<PAGE>

================================================================================

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                   FORM 10-K/A

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

                   For The Fiscal Year Ended December 31, 2001

                                       OR

[_]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     E0XCHANGE ACT OF 1934 For the Transition Period From _______ to _______.

                         COMMISSION FILE NUMBER: 0-27644

                        Digital Generation Systems, Inc.
             (Exact Name of Registrant as Specified in its Charter)

            Delaware                                            94-3140772
(State or Other Jurisdiction of                              (I.R.S. Employer
 Incorporation or Organization)                           Identification Number)

                   750 West John Carpenter Freeway, Suite 700
                               Irving, Texas 75039
          (Address Of Principal Executive Offices, Including Zip Code)

                                 (972) 581-2000
              (Registrant's Telephone Number, Including Area Code)

        Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to the Section 12 (g) of the Act: common stock
                                                                 ($0.001 par
                                                                 value)

     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months and (2) has been subject to such filing
requirements for the past 90 days. YES [X] NO [_]

    Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [_]

    The aggregate market value of the common stock held by non-affiliates of the
registrant, based upon the closing sale price of the common stock on March 31,
2002, as reported on the Nasdaq National Market, was approximately $80.7
million. Shares of common stock held by each officer and director of the
registrant and by each person who may be deemed to be an affiliate have been
excluded. This determination of affiliate status is not necessarily a conclusive
determination for other purposes.

    As of March 31, 2002, the registrant had 70,784,475 shares of common stock
outstanding.

================================================================================

                                       1

<PAGE>

                                 AMENDMENT NO. 1

The undersigned Registrant hereby amends Part III, to read as follows:

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

    Name                             Age    Title(s)
    ----                             ---    --------
    Scott K. Ginsburg (2)             49    Chairman of the Board
    Matthew E. Devine                 53    Chief Executive Officer and Director
    Omar A. Choucair                  40    Chief Financial Officer and Director
    Lawrence D. Lenihan, Jr. (2)      37    Director
    David M. Kantor (2)               45    Director
    Cappy R. McGarr (1)               50    Director
    Jeffrey A. Dankworth              46    Director
    Eric L. Bernthal                  55    Director
    Robert J. Schlegel (1)            52    Director
    Kevin C. Howe (1)                 53    Director

(1) Member of the Audit Committee
(2) Member of the Compensation Committee

    Scott K. Ginsburg joined the Company in December 1998 as Chief Executive
Officer and Chairman of the Board. In July 1999, Matthew E. Devine assumed the
responsibilities of Chief Executive Officer, but Mr. Ginsburg remains the
Company's Chairman. Most recently Mr. Ginsburg served as Chief Executive Officer
and Director of AMFM Corporation (formerly Chancellor Media). Mr. Ginsburg
founded Evergreen Media Corporation in 1988, and was the co-founder of Statewide
Broadcasting, Inc. and H&G Communications, Inc. Mr. Ginsburg earned a B.A. from
George Washington University in 1974 and a J.D. from the George Washington
University Law Center in 1978.

    Matthew E. Devine joined the Company in July 1999 as Chief Executive Officer
and Director. Prior to joining the Company, Mr. Devine served as Chief Financial
Officer of AMFM Corporation (formerly Chancellor Media) and served as Chief
Financial Officer, Executive Vice President, Treasurer, Secretary and Director
for Evergreen Media Corporation. Between 1975 and 1988, Mr. Devine served in
various finance positions at AMR Corporation, parent company to American
Airlines.

    Omar A. Choucair joined the Company as Chief Financial Officer in July
1999. Prior to joining the Company, Mr. Choucair served as Vice President of
Finance for AMFM Corporation (formerly Chancellor Media), and served as Vice
President of Finance for Evergreen Media before it was acquired by Chancellor
Media in 1997. Prior to entering the media industry, Mr. Choucair was a Senior
Manager at KPMG LLP, where he specialized in media and telecommunications
clients. Mr. Choucair received a B.B.A. from Baylor University and is a
Certified Public Accountant. Mr. Choucair became a Director in February 2001.

    Lawrence D. Lenihan, Jr. has been a member of the Board of Directors of the
Company since July 1997. Mr. Lenihan is a Managing Director and co-head of the
Pequot venture funds and the Pequot private equity funds. Prior to joining
Pequot in 1996, Mr. Lenihan was a principal with Broadview Associates L.L.C.
("Broadview"), a technology oriented investment-banking firm. Prior to joining
Broadview, Mr. Lenihan held several positions at IBM, including the leader of
the interactive multimedia software product business. Mr. Lenihan graduated from
Duke University with a B.S. in Electrical Engineering and he holds an M.B.A.
from the Wharton School of Business at the University of Pennsylvania. He
currently serves on the Board of Directors of Netegrity, Inc. and USSearch.com,
Inc., as well as several other private companies.

                                       2

<PAGE>

    David M. Kantor has been a member of the Board of Directors of the Company
since August 1999. Mr. Kantor is a media industry consultant. Formerly, he was
Senior Vice President for Network Operations of AMFM, Inc. (formerly Chancellor
Media Corporation) and President of ABC Radio Network, having previously served
as Executive Vice President. Prior to joining ABC Radio Network, he held
executive positions with Cox Cable and Satellite Music Network. Mr. Kantor holds
a B.S. from the University of Massachusetts and an MBA from Harvard Business
School.

    Cappy R. McGarr has been a member of the board since February 2001. Mr.
McGarr is President of McGarr Capital Holdings, LLC, a firm specializing in
managing domestic and offshore hedge funds. He received Bachelor of Arts,
Bachelor of Journalism and Master of Business Administration degrees from the
University of Texas at Austin. Upon completing his graduate degree in 1970,
McGarr was employed by Goldman, Sachs & Co. He serves on the Board of Trustees
of The John F. Kennedy Center for the Performing Arts and the Board of Directors
of the Lyndon Baines Johnson Foundation.

    Jeffrey A. Dankworth has been President and a Director of StarGuide since
1995 and a director of the Company since February 2001. Prior to co-founding
StarGuide in 1994, Mr. Dankworth was an entrepreneur in the entertainment media
and professional sports industries where he led the development of various media
joint ventures in professional sports including the NFL Quarterback Club. As an
attorney, Mr. Dankworth has extensive experience in various areas of business
development, including the negotiation and management of media partnerships,
licensing programs, and joint ventures. Between 1984 and 1994, Mr. Dankworth was
Of Counsel with the law firm of Mitchell, Silberberg & Knupp and prior to that
was an associate with the law firm of Gibson, Dunn & Crutcher (1981-1984).

    Eric L. Bernthal has been a member of the board since February 2001. Mr.
Bernthal is the Managing Partner of the Washington, DC office of Latham &
Watkins, a law firm with more than 1,400 attorneys worldwide. He has practiced
corporate and telecommunications law for 30 years, specializing in transactional
and regulatory matters. Mr. Bernthal has represented companies in the media,
communications, health care, consumer products and retail industries. Mr.
Bernthal has been a partner in Latham & Watkins since 1986. Prior to joining
Latham, Mr. Bernthal was an associate and then a partner in the Washington, DC
law firm of Arent, Fox, Kintner, Plotkin & Kahn, from 1972 to 1986. He served on
that law firm's Executive Committee for five years. Mr. Bernthal served as law
clerk to the Honorable Ruggero J. Aldisert of the United States Court of Appeals
for the Third Circuit in Philadelphia from 1970 to 1972. He earned an
undergraduate degree from Columbia University in 1967 and a graduate degree from
George Washington University Law Center.

    Robert J. Schlegel has been a member of the board since February 2001. Mr.
Schlegel has been the CEO of The Pavestone Company, a manufacturer of
decorative, environmental-friendly concrete landscape products, since 1980. Mr.
Schlegel also built a health care company, PeopleCare Heritage Centers,
including 2,200 nursing retirement care beds in 13 Texas facilities. Mr.
Schlegel has been actively involved in the Dallas community with the Trinity
Christian Academy, the Cox School of Business at Southern Methodist University,
the Salvation Army, Students in Free Enterprise, the Alzheimer's Association,
the Dallas Symphony, the Young Presidents' Organization and his own foundation,
the Schlegel Horizons Foundation. Mr. Schlegel graduated with a B.A. degree in
Economics from Wilfrid Laurier University in 1972.

    Kevin C. Howe is the Managing Partner of Mercury Ventures. Mercury Ventures
manages 3 different funds that invest in emerging technology companies that
focus on Internet applications. Mr. Howe serves on the board of three publicly
traded technology firms that are listed on the Nasdaq and London exchanges and
has been a member of the Board since February 2001. Mr. Howe also sits on the
boards of five privately held technology firms. In 1985, he co-founded DacEasy,
an early leader in packaged application software. In 1987, Mr. Howe led the sale
of DacEasy to Insilco (a Fortune 500 company). In 1991, Mr. Howe led the
carve-out of DacEasy from Insilco and subsequent sale to Sage Group, plc. which
had market capitalization of over $7 billion. He was CEO of the US operations
responsible for operations and acquisitions until 1999. He remains a director of
Sage. In 1993, Mr. Howe also co-founded Martin Howe Associates, which was an
early leader in the merchant credit card processing industry and a pioneer in
wireless solutions. The company was sold in 1997 to PMT, a Nasdaq listed
company. Mr. Howe received his MBA from SMU in 1976.

                                       3

<PAGE>

    Information regarding the executive officers of the Company are included
under Item 4A - Executive Officers of the Registrant.

                       SECTION 16 (a) BENEFICIAL OWNERSHIP
                              REPORTING COMPLIANCE

    The members of the Board of Directors, the executive officers of the Company
and persons who hold more than 10% of the Company's outstanding common stock are
subject to the reporting requirements of Section 16 (a) of the Securities
Exchange Act of 1934, as amended, which require them to file reports with
respect to their ownership of the Company's common stock and their transactions
in such common stock. Based upon (i) the copies of Section 16 (a) reports that
the Company received from such persons for their 2001 fiscal year transactions
in the common stock and their common stock holdings and (ii) the written
representation received from one or more of such persons that no annual Form 5
reports were required to be filed by them for the 2001 fiscal year, the Company
believes that all reporting requirements under Section 16 (a) for such fiscal
year were met in a timely manner by its executive officers, Board members and
greater than ten-percent shareholders at all times during the 2001 fiscal year.

ITEM 11.  EXECUTIVE COMPENSATION

     The following Summary Compensation Table sets forth the compensation earned
by the Company's Chief Executive Officer and the four other most highly
compensated executive officers (collectively, the "Named Officers").

<TABLE>
<CAPTION>
                                                                                                      Long-Term
                                                        Annual Compensation (1)               Compensation Awards (1)
                                               -----------------------------------------      -----------------------
                                                                                              Restricted   Securities
                                                                            Other Annual        Stock      Underlying
Name and Principal Position            Year      Salary         Bonus       Compensation        Awards       Options
---------------------------            -------------------------------------------------      -----------------------
<S>                                    <C>     <C>            <C>           <C>               <C>          <C>
Scott K. Ginsburg                      2001    $ 250,000      $      -      $    167,542 (2)           -       50,000
    Chairman of the Board              2000    $  50,000      $      -      $    180,006 (2)           -            -
                                       1999    $  52,083      $      -      $    301,243 (2)           -      433,000

Matthew E. Devine                      2001    $ 250,000      $      -      $     12,000 (3)           -       50,000
    Chief Executive Officer            2000    $ 250,000      $      -      $     12,000 (3)           -            -
                                       1999    $  52,083      $      -      $          -               -    1,433,300

Omar A. Choucair                       2001    $ 175,000      $      -      $          -               -       50,000
    Chief Financial Officer            2000    $ 150,000      $      -      $          -               -            -
                                       1999    $  31,250      $      -      $          -               -      423,320

Jeffrey A. Dankworth                   2001    $ 250,000      $      -      $     10,800 (3)           -       50,000
    President of StarGuide Digital     2000    $ 250,000      $      -      $     10,800 (3)           -            -
    Networks, Inc.                     1999    $ 250,000      $ 60,184      $     10,800 (3)           -      173,320

Robert C. Ryan                         2001    $ 275,000      $       -     $    420,733 (4)           -       50,000
    General Intellectual Property      2000    $ 203,624      $ 20,376      $          -               -            -
    Counsel of StarGuide Digital       1999    $ 160,648      $ 19,000      $          -               -      173,320
    Networks, Inc.
</TABLE>

                                       4

<PAGE>

          (1)  Annual compensation amounts and long-term compensation awards for
               2000 and 1999 represent the combined amounts and awards for
               services performed by the individuals related to both Digital
               Generation Systems, Inc. and StarGuide Digital Networks, Inc.

          (2)  For 2001, represents various perquisites, including reimbursement
               of automobile expenses ($12,000) and travel expenses ($155,542).
               For 2000, represents various perquisites, including reimbursement
               of automobile expenses ($12,000) and travel expenses ($168,000).
               For 1999, represents various perquisites, including reimbursement
               of premiums for life insurance ($13,243), automobile expense
               ($18,000) and travel expenses ($270,000).

          (3)  Represents reimbursement of automobile expenses.

          (4)  Forgiveness of loan ($400,000), and medical expense reimbursement
               ($20,733).


     The following table contains information concerning the stock option grants
made to each of the Named Officers for 2001. No stock appreciation rights were
granted to these individuals during such year.


<TABLE>
<CAPTION>
                                              Individual Grant (1)                      Potential Realizable
                           ------------------------------------------------------
                           Number of        % Of Total                                    Value at Assumed
                           Securities        Options        Exercise                    Annual Rates of Stock
                           Underlying       Granted to       Price                       Price Appreciation
                            Options         Employees         Per      Expiration        For Option Term
Name                        Granted          In 2001         Share        Date          5%             10%
----                       ------------------------------------------------------    -------------------------
<S>                        <C>              <C>            <C>         <C>           <C>             <C>
Scott K. Ginsburg              50,000          2.8%        $ 3.3125     01/17/08     $ 67,426        $157,131

Matthew E. Devine              50,000          2.8%        $ 3.3125     01/17/08     $ 67,426        $157,131

Omar A. Choucair               50,000          2.8%        $ 3.3125     01/17/08     $ 67,426        $157,131

Jeffrey A. Dankworth           50,000          2.8%        $ 3.3125     01/17/08     $ 67,426        $157,131

Robert C. Ryan                 50,000          2.8%        $ 3.3125     01/17/08     $ 67,426        $157,131
</TABLE>

          1.   Each of the options listed above have a term of 7 years, subject
               to earlier termination upon termination of employment. In the
               event of a merger of the Company with or into another corporation
               or other legal entity, where vested options have not been assumed
               or substituted by such successor corporation or other entity,
               such options will be exercisable for a period for a period of 15
               days from the date of notice thereof, and will terminate upon the
               expiration of such period. The Company's 1992 Stock Option Plan
               provides that upon a change in control, the unvested options
               granted to each of the Company's executive officers will be
               subject to accelerated vesting to the extent of 50% of such
               unvested options. A change in control is defined as (i) merger or
               acquisition of the Company resulting in a 50% or greater change
               in the total voting power of the Company immediately following
               such transaction, or (ii) certain changes in the majority
               composition of the Company's Board of Directors during a 24-month
               period, which changes are not initiated by the Board of
               Directors.

                                       5

<PAGE>

         The following table sets forth information concerning option exercises
during the 2001 fiscal year and option holdings as of the end of the 2001 fiscal
year with respect to each of the Named Officers. No stock appreciation rights
were outstanding at the end of the year.

<TABLE>
<CAPTION>
                                                                 Number of Securities          Value of Unexercised
                                                                Underlying Unexercised             in-the-Money
                                                                  Options at Fiscal              Options at Fiscal
                            Shares Acquired     Value                  Year End                    Year End (1)
Name                          on Exercise      Realized      Exercisable    Unexercisable   Exercisable    Unexercisable
----                          -----------      --------      -----------    -------------   -----------    -------------
<S>                            <C>           <C>             <C>            <C>             <C>            <C>
Scott K. Ginsburg                     -      $         -         433,300           50,000      $   -         $     -


Matthew E. Devine                     -      $         -       1,257,231          226,069      $   -         $     -


Omar A. Choucair                      -      $         -         395,695           77,625      $   -         $     -


Robert C. Ryan                  347,826      $   186,957        371, 452           50,000      $   -         $     -


Jeffrey A. Dankworth                  -      $         -         173,320           50,000      $   -         $     -
</TABLE>

       (1)  Based on the fair market value of the Company's common stock at
            December 31, 2001, of $1.11 per share, less the exercisable price
            payable for each share.

DIRECTOR COMPENSATION

     Except for grants of stock options, directors of the Company generally do
not receive compensation for services provided as a director other than
reimbursement for documented reasonable expenses incurred in connection with
attendance at meetings of the Company's Board of Directors and the committees
thereof. The Company also does not pay compensation for committee participation
or special assignments of the Board of Directors.

     Non-employee Board members are eligible for option grants pursuant to the
provisions of the Company's 1995 Director Option Plan. The exercise price per
share of all options granted under the 1995 Director Option Plan shall be equal
to the fair market value of a share of the Company's common stock on the date of
grant of the option. The terms of the options granted are ten years.

     Directors who are also employees of the Company are eligible to receive
options for common stock directly under the 1992 Stock Option Plan and, if
officers of the Company, are eligible to receive incentive cash bonus awards and
are eligible to participate in the 1996 Employee Stock Purchase Plan.

EMPLOYMENT CONTRACTS AND CHANGE IN CONTROL ARRANGEMENTS

     None of the Company's current executive officers have employment or
severance agreements with the Company, and their employment may be terminated at
any time at the discretion of the Board of Directors.

COMPENSATION COMMITTEE REPORT

     The Compensation Committee of the Company's Board of Directors (the
"Compensation Committee" or the "Committee") reviews and approves the Company's
compensation policies. The following is the report of the Compensation Committee
describing the compensation policies applicable to the compensation of the
Company's Chief Executive Officer and other executive officers for the 2001
fiscal year.

                                       6

<PAGE>

     For the 2001 fiscal year, the process utilized by the Committee in
determining executive officer compensation levels was based on the subjective
judgment of the Committee. Among the factors considered by the Committee were
the recommendations of the CEO with respect to the compensation of the Company's
key executive officers. However, the Committee made the final compensation
decisions concerning such officers.

     GENERAL COMPENSATION PHILOSOPHY. The Company's philosophy in setting its
compensation policies for executive officers is to maximize shareholder value
over time. The primary goal of the Company's executive compensation program is,
therefore, to closely align the interests of the executive officers with those
of the Company's shareholders. To achieve this goal, the Company attempts to (i)
offer compensation opportunities that attract and retain executives whose
abilities are critical to the long-term success of the Company, motivate
individuals to perform at their highest level and reward outstanding
achievement, (ii) maintain a portion of the executive total compensation at
risk, with payment of that portion tied to achievement of financial,
organizational and management performance goals, and (iii) encourage executives
to manage from the perspective of owners with an equity stake in the Company.
The Compensation Committee currently uses salary, incentive cash bonus awards
and long-term stock-based incentives to meet these goals.

     BASE SALARY. The base salary component of total compensation is primarily
designed to attract, motivate, reward and retain highly skilled executives and
to compensate executives competitively within the industry and the marketplace.
In establishing base salaries of executive officers, the Compensation Committee
evaluates each executive's salary history, scope of responsibility at the
Company, prior experience, past performance for the Company, expected
contribution to the Company's future success and recommendations from
management. The Compensation Committee also takes into account the salaries for
similar positions at comparable companies in the Company's industry, based on
each individual Committee member's industry experience, and the position of each
executive officer's base pay relative to the total compensation package,
including cash incentives and long-term stock based incentives. In making its
salary decisions, the Compensation Committee exercised its discretion and
judgment based upon these factors. No specific formula was applied to determine
the weight of each factor.

     INCENTIVE CASH BONUSES. Each executive officer's annual bonus is based on
qualitative and quantitative factors and is intended to motivate and reward
executive officers by directly linking the amount of the bonus to performance
targets. In addition, incentive bonuses for executive officers are intended to
reflect the Compensation Committee's belief that the compensation of each
executive officer should be contingent upon the overall performance of the
Company. To carry out this philosophy, the Board of Directors reviews and
approves the financial goals for the fiscal year. The Compensation Committee
then evaluates the overall performance of the Company and approves performance
bonuses based on the extent to which the goals of the Board of Directors have
been achieved. During fiscal 2001, the Board of Directors and/or the
Compensation Committee, in their discretion, did not approve any cash bonuses to
the CEO or executive officers.

     LONG-TERM INCENTIVE COMPENSATION. The Compensation Committee views stock
option grants as an important component of its long-term, performance-based
compensation philosophy. The Company considers long-term incentives to its Chief
Executive Officer and its other executive officers. The purpose of such option
grants is to attract and retain the best employee talent available and to create
a direct link between executive compensation and the long-term performance of
the Company. The Compensation Committee believes that stock options directly
motivate its executive officers to maximize long-term shareholder value. The
options also utilize vesting periods that encourage key executives to continue
in the employ of the Company. All options granted to executive officers to date
have been granted at the fair market value of the Company's common stock on the
date of grant. Accordingly, the option will provide a return to the executive
officer only if he or she remains employed by the Company, and then only if the
market price of the Company's common stock appreciates over the option term. The
Board of Directors and/or the Compensation Committee consider the grant of each
option subjectively, considering factors such as the individual performance of
the executive officer and the anticipated contribution of the executive officer
to the attainment of the Company's long-term strategic performance goals. During
fiscal 2001, the Board of Directors and/or the Compensation Committee, in their
discretion, did not make option grants to the CEO or executive officers.

                                       7

<PAGE>

     CEO COMPENSATION. On July 22, 1999, Mr. Devine was appointed the Chief
Executive Officer of the Company. Effective August 1, 1999, Mr. Devine's annual
salary was established at $125,000 each for DGS and StarGuide, resulting in a
total annual salary of $250,000 for 2001 as a result of the merger. Mr. Devine's
compensation was based on his experience and responsibility as well as
compensation offered to similarly situated executives.

     TAX LIMITATION. Under the Federal tax laws, a publicly held company such as
the Company will not be allowed a federal income tax deduction for compensation
paid to certain executive officers to the extent that compensation exceeds $1
million per officer in any year. To qualify for an exemption from the $1 million
deduction limitation, the shareholders were asked to approve a limitation under
the Company's 1992 Stock Option Plan on the maximum number of shares of common
stock for which any one participant may be granted stock options per calendar
year. Because this limitation was adopted, any compensation deemed paid to an
executive officer when he or she exercises an outstanding option under the 1992
Stock Option Plan with an exercise price equal to the fair market value of the
option shares on the grant date will qualify as performance-based compensation
that will not be subject to the $1 million limitation. Since the cash
compensation paid to the Company's executive officers for the 2001 fiscal year
did not exceed the $1 million limit per officer and it is not expected that the
cash compensation to be paid to any executive officer for the 2002 fiscal year
will exceed this limit, the Committee will defer any decision on whether to
limit the dollar amount of all other compensation payable to the Company's
executive officers to the $1 million cap.

     COMPENSATION COMMITTEE:

         Scott K. Ginsburg
         Lawrence D. Lenihan, Jr.
         David M. Kantor

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

     The members of the Compensation Committee are Messrs. Ginsburg, Lenihan and
Kantor. Other than Mr. Ginsburg, the Company's Chairman of the Board and former
Chief Executive Officer, none of these individuals was at any time during 2001,
or at any other time, an officer or employee of the Company.

     No executive officer of the Company serves as a member of the board of
directors or compensation committee of any entity that has one or more executive
officers serving as a member of the Company's Board of Directors or Compensation
Committee. See Item 13 regarding certain shares received by Mr. Ginsburg in
connection with the merger.

STOCK PERFORMANCE TABLE

     The table set forth below compares the cumulative total shareholder return
on the Company's common stock between December 31, 1996 and December 31, 2001
with the cumulative total return of (i) the Nasdaq Non-Financial Stocks Index
and (ii) the Nasdaq Computer and Data Processing Services Stocks Index, over the
same period. This table assumes the investment of $100.00 on December 31, 1996
in the Company's common stock, the Nasdaq Non-Financial Stocks Index and the
Nasdaq Computer and Data Processing Services Stocks Index, and assumes the
reinvestment of dividends, if any.

     The comparisons shown in the table below are based upon historical data.
The Company cautions that the stock price performance shown in the table below
is not indicative of, nor intended to forecast, the potential future performance
of the Company's common stock. Information used in the graph was obtained from
the CRSP Total Return Index published by Nasdaq and SG Cowen, sources believed
to be reliable, but the Company is not responsible for any errors or omissions
in such information.

                                       8

<PAGE>

<TABLE>
<CAPTION>
      CRSP Total Returns Index for:                   12/1996   12/1997     12/1998  12/1999  12/2000  12/2001
      -----------------------------                   -------   -------     -------  -------  -------  -------
      <S>                                             <C>       <C>         <C>      <C>      <C>      <C>
      Digital Generation Systems, Inc.                  100.0      29.9        66.4     85.1     25.4     13.3

      Nasdaq Non-Financial Stocks                       100.0     117.1       171.8    336.9    196.4    150.1

      Nasdaq Computer and Data Processing Stocks
      SIC 7370-7379 US & Foreign                        100.0     122.9       219.2    481.7    221.8    178.7

<CAPTION>
                                                     12/1996   12/1997    12/1998   12/1999   12/2000  12/2001
                                                     -------   -------    -------   -------   -------  -------
      <S>                                            <C>       <C>        <C>       <C>       <C>      <C>
      Digital Generation Systems, Inc.                $  100     $  30      $  66     $  85     $  25    $  13

      Nasdaq Non-Financial Stocks                     $  100       117        172       337       196      150

      Nasdaq Computer and Data Processing Stocks
      SIC 7370-7379 US & Foreign                      $  100       123        219       482       222      179
</TABLE>

     The Company effected its initial public offering of common stock on
February 6, 1996.

     Notwithstanding anything to the contrary set forth in any of the Company's
previous or future filings under the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended, that might incorporate this report
or future filings made by the Company under those statutes, the Compensation
Committee Report and Stock Performance Graph shall not be deemed filed with the
Securities and Exchange Commission and shall not be deemed incorporated by
reference into any of those prior filings or into any future filings made by the
Company under those statutes.

                                       9

<PAGE>

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The following table sets forth, as of January 31, 2002 (except where
otherwise noted), certain information with respect to shares beneficially owned
by (i) each person who is known by the Company to be the beneficial owner of
more than five percent of the Company's outstanding shares of common stock, (ii)
each of the Company's directors and the executive officers named in the Summary
Compensation Table and (iii) all current directors and executive officers as a
group. Beneficial ownership has been determined in accordance with Rule 13d-3
under the Exchange Act. Under this rule, certain shares may be deemed to be
beneficially owned by more than one person (if, for example, persons share the
power to vote or the power to dispose of the shares). In addition, shares are
deemed to be beneficially owned by a person if the person has the right to
acquire shares (for example, upon exercise of an option or warrant) within sixty
(60) days of the date as of which the information is provided; in computing the
percentage ownership of any person, the amount of shares is deemed to include
the amount of shares beneficially owned by such person (and only such person) by
reason of such acquisition rights. As a result, the percentage of outstanding
shares of any person as shown in the following table does not necessarily
reflect the person's actual voting power at any particular date. The following
table includes the effect of StarGuide shares that were converted into common
stock of the Company as a result of the merger on January 18, 2001.

<TABLE>
<CAPTION>
                                                                          Shares Beneficially Owned
                                                                        as of January 31, 2002 (1) (2)
                                                                     ------------------------------------
                                                                           Number of        Percentage
            Beneficial Owner                                                Shares           of Class
            ----------------                                                ------           --------
            <S>                                                          <C>                <C>
            Scott Ginsburg (3)                                           31,914,868            41.0%
            Moon Doggie Family Partnership
            4707 Park Lane
            Dallas, Texas  75220


            Entities and individuals associated with                      5,195,603             7.3%
            Pequot Capital Management, Inc. (4)
            354 Pequot Avenue
            Southport, Connecticut  06490

            C.D.A.S., Inc. (5)                                            5,362,503             7.6%
            2897 Granite Pointe Court
            Reno, NV  89511

            Matthew E. Devine (6)                                         2,539,136             3.5%
            Omar A. Choucair (7)                                            515,746               *
            Lawrence D. Lenihan, Jr  (8)                                  5,216,298             7.3%
            David M. Kantor (9)                                               9,028               *
            Cappy R. McGarr (9)                                             139,884               *
            Jeffrey A. Dankworth (10)                                     5,554,049             7.8%
            Eric L. Bernthal (9)                                            702,308             1.0%
            Robert J. Schlegel (9)                                           95,688               *
            Kevin Howe (9)                                                   95,688               *
            All current directors and executive officers as a group      46,782,693            58.2%
</TABLE>

                    * Less than 1% of the outstanding shares of common stock.

          (1)    Except as indicated in the footnotes to this table and pursuant
                 to applicable community property laws, the persons named in the
                 table have sole voting and investment power with

                                       10

<PAGE>

          respect to all shares of common stock. To the Company's knowledge, the
          entities named in the table have sole voting and investment power with
          respect to all shares of Common stock shown as beneficially owned by
          them. Unless otherwise indicated, the business address of each
          beneficial owner listed is 750 West John Carpenter Freeway, Suite 700,
          Irving, Texas 75039.

     (2)  The number of shares of common stock deemed outstanding as of January
          31, 2002 was 70,784,475. The number of beneficially owned shares
          includes shares issuable pursuant to stock options and warrants that
          may be exercised within sixty days after January 31, 2002.

     (3)  Based on a filing with the Securities and Exchange Commission, dated
          January 22, 2001, indicating beneficial ownership as of such date.
          Includes 22,028,594 shares held in the name of Scott K. Ginsburg and
          2,920,134 shares held in the name of Moon Doggie Family Partnership,
          L.P. Scott K. Ginsburg, the Company's Chairman of the Board, is the
          sole general partner of Moon Doggie Family Partnership, L.P. Includes
          options exercisable into 447,883 shares of common stock, warrants
          issued to Moon Doggie Family Partnership, L.P. exercisable into
          3,008,527 shares of common stock and warrants issued to Scott K.
          Ginsburg exercisable into 3,509,730 shares of common stock.

     (4)  Includes 375,367 shares held in the name of Pequot Offshore Private
          Equity Fund, Inc., 2,964,740 shares held in the name of Pequot Private
          Equity Fund, L.P., 823,902 shares held in the name of Pequot
          International Fund, Inc. and 823,902 shares held in the name of Pequot
          Partners Fund, L.P. Pequot Capital Management, Inc. is the investment
          advisor to Pequot Offshore Private Equity Fund, Inc., Pequot Private
          Equity Fund, L.P., Pequot International Fund, Inc. and Pequot Partners
          Fund, L.P. (the "Pequot Funds") and may be deemed to beneficially own
          all of such shares. Pequot Capital Management, Inc. acquired
          beneficial ownership of such shares from Dawson-Samberg Capital
          Management, Inc., the former investment advisor to the Pequot Funds.
          On January 1, 1999, Dawson-Samberg Capital Management, Inc. spun-off a
          portion of its investment management business to Pequot Capital
          Management, Inc., including the beneficial ownership of all of such
          shares formerly held by Dawson-Samberg Capital Management, Inc.
          Lawrence D. Lenihan, Jr., a member of the Company's Board of
          Directors, is a principal and minority shareholder of Pequot Capital
          Management, Inc. Mr. Lenihan disclaims beneficial ownership of all
          shares held or beneficially owned by or through such entity. Includes
          warrants exercisable into 207,692 shares of common stock.

     (5)  Based on a filing with the Securities and Exchange Commission, dated
          January 31, 2001, indicating beneficial ownership as of such date.

     (6)  Includes options exercisable into 1,299,193 shares of common stock and
          warrants exercisable into 303,310 shares of common stock.

     (7)  Includes options exercisable into 415,221 shares of common stock and
          warrants exercisable into 86,660 shares of common stock.


     (8)  Includes 5,195,603 shares beneficially owned by affiliated entities of
          Pequot Capital Management, Inc., of which Mr. Lenihan disclaims
          beneficial ownership as set forth in footnote 4 above. Includes
          options exercisable into 20,695 shares of common stock.

     (9)  Includes options exercisable into 9,028 shares of common stock.

     (10) Includes options exercisable into 187,903 shares of common stock.

                                       11

<PAGE>

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     During January 2001, DG Systems completed its merger with StarGuide Digital
Networks, Inc. ("StarGuide") pursuant to the Agreement and Plan of Merger by and
among DG Systems, SG Nevada Merger Sub Inc., a wholly owned subsidiary of DG
Systems ("Merger Sub"), and StarGuide. In this merger, the holders of StarGuide
common stock received for each share of StarGuide common stock approximately
1.7332 shares of Company common stock, and the holders of Company common stock
continued to hold their shares. The following table summarizes the number of
shares of common stock of the Company issued to directors and executive officers
as a result of the merger.

                                                    # Of Common
                     Name                          Shares Issued
                     ----                          -------------

                     Scott K. Ginsburg                20,702,178
                     Matthew E. Devine                   779,940
                     Omar A. Choucair                     13,866
                     Jeffrey A. Dankworth              5,366,148
                     Eric L. Bernthal                    693,280

     During 2001, the Company incurred approximately $424,000 in legal fees to
Latham & Watkins, a law firm for which Eric L. Bernthal is a partner.

                                       12

<PAGE>

                                   SIGNATURES

    Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.

                                               DIGITAL GENERATION SYSTEMS, INC.

Dated:  April 30, 2002                         By:   /S/  MATTHEW E. DEVINE
                                                     -----------------------
                                                       Matthew E. Devine
                                                       Chief Executive Officer

     In accordance with the requirements of the Securities Exchange Act of 1934,
this Amendment was signed below by the following persons on behalf of the
Registrant and in the capacities and dates indicated.

<TABLE>
<CAPTION>
     Signature                                                Title                              Date
     ---------                                                -----                              ----
     <S>                                   <C>                                              <C>
                      *                               Chairman of the Board                 April 30, 2002
     -------------------------------------
     Scott K. Ginsburg                     and Director (Principal Executive Officer)

     /S/MATTHEW E. DEVINE                            Chief Executive Officer                April 30, 2002
     -------------------------------------
     Matthew E. Devine                                    And Director

                      *                       Chief Financial Officer and Director          April 30, 2002
     -------------------------------------
     Omar A. Choucair                          (Principal Financial and Accounting
                                                            Officer)

                      *                              Chief Operating Officer                April 30, 2002
     -------------------------------------
     David M. Kantor

                      *                                     Director                        April 30, 2002
     -------------------------------------
     Lawrence D. Lenihan, Jr.

                      *                                     Director                        April 30, 2002
     -------------------------------------
     Cappy R. McGarr

                      *                                     Director                        April 30, 2002
     -------------------------------------
     Jeffrey A. Dankworth

                      *                                     Director                        April 30, 2002
     -------------------------------------
     Eric L. Bernthal

                      *                                     Director                        April 30, 2002
     -------------------------------------
     Robert J. Schlegel

                      *                                     Director                        April 30, 2002
     -------------------------------------
     Kevin Howe


     By:  /S/MATTHEW E. DEVINE
     -------------------------------------
     Attorney-in-Fact
</TABLE>

                                       13