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

                                    Form 10-Q

                   QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

(Mark One)

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

     For the quarterly period ended SEPTEMBER 30, 2001

[ ]  Transition  Report  Pursuant  to  Section  13 or  15(d)  of the  Securities
     Exchange Act of 1934

     For the transition period from __________ to __________

                         Commission file number 0-22132


                          BUCKHEAD AMERICA CORPORATION
             (Exact name of registrant as specified in its charter)


              DELAWARE                                   58-2023732
 -----------------------------------     ---------------------------------------
  (State or other jurisdiction of                      (IRS Employer
   incorporation or organization)                    Identification No.)

            7000 CENTRAL PARKWAY, SUITE 850, ATLANTA, GEORGIA 30328
            -------------------------------------------------------
              (Address of principal executive offices) (Zip Code)

                                 (770) 393-2662
                                 --------------
              (Registrant's telephone number, including area code)

                                       N/A
                        -----------------------------------
             (Former name, former address and former fiscal year, if
                          changed since last report.)

     Indicate  by check mark  whether the  registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days. Yes X No


                      APPLICABLE ONLY TO CORPORATE ISSUERS:

     Indicate the number of shares  outstanding of each of the issuer's  classes
of common stock, as of the latest practicable date: October 31, 2001

           Common stock, par value $.01 - 2,015,885 shares outstanding
           -----------------------------------------------------------



<PAGE>

                         PART I - FINANCIAL INFORMATION

                          Item 1. Financial Statements


                          BUCKHEAD AMERICA CORPORATION
                                AND SUBSIDIARIES

                   Condensed Consolidated Financial Statements

                           September 30, 2001 and 2000

                                   (Unaudited)


<PAGE>


                          BUCKHEAD AMERICA CORPORATION
                                AND SUBSIDIARIES

                      Condensed Consolidated Balance Sheets
                    September 30, 2001 and December 31, 2000
                                   (Unaudited)

<TABLE>
<CAPTION>
<S>                                                                                       <C>                    <C>
                                                                                            September 30,           December 31,
                                    ASSETS                                                       2001                  2000
                                                                                          ------------------     -----------------

  Current assets:
     Cash and cash equivalents, including restricted cash of
      $452,821 at September 30, 2001 and $382,646 at December 31, 2000                     $        651,881       $     1,345,671
     Investment securities, including restricted securities of
      $118,133 at September 30, 2001 and $182,067 at December 31, 2000                              137,998               202,750
     Accounts receivable, net                                                                     1,614,587             1,436,030
     Current portions of notes receivable, net                                                      798,226               832,055
     Property held for sale, net                                                                 22,873,313            21,273,517
     Other current assets                                                                           306,799               202,911
                                                                                          ------------------     -----------------
                    Total current assets                                                         26,382,804            25,292,934

  Noncurrent portions of notes receivable, net                                                    4,325,591             3,695,160
  Property and equipment, at cost, net                                                            9,665,170            20,967,076
  Other assets                                                                                    2,937,372             3,409,302
                                                                                          ------------------     -----------------
                                                                                           $     43,310,937       $    53,364,472
                                                                                          ------------------     -----------------

                             LIABILITIES AND SHAREHOLDERS' EQUITY

  Current liabilities:
     Accounts payable and accrued expenses                                                 $      3,354,178       $     3,420,277
     Current portions of notes payable                                                           15,913,629            18,803,712
                                                                                          ------------------     -----------------
                    Total current liabilities                                                    19,267,807            22,223,989

  Noncurrent portions of notes payable                                                           11,920,104            16,353,009
  Other liabilities                                                                                 158,752               269,330
                                                                                          ------------------     -----------------
                    Total liabilities                                                            31,346,663            38,846,328
                                                                                          ------------------     -----------------

  Minority interests                                                                                646,543               764,068

  Shareholders' equity:
     Series B preferred stock; par value $100; 200,000 shares
        authorized; 30,000 shares issued and outstanding                                          3,000,000             3,000,000
     Common stock; $.01 par value; 5,000,000 shares authorized;
        2,113,881 shares issued and 2,015,885 and 2,025,023 shares
        outstanding at September 30, 2001 and December 31, 2000, respectively                        21,139                21,139
     Additional paid-in capital                                                                   7,897,530             7,897,530
     Retained earnings                                                                            1,369,402             3,729,683
     Accumulated other comprehensive loss                                                          (283,023)             (245,229)
     Treasury stock, 97,996 and 88,858 common shares
        at September 30, 2001 and December 31, 2000, respectively                                  (687,317)             (649,047)
                                                                                          ------------------     -----------------
                    Total shareholders' equity                                                   11,317,731            13,754,076
                                                                                          ------------------     -----------------
                                                                                           $     43,310,937       $    53,364,472
                                                                                          ==================     =================
</TABLE>

  See accompanying notes to condensed consolidated financial statements.

                                       3
<PAGE>


                          BUCKHEAD AMERICA CORPORATION
                                AND SUBSIDIARIES

               Condensed Consolidated Statements of Income (Loss)
                  Nine Months ended September 30, 2001 and 2000
                                   (Unaudited)

<TABLE>
<CAPTION>
  <S>                                                            <C>                    <C>
                                                                       2001                  2000
                                                                 ----------------       ---------------
  Revenues:
      Hotel revenues                                              $  14,335,846          $  18,872,173
      Franchise fees, management fees, and other income               1,632,657              1,537,628
      Gains on property and leasehold interest sales, net                -                     591,584
      Interest income                                                   347,097                348,310
                                                                 ----------------       ---------------
              Total revenues                                         16,315,600             21,349,695
                                                                 ----------------       ---------------

  Expenses:
      Hotel operations                                               10,681,736             13,496,944
      Other operating and administrative                              2,799,648              2,678,620
      Leasehold rent                                                  2,100,253              2,074,184
      Depreciation and amortization                                     770,828              1,252,943
      Interest                                                        2,230,916              2,183,820
                                                                 ----------------       ---------------
           Total expenses                                            18,583,381             21,686,511
                                                                 ----------------       ---------------

                   Income (loss) before income taxes                 (2,267,781)              (336,816)

  Deferred income tax expense (benefit)                                   -                   (135,000)
                                                                 ----------------       ---------------

                   Net income (loss)                              $  (2,267,781)              (201,816)
                                                                 ================       ===============

  Net income (loss) per common share:
      Basic                                                       $       (1.23)                 (0.21)
                                                                 ================       ===============
      Diluted                                                     $       (1.23)                 (0.21)
                                                                 ================       ===============

  Weighted average number of shares
     used to calculate net income (loss) per common share:
      Basic                                                           2,016,934              2,021,892
                                                                 ================       ===============
      Diluted                                                         2,016,934              2,021,892
                                                                 ================       ===============
</TABLE>


See accompanying notes to condensed consolidated financial statements.


                                       4
<PAGE>


                          BUCKHEAD AMERICA CORPORATION
                                AND SUBSIDIARIES

               Condensed Consolidated Statements of Income (Loss)
                 Three Months ended September 30, 2001 and 2000
                                   (Unaudited)

<TABLE>
<CAPTION>
<S>                                                              <C>                     <C>
                                                                       2001                   2000
                                                                ----------------         --------------
  Revenues:
      Hotel revenues                                             $    4,970,551           $  6,567,003
      Franchise fees, management fees, and other income                 564,151                560,643
      Gains on property and leasehold sales, net                              -                578,411
      Interest income                                                   102,900                106,926
                                                                ----------------         --------------
      Total revenues                                                  5,637,602              7,812,983
                                                                ----------------         --------------

  Expenses:
      Hotel operations                                                3,536,261              4,902,954
      Other operating and administrative                                880,782                934,278
      Leasehold rent                                                    769,499                740,987
      Depreciation and amortization                                     228,065                437,021
      Interest                                                          673,503                765,232
                                                                ----------------         --------------
           Total expenses                                             6,088,110              7,780,472
                                                                ----------------         --------------
                   Income (loss) before income taxes                   (450,508)                32,511

  Deferred income tax expense                                                 -                 13,000
                                                                ----------------         --------------

                   Net income (loss)                              $    (450,508)          $     19,511
                                                                ================         ==============

  Net income (loss) per common share:
      Basic                                                       $       (0.26)          $      (0.03)
                                                                ================         ==============
      Diluted                                                     $       (0.26)          $      (0.03)
                                                                ================         ==============

  Weighted average number of shares used to
      calculate net income (loss) per common share:
      Basic                                                           2,015,885              2,024,393
                                                                ================         ==============
      Diluted                                                         2,015,885              2,024,393
                                                                ================         ==============

</TABLE>

  See accompanying notes to condensed consolidated financial statements.


                                       5
<PAGE>


                          BUCKHEAD AMERICA CORPORATION
                                AND SUBSIDIARIES

                 Condensed Consolidated Statements of Cash Flows
                  Nine Months Ended September 30, 2001 and 2000
                                   (Unaudited)
<TABLE>
<CAPTION>
  <S>                                                                            <C>                     <C>
                                                                                        2001                  2000
                                                                                -----------------        --------------

  Cash flows from operating activities:
      Net loss                                                                   $    (2,267,781)         $   (201,816)
      Adjustments to reconcile net loss
      to net cash provided by (used in) operating activities:
         Depreciation and amortization                                                   770,828             1,252,943
         Sales of trading securities, net                                                      -             1,034,142
         Gains on property and leasehold sales                                                 -              (591,894)
         Minority interest in income (loss)                                             (146,065)              190,196
         Deferred income tax benefit                                                           -              (135,000)
         Increase in accounts receivable, net                                           (178,557)             (607,551)
         Increase (decrease) in accounts payable and accrued expenses, net               (66,099)              903,190
         Other, net                                                                     (187,508)              165,254
                                                                                -----------------        --------------
              Net cash provided by (used in) operating activities                     (2,075,182)            2,009,464
                                                                                -----------------        --------------

  Cash flows from investing activities:
      Principal receipts on notes receivable                                             518,398               535,628
      Originations of notes receivable                                                  (140,000)             (652,500)
      Acquisitions of businesses and hotels                                                    -              (992,556)
      Capital expenditures                                                              (518,812)           (3,046,798)
      Proceeds from property and leasehold interest sales, net                         1,984,915             1,185,266
      Other, net                                                                         216,903              (248,932)
                                                                                -----------------        --------------
              Net cash provided by (used in) investing activities                      2,061,404            (3,219,892)
                                                                                -----------------        --------------

  Cash flows from financing activities:
      Repayments of notes payable                                                       (817,782)             (990,911)
      Proceeds from notes payable                                                        240,000             2,220,809
      Distributions to minority interest partners                                        (36,744)             (106,768)
      Preferred stock dividends paid                                                     (92,500)             (185,000)
      Other, net                                                                          27,014               (31,142)
                                                                                -----------------        --------------
              Net cash provided by (used in) financing activities                       (680,012)              906,988
                                                                                -----------------        --------------

  Net increase (decrease) in cash and cash equivalents                                  (693,790)             (303,440)

  Cash and cash equivalents at beginning of period                                     1,345,671             2,390,856
                                                                                -----------------        --------------

  Cash and cash equivalents at end of period                                       $     651,881             2,087,416
                                                                                =================        ==============

</TABLE>

  See accompanying notes to condensed consolidated financial statements.


                                       6
<PAGE>

                          BUCKHEAD AMERICA CORPORATION
                                AND SUBSIDIARIES

              Notes to Condensed Consolidated Financial Statements
                           September 30, 2001 and 2000
                                   (Unaudited)

(1)  Basis of Presentation

     The accompanying  unaudited condensed  consolidated financial statements do
     not include all of the  information  and  footnotes  required by  generally
     accepted accounting  principles for complete financial  statements.  In the
     opinion of management,  all  adjustments  (consisting  of normal  recurring
     accruals)  considered necessary for a fair presentation have been included.
     The  results  of  operations  for  interim   periods  are  not  necessarily
     indicative of the results that may be expected for a full year or any other
     interim period.  For further  information,  see the consolidated  financial
     statements  included in the Company's Form 10-K for the year ended December
     31, 2000.

(2)  Comprehensive Income (Loss)

     Total  comprehensive  income (loss) for the nine months ended September 30,
     2001 and 2000 was  $(2,305,575) and $(271,805),  respectively,  and for the
     three months ended September 30, 2001 and 2000 was $(451,752) and $(3,819),
     respectively.

(3)  Segment Information

     Condensed  operating  results for each Company  segment for the nine months
     ended September 30, 2001 and 2000 are presented below:
<TABLE>
<CAPTION>
<S>                                <C>               <C>          <C>             <C>             <C>               <C>
                                                                                                Nine months ended September 30, 2001
                                   -------------------------------------------------------------------------------------------------
                                       Hotel           Hotel          Hotel        Development
                                     Operations      Management    Franchising     & Corporate     Eliminations      Consolidated
                                   --------------   ------------  -------------   -------------   -------------     --------------

         Revenues                   $ 14,335,846      1,267,114      1,597,459         349,100      (1,233,919)        16,315,600
         Expenses                     11,035,173      1,734,735        845,119       1,100,276      (1,233,919)        13,481,384
                                   --------------   ------------  -------------   -------------                     --------------

            EBITDAR*                   3,300,673       (467,621)       752,340        (751,176)                         2,834,216

         Rent                          2,100,253              -              -               -                          2,100,253
         Depreciation                    575,040         83,288         94,500          18,000                            770,828
         Interest                      1,729,393              -              -         501,523                          2,230,916
                                   --------------   ------------  -------------   -------------                     --------------

         Income (loss) before
            income taxes            $ (1,104,013)      (550,909)       657,840      (1,270,699)                        (2,267,781)
                                   ==============   ============  =============   =============                     ==============

                                                                                                Nine months ended September 30, 2000
                                   -------------------------------------------------------------------------------------------------
                                       Hotel           Hotel          Hotel        Development
                                     Operations      Management    Franchising     & Corporate     Eliminations      Consolidated
                                   --------------   ------------  -------------   -------------   -------------     --------------

         Revenues                   $ 18,872,173      1,533,545      1,378,818         955,893      (1,390,734)        21,349,695
         Expenses                     13,894,395      1,596,126        819,598       1,256,179      (1,390,734)        16,175,564
                                   --------------   ------------  -------------   -------------                     --------------

            EBITDAR*                   4,977,778        (62,581)       559,220        (300,286)                         5,174,131

         Rent                          2,074,184              -              -               -                          2,074,184
         Depreciation                  1,040,418        100,025         94,500          18,000                          1,252,943
         Interest                      1,729,339              -              -         454,481                          2,183,820
                                   --------------   ------------  -------------   -------------                     --------------

         Income (loss) before
            income taxes            $    133,837       (162,606)       464,720        (772,767)                          (336,816)
                                   ==============   ============  =============   =============                     ==============
</TABLE>


                                       7
<PAGE>


                          BUCKHEAD AMERICA CORPORATION
                                AND SUBSIDIARIES

              Notes to Condensed Consolidated Financial Statements
                           September 30, 2001 and 2000
                                   (Unaudited)


     Condensed  operating  results for each Company segment for the three months
     ended September 30, 2001 and 2000 are presented below:

<TABLE>
<CAPTION>
<S>                                <C>               <C>          <C>             <C>             <C>               <C>
                                                                                               Three months ended September 30, 2001
                                   -------------------------------------------------------------------------------------------------
                                       Hotel           Hotel          Hotel        Development
                                     Operations      Management    Franchising     & Corporate     Eliminations      Consolidated
                                   --------------   ------------  -------------   -------------   -------------     --------------

         Revenues                   $  4,970,551        402,457        586,867         103,319        (425,592)         5,637,602
         Expenses                      3,666,145        513,557        274,277         388,656        (425,592)         4,417,043
                                   --------------   ------------  -------------   -------------                     --------------

            EBITDAR*                   1,304,406       (111,100)       312,590        (285,337)                         1,220,559

         Rent                            769,499              -              -               -                            769,499
         Depreciation                    174,540         16,025         31,500           6,000                            228,065
         Interest                        506,716              -              -         166,787                            673,503
                                   --------------   ------------  -------------   -------------                     --------------

         Income (loss) before
            income taxes            $   (146,349)      (127,125)       281,090        (458,124)                          (450,508)
                                   ==============   ============  =============   =============                     ==============


                                                                                               Three months ended September 30, 2000
                                   -------------------------------------------------------------------------------------------------
                                       Hotel           Hotel          Hotel        Development
                                     Operations      Management    Franchising     & Corporate     Eliminations      Consolidated
                                   --------------   ------------  -------------   -------------   -------------     --------------

         Revenues                    $ 6,567,003        585,773        474,611         686,586        (500,990)         7,812,983
         Expenses                      5,049,740        547,309        314,839         426,334        (500,990)         5,837,232
                                   --------------   ------------  -------------   -------------                     --------------

            EBITDAR*                   1,517,263         38,464        159,772         260,252                          1,975,751

         Rent                            740,987              -              -               -                            740,987
         Depreciation                    362,740         36,781         31,500           6,000                            437,021
         Interest                        626,369              -              -         138,863                            765,232
                                   --------------   ------------  -------------   -------------                     --------------

         Income (loss) before
            income taxes            $  (212,833)          1,683        128,272         115,389                             32,511
                                   ==============   ============  =============   =============                     ==============

</TABLE>

     * Earnings before interest, taxes, depreciation, amortization, and rent


                                       8
<PAGE>


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

Material Changes in Financial Condition.

The Company  experienced  negative cash flow from  operations  of  approximately
$2,075,000   during  the  first  nine  months  of  2001.   The  Company   repaid
approximately  $818,000 of debt obligations and invested  approximately $519,000
in capital expenditures for improvements and replacements on existing properties
and on new  construction.  A portion  of the  funding  for these  items was from
additional  borrowings of approximately  $240,000,  principal  receipts on notes
receivable of approximately  $518,000, and from net proceeds from property sales
of approximately $1,985,000 .

As of December  31, 2000,  the Company had 17 owned or leased  hotel  properties
classified  as held for sale.  Eight of these  properties  were sold  during the
first nine months of 2001 and three  others are  presently  under  contract  for
sale.  During 2001,  three  additional hotel properties were categorized as held
for sale and  management is evaluating  other owned hotel  properties  for their
potential for sale and the resulting  impact on the Company.  In connection with
the aforementioned property sales, the Company also reduced its notes payable by
approximately $6,745,000.

Management  has  negotiated  the  extension of payment  terms for certain of its
secured and unsecured  borrowings and is presently  discussing  extension  terms
with other  lenders.  Preferred  stock  dividends  are eight  months in arrears.
Certain staff and executive level  positions in the Company's  hotel  management
and hotel  franchising  operations  have been  eliminated.  Capital  expenditure
commitments have been limited and certain  previous lease  commitments have been
cancelled.

Adequate  liquidity for future  operations will be dependent upon the generation
of significant  cash proceeds from hotel property sales and the timing  thereof,
and the Company's ability to negotiate  extensions or replacements of certain of
its  existing  credit  facilities.  Management  presently  intends  to  continue
increased focus on its hotel franchising  segment and expects that the Company's
future  profitability  will be  primarily  dependent  upon  the  growth  of that
segment.


Material Changes in Results of Operations.

The decline in revenues and increase in net loss in the first three  quarters of
2001 versus 2000 is partly attributable to the loss of the Company's Orlando and
Daytona,  Florida hotel properties.  The Orlando hotel property lease expired at
the end of 2000 and the Daytona hotel was sold in September  2000.  The combined
revenues and income  before taxes from these two hotels in the first nine months
of 2000 amounted to  approximately  $4,264,000  and $888,000  respectively.  The
third quarter of 2000 also  included a gain on the sale of the Daytona  property
of  approximately  $592,000.  Excluding the Daytona gain, third quarter net loss
decreased  slightly  in 2001 from the same  quarter in 2000.  This is  partially
attributable to the  non-recognition of depreciation  expense on properties held
for sale.

Owned  and  leased  hotel  earnings  before   interest,   taxes,   depreciation,
amortization and rent  ("EBITDAR")  during the nine month period ended September
30,  2001  decreased  approximately  $1,069,000  as a result  of the loss of the
Orlando and Daytona hotels,  most of which occurred in the first six months. The
remaining  decrease  in  EBITDAR  in  2001  is  attributable  to the  impact  of
properties  sold during 2001 and overall  revenue  declines in other owned hotel
properties  which are presently  held for sale.  Management  has noted  distinct
declines in demand at Company  properties which are consistent  within the hotel
industry.

The decrease in owned and leased hotel third quarter loss before income taxes is
attributable to reductions in depreciation  expense resulting from 2000 and 2001
property  sales  and  the  aforementioned  non-recognition  of  depreciation  on
properties held for sale. Also,  third quarter  interest expense  decreased as a
result of the  aforementioned  reductions in notes  payable in  connection  with
hotel property sales. Interest expense is expected to decrease in future periods
as additional properties are sold.

Hotel management revenues, EBITDAR, and loss before income taxes worsened during
the first,  second,  and third quarters of 2001 versus the same periods in 2000.
This is  partially  attributable  to  increased  payroll  costs  resulting  from
severance  payments  relating to eliminated  positions and the addition of three
sales and  marketing  positions  since the third quarter of 2000 in an effort to
improve  revenues at Company and third party owned hotels.  In April 2001,  nine
management  contracts  relating to hotels owned by affiliates of Quality Lodging


                                       9
<PAGE>

LLC were purportedly  terminated by the hotel owners.  The Company is contesting
the  validity of such  terminations  and is seeking to recover  damages  through
arbitration  and  litigation.  The  Company's  September  30, 2001 balance sheet
includes   noncurrent  assets  of  approximately   $777,000  relating  to  these
contracts;   and  management  fees  earned  from  these  contracts  amounted  to
approximately  $300,000 annually.  The valuation of the Company's recorded asset
is  dependent  upon  the  Company's  ability  to  recover  sought  damages.  The
recoverability  of the  carrying  value  of the  Company's  deferred  management
contracts  is  dependent  upon  the  Company's  success  in  the  aforementioned
arbitration and litigation.

Hotel  franchising  revenues,  EBITDAR,  and income before income taxes improved
significantly  during the first,  second,  and third quarters of 2001 versus the
same periods in 2000.  Such  improvements  resulted  primarily  from  additional
franchise  property  openings.   Presently  there  are  61  Country  Hearth  Inn
properties  open and an  additional 20 properties  under  development,  of which
approximately half are expected to open within the next 12 months.

Net losses of approximately  $1,350,000  resulting from first, second, and third
quarter  2001 hotel  property  sales  were  charged  to  previously  established
impairment allowances and therefore had no impact on 2001 net losses.

Development and corporate  revenues  primarily  consist of net gains on property
sales and interest income.  The three and nine month periods ended September 30,
2000  include the  aforementioned  Daytona  gain.  The  decreases  in  corporate
expenses in the three and nine month periods  ended  September 30, 2001 resulted
primarily from the termination of an executive  officer in the fourth quarter of
2000.

The Company files income tax returns and recognizes income tax expense (benefit)
on an annual calendar basis.  The deferred income tax benefit  recognized in the
first, second, and third quarters of 2000 represented  management's estimates of
the impact on the annual income tax expense  (benefit)  which resulted from each
quarter's  operations.  In the  fourth  quarter of 2000,  management  elected to
establish a valuation  allowance for the full amount of the  Company's  deferred
tax assets. Consequently, no deferred tax benefit has been recognized in 2001.


Effect of New Accounting Pronouncements.

In July 2001, the Financial Accounting Standards Board ("FASB") issued Statement
No. 141,  "Business  Combinations"  ("Statement  141"),  and  Statement No. 142,
"Goodwill and Other Intangible Assets" ("Statement 142"). Statement 141 requires
that the purchase  method of  accounting  be used for all business  combinations
initiated  after  June  30,  2001  as  well  as  all  purchase  method  business
combinations  completed  after  June 30,  2001.  Statement  141  also  specifies
criteria  intangible  assets acquired in a purchase method business  combination
must meet to be recognized  and reported  apart from  goodwill,  noting that any
purchase  price  allocable to an assembled  workforce  may not be accounted  for
separately.  Statement 142 will require that goodwill and intangible assets with
indefinite  useful  lives  no  longer  be  amortized,  but  instead  tested  for
impairment at least annually in accordance with the provisions of Statement 142.
Statement 142 will also require that  intangible  assets with  estimable  useful
lives  be  amortized  over  their  respective  estimated  useful  lives to their
estimated  residual values,  and reviewed for impairment in accordance with FASB
Statement No. 121,  "Accounting for the Impairment of Long-Lived  Assets and for
Long-Lived Assets to Be Disposed Of."

The Company is required to adopt the  provisions of Statement  141  immediately,
except  with regard to business  combinations  initiated  prior to July 1, 2001,
which it expects  to  account  for using the  pooling-of-interests  method,  and
Statement 142 effective  January 1, 2002.  Furthermore,  goodwill and intangible
assets  determined  to have an  indefinite  useful  life  acquired in a purchase
business combination  completed after June 30, 2001, but before Statement 142 is
adopted in full will not be  amortized,  but will  continue to be evaluated  for
impairment in  accordance  with the  appropriate  pre-Statement  142  accounting
literature.  Goodwill and intangible  assets  acquired in business  combinations
completed  before  July 1, 2001 will  continue  to be  amortized  and tested for
impairment in  accordance  with the  appropriate  pre-Statement  142  accounting
requirements prior to the adoption of Statement 142.

Statement  141 will require upon  adoption of  Statement  142,  that the Company
evaluate its existing  intangible  assets and goodwill  that were  acquired in a
prior purchase business combination, and to make any necessary reclassifications
in order to conform with the new criteria in Statement 141 for recognition apart
from  goodwill.  Upon adoption of Statement 142, the Company will be required to
reassess the useful lives and residual values of all intangible assets acquired,


                                       10
<PAGE>

and make any necessary  amortization  period adjustments by the end of the first
interim period after adoption. In addition, to the extent an intangible asset is
identified as having an indefinite  useful life, the Company will be required to
test the intangible  asset for  impairment in accordance  with the provisions of
Statement  142 within the first  interim  period.  Any  impairment  loss will be
measured as of the date of adoption and recognized as the cumulative effect of a
change in accounting principle in the first interim period.

In connection with Statement 142's transitional goodwill impairment  evaluation,
the Statement will require the Company to perform an assessment of whether there
is an indication  that goodwill (and  equity-method  goodwill) is impaired as of
the date of  adoption.  To  accomplish  this,  the  Company  must  identify  its
reporting  units and  determine  the carrying  value of each  reporting  unit by
assigning  the assets and  liabilities,  including  the  existing  goodwill  and
intangible  assets,  to those  reporting  units as of the date of adoption.  The
Company  will then have up to six months from the date of adoption to  determine
the fair value of each  reporting  unit and compare it to the  reporting  unit's
carrying  amount.  To the extent a reporting  unit's carrying amount exceeds its
fair value,  an  indication  exists that the  reporting  unit's  goodwill may be
impaired  and the  Company  must  perform  the second  step of the  transitional
impairment  test. In the second step,  the Company must compare the implied fair
value of the reporting unit's  goodwill,  determined by allocating the reporting
unit's  fair  value  to all of its  assets  (recognized  and  unrecognized)  and
liabilities  in a manner  similar to a purchase  price  allocation in accordance
with Statement 141, to its carrying  amount,  both of which would be measured as
of the date of adoption. This second step is required to be completed as soon as
possible,  but no later than the end of the year of adoption.  Any  transitional
impairment  loss  will be  recognized  as the  cumulative  effect of a change in
accounting principle in the Company's statement of earnings.

And finally,  any  unamortized  negative  goodwill (and  equity-method  negative
goodwill)  existing at the date  Statement 142 is adopted must be written off as
the cumulative effect of a change in accounting principle.

Because of the extensive  effort needed to comply with adopting  Statements  141
and 142, it is not  practicable  to  reasonably  estimate the impact of adopting
these  Statements  on the  Company's  financial  statements  at the date of this
report,  including  whether it will be required to  recognize  any  transitional
impairment losses as the cumulative effect of a change in accounting principle.

In  August  2001,  the  FASB  issued  Statement  No.  144,  "Accounting  for the
Impairment or Disposal of Long-Lived Assets" ("Statement 144"), which supersedes
both FASB Statement No. 121, "Accounting for the Impairment of Long-Lived Assets
and  for  Long-Lived  Assets  to Be  Disposed  Of"  ("Statement  121")  and  the
accounting  and  reporting  provisions  of APB  Opinion No. 30,  "Reporting  the
Results  of  Operations-Reporting  the  Effects  of  Disposal  of a Segment of a
Business,  and  Extraordinary,  Unusual and  Infrequently  Occurring  Events and
Transactions"  ("Opinion  30"),  for the disposal of a segment of a business (as
previously  defined in that  Opinion).  Statement  144 retains  the  fundamental
provisions in Statement 121 for recognizing and measuring  impairment  losses on
long-lived  assets held for use and long-lived assets to be disposed of by sale,
while also resolving significant implementation issues associated with Statement
121. For example, Statement 144 provides guidance on how a long-lived asset that
is used as part of a group  should  be  evaluated  for  impairment,  establishes
criteria  for when a  long-lived  asset is held for  sale,  and  prescribes  the
accounting  for a long-lived  asset that will be disposed of other than by sale.
Statement  144  retains  the basic  provisions  of  Opinion 30 on how to present
discontinued  operations in the income statement but broadens that  presentation
to include a  component  of an entity  (rather  than a segment  of a  business).
Unlike  Statement 121, an impairment  assessment  under Statement 144 will never
result in a write-down of goodwill. Rather, goodwill is evaluated for impairment
under Statement 142.

Statement 144 also requires that the assets and  liabilities of a disposal group
classified  as held for sale be presented  separately in the asset and liability
sections,  respectively,  on a gross basis in the balance sheet. In other words,
the assets and liabilities of a disposal group cannot be netted and presented as
a single line in the balance sheet. If a company has netted or offset the assets
and  liabilities  of an  asset  group  that was  reported  as held for sale in a
balance  sheet prior to the date  Statement  144 is adopted,  that balance sheet
must be reclassified when it is presented for comparative purposes.  The Company
presently does not present such assets and liabilities on a net basis.

The Company is required to adopt  Statement 144 no later than the year beginning
after  December  15,  2001,  and plans to adopt its  provisions  for the quarter
ending March 31, 2002.  Management does not expect the adoption of Statement 144
to have a material  impact on the  Company's  financial  statements  because the
impairment  assessment  under Statement 144 is largely  unchanged from Statement
121. The  provisions of the Statement for assets held for sale or other disposal
generally  are required to be applied  prospectively  after the adoption date to
newly initiated disposal activities.  Therefore, management cannot determine the
potential  effects  that  adoption of Statement  144 will have on the  Company's
financial statements.

                                       11
<PAGE>

Risk Factors.

This Form 10-Q  contains  forward  looking  statements  that  involve  risks and
uncertainties.  Statements  contained in this Form 10-Q that are not  historical
facts are forward looking statements that are subject to the safe harbor created
by the Private  Securities  Litigation  Reform Act of 1995. The Company's actual
results may differ  significantly  from the results  indicated  by such  forward
looking statements.

The  Company is subject to a number of risks,  including  the  general  risks of
investing in real estate, the illiquidity of real estate,  environmental  risks,
possible  uninsured or under insured  losses,  fluctuations  in property  taxes,
hotel operating  risks,  the impact of  competition,  the difficulty of managing
growth, seasonality,  the risks inherent in operating a hotel franchise business
and hotel  management  business,  and the risks involved in hotel renovation and
construction,   and  the  uncertainty  of  obtaining   additional  financing  or
extensions of existing  credit  facilities as needed.  For a discussion of these
and other risk factors, see the "RISK FACTOR" section contained in the Company's
Registration Statement on Form S-3 (File No. 333-37691).


Item 3. Quantitative and Qualitative Disclosures About Market Risk

As of September  30, 2001,  the  Company's  obligations  included  variable rate
mortgage notes and a line of credit bank note with aggregate  principal balances
of $2,086,835 which mature at various dates through 2015. The Company is exposed
to the market risk of  significant  increases  in future  interest  rates.  Each
incremental  one-point  increase in the prime  interest rate would  increase the
Company's  interest  expense by  approximately  $20,000  per year.  This risk is
somewhat  mitigated  in that  inflationary  increases  in  interest  rates would
theoretically result in increases in average hotel room rates. Also, significant
increases  in  interest  rates  would have a dampening  effect on  additions  of
competitive hotels in the Company's markets.

At September 30, 2001, the Company's unrestricted investment securities included
equity  securities  valued at  $24,841.  The Company is exposed to the risk that
such  securities  will become  worthless.  The Company's  restricted  investment
securities also include equity securities.  Such restricted  securities comprise
the assets of the Company's deferred  compensation plan and changes in the value
of such securities have no net impact on the Company's earnings.

The ultimate  collection of the Company's notes receivable is subject to various
credit risks.  Net notes receivable at September 30, 2001 amounted to $5,123,817
and consisted of 35 notes,  most of which were  collateralized  by or related to
various hotel assets. Also, certain of these notes relate to leasehold interests
in hotel properties for which the Company remains contingently liable for future
rent payments. The Company is also contingently liable for certain notes payable
relating to hotel  properties which have been sold. The collection of such notes
receivable and the potential  financial  exposure for contingent  rents and note
payable  obligations  is determined  by the ability of other hotel  operators to
satisfy these obligations.  Their ability to satisfy such obligations is subject
to many risks, including economic conditions affecting the hotel industry, their
ability to effectively  manage their hotel assets,  new  competition,  and other
factors.


                                       12
<PAGE>

                           PART II - OTHER INFORMATION

Item 3. Defaults Upon Senior Securities

As of November 14, 2001, a total of $185,000 of Series B preferred dividends are
in arrears.


Item 6. Exhibits and Reports on Form 8-K

     (a) Exhibit Index

Exhibit        Description
-------        -----------
3(i)           Articles of  Incorporation.(Incorporated  by reference to Exhibit
               3(i) to the  Registrant's  Registration  Statement  on Form 10-SB
               (No.0-22132) which became effective on November 22, 1993.)

3(i)(a)        Certificate  of  Amendment  of   Certificate  of   Incorporation.
               (Incorporated by reference to Exhibit 3(i)(a) to the Registrant's
               Annual  Report on Form 10-KSB for the fiscal year ended  December
               31, 1994.)

3(i)(b)        Certificate  of  Amendment  of   Certificate  of   Incorporation.
               (Incorporated  by reference  to Appendix "A" to the  Registrant's
               Definitive Proxy Statement filed with the Securities and Exchange
               Commission on June 9, 1997.)

3(i)(c)        Certificate  of  Amendment  of   Certificate  of   Incorporation.
               (Incorporated  by reference  to Appendix "A" to the  Registrant's
               Definitive Proxy Statement filed with the Securities and Exchange
               Commission on May 5, 1998.)

3(ii)          By-Laws - Amended and Restated as of June 27, 1994. (Incorporated
               by reference to Exhibit 3(ii) to the  Registrant's  Annual Report
               on Form 10-KSB for the fiscal year ended December 31, 1994.)

4(i)           Certificate of  Designation,  Preferences  and Rights of Series B
               Preferred Stock of the Registrant.  (Incorporated by reference to
               Exhibit 4(i) to the  Registrant's  Quarterly  Report on Form 10-Q
               for the quarter ended March 31, 2001.)

11             Statement re: Computation of per share Earnings


     (b) Reports on Form 8-K

     The  Company  has not filed any  reports on Form 8-K during the quarter for
which this report is filed.



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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 its  behalf by the
undersigned thereunto duly authorized.


                                       Buckhead America Corporation
                                       (Registrant)


Date:  November 14, 2001               /s/ Douglas C. Collins
                                       --------------------------------
                                       Douglas C. Collins
                                       President and Chief Executive Officer



Date:  November 14, 2001               /s/ Robert B. Lee
                                       --------------------------------
                                       Robert B. Lee
                                       Senior Vice President and
                                       Chief Financial and Accounting Officer






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