Note  3:  The Company entered into an agreement with Matthew & Markson, Ltd., an
-------
Antigua  corporation  ("M&M"),  in conjunction with the acquisition of Telco for
the  license  of  the  URL  Yellow-Page.Net.  The  Company  agreed  to  pay  M&M
                            ---------------
$5,000,000  to  license  URL  Yellow-Page.Net.   At  March 31, 2001 the M&M note
                              ---------------
payable  had  an outstanding balance of $863,216.  M&M owns approximately 20% of
the  Company's  outstanding  stock.

6.  Common  Stock

Transactions in the Company's common stock issued for the acquisition of assets,
products,  or  services  are  accounted for at 90% of fair value.  Fair value is
determined  based on the closing price of the Company's common stock on the date
of  the  transaction,  or  the  fair  value  of  the  asset, product, or service
received.

7.  Income  Taxes

The  Company  provides  for income taxes based on the provisions of Statement of
Financial Accounting Standards No. 109, Accounting for Income Taxes, which among
other  things, requires that recognition of deferred income taxes be measured by
the  provisions  of  enacted  tax  laws  in  effect  at  the  date  of financial
statements.  The provision for income taxes for interim periods is calculated on
the  basis  of  the  expected  effective  rate  for  the  full  year.


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

     Except  for  historical  information  contained  herein,  the  following
discussion  contains  forward-looking  statements  that  involve  risks  and
uncertainties.  Such forward-looking statements include, but are not limited to,
statements  regarding  future  events and our plans and expectations. Our actual
results  could differ materially from those discussed herein. Factors that could
cause  or  contribute to such differences include, but are not limited to, those
discussed elsewhere in this Form 10-QSB or incorporated herein by reference. See
"Forward-Looking  Statements"  below.

OVERVIEW

     YP.Net,  Inc.  ("we"  or  "our"  refers  to  the  "Company")was  originally
incorporated  in  Nevada in 1996 as Renaissance Center, Inc.  Renaissance Center
and  Nuclear  Corporation  merged  in  1997.  Our articles of incorporation were
restated  in  July  1997  and  our name was changed to Renaissance International
Group,  Ltd.  Our name was later changed to RIGL Corporation in July 1998.  With
the acquisition of Telco Billing, Inc. ("Telco"), the Company shift of the focus
of our business and changed its name to YP.Net, Inc., effective October 1, 1999.
The  new  name was chosen to reflect our focus on our Internet-based yellow page
services.

     We  provide  Internet-based  yellow  page  listing  services  on  our
Yellow-Page.Net  and YP.Net Web sites.  We acquired Telco in June 1999, changing
---------------      ------
our  primary  business  focus  to  become  an Internet-based yellow page listing
service.  Our  websites serve as a search engine for yellow page listings in the
United  States  and  Canada.  We charge our customers for a preferred listing of
their  businesses  on  our  websites.

     We  have  experienced  continued  increases  in competition in the Internet
yellow  page  market,  and  continue  to  seek  joint  venture  and  investment
acquisition  opportunities  to  potentially lessen the effects of competition in
the  electronic  yellow  page  markets.

     We  utilized  direct  mailings  as  our  primary marketing program. We have
experienced  some  attrition in our customer base since September 2000. However,
we  have  implemented a customer contact programs with the goals of assisting us
in  maintaining  our  customer base and growing our customer base without direct
mail  marketing  efforts. We resumed our direct mailing program in February 2001
on  a  limited  basis.  As  of  September  30,  2000,  we  had 130,592 customers
subscribing  to our services. As of March 31, 2001, we had 103,187 customers. We
believe  the  decrease  in our customer base for these periods was primarily the
result  of natural attrition we have not sent a direct mailer to customers since
June  2000  due  to our election to close any open issues with the Federal Trade
Commission.  We  have  continued  our  customer  contact  program  to attempt to
increase  our  customer  satisfaction and limit customer attrition. This program
has  and  will  continue  to  provide  decrease in attrition and better customer
satisfaction.

     Expenditures related to professional fees were significant in the three and
six months period ended March 31, 2001 and 2000.  Management believes that these
expenditures  will  not  be  as  significant in future periods.  Management also
believes  the  professional fees expended to reach an agreement with the Federal
Trade Commission has adversely effected our current earnings for the three month
and six months ended March 31, 2001.  Management is actively pursuing rescission
and  cancellation  of  certain  common  and  preferred stock that was previously
issued  for  services.  Management has presently entered into a written offer to
settle  this dispute with some of the recipients and the return of approximately
66%  of  the  disputed  shares  held  by  those recipients (approximately 82,000
shares).  If  offers to settle are rejected, legal action regarding the disputed
shares  may  adversely  affect  our  future  earnings  due to costs of potential
litigation.  If  we are successful in canceling some or all of these shares, our
total outstanding shares will decrease which could affect our earners per share.


                                        8
<PAGE>
     On  March 9, 2001, the Company retained S.G. Martin Securities LLC to serve
as  its  investment  banker for a one year period commencing March 9, 2001. S.G.
Martin  will assist in implementing the Company's strategic business and capital
formation  plans  and  programs.  They  will  also  assist  the  Company  in its
presentation to the brokerage community and with introductions to security firms
and  brokers  other  than  S.G.Martin.

     Our  new  co-branded  syndication  with I411.com has provided our preferred
customers  and  those  using  our  site  to  finds goods and services easier and
faster.  This arrangement has allowed us to have additional advertising space on
our  website  which  Management  believes will bring in additional revenue. With
I411.com  powering  our  sites we will have more pages with our "Look and Feel".
This has allowed us to have more control over content, which management believes
will  help  attract more people to our site.  The company now has the ability to
sell  syndicate  yellow  page  sites.  The  company is already able to offer our
client visible storefronts. Through visible storefronts our clients will be able
to  set  up  "Web  Stores"  easily  and  cheaply;  complete  with the ability to
utilitized credit cards to process orders. Management is currently testing these
products  and  believes  that  they  have  the  potential  to  add  income.

     Management  believes  that  our  Direct  Response Program if partnered with
other  reputable companies could be an additional source of revenue. The Company
has  embarked  on  a  program  to  find and solicit promotional partners for its
Direct  Response  Program  on  a  test  basis.

RESULTS  OF  OPERATIONS

     Our  Internet  yellow  page  services  is  currently the sole source of our
revenue.  Revenues  were  $4,138,223  and $8,664,846 for the three and six month
periods  ended  March  31,  2001,  respectively,  compared  to  $3,826,077  and
$6,123,557  for  three and six month periods ended March 31, 2000, respectively.
Until  other  sources  of  revenue  are  developed,  our  total revenues will be
directly  dependent  upon  the  number of customers subscribing to our preferred
listing  service.  We  are  presently,  seeking  other  revenue  sources  from
advertising  media  through  our  new  co-branding  agreement  with  I411.com.

     Cost  of  Sales  were  $2,440,354  and  $5,320,758  for three and six month
periods  ended  March  31,  2001,  respectively,  compared  to  $1,653,116  and
$2,728,601  for  three and six month periods ended March 31, 2000, respectively.
Cost  of sales is comprised of dilution expenses, direct mailer marketing costs,
allowances  for  bad  debt  and  our  billing  costs.  Dilution expenses include
customer  credits  and any other receivable write-downs.  Dilution expenses were
approximately  $1,754,068  for the three months ended March 31, 2001 compared to
$945,000  for  March 31, 2000.  Cost of sales inclusive of dilution expenses has
primarily increased because the expenses are directly related to the increase in
revenue.  Our  cost  of sales has increased also because an increase in dilution
primarily due to the increase in competitive local exchange carriers (CLEC) that
cannot  be  billed  through the LEC's.  We have made corrective steps to counter
the  increase  in  CLEC's  by  billing  on  credit  cards  and  ACH.

     Selling  expenses  were $24,666 and $35,472 for three and six month periods
ended  March  31, 2001, respectively, compared to $985 and $20,783 for three and
six  month  periods  ended  March  31,  2000,  respectively.  Selling  costs are
primarily  associated  with  general  advertising and marketing of other revenue
sources.


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<PAGE>
     General  and administrative expenses were $564,800 and $1,138,504 for three
and  six  month periods ended March 31, 2001, respectively, compared to $777,242
and  $2,312,101  for  three  and  six  month  periods  ended  March  31,  2000,
respectively.    These costs are primarily related to customer service staffing,
which  we believe provides better service to our customers. For the three months
ended March 31, 2001 our professional fees were 264,228 compared to $163,000 for
March  31,  2000,  due  primarily  to defending and negotiating with the Federal
Trade  Commission  related  to  the  allegations that the Company engaged in the
settlement  of  advertising  in  June  2000.

     Interest  expense net of interest income was $92,796 and $252,186 for three
and  six  month periods ended March 31, 2001, respectively, compared to $187,302
and $336,907 for three and six month periods ended March 31, 2000, respectively.
Interest  expense  was  a result of our outstanding debt.  This outstanding debt
included  debt  incurred  in  connection  with  the  acquisition  of  the  URL
Yellow-Page.Net.  The  reduction in interest expense is due to a decrease in the
----------------
amount  outstanding  under  our credit facility with Finova Capital Corporation,
Matthew  Markson  Ltd,  and  to  Joseph  and  Helen  Van  Sickle.

     Net  Income  was $578,985 or $.01 per diluted share, and $1,097,380 or $.03
per  diluted  share,  for the three and nine month periods ended March 31, 2001,
compared  to  $1,151,920,  or  $.03 per diluted share, and $413,907, or $.01 per
diluted share, for the three and nine month periods ended March 31, 2000. Unlike
prior  periods  the Net Income for the current period reflects the provision for
income  taxes  required  now  that the tax loss carry forwards for Telco billing
have  all  been  utilized.  The  decrease  in Net income is primarily due to the
attrition  of  our  customers  from reduced marketing efforts due to the Federal
Trade  Commssion's  requirements.  We  have  made corrective changes to increase
marketing  efforts.

LIQUIDITY  AND  CAPITAL  RESOURCES

     Cash  provided  by  operating  activities was $2,121,605 for the six months
period  ended  March  31, 2001, compared to cash used by operating activities of
($338,062) for the six months period ended March 31, 2000. Revenue was generated
solely  from  providing  electronic  yellow page listing advertising.  Cash from
operating  activities for the six months period ended March 31, 2001 was used to
increase  our  prepaid  expenses  ($57,503),  and  to  decrease  trade  accounts
receivables  by  $888,099; customer acquisition $138,846; trade accounts payable
($39,429);  and  accrued  liabilities ($281,707).  Cash in the six months period
ended  March  31,  2000 was generated by an increase in our accounts receivables
$1,706,3577,  in prepaid assets $116,231, and in accounts payable $16,469 and by
decreases  in  customer  acquisition  costs $147,588; other receivables $77,182;
accrued  liabilities  ($195,226);  and  deferred  revenue  ($81,190).

     Cash used by investing activities was $9,697 for the six month period ended
March 31, 2001, compared to $159,594 for the six months ended March 31, 2000. We
purchased additional computer equipment of $9,697 for March 31, 2001 compared to
$159,594  for  March  31,  2000.

     Cash  provided  by financing activities was $2,059,559 for six month period
ended  March  31,  2001,  compared  to  cash provided by financing activities of
$346,983  for  the  six  months  ended March 31, 2000.  The cash used represents
total  payments  made  to reduce the principle balances of the outstanding notes
for  March 31, 2001.  Cash provided by financing activities was $346,983 for the
six  months  period  ended  March  31,  2000;  we realized cash of $897,648 from
advances  on our line of credit and utilized $550,665 to pay notes payable.  The
$550,665  represents the total payments made to reduce the principal balances of
the  outstanding  notes.

     We have an existing asset collateralized line of credit with Finova Capital
Corporation ("Finova").  Because of certain defaults under the terms of the loan
agreement,  which occurred under prior management, Finova exercised its right to
terminate  the agreement.  We have entered into letter agreements whereby Finova
has agreed to forbear the exercise of any of its available remedies through June
8,  2001. Our line of credit has been reduced to $1,400,000 on November 6, 2000;
reduced  to  $1,200,000 on December 5, 2000; reduced to $1,000,000 on January 6,


                                       10
<PAGE>
2001;  reduced  to $750,000 on February 8, 2001; reduced to $500,000 on March 8,
2001,  reduced  to  $250,000  April  8,  2001, reduced to $0.00 on June 8, 2001.
Management  is  seeking  other  potential  lenders  that specialize in financing
businesses  utilizing  LEC billings.  We do not anticipate these changes to have
an  adverse  affect  on our ability to continue operating at our current levels.

OTHER  CONSIDERATIONS

     There are numerous factors that affect the Company business and the results
of  its  operations.  Sources  of  these  factors  include  general economic and
business  conditions,  federal  and state regulation of our business activities,
the  level of demand for our services, the level and intensity of competition in
the  Internet-based  yellow  page  industry  and  the pricing pressures that may
result,  our ability to develop new services based on new or evolving technology
and  the  market's  acceptance  of those new services, our ability to timely and
effectively  manage  periodic  product  transitions,  the services, customer and
geographic  sales  mix  of any particular period, and our ability to continue to
improve  our  infrastructure (including personnel and systems) to keep pace with
the  growth  in  its  overall  business  activities.

FORWARD-LOOKING  STATEMENTS

     Except  for  historical  information  contained  herein,  this  Form 10-QSB
contains  express  or  implied  forward-looking statements within the meaning of
Section  27A  of the Securities Act of 1933 and Section 21E of the Exchange Act.
We  intend  that  such forward-looking statements be subject to the safe harbors
created  thereby.  We  may  make written or oral forward-looking statements from
time  to  time  in filings with the SEC, in press releases, quarterly conference
calls  or otherwise.  The words "believes," "expects," "anticipates," "intends,"
"forecasts,"  "project,"  "plans,"  "estimates" and similar expressions identify
forward-looking  statements.  Such  statements  reflect  our  current views with
respect  to future events and financial performance or operations and speak only
as  of  the  date  the  statements  are  made.

     Forward-looking  statements involve risks and uncertainties and readers are
cautioned not to place undue reliance on forward-looking statements.  Our actual
results  may  differ  materially  from  such  statements.  Factors that cause or
contribute  to such differences include, but are not limited to, those discussed
elsewhere  in  this  Form  10-QSB, as well as those discussed in our Form 10-KSB
which  is  incorporated  by  reference  in  this  Form  10-QSB.

     Although  we  believe  that  the assumptions underlying the forward-looking
statements  are  reasonable,  any of the assumptions could prove inaccurate with
the  result  that  there  can  be  no assurance the results contemplated in such
forward-looking  statements  will  be  realized.  The  inclusion  of  such
forward-looking information should not be regarded, as a representation that the
future  events,  plans,  or  expectations  contemplated  will  be  achieved.  We
undertake  no  obligation  to  publicly  update,  review,  or  revise  any
forward-looking  statements  to  reflect  any  change in our expectations or any
change  in  events,  conditions,  or  circumstances on which any such statements
based.  Our  filings with the SEC, including the Form 10-KSB, may be accessed at
the  SEC's  Web  site,  www.sec.gov.
                        ------------


                           PART II - OTHER INFORMATION

ITEM  1.  LEGAL  PROCEEDINGS

     YP.Net  is involved in various legal proceedings and claims as described in
our  Form  10-KSB  for  the  year  ended  September  30,  2000.


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<PAGE>
     We  settled  YP.Net,  Inc  vs.  BJM Consulting, Inc. ("BJM") on January 11,
2001. BJM has agreed to return 500,000 shares of the Company's common stock that
was issued by prior management and has agreed to return the stock since they did
not  perform the services required by its contract. By a further prior agreement
YP.Net purchased additional consulting services from BJM Consulting Inc. Payment
for  those  new  services  that  began  in October of 2000 was 500,000 shares of
common  stock  and  was  to  be  paid in full upon completion and was not deemed
earned  until  fully completed. Those service were to include but not be limited
to  advise the Company on the availability of potential lenders in the Company's
market  niche, assist in evaluating potential Public Relation firms and Investor
Relations  firms,  and  contact  market makers to regain our listing on the OTC:
Bulletin  Board  and to provide other financial services. These services will be
rendered in a three months period and was completed during this period. No other
material  developments  have  occurred  in  any  of these proceedings. The costs
associated with these legal proceedings could be significant and could adversely
affect  the  results  of  our future operations. An unfavorable result in any of
these  proceedings  could also adversely affect our operations. The stock issued
to  BJM  Consulting,  Inc.  is  restricted  common shares under 144 rules with a
one-year  restriction. The stock has been recorded at 90% of average bid and ask
price  as  of  January  11,  2001.

     On  June  26,  2000  the Federal Trade Commission ("FTC") filed a complaint
against  the  Company  and  other defendants alleging that the Company and other
defendants  were  engaged  in  deceptive  advertising  practices  and  sought  a
preliminary  injunctive and the appointment of a receiver business and to freeze
all  our  assets.  The  alleged  deceptive  practices  related to a check mailer
solicitation utilized in our marketing activities.  On July 13, 2000, YP.Net and
all other defendants entered into a global settlement with the FTC, resulting in
dismissal of the receiver and termination of the asset freeze.  Subsequently, we
have  met  with  the  FTC  and anticipate a final settlement of the matter to be
negotiated.  The  legal  fees  and litigation related to the FTC allegation have
adversely  affected  our  profitability  and  caused our marketing efforts to be
greatly  curtailed.  We have entered into a Stipulated Final Judgement and Order
For  Permanent  Injunction  and  other  Equitable  Relief  with the FTC.  We are
waiting  final  signature from the Honorable Stephen M. McNamee and at that time
the order will become permanent.  The company has never admitted liability.  The
order,  in the opinion of management, should not materially and adversely effect
the  Company's  business.


ITEM  2.  CHANGES  IN  SECURITIES

     In  January 11, 2001 YP.Net issued 500,000 common shares to BJM Consulting,
Inc.  as  payment  for  completion  of specific services rendered. In a separate
agreement  that  resolved  a  dispute  between  the parties BJM Consulting, Inc,
agreed  to  return all of the pervious shares received for work not completed in
the  amount  of  500,000  common  shares.  (Refer  to  Part  II,  Item  1 "Legal
Proceedings")  The  shares  were  issued  in  reliance  on  the  exemption  from
registration  provided  by  Section  4(2)  of  the  Securities  Act  of  1933.


     ITEM  6.  EXHIBITS  AND  REPORTS  ON  FORM  8-K

EXHIBITS

10.1     S.G.  Martin  Securities  LLC

REPORTS  ON  FORM  8-K

     No  reports  on Form 8-K were filed during the three months ended March 31,
2001.


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<PAGE>
                                   SIGNATURES


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

                              YP.NET,  INC.




Dated:  March  15,  2001      By      /s/  Angelo  Tullo
                                    -----------------------------------------
                                     Angelo  Tullo,  Chairman  of  the  Board


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