U.S. SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C. 20549

                                FORM 10-KSB

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

                For the fiscal year ended December 31, 1999

Commission File No. 0-23866
                           VARI-L COMPANY, INC.
              (Name of Small Business Issuer in its Charter)

        Colorado                                  06-0679347
(State or other jurisdiction of incorporation)(I.R.S. Employer I
dentification No.)


                            4895 Peoria Street
                          Denver, Colorado 80239
                              (303) 371-1560
       (Address and Telephone Number of Principal Executive Offices)

Securities registered under Section 12(b) of the Exchange Act:  None

Securities registered under Section 12(g) of the Exchange Act:

                              Title of Class
                             -----------------
                       Common Stock, $.01 Par Value

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

     [X]  Yes     [ ]  No

     Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B contained in this form, and no disclosure will
be contained, to the best of issuer's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-KSB or any amendment to this Form 10-KSB.          [X]

     State issuer's revenues for the fiscal year ended December 31, 1999:
$24,280,827.

     At March 23, 2000, 7,069,188 shares of Common Stock were outstanding.
The aggregate market value of the Common Stock held by non-affiliates on
March 23, 2000 was approximately $153,794,552 based on the closing price
on the Nasdaq National Market System on that date.

                    DOCUMENTS INCORPORATED BY REFERENCE

     Portions of the issuer's definitive proxy statement to be filed
pursuant to Regulation 14A not later than 120 days after the end of the
fiscal year are incorporated by reference in Part III.

                                  PART I
ITEM 1.  BUSINESS

Introduction
------------

     Vari-L Company, Inc. (the "Company") designs, manufactures and
markets a wide range of signal source and signal processing components and
devices which are used in communications equipment and systems, such as
cellular telephones and base stations, local area computer networks, and
satellite communications equipment, as well as military and aerospace
applications, such as advanced radar systems, missile guidance systems,
and navigational systems.  The Company sells its products primarily to
original equipment manufacturers of communications systems.

     The Company was founded in 1953 in Stamford, Connecticut and
relocated to Denver, Colorado in 1969.  The Company's corporate
headquarters is located at 4895 Peoria Street, Denver, Colorado 80239, and
its telephone number is 303/371-1560.  The Company also conducts certain
portions of its operations at three other buildings within a five-mile
radius of its Denver headquarters building.

Overview
--------

     The Company's products are used in wireless communications equipment.
Wireless communication is the transmission of voice and data signals
through the air, without a physical connection, such as a metal wire or
fiber-optic cable.  Information transmitted through wireless
communications equipment is transmitted by electromagnetic waves, also
known as signals. Electromagnetic waves vary in length, or frequency, and
intensity.  The range of electromagnetic waves is called the spectrum,
which encompasses sound near the low end and light toward the higher end.
In between is the radio spectrum which is used in all wireless
communications. Radio Frequency ("RF") indicates lower frequencies while
"microwave" refers to relatively higher frequencies in the spectrum.

     Different types of wireless communications systems utilize different
frequencies in the spectrum.  Frequency is measured in cycles per second,
or Hertz.  The spectrum currently in use by the various types of wireless
communications equipment ranges from 1 kiloHertz  (1 thousand cycles per
second) to 20 gigaHertz (20 billion cycles per second).  In the United
States, the Federal Communications Commission allocates portions of the
spectrum for different types of wireless communication systems.  Wireless
communications systems currently in use include cellular telephones and
base stations, local multipoint service distribution ("LMDS"), multipoint
multimedia service distribution ("MMDS") satellite communications, global
positioning systems, local area networks, personal communications systems
("PCS"), pagers, and direct broadcast satellites, as well as radar
systems, missile guidance systems and navigational systems.
Products
--------

     The Company produces a wide range of products which are, in essence,
basic building blocks used in many wireless communications systems, and
they perform a wide variety of RF and microwave signal source and signal
processing functions.  The Company's products and technologies are also
integrated vertically by the Company into specialized assemblies which
perform combinations of signal source and signal processing functions.
The Company produces both standard catalog and custom-designed products;
however, the majority of products shipped by the Company are custom
solutions tailored to individual customers' needs.

     Signal Source Components
     ------------------------

     One of the Company's major product lines is based on its patented
design of the voltage controlled oscillator ("VCO").  Oscillators are
components which generate a high quality RF/ microwave signal source
within a frequency range.  They are widely used in transmitting and
receiving equipment.

     Military/Aerospace Signal Source Components
     -------------------------------------------

     The Company produces several types of VCOs.  The Company's
Military/Aerospace Signal Source Components are wide-band VCOs which are
sophisticated, high reliability components manufactured in a clean-room
environment and hermetically-sealed.  They are sold for use in both
military/aerospace and high-end industrial applications.

     Commercial Signal Source Component VCO's
     ----------------------------------------

     One of the Company's Commercial Signal Source Component products, the
low-cost VCO, was introduced in 1994 into the cellular base-station
market.  A higher-volume production version of this VCO was introduced in
1998 into the subscriber market for cellular phones and pagers.  These
products are designed to perform at high levels of efficiency while being
priced competitively for commercial applications.

     Most of the increase in the Company's sales over the past five years
is attributable to the low-cost VCO.  Since 1997 the Company has made
significant investments in automatic manufacturing and test equipment to
manufacture low-cost VCOs in its Denver facilities.

     Besides direct sales to original equipment manufacturers and
component suppliers to such manufacturers, the Company's low-cost VCOs are
also utilized by the Company as components in its phase locked loop
synthesizers, discussed below.

     Subscriber Signal Source Components
     -----------------------------------

     In 1999, the Company continued the installation of a high-speed,
automated production line on the second floor of its corporate
headquarters, allowing the Company to compete for new business in
expanding subscriber applications markets.   This line represents a
fivefold increase in the Company's annual capacity for these products.

     Phase Locked Loop Synthesizers
     ------------------------------

     The Company introduced its first Commercial Signal Source Component
product, the phase locked loop synthesizer ("PLL"), in 1993.  The PLL is a
device made up of a VCO, a loop filter, and integrated circuits.  PLLs are
utilized in both transmitting and receiving equipment.  The PLL's function
is to generate a precise, stable frequency source, with accuracy, achieved
by locking the generated signal to an accurate reference signal. This
function is essential in communications equipment.

     As compared to its competitors, the Company's PLL exhibits superior
phase noise performance and settling time, low power use, operates with an
extended life, and is competitively priced.  The Company's PLL-300/400
series and low-cost VCOs are designed for use in applications such as
cellular telephones and cellular telephone base stations, personal
communications networks, personal communication systems, local area
computer networks, satellite communications, global positioning systems,
and direct broadcast systems.

Signal Processing Components
----------------------------

     Military/Aerospace Signal Processing Components
     -----------------------------------------------

     The Company produces a line of RF and microwave signal processing
components which are primarily used in military and space applications.
Among these products are power dividers and combiners used for directing
RF and microwave signals, solid state switches used to change the routing
of RF and microwave signals, and transformers used to convert signals
between different impedances.  The Company also produces mixers and phase
detectors which are used to convert the frequency of RF and microwave
signals into usable information and data.

     Military and space applications of these products, as well as the
Company's wide-band VCOs, described above, include the radar systems of
military aircraft, the guidance systems of anti-aircraft and anti-missile
missiles, and military and commercial satellites.  The military programs
using these products include the Patriot missile, AMRAAM missile, Harm
missile, PRC104 Man-Pac radio, F14, F15 and F18 fire control systems,
Phoenix missile, F16 radar systems (tail warning) and the Standard Missile
II.  These components, together with the wide-band VCOs, formed the
original product lines of the Company and continue to be the Company's
most technically advanced products, often utilizing technologies developed
by the Company.  They are typically very high reliability, high
performance, custom designed components.  The production of custom
designed components usually entails the modification of existing products
to meet the specific performance criteria of the customer, but may, in
certain instances, require the design of an entirely new product.  In this
area, because the components are manufactured to its customers'
specifications, the Company is often a sole source supplier.

     Commercial Signal Processing Components
     ---------------------------------------

     Through its Signal Processing Components engineering group, the
Company patented technology for a high-impedance ratio, wide-band
transformer circuit used in the conversion of radio frequency signals to
light wave signals.  This patent was approved in April 1997 by the U.S.
Patent and Trademark Office.  A 1998 patent was awarded for a design
improvement to this product.  Demand for the "fiber-optic" transformer
circuit comes from a variety of applications, including cable access
television ("CATV").

Manufacturing
-------------

     The Company's Commercial Signal Source Components and Subscriber
Signal Source Components products are manufactured with automated "pick
and place" assembly equipment.  Until 1997, these products were
manufactured by third-party contract manufacturers in the United States.
In 1997, the Company brought this process in-house with the acquisition of
two automated assembly lines.  In 1998, additional equipment was purchased
to automate other steps in the production and testing processes.  Also in
1998, the Company initiated the installation of a high-speed, automated
production line in its state-of-the-art manufacturing facility on the
second floor of its corporate headquarters, allowing the Company to
compete for new business in expanding subscriber applications markets. The
new line gives the Company the ability to produce an additional 8 million
units annually. This line was utilized at approximately 20% to 25%
capacity as of December 31, 1999.

     The length of the production process for products manufactured
through the Company's automated assembly lines is one to three weeks.
Manufacturing of the Company's other products, which involves less
automated assembly, takes from one to fifty-two weeks.  The Company may
maintain inventory of the raw materials required for production of its
products for a period of up to one year or more.

     At the present time, the majority of the Company's products are
manufactured at the Company's various facilities in Denver, Colorado.
Portions of certain commercial signal processing components are assembled
at contract manufacturers outside of the United States to benefit from
reduced labor costs on certain labor-intensive builds.  All of these
assemblies are completed and tested in Denver, Colorado.

     In December 1998, the Company received patent protection from the
Chinese government for its products, which clears the way for the Company
to proceed with a sales and distribution joint venture with a State-run
company in China.  Pursuant to a 1996 joint venture agreement, the Company
invested significant resources to obtain this patent protection with a
strategy of developing a manufacturing facility in China.  While the time-
consuming patent process was ongoing, the Company installed its new,
automated production facility in Denver.   The Company is currently
focused on sales and distribution in China, although it has not ruled out
a Chinese manufacturing facility.

Suppliers
---------

     The Company currently has approximately 250 suppliers and
historically has not experienced any unusual supply problems.  There are
certain components used in the commercial and subscriber production of
VCO's which have become in short supply because of a high, world-wide
demand.  The Company has actively increased travel to and communications
with the manufacturers and distributors of these components, domestically
and internationally, in addition to increasing inventory levels on these
affected components, to maximize the Company's ability to maintain the
highest possible production levels on products which incorporate these
components.

Sales and Marketing
-------------------

     Originally,  the Company's primary business was to engineer,
manufacture and market high performance, high reliability, RF and
microwave signal source and signal processing components used in military
applications, such as missile guidance systems, advanced navigational
systems and advanced radar systems.  In 1993, the Company expanded its
focus to the commercial marketplace to lessen the Company's susceptibility
to trends in defense spending and to seek a share of the dramatic growth
anticipated for commercial wireless communications.  As a result of this
shift, fluctuations in the Company's business are now more dependent on
general business cycles, changes in market demand for the commercial and
subscriber products built with the Company's components, and on
technological innovations.  In 1991, the approximate mix of customer
orders was 25% for commercial applications and 75% for military
applications. In 1999, this mix was approximately 89% for commercial
applications and 11% for military applications.

          The following table lists the Company's sales revenues for each
of the past five years according to the Company's product lines:

<TABLE>
<CAPTION>
                                            Sales Revenues
                                            (In thousands)

                                  1999          1998         1997
                                  ----          ----         ----

<S>                             <C>           <C>           <C>

Mil/Aero Signal
  Processing Components         $ 1,667       $ 2,118      $ 1,897
Commercial Signal
  Processing Components           1,601         1,060        1,392
Mil/Aero Signal
  Source Components               2,324         3,211        4,957
Signal Processing
  Components
     Special Assemblies              30           185          262
Commercial Signal
  Source Components              17,226        11,489        8,877
Subscriber Signal
  Source Components               1,006          -0-           -0-
Commercial Special
  Assemblies                        427          -0-           -0-
                                -------       -------      -------
                                $24,281       $18,063      $17,385
                                =======       =======      =======
</TABLE>

<TABLE>
<CAPTION>


                                            Sales Revenues
                                            (In thousands)

                                 1996                   1995
                                 ----                   ----

<S>                             <C>                    <C>

Mil/Aero Signal
  Processing Components         $ 1,738                $2,345
Commercial Signal
  Processing Components             -0-                   -0-
Mil/Aero Signal
  Source Components               3,825                 3,829
Signal Processing
  Components
     Special Assemblies           1,025                   776
Commercial Signal
  Source Components               5,622                 2,518
Subscriber Signal
  Source Components                 -0-                   -0-
Commercial Special
  Assemblies                        -0-                   -0-
                                ------                 ------
                                $12,210                $9,468
                                =======                ======

</TABLE>


     The Company's sales are made primarily through independent sales
representatives who promote and solicit orders for the Company's products
on a commission basis in exclusive marketing territories.  The Company
selects its sales representatives on the basis of technical and marketing
expertise, reputation within the industry, and financial stability.  These
sales representatives also represent other manufacturers with products
complementary to, rather than competitive with, the Company's products.
The Company normally engages 15 to 20 sales representative firms in the
U.S. and also has 17 sales representatives covering 28 foreign countries.
The Company now employs an Eastern Regional Sales Manager, a Western
Regional Sales Manager, a Director of Military/Aerospace Sales, a Director
of Program Management, a European/Pacific Rim International Sales Manager,
a Director of Sales-Ericsson Worldwide Accounts, a Director of Sales-Nokia
Worldwide Accounts, and a Vice-President of Sales and Marketing, who is
also the acting Director of Sales-Motorola Worldwide Accounts, all of whom
work together to manage and coordinate the activities of the sales
representatives.

     In addition to the efforts of its independent sales representatives,
the Company uses various methods to directly promote its products,
including field visits to customers, advertising in trade journals,
authoring technical articles for publication in trade journals, and
participation in trade show product seminars and exhibitions.

Customers
---------

     The Company sells primarily to original equipment manufacturers of
communications equipment in either the commercial or military marketplace.
Many of those customers are larger Fortune 500 companies with world-wide
operations or prime contractors for military work.  Management believes it
has a strong reputation with these and other customers for high
performance products and solutions.

     Key customers of the Company include Adaptive Broadband, Glenayre
Technologies/Wireless Access, Ericsson, LGIC, Lucent Technologies,
Motorola, Neopoint, Netro, Newbridge Networks, Nokia, Siemens, Sharewave
and SpectraPoint in the commercial and subscriber markets, and Harris,
Hughes, Lockheed Martin, Mitsubishi, NEC, Northrop Grumman, Raytheon and
Saab Ericsson in the military and aerospace market.  In 1998, Motorola and
Nokia accounted for 16% and 11% of sales revenues, respectively.  The
Company's two largest customers in 1999 were also Motorola and Nokia, with
22% and 15% of sales revenues, respectively.  Notwithstanding this
concentration, the Company does not believe that its business is dependent
on any one of its customers.

     The Company's customers have historically bought products from the
Company on the basis of purchase orders, rather than long-term supply
contracts. The Company enters into long term purchase agreements with some
of its larger commercial customers.  These agreements establish preferred
vendor status for the Company and, in certain cases, set minimum amounts
which will be purchased by the customer over the term of the agreement.

Competition
-----------

     The Company is subject to active competition in the sale of virtually
all of its products. Many of its competitors, including divisions of major
corporations, have significantly greater resources than those currently
available to the Company.  Additionally, some of the Company's customers
compete with the Company by manufacturing certain components themselves,
rather than purchasing them from the Company.  While some large foreign
firms, principally Japanese, still have the ability to manufacture
competitive products in larger production runs than the Company, the
Company's expanded capacity has materially increased its own mass
production capabilities.

     The Company believes that its surface mount products for commercial
applications compete with other manufacturers' products on the basis of
their unique features, price and performance.  The Company believes that
its products manufactured for military applications, including its Signal
Processing Components and Wide-Band VCOs, compete on the basis of quality
and performance.  These products are typically high performance, high
reliability components which are required to meet high quality system
standards.

     The Company believes Merrimac and Stellex Microwave are its largest
competitors in the signal processing components market. The Company
believes that Mini-Circuits, M/A-Com and Z-Comm are its largest
competitors in the commercial signal source components market and that
Murata, Panasonic, Fujitsu and Alps are its largest competitors in the
subscriber signal source components market.  Remec/Magnum competes with
the Company primarily in the wide-band, hermetically-sealed VCO
marketplace.  PLL competitors include Panasonic, M/A-Com and Synergy.
While many of these competitors have significantly greater financial and
other resources than the Company, the Company believes that it will
continue to be able to successfully compete in these markets because of
the strength of its existing technology and its ongoing commitment to
technological innovation.

Research and Development
------------------------

     The Company's products are marketed in a highly competitive and
rapidly changing technological environment.  Consequently, the Company has
historically invested heavily in its research and development programs.
For the years ended December 31, 1999 and 1998, the Company expended
approximately $1,675,000 and $1,155,000, respectively, on such programs.

     Joseph H. Kiser, Chief Scientific Officer, directs the research and
development efforts of the Company.  Mr. Kiser has been largely
responsible for many of the technological successes and innovations of the
Company over the past 41 years and is the author of the Company's VCO
patent.  He heads up a 51 member team of engineers and other technically
trained personnel who perform research and development in addition to
providing process and production assistance to other departments.

Patents
-------

     The patent on the Company's wide-band VCO was issued in the U.S. on
November 4, 1986, in Canada on April 17, 1990, and by the European Patent
Office on April 3, 1992.  The U.S. patent will expire in 2005.  The
Canadian patent will expire in 2007 and the European patents will expire
in 2006. In December of 1998, the Company received Chinese patent approval
on components used in base stations, handsets and pagers.

     The Company also owns U.S. patents for (i) a Broadband Mixer with
Coplanar Balun, expiring in 2000, (ii) a High Impedance Ratio Wideband
Transformer Circuit expiring in 2015, (iii) a 1.2 Volt Voltage Controlled
Oscillator expiring in 2016 and (iv) an Unbalanced to Balanced High
Impedance Ratio Wide-Band Transformer Circuit, expiring in 2015.

     Additionally during 1999, the Company received approval from the U.S.
Patent and Trademark Office on five new patents which expire in 2017.  In
January, the Company announced two patents for a "Sliver Board Orthoganal
Mounted Substrate Resonator" and a "Continually Adjustable Resonator".
This breakthrough technology enables high-volume, automated production of
advanced high-frequency components. In June, the Company announced a
"Multiple Single-Layer Monolithic Passive Integrated Circuits and Method"
patent.  This technology improves the manufacturing process of VCOs for
subscriber applications such as wireless phones and pagers by lowering
material costs and shortening assembly times by integrating multiple
components into a single unit during production.  In July, the Company
announced patents for a "Switched Mode Oscillator" and a "Passive Switched
Oscillator Output Circuit".  Both patents apply to critical improvements
of the Company's dual-band VCOs.  The Switched Mode Oscillator allows the
VCOs to operate on two significantly different frequencies with only a
single transistor.  The Passive Switched Oscillator Output Circuit enables
two oscillators to be integrated into a single unit with a minimum of
added circuitry. These patents bring improvements to production cost, and,
in the case of the Passive Switched Oscillator Output Circuit, reduces
component size.

     Including the China patent, the Company has earned a total of nine
patents since the beginning of 1997, many of which cover technology
significantly improving commercial and subscriber products and the methods
by which they are manufactured.

     To the Company's knowledge, there are no asserted claims by other
parties against the Company's patents or its other proprietary
technologies.

     In the absence of patents, the Company relies upon nondisclosure
agreements and trade secret laws to protect its confidential and
proprietary information.  Due to the rapid rate of technological change in
its markets, the Company believes that the ability to innovate is of
greater importance to its business than availability of patents and
proprietary rights.  Barriers to competitor entry for non-patented
technology include the time and expense to design and manufacture
components and the difficulty of selling to those customers who have
already designed the Company's components into their equipment.

Government Regulation
---------------------

     In many instances, the Company has been required to obtain export
licenses before filling foreign orders.  United States Export
Administration regulations control high technology exports like the
Company's products for reasons of national security, compliance with U.S.
foreign policy, protection of domestic reserves of products in short
supply and, under certain circumstances, for the security of a destination
country.  Any foreign sales of the Company's products requiring export
licenses must comply with these general policies.  During 1998, the U.S.
State Department restricted certain exports, including many of the
Company's products, to India due to nuclear testing by, and resulting
tensions between, India and Pakistan.  In 1999, the restrictions remained
in place and continued to hinder the Company's sales in that market.

Employees
---------

     As of December 31, 1999, the Company had 219 full-time employees and
10 part-time employees, including 41 engaged in management and
administration, 51 in engineering, 122 in production and testing, and 15
in sales.  The Company believes that its employee relations are good.

ITEM 2.  DESCRIPTION OF PROPERTY

     The Company began leasing its corporate headquarters (Building 4) in
Denver, Colorado in November 1997.  Building 4 has approximately 30,800
square feet and houses the Company's administration, sales, personnel,
quality assurance, finance, and management information systems departments
on its first floor.  The second floor of Building 4 is the site of the
Company's highly-automated pick and place assembly line for products aimed
at the subscriber market, the assembly facility for the Company's
commercial special assembly products, the commercial and subscriber
engineering and advanced design departments, the Company's process
engineering and automated test equipment fabrication facility, and a
training facility.  The Building 4 lease expires on September 1, 2013, and
provides for a monthly base rental of $44,890, which includes
approximately $2,000 per month for a property tax and insurance accrual,
through August 31, 2003, with possible increases each year thereafter.
The Company is also obligated to pay maintenance and other expenses on the
facility for the term of the lease.  The lease may be extended at the
option of the Company for two additional terms of five years each.

     In 1998 the Company remodeled its former headquarters building, an
approximately 20,200 square foot facility in Denver, Colorado (Building
1).  This building houses all aspects of the Company's military/aerospace
signal processing components and signal source components operations and
commercial signal processing components operations in a single facility.
The Building 1 lease, which expires on June 30, 2002, provides for a
monthly base rental of $10,333 through June 30, 2000 with increases each
year thereafter up to $10,920 per month during the final year.  The
Company is obligated to pay taxes, insurance, maintenance and other
expenses for the term of the lease.  After 2002, the lease may be extended
at the option of the Company for two additional terms of two years each.

     The Company leases another facility in Denver of approximately 13,650
square feet (Building 2) which currently houses all of the Company's
engineering, purchasing and production operations for its commercial
signal source component products. The Company's two pick and place
assembly lines for the commercial infrastructure market, including VCOs
used in cellular and PCS base stations, are in Building 2.  The lease, as
amended during 1998, expires on October 31, 2005, and provides for a
monthly base rental of $10,801 per month.  The Company is responsible for
payment of taxes, insurance, maintenance and other expenses.  The facility
is leased from a partnership in which an executive officer of the Company,
Joseph H. Kiser, is a partner.

     The Company leases a fourth facility (Building 3) in Denver which
houses the Company's machine shop.  Building 3 has approximately 8,800
square feet and the lease, as amended, expires August 1, 2003.  The
monthly base rental is $3,279 plus taxes, insurance, maintenance and other
expenses.  The facility is leased from Joseph H. Kiser, an executive
officer of the Company.

     The Company also leases an apartment in Denver, near its
administrative offices, which serves as corporate housing for certain
managers whose primary residences are outside of the state but who spend a
significant amount of time in Denver.  This unit can house up to four
individuals at a time and is subject to a one-year lease which expires
September 30, 2000.  The monthly base rental is $1,245.

ITEM 3.  LEGAL PROCEEDINGS

     The Company has recently brought a collection action against the
successor to a former customer for nonpayment of two longstanding invoices
totaling approximately $550,000.  No other material legal proceedings to
which the Company is a party or to which the property of the Company is
subject are pending and no such proceedings are known by the Company to be
contemplated.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     There were no matters submitted to a vote of security holders of the
Company during the fiscal quarter ended December 31, 1999.

                                  PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

Market
------

     The Company's common stock is traded under the symbol "VARL" on the
Nasdaq National Market.  The following table sets forth the high and low
prices for the common stock for the periods indicated:

<TABLE>
<CAPTION>

                                             High            Low
                                             ----            ----

1998
----
<S>                                        <C>            <C>
Fiscal quarter ended March 31, 1998        $10-5/8          $7-3/8
Fiscal quarter ended June 30, 1998         $14-3/4            $8
Fiscal quarter ended September 30, 1998    $10-5/8          $5-1/8
Fiscal quarter ended December 31, 1998      $9-3/4         $4-15/16

1999
----

Fiscal quarter ended March 31, 1999         $8-3/8          $5-3/4
Fiscal quarter ended June 30, 1999          $9-5/8         $5-60/64
Fiscal quarter ended September 30, 1999    $14-3/16        $8-29/64
Fiscal quarter ended December 31, 1999       $35            $9-7/8

</TABLE>

Holders
-------

     As of December 31, 1999, there were approximately 210 holders of
record and in excess of 1,000 beneficial owners of the Company's common
stock.

Dividends
---------

     The Company has never declared or paid a cash dividend on its common
stock.  The Board of Directors presently intends to retain all earnings
for use in the Company's business and, therefore, does not anticipate
paying cash dividends in the foreseeable future.  The declaration of cash
dividends, if any, in the future would be subject to the discretion of the
Board of Directors, which may consider such factors as the Company's
results of operations, financial condition, capital needs, and any
contractual or other restrictions.

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Overview
--------

     Net income for 1999 increased 26%, to $3.4 million, or 60 cents per
basic share and 57 cents per diluted share, compared with net income of
$2.7 million, or 50 cents per basic share and 48 cents per diluted share,
for 1998.  Sales of the Company's products increased approximately $6.2
million, or 34%, from 1998 to 1999.  Shipments of commercial products were
up $7.7 million, or 61%, from 1998 to 1999.  A portion of that gain was
offset by reduced sales of military/aerospace products which declined
approximately $1.5 million, or 27%, from 1998 to 1999.   Commercial
shipments are expected to continue to improve in 2000 as the Company
further penetrates the subscriber applications market.  Military/aerospace
shipments are also expected to improve.

     In the early part of 1999, military/aerospace operations were
downsized due to reduced orders even while military/aerospace engineering
was upsized to re-engineer the product designs, resulting in reduced
production costs and sales price improvements for our military/aerospace
customers.  By the end of the year, bookings of firm customer orders for
military/aerospace products had increased 10% over the prior year.
Shipments are expected to increase in the future due to those efforts, the
Company's successful ISO 9001 certification for its military/aerospace
operations, and increased federal defense spending.

     Manufacturing costs as a percent of sales remained approximately 45%
in 1998 and 1999.  Net income, as a percent of revenue, decreased slightly
from 1998 to 1999, from 15% to 14%, due primarily to the combination of a
decrease in interest income (.7%), an increase in contributions to the
Company's pension and profit sharing plan (.8%), and a decrease in other
expenses (-.3%).

     During 1999, Vari-L had significant successes in its various product
lines, furthering the Company's goals for quality growth and
profitability:

     o    The Company's military/aerospace production operations received
          ISO 9001 certification.  This highly visible designation, which
          assures customers that Vari-L has acted to insure consistent
          levels of durability and excellence in its military/aerospace
          components operations, significantly enhances the Company's
          reputation and bolsters the marketability of its products,
          particularly with non-U.S. customers.

     o    Installation of a state-of-the art manufacturing facility was
          completed on the second floor of its corporate headquarters,
          allowing the Company to compete for new business in the
          expanding subscriber applications markets.  At December 31,
          1999, this facility was operating at approximately 20% to 25%
          capacity.

     o    The Company received approval from the U.S. Patent and Trademark
          Office on five new patents.

     --   In January, the Company announced two patents for a "Sliver
          Board Orthoganal Mounted Substrate Resonator" and a "Continually
          Adjustable Resonator". This breakthrough technology enables high-
          volume, automated production of advanced high-frequency
          components.

     --   In June, the Company announced a "Multiple Single-Layer
          Monolithic Passive Integrated Circuits and Method" patent.  This
          technology improves the manufacturing process of VCOs for
          subscriber applications such as wireless phones and pagers by
          lowering material costs and shortening assembly times by
          integrating multiple components into a single unit during
          production.

     --   In July, the Company announced patents for a "Switched Mode
          Oscillator" and a "Passive Switched Oscillator Output Circuit".
          Both patents apply to critical improvements of the Company's
          dual-band VCOs.  The Switched Mode Oscillator allows the VCOs to
          operate on two significantly different frequencies with only a
          single transistor.  The Passive Switched Oscillator Output
          Circuit enables two oscillators to be integrated into a single
          unit with a minimum of added circuitry. These patents bring
          improvements to production cost, and, in the case of the Passive
          Switched Oscillator Output Circuit, reduce component size.

     o    The Company entered into several purchase agreements for the
          delivery of commercial, broadband components used in more
          complex subassemblies for the Local Multipoint Distribution
          Service (LMDS) and Multipoint Multimedia Distribution Service
          (MMDS) networks that are the backbone of "last-mile" wireless
          communications.  While these agreements will account for only a
          small percentage of expected near-term revenue from our
          commercial business, they do demonstrate the potential for
          substantial growth in this market as consumer demand for
          broadband services grows.

     --   The Company entered into agreements with Netro, a division of RO
          Computers Devices Pty Limited, and Stanford Wireless Broadband,
          Inc., a subsidiary of Stanford Telecommunications, to produce,
          in combination, $2.4 million in broadband communications
          products.  Netro will integrate the Company's signal source
          components into products that offer multipoint, high-speed
          networking for Internet, voice and frame-relay traffic.
          Stanford is purchasing subassemblies for its new Local
          Multipoint Distribution Service (LMDS), which gives
          communication providers a faster, more cost-effective way to
          deliver internet access and video and voice services.

     --   The Company entered into a $1.l million agreement with Adaptive
          Broadband, Inc. to produce components for wireless microwave
          radio networks, including point to point networks.  Pursuant to
          this agreement, the Company is to deliver narrow-frequency VCOs
          over the next two years beginning with the fourth quarter of
          1999.

Results of Operations
---------------------

                            Operating Revenues
                            ------------------

     Sales revenues increased approximately $6.2 million (34%) in 1999,
from $18.1 million in 1998 to $24.3 million in 1999.  Revenues from the
Company's commercial signal source components  were approximately $17.2
million, or 71% of revenues, in 1999 as compared to $11.5 million, or 64%,
in 1998. Revenues from sales of the Company's military/aerospace signal
source components products were approximately $2.3 million, or 10% of
revenues, in 1999 as compared to $3.2 million, or 18%, in 1998.  Revenues
from the Company's military/aerospace signal processing components
products were approximately $1.7 million, or 7% of revenues, in 1999 as
compared to $2.1 million, or 12%, in 1998. Revenues from the Company's
commercial signal processing components products were approximately $1.6
million, or 6% of revenues, in 1999 as compared to $1.0 million, or 5%, in
1998. Revenues from sales of products that combine the Company's signal
processing components and signal source components were approximately $.1
million in 1999, or less than 1% of revenues, as compared to $.2 million,
or 1% of revenues, in 1998. Revenues from sales from subscriber signal
source components products were approximately $1.0 million, or 4%, in
1999, as compared to less than 1% in 1998. Revenues from sales from
commercial special assembly components products were approximately $.4
million, or 2%, in 1999, as compared to less than 1% in 1998.

                            Cost of Goods Sold
                            ------------------

     Cost of goods sold, as a percent of sales revenues, was 45% in 1999
and 1998.  Gross profit margins were 55% for 1999 and 1998.  It is
anticipated that cost of goods sold and gross profit margins will continue
to be relatively constant in the near future as the amortization of the
costs of new and expanded manufacturing facilities are offset by increased
sales and decreases in the personnel cost of manufacturing across all of
the Company's product lines.

                    General and Administrative Expenses
                    -----------------------------------

     General and administrative expenses increased approximately $535,000,
or 27%, from $1,956,000 in 1998 to $2,491,000 in 1999.  The increase to G
& A primarily resulted from  increased personnel and staffing costs,
increased board of director and committee activity, and related legal and
accounting costs, some of which can be attributed to management's
commitment to meet or exceed the newly adopted requirements imposed by the
"Blue Ribbon Committee" of the SEC and Nasdaq concerning increased
scrutiny of financial reporting, and an increase of $100,000 in the
reserve for uncollectible receivables.

                           Engineering Expenses
                           --------------------

     Engineering expenses increased approximately $520,000, or 45%, from
$1,155,000 in 1998 to $1,675,000 in 1999, primarily reflecting the
expansion of the engineering team, plus the related costs of recruiting,
equipment depreciation, and other expenses of this increasing emphasis on
building the Company's team of technical experts and innovators.

                             Selling Expenses
                             ----------------

     Selling expenses increased approximately $665,000, or 32%, from
$2,085,000 in 1998 to $2,750,000 in 1999, reflecting the sales commissions
on increased revenue of $6.2 million and a 25% increase in personnel in
the Sales Department, including the hiring of a Director of Sales-Ericsson
Worldwide Accounts and a Director of Sales-Nokia Worldwide Accounts.

                        Interest Income and Expense
                        ---------------------------

     The Company manages its credit facility and interest bearing
investments in tandem.

     Interest expense increased approximately $236,000, or 36%, from
$663,000 in 1998 to $899,000 in 1999.  The increase reflects the increase
in interest for long-term debt used to finance capital improvements and
fixed assets purchased during 1999.

     Interest income decreased approximately $66,000, or 20%, from
$328,000 in 1998 to $262,000 in 1999.  The Company's investment in a money-
market mutual fund of U.S. Government securities, from which interest
income is earned, was approximately $9.0 million at December 31, 1999 and
$6.5 million at December 31, 1998.  During the fourth quarter of 1999, a
significant portion of the proceeds from the exercises of warrants and
employee stock options were invested in the money fund. The amount of
monies in the fund averaged $6.9 million per month in 1998, versus an
average of $5.7 million per month in 1999.

                     Profit Sharing Plan Contribution
                     --------------------------------

     During 1990, the Company adopted a qualified profit sharing plan for
its employees.  Annual contributions to the plan, which may be in the form
of cash or shares of the Company's stock, are determined by the Board of
Directors at its sole discretion.

     During 1998, $4,000 of cash contributions were made to the plan.
During 1999, shares of the Company's common stock, valued at approximately
$101,000, and cash contributions of approximately $87,000, were
contributed to the plan.

                       Depreciation and Amortization
                       -----------------------------

     Depreciation and amortization increased approximately $637,000, or
51%, from $1,240,000 in 1998 to $1,877,000 in 1999.  The increase reflects
depreciation on increased investments in property, equipment and leasehold
improvements and amortization of costs pertaining to ISO certification and
patents.  Depreciation and amortization expense is expected to continue to
increase as a result of these and future capital investments.

                              Other Expenses
                              --------------

     Other expenses decreased approximately $38,000, or 54%, from $70,000
in 1998 to $32,000 in 1999, due primarily to the final payment in June
1998 of costs related to a 1992 covenant not to compete.

                                Net Income
                                ----------

     Net income increased approximately $707,000, or 26%, from $2,696,000
in 1998 to $3,403,000 in 1999.  The increase in net income was due
principally to increased revenues of $6.2 million from 1998 to 1999.

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

     Basic earnings per share increased 10 cents, or 20%, from $.50 in
1998 to $.60 in 1999 on weighted average outstanding shares that increased
265,000 shares, or 5%, from 5,407,000 shares in 1998 to 5,672,000 shares
in 1999.

     Diluted earnings per share increased 9 cents, or 19%, from $.48 in
1998 to $.57 in 1999 on weighted average shares outstanding and dilutive
securities that increased 407,000, or 7%, from 5,610,000 in 1998 to
6,017,000 in 1999.

                            Financial Condition
                            -------------------

                                  Assets
                                  ------

     Total assets increased approximately $16.7 million during 1999.  The
increase resulted from a significant increase in cash from stock option
and warrant exercises in the fourth  quarter of the year, and investments
in increased inventories and capital investments in the Company's
infrastructure, patents and ISO 9001 registration.

     Cash and cash equivalents increased approximately $8.3 million,
reflecting the exercises, during the fourth quarter of 1999, of stock
options for approximately 500,000 shares and warrants for 657,000 shares
of the Company's common stock.

     Trade accounts receivable increased approximately $.3 million, net of
the allowance for doubtful accounts, or 8%, from December 31, 1998 to
December 31, 1999, reflecting shipments in the fourth quarter of 1999 that
were higher than the shipments in the fourth quarter of 1998.

     Inventories increased approximately $2.4 million, or 30%, during
1999.  Components of the increase were approximately $1.0 million in
finished goods and $1.6 million in raw materials, offset by a decrease in
work in process of approximately $0.2 million.  Finished goods increased
as a result of the Company's decision to provide a faster turnaround of
products to its customers by shortening the lead times on deliveries; raw
materials increased as a result of the Company's decision to supplement
inventory levels of certain components, used in the commercial and
subscriber production of signal source products, which have become in
short supply because of a high, world-wide demand for them; work in
process inventories decreased due to improved processes which enable
placing covers, testing, labeling and packaging products to be completed
more quickly.

     Property and equipment increased approximately $5 million as a net
result of extensive capital improvements and acquisitions and depreciation
during 1999.  This included the expanded tenant finish of the second floor
of the Company's headquarters to house the assembly facility for the
Company's commercial special assembly products, the commercial and
subscriber engineering and advanced design departments, the Company's
process engineering and automated test equipment fabrication facility, and
a training facility, in addition to the final installation of the high-
speed test and automated production equipment for the assembly of the
Company's line of products being sold into the subscriber marketplace.

     Patents increased approximately $.6 million in 1999.  The Company
obtained approval for five new patents during the year.  Other assets,
which include costs for the Company's registration under ISO 9001,
increased approximately $.3 million, net of amortization,  during 1999.
The Company received ISO 9001 certification for its military and aerospace
operations in August 1999.

                                Liabilities
                                -----------

     Total liabilities decreased approximately $700,000 during 1999,
primarily due to approximately $1.1 million in decreased trade payables
and deferred income taxes and repayments on the line of credit, offset by
approximately $400,000 in increased term debt.

                           Stockholders' Equity
                           --------------------

     Common stock and paid-in capital increased approximately $14.0
million during 1999 due to the exercise of stock warrants from the
Company's 1997 convertible debenture offering, the exercise of stock
options, the issuance of shares under the employee stock purchase plan,
and the issuance of shares under the Company's stock grant plan.

                                 Liquidity
                                 ---------

     At December 31, 1999, the Company's working capital was $27.4 million
compared to $16.4 million at December 31, 1998.  The Company's current
ratio was 8.4 to 1 at December 31, 1999 compared to 5.4  to 1 at December
31, 1998.

     The increase in working capital was due to several factors. Cash and
cash equivalents increased approximately $8.3 million, inventories
increased approximately $2.5 million, trade accounts receivable increased
approximately $.3 million, and trade payables and accrued expenses
decreased approximately $.2 million. These improvements were partially
offset by an increase in current maturities of long-term debt ($.2
million), and a decrease in prepaid expenses ($.1 million.)

                             Capital Resources
                             -----------------

     The Company has credit facilities with two banking institutions.  The
first consists of a $6.0 million line of credit agreement.  The second
consists of two agreements, a $4.1 million term loan agreement and a $4.0
million revolving equipment term loan agreement.

     The line of credit was restructured on May 18, 1999 to provide for
borrowings of up to $6.0 million.  Interest is payable monthly, calculated
at prime.  The line of credit matures April 30, 2001.  At December 31,
1999, the outstanding balance due under the line of credit was $4,016,112.
The Company's accounts receivable, inventory, and general intangible
assets secure the line of credit.

     The Company's term loan has a floating rate of Libor plus 1.5% with
fixed rate protection through an interest rate swap agreement which
results in an all-in fixed rate of 7.75% through the maturity date of
February 24, 2002.  Monthly principal and interest payments of
approximately $65,000 are required.  At December 31, 1999, the balance due
under the term loan was $3,589,393.

     The revolving equipment term loan provides for borrowings up to $4.0
million.  Interest accrues on the outstanding principal balance of the
revolving equipment term loan at prime plus .25 percent when advances are
made under the revolver.  These borrowings can be converted to term notes
at rates which adjust to the three-year treasury note rate plus 1.95
percent.  When converted, the term debt requires monthly principal and
interest payments calculated on a seven-year amortization basis with a 42-
month maturity.  The revolving loan maturity date has been extended to
February 13, 2000.  As of December 31, 1999, the balance of the
outstanding advances under the revolving loan that had been converted to
term notes totaled $3,497,903.  Interest accrues on the outstanding
principal balances of these term notes at rates ranging from 6.10 percent
to 7.72 percent, and monthly principal and interest payments totaling
$57,486 are required.  The Company's property and equipment secure the
term loan and revolving equipment term loan.

     The Company has separately financed the purchase of motor vehicles
with promissory notes bearing interest at rates ranging from 7.75 percent
to 8.50 percent.  Monthly principal and interest payments totaling $2,826
are currently required.  The notes mature from 2002 through 2003.

     The Company finances certain of its annual insurance premiums through
a financing company.  The amount due under these loans totaled $38,175 as
of December 31, 1999 and is paid in monthly installments of $6,692 with an
interest rate of  8.3%.

     On March 4, 1997, the Company entered into an agreement to sell up to
75 units of debentures and warrants.  The units consisted of an aggregate
of $7.5 million in four year, 7% convertible debentures and 750,000 non-
redeemable common stock purchase warrants exercisable at $9.50 per share
for a period of three years.  All of the debentures plus accrued interest
were converted into common stock during 1997 and 85,000 warrants were
exercised by the end of 1998.  During 1999, the last 665,000 warrants were
exercised.

     The Company believes that it has sufficient financial resources
available to meet its short-term working capital needs through cash flows
generated by operating activities and through the management of its
sources of financing.  The Company also believes that, partially as the
result of the recent warrant and stock option exercises, it has adequate
capital resources to continue its growth plans.

                                  Backlog
                                  -------

     Total backlog of unfilled firm customer orders at December 31, 1999
was $22.6 million compared with $18.1 million at December 31, 1998.  The
increase in firm customer orders reflects the Company's success in
capturing a substantial portion of the market for cellular infrastructure,
purchased-VCOs in Western Europe, and increases in commercial domestic
markets.

                             Year 2000 Issues
                             ----------------

     The Company gave serious attention to the potential problems that
could have arisen from the rollover of computer clocks with two-digit year
fields when the year 2000 arrives.  By December 31, 1999, the Company had
successfully completed all of its Year 2000 preparedness measures.

     The costs that the Company incurred which were specific to the
assessment and remediation of Year 2000 issues were not material.  No
special expenditures were required in the area of software or hardware;
the Company's growth over the last several years had enabled the Company
to purchase hardware and software that met Year 2000 compliance criteria.
Some legal fees and educational expenses were incurred to heighten
awareness and to help organize business activities to incorporate
assessment and remediation.  For the most part, however, Year 2000 issues
were incorporated into other management routines, thereby minimizing
extraordinary costs.

     The Company was very diligent to monitor the effects prior to and
with the advent of the clock rollover to January 1, 2000 and subsequent
time periods.  The impact, if any, was negligible.  The Company has not
seen any negative effects of the rollover in the business it does with
either its vendors or customers.

     While there is no guarantee that there will be no residual effect
from the Year 2000 rollover, the Company believes that it would be minimal
and within the ability of the Company to manage it without any noticeable
impact to operations.

                        Forward Looking Statements
                        --------------------------

     Some of the statements contained in this document are forward-looking
statements.  The accuracy of these statements cannot be guaranteed as they
are subject to a variety of risks including, but not limited to the
success of the products into which the Company's products are integrated,
governmental action relating to wireless communications licensing and
regulation, internal projections as to the demand for certain types of
technological innovation, competitive products and pricing, the success of
new product development efforts, the timely release for production and the
delivery of products under existing contracts, future economic conditions
generally, as well as other factors.

ITEM 7.  FINANCIAL STATEMENTS.
     See pages F-1 through F-28 for this information.

                           Vari-L Company, Inc.
                       Index to Financial Statements
                        December 31, 1999 and 1998

          Independent Auditor's Report                      F-1
          Balance Sheets                                    F-2 - F-3
          Statements of Income                              F-4
          Statements of Stockholders' Equity                F-5
          Statements of Cash Flows                          F-6
          Notes to Financial Statements                     F-7 - F-28

     Financials inserted here with separate page numbering F-1 to F-28.



                     REPORT OF INDEPENDENT ACCOUNTANTS
                     ---------------------------------



To the Board of Directors and Stockholders
Vari-L Company, Inc.

     We have audited the accompanying balance sheets of Vari-L Company,
Inc. as of December 31, 1999 and 1998, and the related statements of
income, stockholders' equity, and cash flows for the years then ended.
These financial statements are the responsibility of the Company's
management.  Our responsibility is to express an opinion on these
financial statements based on our audits.

     We conducted our audits in accordance with generally accepted
auditing standards.  Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement.  An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements.  An audit also includes assessing
the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation.  We believe that our audits provide a reasonable basis for
our opinion.

     In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Vari-L
Company,  Inc. as of December 31, 1999 and 1998, and the results of its
operations and its cash flows for the years then ended, in conformity with
generally accepted accounting principles.



                                        HAUGEN, SPRINGER & CO., P.C.



March 14, 2000
Denver, Colorado






                           VARI-L COMPANY, INC.

                              BALANCE SHEETS
                              (000'S OMITTED)

<TABLE>
<CAPTION>
                                                      December 31,
                                                      ------------
                                                1999                1998
                                                ----                ----

<S>                                           <C>                <C>
ASSETS

Current Assets:
  Cash and cash equivalents                    $ 14,883          $  6,515
  Trade accounts receivable, less $123 and
    $23 allowance for doubtful accounts           4,762             4,417
  Inventories                                    10,255             7,901
  Prepaid expenses and other                      1,160             1,235
                                               --------          --------
          Total Current Assets                   31,060            20,068
                                               --------          --------

Property and Equipment:
  Machinery and equipment                        27,949            22,299
  Furniture and fixtures                          1,776             1,499
  Leasehold improvements                          8,544             7,797
                                               --------          --------
                                                 38,269            31,595

  Less accumulated depreciation and
    amortization                                  6,112             4,444
                                               --------          --------

          Net Property and Equipment             32,157            27,151
                                               --------          --------

Other Assets:
  Long-term inventories                             475               475
  Covenant not to compete                             -                33
  Patents, net of accumulated amortization
    of $258 and $141                              2,065             1,529
  ISO registration costs and other, net of
    accumulated amortization of $149 and $58      1,616             1,415
                                               --------          --------

          Total Other Assets                      4,156             3,452
                                               --------          --------

TOTAL ASSETS                                   $ 67,373          $ 50,671
============                                   ========          ========

</TABLE>
                                                      (Continued)


              SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS


                           VARI-L COMPANY, INC.

                              BALANCE SHEETS
                              (000'S OMITTED)

<TABLE>
<CAPTION>
(Continued)                                           December 31,
                                                      ------------
                                                1999                1998
                                                ----                ----

<S>                                           <C>                <C>
LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities:
  Current installments of long-term debt       $  1,070          $    832
  Financed insurance premiums                        38                22
  Trade accounts payable                          1,996             2,147
  Accrued expenses                                  602               684
                                               --------          --------

          Total Current Liabilities               3,706             3,685

Bank line of credit                               4,016             4,756
Long-term debt                                    6,099             5,901
Deferred income taxes                             3,730             3,904
                                               --------          --------

          Total Liabilities                      17,551            18,246
                                               --------          --------

Commitments and Contingencies
  (Notes 9, 10, 11, and 12)

Stockholders' Equity:
  Common stock, $.01 par value, 50,000
    shares authorized; 6,945 and 5,454
    shares issued and outstanding, respectively      69                54
  Paid-in capital                                36,064            22,085
  Retained earnings                              13,689            10,286
                                               --------          --------

          Total Stockholders' Equity             49,822            32,425
                                               --------          --------

TOTAL LIABILITIES AND
  STOCKHOLDERS' EQUITY                         $ 67,373          $ 50,671
======================                         ========          ========
</TABLE>

              SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS



                           VARI-L COMPANY, INC.

                           STATEMENTS OF INCOME
               (000'S OMITTED, EXCEPT FOR PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
                                                Years Ended December 31,
                                                ------------------------
                                                1999                1998
                                                ----                ----

<S>                                           <C>                <C>

Net sales                                      $ 24,281          $ 18,063

Cost of products sold                            11,007             8,100
                                               --------          --------

Gross profit                                     13,274             9,963
                                               --------          --------

Other income and expenses:
  General and administrative                      2,491             1,956
  Engineering                                     1,675             1,155
  Selling                                         2,750             2,085
  Profit sharing plan contribution                  188                 4
  Interest expense                                  899               663
  Interest income                                 (262)             (328)
  Other                                              32                70
                                               --------          --------

                                                  7,773             5,605
                                               --------          --------

Income before taxes                               5,501             4,358

Income taxes                                      2,098             1,662
                                               --------          --------

NET INCOME                                     $  3,403          $  2,696
==========                                     ========          ========


Basic earnings per share                      $    0.60         $    0.50
                                               ========          ========

Diluted earnings per share                    $    0.57         $    0.48
                                               ========          ========
</TABLE>

              See Accompanying Notes to Financial Statements



                           VARI-L COMPANY, INC.

                    STATEMENTS OF STOCKHOLDERS' EQUITY
                              (000'S OMITTED)

<TABLE>
<CAPTION>

                                                                 Total
                                                                 Stock-
                         Number    Common   Paid-In   Retained  holders'
                       of Shares   Stock    Capital   Earnings   Equity
                       ---------   ------   -------   --------  --------
<S>                     <C>        <C>      <C>       <C>       <C>

Balances 12/31/97         5,251    $   52  $ 20,193  $  7,590   $27,835

Stock options
  exercised                  48         1       390         -       391

Stock warrants
  exercised                 130         1     1,120         -     1,121

Issued under employee
  stock purchase plan        14         -        94         -        94

Issued under stock
  grant plan                 26         -       315         -       315

Shares repurchased          (5)         -      (27)         -      (27)

Net income                    -         -         -     2,696     2,696
                        -------   -------   -------   -------   -------

Balances 12/31/98         5,464        54    22,085    10,286    32,425

Stock options
  exercised                 780         8     7,416         -     7,424

Stock warrants
  exercised                 665         7     6,311         -     6,318

Issued under employee
  stock purchase plan        13         -        82         -        82

Issued under stock
  grant plan                 14         -        92         -        92

Issued to profit sharing
  plan                       13         -       101         -       101

Shares repurchased          (4)         -      (23)         -      (23)

Net income                    -         -         -     3,403     3,403
                        -------   -------   -------   -------   -------

Balances 12/31/99         6,945   $    69   $36,064   $13,689   $49,822
                        =======   =======   =======   =======   =======
</TABLE>

              See Accompanying Notes to Financial Statements



                           VARI-L COMPANY, INC.

                         STATEMENTS OF CASH FLOWS
                              (000'S OMITTED)

<TABLE>
<CAPTION>

                                                Years Ended December 31,
                                                ------------------------
                                                1999                1998
                                                ----                ----
<S>                                          <C>               <C>

Net cash provided by operating
  activities (Note 15)                       $ 3,801           $  4,398
                                             -------           --------

Cash flows from investing activities:
  Purchases of property and equipment        (6,674)            (9,957)
                                             -------           --------

    Net cash (used in) investing activities  (6,674)            (9,957)
                                             -------           --------

Cash flows from financing activities:
  Proceeds from long-term debt                 1,402              2,236
  Repayments of long-term debt                 (966)              (564)
  Proceeds from bank line of credit            1,680              4,434
  Repayments of bank line of credit          (2,420)            (1,491)
  Net borrowings for insurance financing          16                (2)
  Net proceeds from stock issuances           11,551              1,517
  Acquisition of treasury stock                 (22)               (27)
                                             -------           --------

    Net cash provided by financing
      activities                              11,241              6,103
                                             -------           --------

    Net increase in cash                       8,368                544

Beginning cash                                 6,515              5,971
                                             -------           --------

Ending cash                                  $14,883           $  6,515
                                             =======           ========

Supplemental disclosure of cash information:

  Cash paid for interest                     $   855           $    707
                                             =======           ========

</TABLE>

              See Accompanying Notes to Financial Statements



                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 1 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
          ------------------------------------------

     Organization and Nature of Operations
     -------------------------------------

     Vari-L Company, Inc. is a manufacturer of electronic components and
     was founded in 1953. The Company's business is the design,
     manufacture, and marketing of microwave signal processing components
     and devices used in the communications industry.  The Company's
     products are sold to original equipment manufacturers of
     communication equipment, either in the military or commercial
     marketplace in the United States and internationally.

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

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

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

     Cash and cash equivalents include a money market mutual fund which is
     convertible to a known amount of cash.

     Inventories
     -----------

     Inventories are stated at the lower of cost method or market.  Cost
     is determined using the first-in, first-out method.

     Property and Equipment
     ----------------------

     Property and equipment are recorded at cost.  Depreciation and
     amortization for the principal components of property and equipment
     are computed using straight-line and accelerated methods over 1 to 12
     year estimated useful lives.  Other components of property and
     equipment are depreciated using units-of-production methods which
     recognize the productive lives of the underlying assets.



                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 1 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
          ------------------------------------------------------

     Stock Compensation Plans
     ------------------------

     The Company applies Accounting Principles Board (ABP) Opinion No. 25,
     Accounting for Stock Issued to Employees, in accounting for its stock
     compensation plans.  The Company discloses the fair value of those
     plans pursuant to Statement of Financial Accounting Standards (SFAS)
     No. 123, Accounting for Stock-Based Compensation.

     Income Taxes
     ------------

     The Company uses the asset and liability method as identified in SFAS
     No. 109, Accounting for Income Taxes.

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

     Basic earnings per common share are based upon the weighted average
     shares outstanding.  Outstanding stock options and warrants are
     treated as common stock equivalents for purposes of computing diluted
     earnings per share and represent the difference between basic and
     diluted weighted average shares outstanding.

     Research and Development Costs
     ------------------------------

     Research and development costs are charged to expense when incurred.
     Research and development expense for the years 1999 and 1998 totaled
     $1,675,000 and $1,155,000, respectively.

     Valuation of Long-Lived Assets
     ------------------------------

     The Company reviews long-lived assets, including intangible assets,
     for impairment whenever events or changes in circumstances indicate
     that the carrying amount of an asset may not be recoverable.  The
     Company establishes guidelines for determining fair value based on
     undiscounted future net cash flows for the use of the asset and for
     the measurement of an impairment loss.  Any impairment loss is
     recorded in the period in which the recognition criteria are first
     applied and met.



                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 1 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
          ------------------------------------------------------

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

     The Company generally recognizes revenue when products are shipped.
     Occasionally, certain military/aerospace customers may request that
     they take delivery of products at the Company's facilities.  Revenue
     for these orders is recognized when the products are ready for
     delivery.  There were no significant amounts of these revenues at
     December 31, 1999 or 1998.

     Reclassifications
     -----------------

     Certain 1998 amounts have been reclassified as to conform with 1999
     presentation.

NOTE 2 -  INVENTORIES
          -----------

     Inventories consisted of the following:

<TABLE>
<CAPTION>
                                                      December 31,
                                                      ------------
                                                1999                1998
                                                ----                ----
                                                    (000's omitted)

<S>                                        <C>                 <C>
          Finished goods                   $  3,181               2,174
          Work in process                     3,087               3,365
          Raw materials                       3,836               2,211
          Gold bullion                          151                 151
                                           --------            --------

                                           $ 10,255            $  7,901
                                           ========            ========

          Long-term inventories            $    475            $    475
                                           ========            ========
</TABLE>

     The gold bullion was purchased for purposes of managing the cost of
     gold consumed in the  Company's manufacturing process.

     The Company's normal operating cycle for certain products may be in
     excess of one year, and the Company occasionally takes advantage of
     quantity discounts for raw materials.  Also, the Company manufactures
     some finished goods in anticipation of customer demands.  As a result
     of these factors, the Company maintains certain inventory quantities
     in excess of one year's supply which are accordingly classified as
     long-term.



                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 3 -  PROPERTY, EQUIPMENT, AND OTHER ASSETS
          -------------------------------------

     During 1999 and 1998, the Company invested significant amounts in the
     remodeling of its leased facilities and expansion of its automated
     production capacity.  The Company  has capitalized certain direct and
     overhead costs related to these projects.

     Patents are carried at cost less accumulated amortization which is
     calculated on a straight-line basis over the estimated useful lives,
     which is generally 17 years.

     Other assets at December 31, 1999 and 1998 included costs related to
     the Company's efforts to obtain ISO 9001 registration for its
     commercial and military/aerospace operations.  The registration was
     part of the Company's ongoing efforts to refine and advance the
     qualities of its products and manufacturing processes.  These costs
     consisted of wages, travel, training, consulting, and related
     overhead costs.  Registration of the Company's military/aerospace
     operations was successful in August 1999 and those costs totaled
     approximately $804,000.  Registration of the Company's commercial
     operations was successful in January 1998 and those costs totaled
     approximately $844,000.  These amounts are being amortized over a
     fifteen-year period beginning with the dates of registration.

NOTE 4 -  BANK LINE OF CREDIT AND LONG-TERM DEBT
          --------------------------------------

     The Company has credit facilities with two banking institutions.  The
     first consists of a $6.0 million line of credit agreement.  The
     second consists of two agreements, a $4.1 million term loan agreement
     and a $4.0 million revolving equipment term loan agreement.

     Line of Credit
     --------------

     The line of credit was restructured on May 18, 1999 to provide for
     borrowings of up to $6.0 million.  Interest is payable monthly,
     calculated at prime.  The line of credit matures April 30, 2001.  At
     December 31, 1999, the outstanding balance due under the line of
     credit was approximately $4.016 million.

     The Company's accounts receivable, inventory, and general intangible
     assets secure the line of credit.



                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 4 -  BANK LINE OF CREDIT AND LONG-TERM DEBT (CONTINUED)
          --------------------------------------------------

     Term Loan
     ---------

     The Company's term loan has a floating rate of Libor plus 1.5% with
     fixed rate protection through an interest rate swap agreement which
     results in an all-in fixed rate of 7.75% through the maturity date of
     February 24, 2002.  Monthly principal and interest payments of
     approximately $65,000 are required.  At December 31, 1999, the
     balance due under the term loan was approximately $3.589 million.

     Revolving Equipment Term Loan
     -----------------------------

     The revolving equipment term loan provides for borrowings up to $4.0
     million.  Interest accrues on the outstanding principal balance of
     the revolving equipment term loan at prime plus .25 percent when
     advances are made under the revolver.  These borrowings can be
     converted to term notes at rates which adjust to the three-year
     treasury note rate plus 1.95 percent.  When converted, the term debt
     requires monthly principal and interest payments calculated on a
     seven-year amortization basis with a 42-month maturity.  The
     revolving loan maturity date has been extended to February 13, 2000.
     As of December 31, 1999, the balance of the outstanding advances
     under the revolving loan that had been converted to term notes was
     approximately $3.498 million.  Interest accrues on the outstanding
     principal balances of these term notes at rates ranging from 6.10
     percent to 7.72 percent, and monthly principal and interest payments
     of approximately $57,000 are required.

     The Company's property and equipment secure the term loan and
     revolving equipment term loan.

     Under the credit facilities, the Company must maintain certain
     financial ratios and obtain the banks' approvals prior to entering
     into various transactions, including the payment of dividends,
     disposal of significant assets, changing its executive management, or
     entering into direct borrowing arrangements or contingent
     liabilities.



                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 4 -  BANK LINE OF CREDIT AND LONG-TERM DEBT (CONTINUED)
          --------------------------------------------------

     Promissory Notes
     ----------------

     The Company has financed the purchase of vehicles with promissory
     notes bearing interest at rates ranging from 7.75 percent to 8.50
     percent.  Monthly principal and interest payments totaling $2,826 are
     required.  The notes mature from 2000 through 2003.

     Summary of Long-Term Debt
     -------------------------

     Long-term debt consists of the following:

<TABLE>
<CAPTION>
                                                      December 31,
                                                      ------------
                                                1999                1998
                                                ----                ----
                                                    (000's Omitted)

     <S>                                    <C>               <C>
     Term loan                              $  3,589          $   4,114
     Equipment term loan                       3,498              2,552
     Vehicle notes                                82                 67
                                            --------          ---------

                                               7,169              6,733
     Less current installments                 1,070                832
                                            --------          ---------

     Long-term portion                      $  6,099          $   5,901
                                            ========          =========

</TABLE>

     Scheduled annual principal payments on the bank line of credit and
     long-term debt for each of the next five years are as follows (000's
     omitted):

               2000                 $   1,070
               2001                     5,864
               2002                     4,060
               2003                       184
               2004                         7

NOTE 5 -  STOCKHOLDERS' EQUITY
          --------------------

     Warrants exercised during 1999 and 1998 were issued in connection
     with a 1997 sale of convertible debentures.  At December 31, 1999,
     all of these warrants had been exercised.



                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 6 -  INCOME TAXES
          ------------

     The provisions for income taxes consisted of:

<TABLE>
<CAPTION>

                                                    December 31,
                                                    ------------
                                              1999                 1998
                                              ----                 ----
                                                    (000's Omitted)

          <S>                               <C>                 <C>
          Deferred:      Federal            $  1,920            $  1,525
                         State                   178                 137
                                            --------            --------

          Total tax provisions              $  2,098            $  1,662
                                            ========            ========

</TABLE>

     For the years ended December 31, 1999 and 1998, the Company had no
     current federal or state income tax liabilities due to net operating
     losses generated during those years.  The operating losses resulted
     primarily from the income tax benefit of stock options exercised and
     the use of accelerated depreciation rates for tax purposes.  The
     amount of the losses available for carryover at December 31, 1999
     were approximately $7.7 million (federal) and $9.5 million (state),
     and expire in varying amounts through December 31, 2014.

     Significant components of deferred tax balances as of December 31,
     1999 and 1998 were as follows:

<TABLE>
<CAPTION>

                                                1999                1998
                                                ----                ----
                                                    (000's Omitted)

          <S>                                 <C>                <C>
          Deferred tax liabilities:

          Depreciation and amortization       $ 4,874            $ 4,004
          Other, net                            1,793                799
                                              -------            -------

              Total deferred tax liabilities    6,667              4,803

          Deferred tax assets:

            Net operating loss carryovers       2,937                899
                                              -------            -------

              Net deferred tax liabilities    $ 3,730            $ 3,904
                                              =======            =======
</TABLE>



                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 6 -  INCOME TAXES (CONTINUED)
          ------------------------

     The differences between the U.S. federal statutory rate and the
     Company's effective tax rate are as follows:

<TABLE>
<CAPTION>

                                                     1999      1998
                                                     ----      ----

     <S>                                           <C>       <C>
     Federal statutory tax rate                    34.000%   34.000%

     State income taxes, net of federal benefit     3.135     3.300

     Officers' life insurance and other             1.005     0.830
                                                   -------   -------

     Effective tax rate                            38.140%   38.130%
                                                   =======   =======
</TABLE>



                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 7 -  EARNINGS PER SHARE
          ------------------

     The following is a reconciliation of the net income (numerator) and
     number of shares (denominator) for the computations of basic and
     diluted earnings per share:

<TABLE>
<CAPTION>

                                     Income         Shares     Per Share
                                  (Numerator)   (Denominator)    Amount
                                  -----------   -------------  ---------
                                       (000's omitted)
                                       ---------------

     For the year ended
     ------------------
       December 31, 1999:
     --------------------

       <S>                         <C>               <C>         <C>
       Basic earnings per share    $  3,403          5,672       $    .60
                                                                 ========

       Effect of dilutive securities:
         Stock options                    -            264
         Warrants                         -             81
                                   --------       --------

       Diluted earnings per share  $  3,403          6,017       $    .57
                                    ========       ========      ========

     For the year ended
     ------------------
       December 31, 1998
     -------------------

       Basic earnings per share    $  2,696          5,407       $    .57
                                                                 ========

       Effect of dilutive securities:
         Stock options                    -            173
         Warrants                         -             30
                                   --------       --------

       Diluted earnings per share  $  2,696          5,610       $    .48
                                    ========       ========      ========

</TABLE>

     At December 31, 1999, the Company had 6,945,483 common shares
     outstanding.   The Company issued 1,485,199 and purchased 3,850
     shares during 1999.  For purposes of computing earnings per share,
     these shares were weighted for the period of time they were
     outstanding.



                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 8 -  STOCK COMPENSATION PLANS
          ------------------------

     The Company has three stock-based compensation plans which are
     described below.  The Company applies APB No. 25 in accounting for
     its stock compensation plans.  For 1999 and 1998, no compensation
     cost was recognized for the stock option portion of the plans.  Had
     compensation cost been determined on the basis of fair value pursuant
     to SFAS No. 123, net  income and earnings per share would have been
     reduced to the following proforma amounts:

<TABLE>
<CAPTION>

                                                   1999        1998
                                                   ----        ----

     <S>                      <C>             <C>         <C>
     Net Income:              As Reported     $   3,403   $   2,696
                                              =========   =========

                              Pro Forma       $   1,742   $   1,824
                                              =========   =========

     Earnings Per Share:
                    Basic:    As Reported     $    .60     $    .50
                                              =========    =========

                              Pro Forma       $    .31     $    .34
                                              =========    =========

                    Diluted:  As Reported     $    .57     $    .48
                                              =========    =========

                              Pro Forma       $    .29     $    .33
                                              =========    =========

</TABLE>

     Stock Option Plan
     -----------------

     During 1987, the Company established a nonqualified tandem stock
     option/stock appreciation rights plan for key employees.  The plan,
     which was amended in 1990, 1994 and 1996, provides for the grant of
     incentive stock options, nonqualified stock options and stock
     appreciation rights to officers, directors or employees of, as well
     as advisers and consultants to, the Company.

     The Company has reserved 3,270,000 shares of its common stock for
     issuance upon exercise of rights and options under the plan.
     Typically, rights and options have been granted subject to a vesting
     schedule, vesting at the rate of 20 percent per year, becoming fully
     vested upon the change of control of the Company, and expiring 10
     years from the date of issuance.  Certain options granted to senior
     management were vested upon issuance or on a shorter vesting
     schedule.  The exercise price is equal to the fair market value of
     the Company's common stock on the grant date or the average of that
     value over a stated period of time prior to such date.



                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 8 -  STOCK COMPENSATION PLANS (CONTINUED)
          ------------------------------------

     Stock Option Plan (Continued)
     -----------------------------

     The fair value of each option grant is estimated on the grant date
     using a binomial option-pricing model with certain weighted-average
     assumptions which, for 1999 and 1998 respectively, were:  expected
     volatility of 73 percent and 78 percent, risk-free interest rates of
     5.5 percent and 5.5 percent, and zero dividend yields for both years.
     The expected average remaining life of the options were seven years.

     The binomial option-pricing valuation model was developed for use in
     estimating the fair value of traded options which have no vesting
     restrictions and are fully transferable.  In addition, option
     valuation models require the input of highly subjective assumptions,
     including the expected stock price volatility.  Because the Company's
     employee stock options have characteristics significantly different
     from those of traded options, and because changes in the subjective
     input assumptions can materially affect the fair value estimate, in
     management's opinion, the existing models do not necessarily provide
     a reliable single measure of the fair value of its employee stock
     options.



                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 8 -  STOCK COMPENSATION PLANS (CONTINUED)
          ------------------------------------

     Stock Option Plan (Continued)
     -----------------------------

     Following is a summary of the status of the stock option plan during
     1999 and 1998:

<TABLE>
<CAPTION>

                                               Number    Weighted Average
                                             of Options   Exercise Price
                                            ------------ ---------------
                                          (000's omitted)

     <S>                                     <C>             <C>
     Outstanding at January 1, 1998              968          $  8.47
       Granted                                 1,043             7.68
       Exercised                                (49)             6.06
       Forfeited                                 (3)             8.61
                                             -------

       Outstanding at December 31, 1998        1,959              .78
                                             =======

       Options exercisable at December 31,
         1998                                  1,138             7.39
                                             =======

       Weighted average fair value of
         options granted during 1998         $ 2.43
                                             =======

       Outstanding at January 1, 1999          1,959             7.78
       Granted                                   565            18.49
       Exercised                               (788)             6.60
       Forfeited                                (29)             7.81
                                             -------

       Outstanding at December 31, 1999        1,707            11.68
                                             =======

       Options exercisable at December 31,
         1999                                    532             8.47
                                             =======

       Weighted average fair value of
         options granted during 1999        $ 15.01
                                             =======

</TABLE>



                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 8 -  STOCK COMPENSATION PLANS (CONTINUED)
          ------------------------------------

     Stock Option Plan (Continued)
     -----------------------------

     Following is a summary of the status of stock options outstanding at
     December 31, 1999 (000's omitted for number of options):

<TABLE>
<CAPTION>

                            Outstanding Options    Exercisable Options
                             ------------------    -------------------
                             Weighted
                             Average     Weighted              Weighted
      Exercise              Remaining    Average               Average
       Price               Contractual   Exercise              Exercise
       Range      Number       Life       Price     Number      Price
      --------    ------   -----------   --------   ------    ---------
  <S>               <C>        <C>       <C>        <C>        <C>
  $ 2.21 - 2.83      26        3.8 Yrs    $ 2.21      26       $ 2.21
    2.83 - 5.65       3        5.1          4.73       3         4.73
    5.65 - 8.48     384        7.3          7.53     165         8.20
    8.48 -11.30     738        7.8          8.90     331         9.00
   11.30 -14.13       4        6.6         12.53       4        12.53
   14.13 -16.96       1        6.1         15.87       1        15.87
   16.96 -19.78     551       10.0         18.76       2        18.26
                   ----                             ----

                  1,707                              532
                   ====                             ====

</TABLE>

     The Company obtained an income tax deduction for the difference
     between the market value of the shares issued and exercise prices of
     options exercised during 1999 and 1998. The amount of the deduction
     was approximately $5.984 million for 1999 and $265,000 for 1998.  The
     income tax benefit of the deductions have been credited to paid-in
     capital.

     Employee Stock Purchase Plan
     ----------------------------

     The Company adopted an employee stock purchase plan during 1995.
     Eligible employees may contribute up to 10 percent of their earnings,
     through payroll deductions, to purchase shares of the Company's
     common  stock.  The purchase price is equal to 85 percent of the fair
     market value of the stock on specified dates.  A total of 800,000
     common shares have been reserved under the plan, and the maximum
     number of shares to be issued is 200,000 per year.  Since the plan is
     noncompensatory, no charges to operations are recorded.



                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 8 -  STOCK COMPENSATION PLANS (CONTINUED)
          ------------------------------------

     Employee Stock Purchase Plan (Continued)
     ----------------------------------------

     Employee withholdings during 1998 were approximately $82,000 and were
     used to purchase 12,773 shares which were issued January 1999.
     Withholdings during 1999 were approximately $50,000.  During January
     2000, these withholdings were used to purchase 7,471 shares.

     Compensation cost for the SFAS No. 123 pro forma amounts was
     estimated using a binomial option-pricing model with certain
     assumptions similar to those used for the stock option plan.  The
     weighted-average fair value of those purchase rights granted in 1999
     and 1998 was $2.05 and $2.07 per share, respectively.

     Stock Grant Plan
     ----------------

     During 1996, the Company adopted a stock grant plan under which stock
     grants can be made to the Company's officers, directors, employees,
     consultants, and advisors.  The Company reserved 100,000 shares of
     its common stock for issuance under the stock grant plan.  The plan
     provides for automatic grants of 50 shares per month to nonmanagement
     members of the Company's Board of Directors.  During 1999 and 1998,
     those members received grants for 1,800 and 1,500 common shares,
     respectively.  Compensation cost charged to operations was measured
     by the fair market value of the stock on the date of the grants.

     In connection with the executive employment agreements described in
     Note 12, the Compensation Committee granted stock bonuses of 25,000
     shares to each of the Company's two senior officers.  The grants are
     subject to a vesting schedule whereby three-quarters of the shares
     were vested during 1997, 1998 and 1999.  The remaining shares are
     scheduled to vest in  2000.  Additionally, the Company is liable for
     income and payroll taxes attributable to the stock bonuses.

     The grants are subject to forfeiture provisions related to
     fulfillment of various terms of the employment agreements.
     Accordingly, the Company is amortizing the cost of the stock bonuses
     over the four-year term of the employment agreements.  At December
     31, 1999, the unamortized portion of this cost was approximately
     $437,000, and was included in prepaid expenses.




                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 9 -  COMMITMENTS AND CONTINGENCIES
          -----------------------------

     Nonrelated Party Leases
     -----------------------

     The Company leases certain of its office and manufacturing facilities
     under long-term operating leases.  Minimum future annual lease
     payments over the next five years are as follows:

                              (000's omitted)

                    2000                    $  643
                    2001                       647
                    2002                       584
                    2003                       518
                    2004                       518
                                            ------

                                            $2,910
                                            ======

     Annual rent expense on these leases was approximately $654,000 for
     1999 and $639,000 for 1998.

     Related Party Leases
     --------------------

     Certain facilities are leased under long-term operating leases from
     the Company's chairman and from a partnership in which he is a
     partner.  Minimum future annual lease payments over the next five
     years are as follows:

                              (000's omitted)

                    2000                    $  169
                    2001                       169
                    2002                       169
                    2003                       169
                    2004                       130
                                            ------

                                            $  806
                                            ======

     Rent expense on these leases was approximately $169,000 for 1999 and
     $127,000 for 1998.



                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 9 -  COMMITMENTS AND CONTINGENCIES (CONTINUED)
          -----------------------------------------

     Contingencies
     -------------

     The Company is contingently liable for guarantees of indebtedness
     owed by senior officers to a former officer.  The amount of this
     contingent liability at December 31, 1999 was approximately $169,000.

NOTE 10 - AGREEMENTS WITH FORMER OFFICER
          ------------------------------

     The Company was party to an agreement with one of its former
     officers.  Among other items, the agreement provided for a severance
     package, a consulting agreement, and a covenant not to compete
     against the Company.

     This agreement was dated November 1996 and was entered into in
     connection with the employment agreements described in Note 12.  The
     Company capitalized $99,581 as the cost of the covenant not to
     compete, which represented the total amount of severance pay due the
     former officer.  The covenant was being amortized using the straight-
     line method over the three year life of the covenant.  As of December
     31, 1999, these amounts were amortized in full.

NOTE 11 - RELATED PARTY TRANSACTIONS
          --------------------------

     As described in Note 9, the Company leases certain facilities from
     the Company's chairman and a partnership in which he is a partner.

NOTE 12 - EMPLOYMENT AGREEMENTS
          ---------------------

     Effective June 1, 1997, the Company entered into new four-year
     employment agreements with its two senior officers which provide for
     (i) automatic annual renewals of their full terms, (ii) minimum
     annual base salaries during the officers' employment with the
     Company, and (iii) severance pay after employment.  Severance pay
     will be equal to the greater of the senior officer's annual base
     salary multiplied by the remaining term of the agreement or 2.99
     times the senior officer's average annual compensation over the last
     five years in the event of involuntary termination of employment by
     the Company.  In the case of voluntary retirement, the senior officer
     will be entitled to (i) one-half of his annual base salary as
     severance pay,  (ii) be engaged as a consultant for a period of up to
     five  years for  a fee equal to 50  percent of his  annual  base
     salary, and   (iii) a retirement



                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 12 - EMPLOYMENT AGREEMENTS (CONTINUED)
          ---------------------------------

     benefit of 25 percent of his annual base salary.  Each of the
     agreements provide for a bonus of 25,000 shares of the Company's
     stock, 75 percent of which was vested on June 1, 1997, April 6, 1998,
     and March 12, 1999, with the remaining 25 percent vesting on April
     15, 2000, if the senior officer achieves performance goals set by the
     Compensation Committee.  All unvested stock bonuses and options and
     stock appreciation rights previously granted to the senior officers
     will fully vest in the event of a change of control of the Company or
     an involuntary termination.  In addition, the officers have agreed
     they will not compete against the Company for a period of one year
     after termination or expiration of their respective employment
     agreements, or the period covered by any severance allowance,
     consulting arrangement or retirement benefit, whichever is greater.
     The Company's Board of Directors has determined that amounts payable
     to the officers under the severance pay provisions of the agreements
     is adequate consideration for the officers' covenants not to compete.

     As described in Note 10, another senior officer retired during
     November of 1996.  The Company and the retiring officer entered into
     a consulting and severance agreement providing for nine months salary
     payable over the first year of a three year consulting relationship
     in lieu of the benefits provided by the senior officer's employment
     agreement.

NOTE 13 - FINANCIAL INSTRUMENTS AND CONCENTRATIONS
          ----------------------------------------
          OF CREDIT RISK
          --------------

     Financial instruments which potentially expose the Company to
     concentrations of credit risk, as defined by SFAS No. 105, consist
     primarily of trade accounts receivable.  The Company's products are
     sold to original equipment manufacturers of communications equipment,
     either in the military or commercial marketplace.  In 1999 and 1998,
     the Company two largest customers accounted for approximately 37
     percent and 27 percent, respectively, of total sales.  For 1999,
     sales to these two customers totaled approximately $5.2 million and
     $3.6 million, respectively.  The accounts receivable at December 31,
     1999 for these same two customers was approximately $1,045,000 and
     $487,000, respectively.  The Company performs credit evaluations of
     its customers but generally does not require collateral.  Receivables
     due from foreign customers are generally insured by a private
     indemnity company.  Otherwise, letters of credit are required of
     foreign customers.



                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 13 - FINANCIAL INSTRUMENTS AND CONCENTRATIONS
          ----------------------------------------
          OF CREDIT RISK (CONTINUED)
          --------------------------

     The Company attributes sales to foreign customers based on the
     country to which products are shipped.  During 1999 and 1998, the
     Company made sales to customers located in 19 different foreign
     countries,  as follows (000's omitted):

<TABLE>
<CAPTION>

                                              1999      1998
                                              ----      ----

               <S>                         <C>       <C>
               England                     $ 5,920   $ 3,753
               Finland                       1,698       588
               Sweden                        1,185       687
               Canada                          686       194
               Other                         3,137     2,726
                                           -------   -------

                                           $12,626   $ 7,948
                                           =======   =======

</TABLE>

     At times, cash balances in operating checking accounts may exceed
     federally insured limits.  At December 31, 1999, the Company had
     approximately $9 million invested in a U.S. government securities
     money market fund and a $151,000 gold bullion investment.  The money
     market fund invests in United States government securities and is not
     otherwise federally insured.  The gold bullion investment is held in
     street name by a national broker and is not federally insured.

     Disclosure of fair value information about certain financial
     instruments, whether or not recognized in the balance sheet, is
     required by SFAS No. 107.  The carrying amounts of cash and cash
     equivalents and gold bullion approximate fair value.

     The Company estimates the fair value of short- and long-term debt
     using discounted cash flow analysis, based on the Company's current
     incremental borrowing rates for similar arrangements.  The carrying
     amounts of the Company's short-and long-term debt at December 31,
     1999 approximate their fair values.  The fair value of contingent
     liabilities is based on the amounts of the underlying instruments,
     which approximates the amounts disclosed in Note 9.



                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 14 - RETIREMENT PLANS
          ----------------

     During 1990, the Company adopted a qualified profit sharing plan for
     its employees.  Annual contributions to the plan, which may be in the
     form of cash or shares of the Company's stock, are determined by the
     Board of Directors at its sole discretion.  During 1999, the Company
     contributed stock and cash of $188,000 to the plan.  During 1998, the
     Company contributed cash of $4,000 to the plan.

     During 1998, the Company adopted a 401(k) plan to which employees may
     contribute up to 15 percent of their pay.  Although the Company may
     make matching contributions to the plan, none were made in 1999 or
     1998.



                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 15 - RECONCILIATION OF NET INCOME TO NET
          -----------------------------------
          CASH PROVIDED BY OPERATING ACTIVITIES
          -------------------------------------

     The reconciliation of net income to net cash provided by operating
     activities for the years ended December 31, 1999 and 1998 is as
     follows:

<TABLE>
<CAPTION>
                                               December 31,
                                               ------------
                                        1999                 1998
                                        ----                 ----
                                             (000's omitted)

<S>                                     <C>                 <C>

Net Income                              $3,403              $2,696
                                        ------              ------

Adjustments to reconcile net income
  to net cash provided by
  operating activities:
     Depreciation of property and
       equipment                         1,668               1,131
     Amortization of other assets          209                 109
     Deferred income taxes               2,098               1,662
     Amortization of covenant not to
       compete                              33                  33
     Stock contribution to profit
       sharing plan                        101              -
     Changes in assets and liabilities:
       (Increase) decrease in accounts
       receivable                         (345)                756
       (Increase) in inventories        (2,354)             (1,064)
       Decrease (increase) in prepaid
       expenses and other current
       assets                              167                 (47)
     (Increase) in patents and
        other assets                      (946)             (1,230)
     (Decrease) increase in accounts
       payable                            (151)                296
     (Decrease) increase in accrued
       expenses                            (82)                 56
                                        -------             -------

     Total adjustments                     398               1,702
                                        ------              -------

Net cash provided by operating
  activities                            $3,801              $4,398
                                        ======              =======

</TABLE>



                           VARI-L COMPANY, INC.

                       NOTES TO FINANCIAL STATEMENTS

NOTE 16 - CHINA JOINT VENTURE
          -------------------

     During 1996, the Company entered into a joint venture agreement with
     Chen-Hui Company, a governmental corporation of the People's Republic
     of China.  The original agreement provided for the creation of a
     manufacturing company to be owned 51 percent by the Company and 49
     percent by Chen-Hui.  During December 1998, the agreement was amended
     to provide for a sales and distribution arrangement whereby the
     products to be marketed will be manufactured by the Company at its
     domestic facilities.  Also, during December 1998, the Company
     received patent protection from the Chinese government for its
     products.

     The Company had capitalized approximately $356,000 of costs related
     to this activity through December 31, 1998.  Upon receipt of the
     patent protection, the Company began amortizing these costs over a 17-
     year period, and these costs are included in patent costs at December
     31, 1999 and 1998.

NOTE 17 - IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS
          ----------------------------------------------

     In the first quarter of 1999, the Company implemented the following
     statements of Position (SOP) issued by the American Institute of
     Certified Public Accountants Accounting Standards Executive
     Committee: SOP 98-1, Accounting for the Costs of Computer Software
     Developed or Obtained for Internal Use, which provided guidelines on
     the accounting for internally developed computer software, and SOP 98-
     5, Reporting on the Costs of Start-Up Activities, which required that
     the costs of start-up activities be expensed as incurred.  The
     adoption of these Statements of Position did not have a material
     impact on the Company's results of operations or financial position.

     In June 1998, the Financial Accounting Standards Board issued
     Statement No. 133, Accounting for Derivative Instruments and Hedging
     Activities (SFAS No. 133).  SFAS No. 133 establishes new standards of
     accounting and reporting for derivative instruments and hedging
     activities by requiring that all derivatives be recognized at fair
     value in the balance sheet, and that the corresponding gains or
     losses be reported either in the statement of operations or as a
     component of comprehensive income.  The effective date of this
     pronouncement, originally for fiscal years beginning after June 15,
     1999, has been delayed to fiscal years beginning after June 15, 2000,
     with the issuance of SFAS No. 137 in June 1999.  Assuming that the
     Company's current minimal involvement in derivatives continues after
     the implementation date of this statement, the Company believes that
     the future adoption of this statement will not have a material impact
     on its results of operations or financial position.

     In December 1999, the Securities and Exchange Commission issued Staff
     Accounting Bulletin No. 101, Revenue Recognition in Financial
     Statements (SAB No. 101).  SAB No. 101 draws upon the existing
     accounting rules and explains those rules, by analogy, to other
     transactions that the existing rules do not specifically address.
     The Company will adopt SAB No. 101 on January 1, 2000, as required,
     and does not expect such adoption to have a material impact on its
     financial statements.



ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

     There were no changes in or disagreements with accountants on any
matters of accounting principles or practices, financial statement
disclosure, or auditing scope or procedure during the period of this
report.

                                 PART III

ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT

     The information required herein is incorporated by reference from the
Company's definitive proxy statement for the 2000 annual meeting of
shareholders.

ITEM 10.  EXECUTIVE COMPENSATION

     The information required herein is incorporated by reference from the
Company's definitive proxy statement for the 2000 annual meeting of
shareholders.

ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The information required herein is incorporated by reference from the
Company's definitive proxy statement for the 2000 annual meeting of
shareholders.

ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     The information required herein is incorporated by reference from the
Company's definitive proxy statement for the 2000 annual meeting of
shareholders.

ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K

Exhibit No.    Description
 ----------    -----------

         3.1a Restated Articles of Incorporation, as Amended, filed
              as Exhibit 4.1 to the Registrant's Form S-8 Registration
              Statement (No. 33-88666) and incorporated herein by
              reference.

         3.1b Articles of Amendment to the Articles of Incorporation
              filed as Exhibit 3.1b to Registrant's Form 10-KSB for the
              year ended December 31, 1996 and incorporated herein by
              reference..

         3.2  Restated Bylaws of the Company as adopted by its Board
              of Directors on November 4, 1992 filed as Exhibit 3.2 to
              the Registrant's Form SB-2 Registration Statement (No. 33-
              74704-D) and incorporated herein by reference

         4.1  Specimen Certificate for $.01 par value Common Stock
              of the Company filed as Exhibit 4.3 to the Registrant's
              Form SB-2 Registration Statement (No. 33-74704-D) and
              incorporated herein by reference

         4.2  Specimen Certificate for Warrant to Purchase Common
              Stock of the Company filed as Exhibit 4.4 to the
              Registrant's Form SB-2 Registration Statement (No. 33-74704-
              D) and incorporated herein by reference

         4.3  Rights Agreement with American Securities Transfer,
              Inc. dated March 15, 1996 filed as Exhibit 4.2 to
              Registrant's Form 8-A/A Registration Statement (No. 0-
              23866) and incorporated herein by reference

         4.4  Specimen Certificate for Right to Purchase $.01 par
              value Common Stock of the Company filed as Exhibit 4.3 to
              Registrant's Form 8-A/A Registration Statement (No. 0-
              23866) and incorporated herein by reference

         4.5  Securities Purchase Agreement between the Registrant
              and certain purchasers dated March 4, 1997 filed as Exhibit
              4.5 to Registrant's Form S-3 Registration Statement (No.
              333-25173) and incorporated herein by reference

         4.6  Form of Convertible Subordinated Debenture issued to
              the Purchasers under the Securities Purchase Agreement
              dated March 4, 1997 filed as Exhibit 4.6 to Registrant's
              Form S-3 Registration Statement (No. 333-25173) and
              incorporated herein by reference

         4.7  Form of Warrant to Purchase Common Stock issued to the
              Purchasers under the Securities Purchase Agreement dated
              March 4, 1997 filed as Exhibit 4.7 to Registrant's Form S-3
              Registration Statement (No. 333-25173) and incorporated
              herein by reference

         10.1 Executive Employment Agreement with Joseph H. Kiser,
              dated effective June 1, 1997, filed as Exhibit 10.1 to the
              Registrant's Form 10-QSB for the quarter ended September
              30, 1998 and incorporated herein by reference

         10.2 Executive Employment Agreement with David G. Sherman,
              dated effective June 1, 1997, filed as Exhibit 10.2 to the
              Registrant's Form 10-QSB for the quarter ended September
              30, 1998 and incorporated herein by reference

         10.3 Executive Employment Agreement with Alwin E. Branson,
              dated November 12, 1992, filed as Exhibit 10.3 to the
              Registrant's Form SB-2 Registration Statement (No. 33-74704-
              D) and incorporated herein by reference

         10.4 Amended and Restated Tandem Stock Option and Stock
              Appreciation Rights Plan, effective as of June 18, 1999
              filed as Exhibit 4 to the Registrant's Form S-8
              Registration Statement (No. 333-81915) and incorporated
              herein by reference.

         10.5 Equipment Lease Agreement dated May 26, 1993 between
              the Company and Rossi Hardesty Financial Inc., filed as
              Exhibit 10.14 to the Registrant's Form SB-2 Registration
              Statement (No. 33-74704-D) and incorporated herein by
              reference

         10.6 Lease Agreement dated January 1, 1987, between the
              Company and J.C. Enterprises for the facility located at
              5165 Peoria Street, Denver, Colorado, as amended on
              December 6, 1990 and March 23, 1993, filed as Exhibit 10.15
              to the Registrant's Form SB-2 Registration Statement (No.
              33-74704-D) and incorporated herein by reference

         10.7 Amended Lease Agreement dated July 1, 1992 between the
              Company and Bello-1 Partnership for the facility located at
              11101 East 51st Avenue, Denver Colorado, filed as Exhibit
              10.16 to the Registrant's Form SB-2 Registration Statement
              (No. 33-74704-D) and incorporated herein by reference

         10.8 Consulting Agreement between Carolyn Y. Kiser and the
              Company, dated January 31, 1992, as amended March 23, 1993,
              filed as Exhibit 10.17 to the Registrant's Form SB-2
              Registration Statement (No. 33-74704-D) and incorporated
              herein by reference

         10.9 Settlement Agreement between the Company, Joseph H.
              Kiser, David G. Sherman, Alwin E. Branson and Carolyn Y.
              Kiser dated January 31, 1992, as amended March 23, 1993,
              filed as Exhibit 10.18 to the Registrant's Form SB-2
              Registration Statement (No. 33-74704-D) and incorporated
              herein by reference

        10.10 Warrant Agreement with American Securities
              Transfer, Inc., filed as Exhibit 10.19 to the Registrant's
              Form SB-2 Registration Statement (No. 33-74704-D) and
              incorporated herein by reference

        10.11 Consulting Agreement between the Company and
              Neidiger/Tucker/Bruner, Inc. dated April 26, 1994, filed as
              Exhibit 10.23 to the Registrant's Form SB-2 Registration
              Statement (No. 33-74704-D and incorporated herein by
              reference

        10.12 Profit Sharing Plan and Trust Agreement, as
              amended and restated effective April 19, 1994 filed as
              Exhibit 10.16 to the Registrant's Form 10-KSB for the year
              ended December 31, 1994 and incorporated herein by
              reference

        10.13 Assignment of Amended Lease Agreement dated July
              1, 1992 between the Company and Bello-1 Partnership from
              Bello-1 Partnership to Kenneth L. Bettenhausen and Jean M.
              Bettenhausen dated May 26, 1994 for the facility located at
              11101 East 51st Avenue, Denver, Colorado filed as Exhibit
              10.18 to the Registrant's Form 10-KSB for the year ended
              December 31, 1994 and incorporated herein by reference

        10.14 Stock Grant Plan effective as of June 19, 1998
              filed as Exhibit 10.8 to the Registrant's Form 10-QSB for
              the quarter ended September 30, 1998 and incorporated
              herein by reference

        10.15 Lease Agreement dated July 14, 1995 between the
              Company and Joseph H. and Nora L. Kiser, as amended
              September 1, 1995, for the facility located at 15556 East
              17th Avenue, Denver, Colorado filed as Exhibit 10.21 to the
              Registrant's Form 10-KSB for the year ended December 31,
              1995 and incorporated herein by reference.

        10.16 Term Loan and Credit Agreement between the
              Company and Norwest Bank Colorado, National Association,
              dated May 17, 1996 filed as Exhibit 10.1 to the
              Registrant's Form 10-QSB for the quarter ended June 30,
              1996 and incorporated herein by reference.

        10.17 Lease Agreement dated March 12, 1997 between the
              Company and Five K Investments for the facility located at
              4895 Peoria Street, Denver, Colorado filed as Exhibit 10 to
              the Registrant's Form 10-QSB for the quarter ended
              September 30, 1997 and incorporated herein by reference.

        10.18 Business Loan Agreement between the Company and
              Bank One, Colorado, N.A., dated August 13, 1997 with a
              maturity date of August 13, 1998 filed as Exhibit 10.18 to
              the Registrant's Form 10-KSB for the year ended December
              31, 1997 and incorporated herein by reference.

        10.19 Business Loan Agreement between the Company and
              Bank One, Colorado, N.A., dated August 13, 1997 with a
              maturity date of February 13, 2001 filed as Exhibit 10.19
              to the Registrant's Form 10-KSB for the year ended December
              31, 1997 and incorporated herein by reference.

        10.20 Letter Agreement between the Company and Norwest
              Bank, Colorado N.A., dated April 30, 1998 and filed as
              Exhibit 10 to the Registrant's Form 10-QSB for the quarter
              ended June 30, 1998 and incorporated herein by reference.

        10.21 Amendment to Business Loan Agreement between the
              Company and Bank One, Colorado N.A., dated effective August
              21, 1998 and filed as Exhibit 10.3 to the Registrant's Form
              10-QSB for the quarter ended September 30, 1998 and
              incorporated herein by reference.

        10.22 Amendment to Business Loan Agreement between the
              Company and Bank One, Colorado N.A., dated effective August
              13, 1998 and filed as Exhibit 10.4 to the Registrant's Form
              10-QSB for the quarter ended September 30, 1998 and
              incorporated herein by reference.

        10.23 Second Amendment to Lease Agreement dated July
              14, 1995 between the Company and Joseph H. Kiser and Nora
              L. Kiser for the facility located at 15556 East 17th
              Avenue, Denver, Colorado, as amended September 31, 1995 and
              July 31, 1998 and filed as Exhibit 10.5 to the Registrant's
              Form 10-QSB for the quarter ended September 30, 1998 and
              incorporated herein by reference.

        10.24 Third Amendment to Lease Agreement dated January
              1, 1987 between the Company and J.C. Enterprises for the
              facility located at 5165 Peoria Street, Denver, Colorado,
              as amended December 6, 1990, March 23, 1993, and October
              30, 1998 and filed as Exhibit 10.6 to the Registrant's Form
              10-QSB for the quarter ended September 30, 1998 and
              incorporated herein by reference.

        10.25 Employment Agreement with Daniel J. Wilmot dated
              January 1, 1998 and filed as Exhibit 10.9 to the
              Registrant's Form 10-QSB for the quarter ended September
              30, 1998 and incorporated herein by reference.

        10.26 Employment Agreement with Derek L. Bailey dated
              January 1, 1998 and filed as Exhibit 10.10 to the
              Registrant's Form 10-QSB for the quarter ended September
              30, 1998 and incorporated herein by reference.

        10.27 Employment Agreement with Jon L. Clark dated
              January 1, 1998 and filed as Exhibit 10.11 to the
              Registrant's Form 10-QSB for the quarter ended September
              30, 1998 and incorporated herein by reference.

        10.28 Employee Stock Purchase Plan effective as of
              December 31, 1998 filed as Exhibit 10.28 to the
              Registrant's Form 10-KSB for the year ended December 31,
              1998 and incorporated herein by reference.

        10.29 Letter Agreement between the Company and Norwest
              Bank, Colorado, N.A. dated May 18, 1999 as Exhibit 10 to
              the Registrant's Form 10-QSB for the quarter ended June 30,
              1999 and incorporated herein by reference.

          23  Consent of Haugen, Springer & Co. to the incorporation
              by reference of their financial statements in the
              Registrant's Form S-8 Registration Statements (No. 33-
              88666), (No. 33-81045), (No. 333-45137) and (No. 333-81915)
              and the Registrant's Form S-3 Registration Statement (No.
              333-25173).

          27  Financial Data Schedule

Reports on Form 8-K
--------------------

     None.

                                SIGNATURES

     In accordance with Section 13 or 15(d) of the Exchange, the
Registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                                   VARI-L COMPANY, INC.


                                   By:/s/David G. Sherman
                                   David G. Sherman,
                                   President

     In accordance with the Exchange Act, this report has been signed
below by the following persons on behalf of the Registrant and in the
capacities and on the dates indicated.


/s/ Joseph H. Kiser                          Date:  March 30, 2000
---------------------------------------
Joseph H. Kiser, Chairman of the Board,
Chief Scientific Officer
and Director


/s/ David G. Sherman                         Date: March 30, 2000
----------------------------------------
David G. Sherman, President,
Chief Executive Officer, Principal Executive
Officer and Director


/s/ Jon L. Clark                             Date: March 30, 2000
----------------------------------------
Jon L. Clark, Vice President of Finance,
Chief Financial Officer and Principal
Accounting and Financial Officer


/s/ Sarah L. Booher                          Date: March 30, 2000
----------------------------------------
Sarah L. Booher, Director
Date: March 30, 2000
David A. Lisowski, Director


/s/ Anthony B. Petrelli                      Date: March 30, 2000
----------------------------------------
Anthony B. Petrelli, Director
Date: March 30, 2000
Jae Shim, Director