SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                    FORM 10-Q

                QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934



For Quarter Ended March 31, 2003       Commission File No.  0-24866


                         MICROTEK MEDICAL HOLDINGS, INC.
             (Exact name of Registrant as specified in its charter)


                Georgia                                58-1746149
------------------------------------------          -----------------
    (State or other jurisdiction of                   (IRS Employer
     incorporation or organization)                 Identification No.)

                                512 LEHMBERG ROAD
                           COLUMBUS, MISSISSIPPI 39702
                    (Address of principal executive offices)

                                 (662) 327-1863
              (Registrant's telephone number, including area code)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed  by  Section  13 or 15 (d) of the  Securities  Exchange  Act of 1934
during the preceding 12 months (or for such shorter  period that the  registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for at least the past 90 days.

Yes   X     No
    -----      -----

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common equity, as of the latest practicable date.

Class                                         Outstanding at May 14, 2003

Common Stock, $.001 par value                        42,067,962

<PAGE>

                                      INDEX

<TABLE>
<CAPTION>
<S>       <C>

PART I:   FINANCIAL INFORMATION

Item 1.   Financial Statements

          Unaudited Condensed Consolidated Balance Sheets as of March 31, 2003 and December 31,
          2002

          Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income
          for the Three Months ended March 31, 2003 and March 31, 2002

          Unaudited Condensed Consolidated Statements of Cash Flows for the Three Months ended
          March 31, 2003 and March 31, 2002

          Notes to Unaudited Condensed Consolidated Financial Statements

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

Item 3.   Quantitative and Qualitative Disclosures About Market Risk

Item 4.   Controls and Procedures


PART II:  OTHER INFORMATION

Item 1.   Legal Proceedings

Item 2.   Changes in Securities and Use of Proceeds

Item 3.   Defaults Upon Senior Securities

Item 4.   Submission of Matters to a Vote of Securityholders

Item 5.   Other Information

Item 6.   Exhibits and Reports on Form 8-K

</TABLE>



                                       2
<PAGE>


                                     PART I
                              FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
                                           MICROTEK MEDICAL HOLDINGS, INC.
                                   Unaudited Condensed Consolidated Balance Sheets
                                                   (in thousands)
<S>                                                          <C>                   <C>
                                                                MARCH 31, 2003          DECEMBER 31, 2002
                                                             -----------------------------------------------
                            ASSETS
Current assets:
        Cash and cash equivalents                             $        10,344          $         9,823
        Accounts receivable, net                                       16,034                   15,029
        Other receivables                                                 316                      448
        Inventories                                                    25,918                   24,794
        Prepaid expenses and other assets                               3,129                    1,486
                                                             -----------------------------------------------
             Total current assets                                      55,741                   51,580
                                                             -----------------------------------------------

Property and equipment                                                 23,831                   23,312
        Less accumulated depreciation                                 (17,188)                 (16,659)
                                                             -----------------------------------------------
             Property and equipment, net                                6,643                    6,653
                                                             -----------------------------------------------

Intangible assets, net                                                 29,419                   29,392
Deferred income taxes                                                   4,544                    5,638
Other assets                                                            3,432                    3,433
                                                             -----------------------------------------------
             Total assets                                     $        99,779          $        96,696
                                                             ===============================================

                 LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
        Accounts payable                                      $         6,500          $         5,118
        Accrued expenses                                                2,675                    3,281
        Current portion of long-term debt                                 225                      231
                                                             -----------------------------------------------
             Total current liabilities                                  9,400                    8,630
                                                             -----------------------------------------------

Long-term debt, net of current portion                                  7,286                    7,136
Other long-term liabilities                                             2,039                    2,044
                                                             -----------------------------------------------
             Total liabilities                                         18,725                   17,810
                                                             -----------------------------------------------

Shareholders' equity:
        Common stock                                                       43                       43
        Additional paid-in capital                                    211,766                  211,505
        Accumulated deficit                                          (128,025)                (130,222)
        Cumulative translation adjustment                                 (54)                      18
        Unrealized loss on available for sale securities                  (82)                    (105)
                                                             -----------------------------------------------
                                                                       83,648                   81,239
        Treasury shares, at cost                                       (2,594)                  (2,353)
                                                             -----------------------------------------------
             Total shareholders' equity                                81,054                   78,886
                                                             -----------------------------------------------
             Total liabilities and shareholders' equity       $        99,779          $        96,696
                                                             ===============================================
</TABLE>

See notes to unaudited condensed consolidated financial statements.


                                       3
<PAGE>


<TABLE>
<CAPTION>
                                        MICROTEK MEDICAL HOLDINGS, INC.
               Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income
                                     (in thousands, except per share data)

<S>                                                       <C>                       <C>
                                                            THREE MONTHS ENDED        THREE MONTHS ENDED
                                                              MARCH 31, 2003            MARCH 31, 2002
                                                          -------------------------------------------------

Net sales                                                   $             22,986       $            20,824
Licensing revenues                                                             -                       357
                                                          -------------------------------------------------
                Net revenues                                              22,986                    21,181

Cost of goods sold                                                        14,122                    12,585
                                                          -------------------------------------------------
                Gross profit                                               8,864                     8,596

Operating expenses:
       Selling, general and administrative                                 7,172                     6,744
       Research and development                                              219                       163
       Amortization of intangibles                                           117                       114
                                                          -------------------------------------------------
                Total operating expenses                                   7,508                     7,021
                                                          -------------------------------------------------

Income from operations                                                     1,356                     1,575

Interest income                                                               27                        37
Interest expense                                                             (65)                     (195)
Equity in earnings of investee                                                21                         -
                                                          -------------------------------------------------
Income before income taxes                                                 1,339                     1,417

Income tax (benefit) expense                                                (858)                       89
                                                          -------------------------------------------------
Net income                                                  $              2,197       $             1,328
                                                          =================================================

Other comprehensive income (loss):
         Foreign currency translation loss                                   (72)                      (53)
         Unrealized gain (loss) on available for sale
           securities                                                         23                        (7)
                                                          -------------------------------------------------

Comprehensive income                                        $              2,148       $             1,268
                                                          =================================================

Net income per common share  - basic
   and diluted                                              $               0.05       $              0.03
                                                          =================================================

Basic weighted average number of common
  shares outstanding                                                      42,115                    42,074
                                                          =================================================

Diluted weighted average number of common
  shares outstanding                                                      42,775                    42,938
                                                          =================================================

</TABLE>

See notes to unaudited condensed consolidated financial statements.


                                       4
<PAGE>

<TABLE>
<CAPTION>
                                          MICROTEK MEDICAL HOLDINGS, INC.
                             Unaudited Condensed Consolidated Statements of Cash Flows
                                                   (in thousands)
<S>                                                                 <C>                     <C>
                                                                       THREE MONTHS ENDED      THREE MONTHS ENDED
                                                                         MARCH 31, 2003          MARCH 31, 2002
                                                                    -------------------------------------------------

Cash flows from operating activities:
      Net income                                                      $           2,197       $            1,328

Adjustments to reconcile net income to net cash provided by
  operating activities:
      Depreciation                                                                  571                      623
      Amortization of intangibles                                                   117                      114
      Provision for doubtful accounts                                               288                       65
      Licensing revenues                                                              -                     (357)
      Deferred income taxes                                                        (929)                       -
      Provision for obsolete and slow moving inventory                               77                       43
      Other                                                                         (21)                      18
      Changes in operating assets and liabilities                                (2,034)                    (950)
                                                                    -------------------------------------------------
NET CASH PROVIDED BY OPERATING ACTIVITIES                                           266                      884
                                                                    -------------------------------------------------
Cash flows from investing activities -
      purchase of and deposits for property and equipment                          (561)                    (260)
                                                                    -------------------------------------------------
Cash flows from financing activities:
      Net borrowings (repayments) under credit agreements                           150                   (2,793)
      Changes in bank overdraft                                                     724                      223
      Net repayments under notes payable                                             (6)                    (413)
      Proceeds from exercise of stock options                                        54                      452
      Repurchase of treasury stock                                                 (241)                     (46)
      Proceeds from issuance of common stock                                        207                      219
                                                                    -------------------------------------------------
NET CASH PROVIDED BY (USED IN ) FINANCING ACTIVITIES                                888                   (2,358)
                                                                    -------------------------------------------------
Effect of exchange rate changes on cash                                             (72)                     (53)
                                                                    -------------------------------------------------
Net increase (decrease) in cash and cash equivalents                                521                   (1,787)
Cash and cash equivalents at beginning of period                                  9,823                   10,587
                                                                    -------------------------------------------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD                            $          10,344       $            8,800
                                                                    =================================================
</TABLE>


See notes to unaudited condensed consolidated financial statements.



                                       5
<PAGE>

                         MICROTEK MEDICAL HOLDINGS, INC.
         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


1.   NATURE OF BUSINESS AND BASIS OF PRESENTATION

     Microtek Medical Holdings,  Inc. and subsidiaries (the "Company")  develop,
     manufacture,  and market  proprietary  and other  products and services for
     patient care,  occupational safety and management of potentially infectious
     and hazardous waste  primarily for the domestic  healthcare  market,  which
     represents  one  business  segment.  The Company  markets  its  products to
     hospitals  and  other  end  users  through  a  broad  distribution   system
     consisting of multiple channels  including  distributors,  directly through
     its own sales force,  original equipment  manufacturers,  and private label
     customers.  The Company also markets certain of its products through custom
     procedure tray companies.  The Company's revenues are generated through two
     operating units, Microtek Medical, Inc.  ("Microtek"),  a subsidiary of the
     Company,  and  OREX  Technologies   International   ("OTI"),  an  operating
     division.  Microtek is the core business of the Company.  OTI is seeking to
     commercialize its patented technology in the nuclear industry.

     The  unaudited  condensed  consolidated  financial  statements  include the
     accounts of the Company and its wholly owned subsidiaries.  All significant
     intercompany   balances   and   transactions   have  been   eliminated   in
     consolidation.

     The accompanying unaudited condensed consolidated financial statements have
     been prepared in accordance  with Rule 10-01 of Regulation  S-X for interim
     financial  statements required to be filed with the Securities and Exchange
     Commission  and do not include all  information  and footnotes  required by
     accounting  principles  generally  accepted in the United States of America
     for  complete  financial  statements.  In the  opinion of  management,  the
     information  furnished reflects all adjustments  (consisting only of normal
     recurring  adjustments)  necessary for a fair presentation of the financial
     position,  results of  operations  and cash flows for the  interim  periods
     presented.  Results for the interim periods are not necessarily  indicative
     of results to be expected  for the full year.  The  consolidated  financial
     statements  herein  should  be read in  conjunction  with the  consolidated
     financial  statements and notes thereto  contained in the Company's  Annual
     Report on Form  10-K for the year  ended  December  31,  2002 (the  "Annual
     Report").

2.   RECENTLY ISSUED ACCOUNTING STANDARDS

     In June 2001, the Financial  Accounting Standards Board issued Statement of
     Financial  Accounting  Standards  ("SFAS")  No. 143,  Accounting  for Asset
     Retirement  Obligations.  SFAS 143  requires the Company to record the fair
     value of an asset  retirement  obligation  as a liability  in the period in
     which it  incurs a legal  obligation  associated  with  the  retirement  of
     tangible long-lived assets that result from the acquisition,  construction,
     development,  and/or  normal use of the assets.  The Company also records a
     corresponding  asset  that is  depreciated  over  the  life  of the  asset.
     Subsequent to the initial  measurement of the asset retirement  obligation,
     the  obligation  will be  adjusted at the end of each period to reflect the
     passage of time and changes in the estimated  future cash flows  underlying
     the  obligation.  The  Company  adopted  SFAS 143 on January  1, 2003.  The
     adoption of SFAS 143 did not have an effect on the  Company's  consolidated
     financial statements.

3.   CRITICAL ACCOUNTING POLICIES AND ESTIMATES

     The Company's  discussion of results of operations and financial  condition
     relies on its consolidated  financial statements that are prepared based on


                                       6
<PAGE>

     certain  critical  accounting  policies  that  require  management  to make
     judgments and estimates that are subject to varying degrees of uncertainty.
     The Company  believes that investors need to be aware of these policies and
     how they impact its financial statements as a whole, as well as its related
     discussion and analysis  presented herein.  While the Company believes that
     these accounting policies are based on sound measurement  criteria,  actual
     future  events can and often do result in outcomes  that can be  materially
     different from these  estimates or forecasts.  The accounting  policies and
     related  risks  described  in the  Company's  Annual  Report are those that
     depend most heavily on these judgments and estimates.  For the three months
     ended March 31, 2003, there were no material changes to any of the critical
     accounting  policies  contained  therein other than the adoption of the new
     accounting standards as discussed herein.

4.   INVENTORIES

     Inventories  are  stated  at the  lower  of cost or  market.  The  first-in
     first-out  ("FIFO")  valuation  method  is used to  determine  the  cost of
     inventories.  Cost includes material,  labor and manufacturing overhead for
     manufactured and assembled goods and materials only for goods purchased for
     resale.  Inventories  are summarized by major  classification  at March 31,
     2003 and December 31, 2002 as follows:

                                       MARCH 31, 2003       DECEMBER 31, 2002
                                      ------------------    ------------------
         Raw materials                 $         10,731     $          10,454
         Work-in-progress                         1,267                 1,009
         Finished goods                          13,920                13,331
                                      ------------------    ------------------
               Inventories             $         25,918     $          24,794
                                      ==================    ==================

     At March 31, 2003 and December 31, 2002, the OTI  inventories  approximated
     $2.5 million and $2.2 million, respectively. Included in OTI inventories at
     March 31, 2003 and  December 31, 2002 were  finished  goods of $943,000 and
     $431,000, respectively, and raw materials of $1.6 million and $1.7 million,
     respectively.

5.   ACQUISITIONS

     Effective  November 29, 2002,  Microtek acquired the surgical drape product
     line of Gyrus  ENT,  LLC.  This  acquisition  was  accounted  for under the
     purchase method, and accordingly,  the results of operations related to the
     acquired  assets  have  been  included  in  the  accompanying  consolidated
     financial  statements  from  the  date  of  acquisition.   The  preliminary
     allocation of the total  estimated  purchase  price of  approximately  $4.2
     million  in cash,  as  adjusted  through  March  31,  2003 and  subject  to
     adjustment in 2003 until finalized,  resulted in approximately $3.5 million
     of goodwill as follows (in thousands):
<TABLE>
<CAPTION>
<S>                                                              <C>              <C>

         Total estimated purchase consideration                                    $      4,185
         Allocated to:
              Inventories                                         $       625
              Property and equipment                                       50
                                                                 -------------
                     Total allocation                                                       675
                                                                                  --------------
         Goodwill                                                                  $      3,510
                                                                                  ==============
</TABLE>



                                       7
<PAGE>

6.   INVESTMENT IN AVAILABLE FOR SALE SECURITIES

     In February  2000,  the Company  paid  $249,000  for  approximately  a 7.5%
     interest  in  Consolidated   Ecoprogress   Technology,   Inc.,  a  Canadian
     technology   marketing   company   focused  on   developing   and   selling
     biodegradable and disposable  absorbent products such as diapers,  feminine
     hygiene,  adult  incontinence  and  other  products.   This  investment  is
     classified in accordance with SFAS 115,  Accounting for Certain Investments
     in Debt and Equity  Securities,  as available  for sale  securities  and is
     stated at fair value.  Unrealized gains and losses in the investment's fair
     value are recorded as a separate  component of  shareholders'  equity,  and
     unrealized  losses  that are other than  temporary  are  recognized  in net
     income. During the quarter ended September 30, 2002, the Company recognized
     an impairment loss of $55,000 related to an other-than-temporary decline in
     the  value  of  this  investment.  There  were no  such  impairment  losses
     recognized  during the three months ended March 31, 2003. The fair value of
     this investment as of March 31, 2003 and December 31, 2002 was $111,000 and
     $88,000, respectively.

7.   LONG-TERM DEBT

     The Credit Agreement.  The Company maintains a credit agreement between the
     Company and a Bank (the "Credit Agreement"). As amended to date, the Credit
     Agreement  provides for a $17.5 million  revolving credit  facility,  which
     matures on June 30, 2004. Borrowing availability under the revolving credit
     facility is based on the lesser of (i) a  percentage  of eligible  accounts
     receivable  and  inventories or (ii) $17.5  million,  less any  outstanding
     letters of credit  issued  under the  Credit  Agreement.  Revolving  credit
     borrowings  bear interest,  at the Company's  option,  at either a floating
     rate  approximating the Bank's prime rate plus an interest margin (4.75% at
     March 31, 2003) or LIBOR plus an interest margin (2.78% at March 31, 2003).
     Borrowing  availability  under the revolving facility at March 31, 2003 and
     December 31, 2002 was $14.3 million and $14.7 million, respectively.  There
     were  outstanding  borrowings  under the revolving  credit facility of $7.3
     million at March 31, 2003 and $7.1 million at December 31, 2002. Borrowings
     under the Credit  Agreement are  collateralized  by the Company's  accounts
     receivable, inventories, equipment, the Company's stock of its subsidiaries
     and certain of the Company's plants and offices.

     The Credit Agreement contains certain restrictive covenants,  including the
     maintenance of certain financial ratios,  earnings before interest,  taxes,
     depreciation  and  amortization   ("EBITDA")  and  net  worth,  and  places
     limitations  on  acquisitions,   dispositions,   capital  expenditures  and
     additional  indebtedness.  In addition, the Company is not permitted to pay
     any dividends.  At March 31, 2003 and December 31, 2002, the Company was in
     compliance with all of its financial covenants under the Credit Agreement.

     The Credit  Agreement  provides  for the  issuance of up to $1.0 million in
     letters of credit. There were no outstanding letters of credit at March 31,
     2003 or December 31, 2002. The Credit  Agreement also provides for a fee of
     0.375% per annum on the unused commitment,  an annual collateral monitoring
     fee of $35,000 and an outstanding letter of credit fee of 2.0% per annum.

     Other  Long-Term  Debt.  The Company is obligated  under certain  long-term
     leases and notes payable,  which aggregated  $225,000 and $231,000 at March
     31, 2003 and  December  31,  2002,  respectively.  These  obligations  bear
     interest at rates  ranging from 4.75% to 11.9% and mature on various  dates
     through October 2003. The acquisition notes payable aggregating $225,000 at
     March 31, 2003 and December 31, 2002, respectively, are subordinated to the
     Credit Agreement.

     The  carrying  value of  long-term  debt at March 31, 2003 and December 31,
     2002  approximates  fair value based on interest rates that are believed to
     be  available to the Company for debt with  similar  prepayment  provisions
     provided for in the existing debt agreements.



                                       8
<PAGE>

8.   EARNINGS PER SHARE

     Earnings  per share is  calculated  in  accordance  SFAS 128,  Earnings Per
     Share,  which requires dual  presentation of basic and diluted earnings per
     share on the face of the income  statement  for all  entities  with complex
     capital  structures.  Basic per share income is computed using the weighted
     average  number of common shares  outstanding  for the period.  Diluted per
     share income is computed  including the dilutive effect of all contingently
     issuable  shares.  Dilutive  potential  common  shares  are  calculated  in
     accordance with the treasury stock method, which assumes that proceeds from
     the exercise of all options are used to repurchase  common shares at market
     value.  The number of shares remaining after the proceeds from exercise are
     exhausted  represents the potentially  dilutive effect of the options.  The
     following  table  reflects  the weighted  average  number of shares used to
     calculate  basic and diluted  earnings per share for the periods  presented
     (in thousands):

<TABLE>
<CAPTION>
<S>                                                           <C>               <C>
                                                                 THREE MONTHS ENDED MARCH 31,
                                                              ----------------------------------
                                                                    2003              2002
                                                              ---------------    ---------------
       Basic Shares                                                 42,115            42,074
       Dilutive Shares (due to stock options)                          660               864
                                                              ---------------    ---------------
       Diluted Shares                                               42,775            42,938
                                                              ===============    ===============
</TABLE>

     Options  to  purchase   approximately   758,000  and  966,000  shares  were
     outstanding at March 31, 2003 and 2002, respectively, but were not included
     in the  computation  of diluted net income per share  because the  exercise
     price of the  options  was greater  than the  average  market  price of the
     common shares, and therefore, the effect would be antidilutive.

9.   STOCK-BASED COMPENSATION PLANS

     The Company accounts for its stock-based employee  compensation plans under
     the  recognition  and  measurement   principles  of  APB  Opinion  No.  25,
     Accounting  for Stock  Issued to  Employees,  and related  Interpretations.
     Accordingly,  no stock-based employee compensation cost is reflected in net
     income,  as all options  granted under the Company's stock option plans had
     an exercise price equal to the market value of the underlying  common stock
     on the date of the grant.

     Pro forma  information  regarding interim net income and earnings per share
     is  required  by  SFAS  148,  Accounting  for  Stock-Based  Compensation  -
     Transition and Disclosure,  an amendment of FASB Statement No. 123, and has
     been  determined  as if the Company had  accounted  for its employee  stock
     options under the fair value  method.  The fair value for these options was
     estimated at the date of grant using a  Black-Scholes  option pricing model
     with the following weighted average assumptions:

                                           THREE MONTHS ENDED MARCH 31,
                                             2003                 2002
                                             ----                 ----

           Dividend yield                    0.0%                 0.0%
           Expected volatility               9.0%                51.0%
           Risk free interest rate           3.9%                 4.5%
           Forfeiture rate                   0.0%                 0.0%
           Expected life, in years          10.0                 10.0

     The  Black-Scholes   option  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


                                       9
<PAGE>

     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.

     The following table illustrates the effect on net income and net income per
     share as if the Company had applied the fair value  recognition  provisions
     of SFAS 123,  Accounting for Stock-Based  Compensation,  to its stock-based
     employee compensation plans (in thousands, except per share data).

<TABLE>
<CAPTION>
<S>                                                             <C>                <C>
                                                                    THREE MONTHS ENDED MARCH 31,
                                                                -----------------------------------
                                                                       2003               2002
                                                                ----------------   ----------------

           Net income, as reported                                $     2,197        $       1,328
           Deduct:  Total stock-based employee
                compensation expense determined under
                fair value based method for all awards,
                net of related tax effects                               (331)                (199)
                                                                ----------------   ----------------

           Pro forma net income                                   $     1,866        $       1,129
                                                                ================   ================

           Net income per share:
              Basic and Diluted - as reported                     $      0.05        $        0.03
                                                                ================   ================
              Basic and Diluted - pro forma                       $      0.04        $        0.03
                                                                ================   ================
</TABLE>

10.  STOCK REPURCHASE PROGRAM

     In 2002,  the Board of  Directors  amended  the  Company's  existing  stock
     repurchase  program to  authorize  the  repurchase  of an  aggregate of 2.0
     million  shares  through  December 31, 2003. A total of 100,000 shares were
     repurchased  under this  program  during the three  months  ended March 31,
     2003. As of March 31, 2003, the Company had  repurchased  1,168,795  shares
     under this program for an aggregate  repurchase price of approximately $2.2
     million.

11.  COMMITMENTS AND CONTINGENCIES

     On February  11, 2003 (the  "Petition  Date"),  Maxxim  Medical,  Inc.  and
     certain of its U.S.  affiliates  (collectively,  "Maxxim  Medical") filed a
     petition  under Chapter 11 of the U.S.  Bankruptcy  Code to reorganize  and
     implement  a  balance  sheet  restructuring.  Maxxim  Medical,  one  of the
     Company's top customers in 2002,  accounted for $5.7 million or 6.6% of the
     Company's total net revenues in 2002. As of the Petition Date, amounts owed
     to the Company by Maxxim Medical totaled approximately  $850,000.  Prior to
     March 31,  2003,  the  Company  collected  $300,000,  reducing  the  amount
     outstanding from Maxxim Medical to $550,000.  During the three-month period
     ended March 31, 2003,  the Company  increased  its  allowance  for doubtful
     accounts by $190,000,  or $.0045 per diluted share, reducing the net amount
     of accounts receivable from Maxxim Medical to management's best estimate of
     the  amount  which will be  collected  based on the  information  currently
     available.

     Maxxim  Medical  expects to continue its  day-to-day  operations  under the
     jurisdiction of the bankruptcy court. Because of the filing, Maxxim Medical
     must  obtain  court  authorization  before it can pay the debts it incurred


                                       10
<PAGE>

     before the Petition Date,  including amounts currently owed to the Company.
     The Company and Maxxim Medical have established guidelines governing future
     sales of products to Maxxim Medical, including available credit and payment
     terms.

     The  Company is  involved  in routine  litigation  and  proceedings  in the
     ordinary course of business.  Management  believes that pending  litigation
     matters  will  not  have  a  material   adverse  effect  on  the  Company's
     consolidated financial position or results of operations.

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

Net revenues for the three months ended March 31, 2003 (the "2003 Quarter") were
$23.0 million, an increase of $1.8 million or 8.5 percent from the $21.2 million
of net  revenues  reported  for the three months ended March 31, 2002 (the "2002
Quarter"). Excluding licensing revenues in the 2002 Quarter, net revenues in the
2002 Quarter were $20.8 million.  There were no license revenues recorded in the
2003  Quarter.  The  increase in net revenues in the 2003 Quarter as compared to
the 2002 Quarter is primarily attributable to increased revenues from Microtek's
domestic  core  businesses,  its CleanOp  product  line,  and its  international
channel and from OTI's nuclear business revenues. These increases were partially
offset by revenue declines in Microtek's safety product line and its OEM channel
and the termination of the OTI licensing revenues in December 2002.

For the 2003 Quarter,  Microtek's net revenues totaled $21.6 million as compared
to $20.5 million for the 2002 Quarter.  The following  table depicts  Microtek's
domestic  and  international  revenues and the  relative  percentage  of each to
Microtek's total revenues for the 2003 Quarter and 2002 Quarter:
<TABLE>
<CAPTION>
<S>                             <C>              <C>                <C>               <C>
                                       THREE MONTHS ENDED                    THREE MONTHS ENDED
                                         MARCH 31, 2003                        MARCH 31, 2002
                                         --------------                        --------------
                                   AMOUNT          % OF TOTAL           AMOUNT          % OF TOTAL
                                -------------    --------------     --------------    --------------
Domestic                         $   18.1              83.9%           $   17.7             86.4%
International                         3.5              16.1%                2.8             13.6%
                                -------------    --------------     --------------    --------------
Total                            $   21.6             100.0%           $   20.5            100.0%
                                =============    ==============     ==============    ==============
</TABLE>

Microtek's  domestic  revenues  are  generated  through two primary  channels or
customer  categories:  hospital  branded and  contract  manufacturing  (commonly
referred to as OEM).  Included in Microtek's  OEM revenues are sales of products
to custom  procedure  tray  companies and other  "non-branded"  or private label
customers.  Microtek's  domestic  revenues  in the  2003  Quarter  increased  by
$361,000 from the 2002 Quarter due to an increase of  approximately  $934,000 in
Microtek's hospital branded revenues and an offsetting decrease of $573,000,  or
approximately  seven  percent,  in  Microtek's  OEM revenues.  Hospital  branded
revenue  growth in the 2003 Quarter over the 2002  Quarter was  demonstrated  in
Microtek's domestic core businesses (an increase of $538,000 or 9.4 percent) and
in its CleanOp  product  line (an increase of $680,000 or 63.9  percent).  These
increases  were offset by a $381,000,  or 24.8  percent,  decrease in Microtek's
safety  revenues  in the 2003  Quarter  as  compared  to the 2002  Quarter.  The
decrease in Microtek's  OEM revenues in the 2003 Quarter as compared to the 2002
Quarter is attributable to the timing of OEM revenue order placement by a number
of customers and pricing pressures.  Microtek's  international net revenues were
$3.5 million for the 2003 Quarter,  an increase of $673,000 or 24.1 percent over
the 2002 Quarter.

OTI's net revenues were $1.4 million in the 2003 Quarter versus  $599,000 in the
2002 Quarter.  Licensing revenues in the 2002 Quarter were $357,000. The Company
ceased recognizing the non-cash licensing revenues in December 2002. Included in
OTI's net revenues for the 2003 Quarter and 2002 Quarter were  revenues  related
to  its  nuclear   operations  of   approximately   $1.2  million  and  $89,000,
respectively.  The growth of OTI's nuclear  revenues is  attributable to growing
nuclear  industry usage and  acceptance of the OREX products.  OREX products are
presently  in use at  approximately  20  nuclear  power  stations.  There are 13
nuclear power stations using OREX products during their spring outages,  nine of
which are using OREX  products as their primary  protective  clothing of choice,


                                       11
<PAGE>

and  other  facilities  are  conducting  initial  product  trials.   There  were
approximately 300,000 OREX protective clothing dressouts in the field at various
facilities  during the first quarter of 2003.  The balance of OTI's net revenues
in the 2003  Quarter and 2002  Quarter  amounted to  approximately  $200,000 and
$153,000, respectively, and is attributable to the liquidation of certain of the
OREX inventories.

Gross  margins in the 2003  Quarter and 2002  Quarter were 38.6 percent and 40.6
percent,  respectively,  a decrease  in the 2003  Quarter of  approximately  2.0
percent.  Approximately  one  percentage  point of this gross margin  decline is
attributable to the absence of the  amortization of deferred license revenues in
the  2003  Quarter.  Because  there  was no cost of  sales  associated  with the
deferred  license  revenues  recorded  in  the  2002  Quarter,   these  revenues
contributed  directly to the Company's  gross  margin.  The balance of the gross
margin  decline in the 2003  Quarter  stems from the  Company's  changing mix of
products and the slightly  dilutive  nature of Microtek's  CleanOp product line,
Microtek's international business and OTI's nuclear revenues.

Operating expenses as a percentage of net revenues in the 2003 Quarter were 32.7
percent  versus  33.1  percent  in  the  2002  Quarter.   Selling,  general  and
administrative expenses were $7.2 million or 31.2 percent of net revenues in the
2003  Quarter,  versus $6.7  million or 31.8 percent of net revenues in the 2002
Quarter.  The increase noted in the absolute  dollar amount of selling,  general
and  administrative  expenses is  attributable  to  increases  in the  Company's
variable selling costs and an increase in marketing  expenses resulting from the
Company's expanded  marketing  campaign for its branded products.  Additionally,
during the 2002  Quarter,  the Company  increased  its  allowance  for  doubtful
accounts  by  approximately  $190,000  as  the  result  of  the  Maxxim  Medical
bankruptcy  described  in the  notes  to the  unaudited  condensed  consolidated
financial   statements.   This  additional  provision  for  amounts  potentially
uncollectible from Maxxim Medical represents approximately $0.0045 per basic and
diluted share and increased selling,  general and  administrative  expenses as a
percentage of net revenues in the 2003 Quarter by approximately 1.0 percent.

Research and  development  expenses  increased by $56,000 in the 2003 Quarter as
compared  to the 2002  Quarter.  This  increase  is the net effect of a $131,000
increase in costs related to Microtek's  new product  development  program which
includes a number of product enhancements and new product  introductions planned
for 2003 and a $75,000  decrease in costs  associated  with OTI's  research  and
development  activities,  substantially  all of which  are  concentrated  on the
nuclear industry.

Amortization  of intangibles in the 2003 Quarter was $117,000 and was consistent
with amortization expense recorded in the 2002 Quarter.

Income  from  operations  for the Company in the 2003  Quarter was $1.4  million
versus  $1.6  million  in the 2002  Quarter.  For the 2003  Quarter,  Microtek's
operating  profit of $1.4  million  declined by $338,000  from the $1.8  million
recorded in the 2002 Quarter.  The Company's OTI division  reported an operating
loss of $58,000 in the 2003 Quarter versus an operating loss of $147,000 for the
2002 Quarter, an improvement of approximately 60.9 percent.

Interest  expense,  net of interest  income,  was $38,000 in the 2003 Quarter as
compared to $158,000 in the 2002 Quarter.  The $120,000 decrease in net interest
expense in the 2003 Quarter as compared to the 2002 Quarter is  attributable  to
declining  interest  rates and to lower average  borrowings  under the Company's
lines of credit  facility  during the 2003  Quarter and was  slightly  offset by
lower interest income on cash and cash equivalents due to lower average interest
rates.

The  Company's  provision  for income taxes in the 2003  Quarter  reflects a net
income tax benefit of  approximately  $858,000  which is comprised of a $929,000
income tax benefit related to the decrease in the Company's  valuation allowance
with  respect  to  certain  of its  deferred  tax  assets,  principally  its net
operating loss  carryforwards,  and the offsetting  state and foreign income tax
provision for the 2003 Quarter of approximately  $71,000. The income tax benefit


                                       12
<PAGE>

portion  of the  provision  for income  taxes in the 2003  Quarter  amounted  to
approximately  $0.02 per basic and diluted  share.  The Company's  provision for
income taxes in the 2002 Quarter consisted  entirely of state and foreign income
taxes of approximately $89,000.

The  resulting  net income for the 2003 Quarter was $2.2  million,  or $0.05 per
basic and diluted share,  as compared to net income for the 2002 Quarter of $1.3
million, or $0.03 per basic and diluted share.

LIQUIDITY AND CAPITAL RESOURCES

As of March 31, 2003,  the  Company's  cash and cash  equivalents  totaled $10.3
million as compared to $9.8 million at December 31, 2002.

During the 2003 Quarter,  the Company's  operating  activities  provided cash of
$266,000  as compared to  $884,000  in the 2002  Quarter.  The  decrease in cash
provided  by  operating  activities  in the  2003  Quarter  is  attributable  to
increases in the Company's accounts  receivable and inventory balances which are
attributable to its increase in net revenues.  Cash used in investing activities
consisted of the purchase of property and  equipment and amounted to $561,000 in
the 2003  Quarter as compared to $260,000 in the 2002  Quarter.  During the 2003
Quarter,  cash provided by financing  activities  was $888,000.  Net  borrowings
under the  Company's  Credit  Agreement in the 2003 Quarter were  $150,000,  and
repayments  of other  long-term  debt  agreements  in the 2003  Quarter  totaled
$6,000.  During the 2003 Quarter,  the Company received $54,000 in proceeds from
the exercise of stock options, generated $207,000 from the issuance of stock and
purchased  100,000  shares  of stock  for  $241,000.  During  the 2002  Quarter,
repayments  under  the  Company's  Credit  Agreement  were  $2.8  million,   and
repayments of other long-term debt  agreements  were $413,000,  including a lump
sum  payment  to Thantex  of  $341,000  under the  product  financing  agreement
described in the Company's  Annual  Report.  This payment  satisfied in full the
Company's  remaining  obligation under this agreement.  During the 2002 Quarter,
the Company  received  $452,000 in proceeds from the exercise of stock  options,
generated  $219,000  from the issuance of stock and  purchased  40,000 shares of
stock for $46,000.

The Company  maintains a $17.5 million credit agreement (as amended to date, the
"Credit Agreement") with the JP Morgan Chase Bank (the "Bank"),  consisting of a
revolving  credit  facility  maturing on June 30, 2004.  Borrowing  availability
under the revolving  credit  facility is based on the lesser of (i) a percentage
of eligible accounts receivable and inventories or (ii) $17.5 million,  less any
outstanding  letters of credit  issued under the Credit  Agreement.  Outstanding
borrowings  under the  revolving  credit  facility  were $7.3  million  and $7.1
million at March 31, 2003 and December 31, 2002,  respectively.  As of March 31,
2003,  the Company had  additional  borrowing  availability  under the revolving
facility of $7.0  million.  As of May 14, 2003,  the Company's  total  borrowing
availability  under  the  revolving  facility  was $13.9  million,  of which the
Company had borrowed $6.7 million. Revolving credit borrowings bear interest, at
the Company's option,  at either a floating rate  approximating the Bank's prime
rate plus an interest  margin  (4.75% at May 14, 2003) or LIBOR plus an interest
margin (2.78% at May 14, 2003). At March 31, 2003, the Company was in compliance
with its financial covenants under the Credit Agreement.

Based on its current  business plan, the Company  expects that cash  equivalents
and short term investments on hand, the Company's  credit facility,  as amended,
and funds budgeted to be generated from  operations will be adequate to meet its
liquidity and capital requirements for the next year. The Company's liquidity is
not  dependent  upon  the  use  of  off-balance  sheet  financing  arrangements.
Currently   unforeseen   future   developments  and  increased  working  capital
requirements  may require  additional debt financing or issuance of common stock
in 2003 and subsequent years.



                                       13
<PAGE>

FORWARD LOOKING STATEMENTS

Statements made in this Quarterly Report include forward-looking statements made
under the  provisions of the Private  Securities  Litigation  Reform Act of 1995
including,  but not limited to, the ability of the Company to meet its liquidity
and capital  requirements.  The Company's actual results could differ materially
from such forward-looking  statements and such results will be affected by risks
described in the Company's Annual Report including,  without  limitation,  those
described  under  "Risk  Factors  -History  of  Net  Losses",   "-Reliance  upon
Microtek",  "-Competition",  "-Product  Liability",  "-Stock Price  Volatility",
"-Dependence on Key Personnel",  "-Anti-takeover Provisions",  "-Low Barriers to
Entry for Competitive Products", "-Potential Erosion of Profit Margins", "-Risks
of Completing Acquisitions", "-Small Sales and Marketing Force", "-Reliance upon
Distributors", "-Microtek Regulatory Risks", "-Risks of Obsolescence", "-Reduced
OREX Market Potential",  "-OREX  Commercialization  Risks", "-OREX Manufacturing
and Supply Risks",  "-Risks Affecting  Protection of  Technologies",  "-Risks of
Technological  Obsolescence" and "-OTI Regulatory Risks". We do not undertake to
update our forward-looking statements to reflect future events or circumstances.

ITEM 3.   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company's greatest  sensitivity with respect to market risk is to changes in
the  general  level of U.S.  interest  rates and its effect  upon the  Company's
interest  expense.  At March 31, 2003, the Company had $7.5 million of long-term
or short-term debt bearing  interest at floating rates.  Because these rates are
variable,  a 1%  increase in interest  rates would have  resulted in  additional
interest expense of  approximately  $18,000 for the three months ended March 31,
2003 and a 1%  reduction  in  interest  rates  would  have  resulted  in reduced
interest expense of  approximately  $18,000 for the three months ended March 31,
2003.

ITEM 4.   CONTROLS AND PROCEDURES

(a)  Evaluation of disclosure controls and procedures. Under the supervision and
     with the participation of the Company's management, including the Company's
     President and Chief  Executive  Officer and Chief  Financial  Officer,  the
     Company  carried out an  evaluation of the  effectiveness  of the Company's
     "disclosure controls and procedures" (as defined in the Securities Exchange
     Act of 1934 Rules  13a-14(c) and  15d-14(c)) as of a date (the  "Evaluation
     Date")  within 90 days  prior to the date of this  report.  Based upon that
     evaluation,  the Company's  President and Chief  Executive  Officer and its
     Chief Financial Officer have concluded that, as of the Evaluation Date, the
     Company's  disclosure controls and procedures were adequate and designed to
     ensure  that  the  information  relating  to  the  Company  (including  its
     consolidated subsidiaries) required to be disclosed in the reports filed or
     submitted  by the  Company  under the  Securities  Exchange  Act of 1934 is
     recorded,  processed,  summarized  and reported  within the requisite  time
     periods.

(b)  Changes in internal controls. There have been no significant changes in the
     Company's  internal  controls or in other factors that could  significantly
     affect internal controls subsequent to Evaluation Date.

                                     PART II
                                OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS

Not applicable.

ITEM 2.   CHANGES IN SECURITIES AND USE OF PROCEEDS

During the  quarter  for which  this  report is filed,  there  were no  material
modifications in the instruments defining the rights of shareholders. During the
quarter  for which this  report is filed,  none of the rights  evidenced  by the
shares of the Company's common stock were materially limited or qualified by the
issuance or modification of any other class of securities.



                                       14
<PAGE>

ITEM 3.   DEFAULT UPON SENIOR SECURITIES

Not applicable.

ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITYHOLDERS

None.

ITEM 5.   OTHER INFORMATION

None.

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

(a)  Exhibits:

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

3.1(1)    Articles of Incorporation of Isolyser Company, Inc.

3.2(2)    Articles  of  Amendment  to  Articles  of  Incorporation  of  Isolyser
          Company, Inc.

3.3(3)    Amended and Restated Bylaws of Isolyser Company, Inc.

4.1(1)    Specimen Certificate of Common Stock

4.2       Fourth Amendment  Agreement dated as of March 31, 2003, to the Amended
          and  Restated  Credit  Agreement,  dated  as of May  14,  2001,  among
          Microtek Medical Holdings, Inc., Microtek Medical, Inc., Isolyser-MSI,
          Inc. and JP Morgan Chase Bank

------------------
(1)  Incorporated by reference to the Company's  Registration  Statement on Form
     S-1 (File No. 33-83474).
(2)  Incorporated by reference to Exhibit 3.2 of the Company's  Annual Report on
     Form 10-K for the year ended December 31, 1996.
(3)  Incorporated by reference to Exhibit 3.1 to the Company's Current Report on
     Form 8-K filed April 23, 2002.


(b)  The  registrant  filed no Current  Reports  on Form 8-K during the  quarter
     ended March 31, 2003.



                                       15
<PAGE>

                                   SIGNATURES


Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has caused  this  quarterly  report on Form 10-Q to be signed on its
behalf by the undersigned thereunto duly authorized on May 14, 2003.


                                    MICROTEK MEDICAL HOLDINGS, INC.



                                    By:  /s/ Dan R. Lee
                                         --------------------------------------
                                         Dan R. Lee
                                         Chairman, President & Chief Executive
                                         Officer
                                         (principal executive officer)


                                    By:  /s/ Roger G. Wilson
                                         --------------------------------------
                                         Roger G. Wilson
                                         Chief Financial Officer
                                         (principal financial officer)





                                       16
<PAGE>

                            CERTIFICATION PURSUANT TO
                  SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Dan R. Lee, certify that:

1.   I have  reviewed  this  quarterly  report on Form 10-Q of Microtek  Medical
     Holdings, Inc.

2.   Based on my knowledge,  this  quarterly  report does not contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this quarterly report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in this  quarterly  report,  fairly  present  in all
     material respects the financial  condition,  results of operations and cash
     flows of the  registrant  as of, and for,  the  periods  presented  in this
     quarterly report;

4.   The  registrant's  other  certifying  officer  and  I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
     (a)  Designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during  the  period in which  this  quarterly
          report is being prepared;
     (b)  Evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing date of
          this quarterly report (the "Evaluation Date"); and
     (c)  Presented  in  this  quarterly   report  our  conclusions   about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

5.   The registrant's  other certifying  officer and I have disclosed,  based on
     our most recent  evaluation,  to the  registrant's  auditors  and the audit
     committee of registrant's board of directors:
     (a)  All  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls; and
     (b)  Any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and

6.   The  registrant's  other  certifying  officer and I have  indicated in this
     quarterly report whether or not there were significant  changes in internal
     controls  or in other  factors  that could  significantly  affect  internal
     controls  subsequent to the date of our most recent  evaluation,  including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.

Date:    May 14, 2003               /s/ Dan R. Lee
                                    ---------------------------------------
                                    Dan R. Lee
                                    Chairman, President and Chief Executive
                                    Officer



                                       17
<PAGE>


                            CERTIFICATION PURSUANT TO
                  SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Roger G. Wilson, certify that:

1.   I have  reviewed  this  quarterly  report on Form 10-Q of Microtek  Medical
     Holdings, Inc.

2.   Based on my knowledge,  this  quarterly  report does not contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this quarterly report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in this  quarterly  report,  fairly  present  in all
     material respects the financial  condition,  results of operations and cash
     flows of the  registrant  as of, and for,  the  periods  presented  in this
     quarterly report;

4.   The  registrant's  other  certifying  officer  and  I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
     (a)  Designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during  the  period in which  this  quarterly
          report is being prepared;
     (b)  Evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing date of
          this quarterly report (the "Evaluation Date"); and
     (c)  Presented  in  this  quarterly   report  our  conclusions   about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

5.   The registrant's  other certifying  officer and I have disclosed,  based on
     our most recent  evaluation,  to the  registrant's  auditors  and the audit
     committee of registrant's board of directors:
     (a)  All  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls; and
     (b)  Any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and

6.   The  registrant's  other  certifying  officer and I have  indicated in this
     quarterly report whether or not there were significant  changes in internal
     controls  or in other  factors  that could  significantly  affect  internal
     controls  subsequent to the date of our most recent  evaluation,  including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.

Date:    May 14, 2003               /s/ Roger G. Wilson
                                    ---------------------------------------
                                    Roger G. Wilson
                                    Chief Financial Officer, Treasurer and
                                    Assistant Secretary



                                       18
1616918v1