UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q


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

For the quarterly period ended September 30, 1996

                                       or

[     ]  TRANSITION REPORTS PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
         EXCHANGE ACT OF 1934

For the transition period from                       to
                              -----------------------  ------------------------

                         Commission File Number: 0-26082


                                  VIDAMED, INC.
             (exact name of registrant as specified in its charter)



           Delaware                                        77-0314454
(State or other jurisdiction of                (IRS Employer Identification No.)
incorporation or organization)


                           1380 Willow Road, Suite 101
                              Menlo Park, CA 94025
                    (Address of principal executive offices)

                                 (415) 328-8781
              (Registrant's telephone number, including area code)


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

The number of outstanding  shares of the  registrant's  Common Stock,  $.001 par
value, was 10,904,837 as of November 1, 1996.


                                                        Page 1 of 16
                                                        Exhibit Index at Page 15

<PAGE>


                                  VIDAMED, INC.
<TABLE>

                                      INDEX
<CAPTION>

PART I: FINANCIAL INFORMATION
                                                                                          Page

<S>                                                                                       <C>
Item 1.      Condensed consolidated financial statements - unaudited

             Condensed consolidated balance sheets - September 30, 1996
                  and December 31, 1995                                                    3

             Condensed consolidated statements of operations - three months
                  ended September 30, 1996 and 1995 and nine months ended                  
                  September 30, 1996 and 1995                                              4

             Condensed consolidated statements of cash flows - nine months
                  ended September 30, 1996 and 1995                                        5

             Notes to condensed consolidated financial statements                          6

Item 2.      Management's discussion and analysis of financial condition
                 and results of operations                                                 9


PART II: OTHER INFORMATION

Item 1.      Legal Proceedings                                                            12

Item 2.      Changes in Securities                                                        12

Item 3.      Defaults Upon Senior Securities                                              12

Item 4.      Submission of Matters to a Vote of Security Holders                          12

Item 5.      Other Information                                                            12

Item 6.      Exhibits and Reports on Form 8-K                                             12

             Signatures                                                                   13

</TABLE>



                                  Page 2 of 16
<PAGE>



                          PART I: FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                                  VidaMed, Inc.
                      Condensed Consolidated Balance Sheets
                                 (In thousands)

                                                  September 30,     December 31,
                                                      1996             1995
                                                  -------------     ------------
                                                   (Unaudited)          (*)
Assets                                    
Current Assets:
     Cash and cash equivalents                        $  7,973         $  5,687
     Short-term investments                              1,989            8,003
     Other current assets                                2,561            1,982
                                                      --------         --------
           Total current assets                         12,523           15,672
                                                                    
     Property and equipment, net                         2,502            2,909
     Other assets, net                                     215              235
                                                      --------         --------
           Total assets                               $ 15,240         $ 18,816
                                                      ========         ========
                                                                    
Liabilities and stockholders' equity                                
Current liabilities:                                                
     Notes payable, current portion                   $  1,034         $  3,650
     Accounts payable                                      710              487
     Accrued professional fees                             371              338
     Accrued clinical trial costs                          915              978
     Accrued and other liabilities                       2,880            2,376
     Current portion of obligations                                 
           under capital leases                            596              696
     Deferred revenue                                      517              779
                                                      --------         --------
           Total current liabilities                     7,023            9,304
                                                                    
     Notes payable, noncurrent                             757            1,543
     Other long-term liabilities                           842            1,214
                                                                    
Stockholders' equity:                                               
     Capital stock                                      55,379           45,088
     Accumulated deficit                               (48,761)         (38,333)
                                                      --------         --------
           Total stockholders' equity                    6,618            6,755
                                                      --------         --------
           Total liabilities and                                    
                stockholders' equity                  $ 15,240         $ 18,816
                                                      ========         ========
                                                               
* The Balance  Sheet at  December  31,  1995 has been  derived  from the audited
financial  statements  at that date but does not include all of the  information
and footnotes required by generally accepted accounting  principles for complete
financial statements.


                             See accompanying notes.

                                  Page 3 of 16
<PAGE>

<TABLE>

                                  VidaMed, Inc.
                 Condensed Consolidated Statements of Operations
                     (In thousands except per share amounts)
                                   (Unaudited)
<CAPTION>


                                                    Three Months Ended        Nine Months Ended
                                                       September 30,             September 30,
                                                    -------------------      -------------------
                                                      1996       1995           1996     1995
                                                    ---------  --------      ---------  --------
<S>                                                   <C>       <C>          <C>        <C>     
Revenues:
     Product sales, net                               $   245   $  615       $  1,121   $  2,083
     License fees and grant revenue                        50      109            264        328
                                                      -------   ------       --------   --------
     Net revenues                                         295      724          1,385      2,411

Operating Expenses:
     Cost of product sales                                709    1,058          2,331      2,887
     Research and development                           1,249    1,868          3,999      4,957
     Selling, general and administrative                1,891    1,736          5,502      5,209
                                                      -------  -------       --------   --------
     Total operating expenses                           3,849    4,662         11,832     13,053
                                                      -------  -------       --------   --------
     Loss from operations                              (3,554)  (3,938)       (10,447)   (10,642)

Other income (expense), net                                10       20             19       (301)
                                                      -------  -------       --------   --------
Net loss                                              $(3,544) $(3,918)      $(10,428)  $(10,943)
                                                      =======  =======       ========   ========
Net loss per share                                      $(.33)   $(.43)        $(1.02)    $(2.38)
                                                      =======  =======       ========   ========
Shares used in computing net loss per share            10,854    9,055         10,208      4,593
                                                      =======  =======       ========   ========

<FN>

                             See accompanying notes.
</FN>
</TABLE>

                                  Page 4 of 16
<PAGE>


                                  VidaMed, Inc.
                 Condensed Consolidated Statement of Cash Flows
                                 (In thousands)
                                   (Unaudited)


                                                           Nine Months Ended
                                                             September 30,
                                                          --------------------
                                                            1996        1995
                                                          --------    --------
Cash flows from operating activities:
     Net loss                                             $(10,428)   $(10,943)
     Adjustments to reconcile net loss to net cash
         used in operating activities:
           Depreciation and amortization                     1,063         853
           Other                                               146         (13)
           Changes in assets and liabilities:
               Other current assets                           (579)       (466)
               Other assets                                     20         (19)
               Accounts payable                                145        (807)
               Accrued and other liabilities                   523       1,944
               Deferred revenue                               (262)       (319)
                                                          --------    --------
Net cash used in operating activities                       (9,372)     (9,770)
                                                          --------    --------

Cash flows from investing activities:
     Expenditures for property and equipment                  (584)       (553)
     Purchase of short-term investments                     (9,816)     (7,882)
     Proceeds from maturities of short-term investments     15,667        --
                                                          --------    --------
Net cash provided by/(used in) investing activities          5,267      (8,435)
                                                          --------    --------

Cash flows from financing activities:
     Net cash proceeds from issuance of Common Stock           554      20,855
     Principal payments under capital leases                  (519)       (487)
     Principal payments of long-term debt                      (18)        (15)
     Principal payments of notes payable                    (3,402)       (286)
     Net proceeds from issuance of
         long-term debt                                        100        --
     Net proceeds from issuance of notes payable
         and convertible notes                               9,676       7,219
                                                          --------    --------
Net cash provided by financing activities                    6,391      27,286
                                                          --------    --------
Net increase in cash and cash equivalents                    2,286       9,081
Cash and cash equivalents at the beginning
  of the period                                              5,687         372
                                                          --------    --------
Cash and cash equivalents at the end of the period        $  7,973    $  9,453
                                                          ========    ========

                             See accompanying notes.


                                  Page 5 of 16
<PAGE>


                                  VIDAMED, INC.

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               September 30, 1996
                                   (Unaudited)

1.       Basis of presentation

The  accompanying  unaudited  condensed  consolidated  financial  statements  of
VidaMed, Inc. (the "Company" or "VidaMed") have been prepared in accordance with
generally accepted accounting  principles for interim financial  information and
with the  instructions  for Form 10-Q and  Article  10 of  Regulation  S-X.  The
balance sheet as of September 30, 1996 and the  statements of operations for the
three  and nine  month  periods  ended  September  30,  1996 and  1995,  and the
statements of cash flows for the nine month periods ended September 30, 1996 and
1995, are unaudited but include all adjustments  (consisting of normal recurring
adjustments)  which the Company  considers  necessary for a fair presentation of
the financial  position at such dates and the  operating  results and cash flows
for those periods.  Although the Company  believes that the disclosures in these
financial  statements  are  adequate  to  make  the  information  presented  not
misleading,  certain information  normally included in financial  statements and
related  footnotes  prepared in accordance  with generally  accepted  accounting
principles have been condensed or omitted  pursuant to the rules and regulations
of the Securities and Exchange Commission. The accompanying financial statements
should be read in  conjunction  with the financial  statements and notes thereto
included in the Company's annual report on Form 10-K for the year ended December
31, 1995 filed with the Securities and Exchange Commission.

Results for any interim period are not necessarily indicative of results for any
other interim period or for the entire year.

2.       Net loss per share

Net loss per share is computed  using the weighted  average  number of shares of
common stock outstanding during the periods presented.  Common equivalent shares
are excluded from the computation as their effect is antidilutive,  except that,
pursuant to the Securities and Exchange  Commission Staff Accounting  Bulletins,
common and common equivalent shares (stock options, warrants,  convertible notes
and  preferred  stock)  issued during the 12 month period prior to the Company's
initial public  offering (IPO) have been included in the  calculation as if they
were  outstanding  for all periods  through  March 31, 1995 (using the  treasury
stock  method for stock  options and warrants  and the  if-converted  method for
convertible notes and preferred stock).

The pro  forma  calculation  of net  loss per  share  presented  below  has been
computed as described above but also gives  retroactive  effect from the date of
issuance  to  the   conversion  of  the   convertible   preferred   stock  which
automatically  converted to common shares upon closing of the Company's  initial
public offering.

                                                    Nine months ended
                                                    September 30, 1995
                                                    ------------------

         Pro forma net loss per share                    $(1.59)
                                                   ====================

         Shares used in computation                     6,903,000
                                                   ====================

                                  Page 6 of 16
<PAGE>

3.       Initial public offering

In June 1995,  the  Company  completed  an initial  public  offering  ("IPO") of
3,565,000  shares of Common  Stock at a price to the  public of $6.50 per share.
The net proceeds of the offering to the Company,  after  deducting  underwriting
discounts and expenses,  were $20.8 million. Upon completion of the IPO all then
outstanding shares of convertible  preferred stock were automatically  converted
into  shares  of  Common  Stock.  Upon  completion  of  the  IPO  $1,518,805  of
convertible  notes  issued  during  March  and  April  1995  were  automatically
converted into 333,800 shares of common stock.  The conversion price equaled 70%
of the IPO price.

4.       Inventories

Inventories  are  stated at the lower of cost  (determined  using the  first-in,
first-out  method)  or market  value.  Inventories  at  September  30,  1996 and
December 31, 1995 consist of the following:

                          September 30,     December 31,
                              1996             1995
                           ----------       ----------
                                          
         Raw Materials     $  502,000       $  507,000
         Work in process      179,000          154,000
         Finished Goods       956,000          684,000
                           ----------       ----------
                           $1,637,000       $1,345,000
                           ==========       ==========
                                      
5.       Intellectual Property Litigation Risks

The Company is aware that EP  Technologies,  Inc.  ("EPT") and the University of
California ("UC") have filed a United States patent  application in the field of
ablation of body tissue.  These  parties have also  requested  the United States
Patent and  Trademark  Office to declare an  interference  with two of VidaMed's
United States  patent  applications  on which  notices of  allowances  have been
received. The inventors identified on the EPT/UC application are Stuart Edwards,
who was  previously  VidaMed's  Chief  Executive  Officer and was previously the
Chief  Technical  Officer of EPT,  and a  cardiologist  from the  University  of
California,  San Francisco,  who worked as a consultant to EPT while Mr. Edwards
was employed there.

Although the Company believes that the  interference  will not be allowed on the
patents, an adverse  determination in the current patent office proceeding or in
other  litigation or interference  proceedings to which the Company may become a
party could subject the Company to  significant  liabilities to third parties or
require  the  Company  to seek  licenses  from  third  parties.  There can be no
assurance  that  necessary  licenses  would  be  available  to  the  Company  on
satisfactory  terms  or at  all.  Accordingly,  an  adverse  determination  in a
judicial or  administrative  proceeding or failure to obtain necessary  licenses
could prevent the Company from  manufacturing  and selling its  products,  which
would  have a  material  adverse  effect on the  Company's  business,  financial
condition and results of operations.

6.       Cash, cash equivalents and short-term investments

The Company  considers all highly liquid  investments  with  maturities from the
date of purchase of 90 days or less to be cash equivalents.  The Company invests
its excess cash with major banks or investment managers.  Short-term investments
consist of corporate paper and government  securities with remaining  maturities
at


                                  Page 7 of 16
<PAGE>

the date of purchase of greater than 90 days and less than one year.  Short-term
investments  are  designated  as  available  for sale and carried at fair market
value, with unrealized gains and losses reported in stockholders' equity.

7.       Convertible notes

In March 1996, the Company completed the sale of $10.1 million of 5% convertible
subordinated  notes (the "Notes").  Interest is payable  semiannually  in either
cash or Common Stock of the Company. The Notes are convertible into Common Stock
of VidaMed  based upon a  percentage  (ranging  from 80% to 85%) of the  average
closing bid price over a period of five trading days prior to conversion.  As of
June 30, 1996 all of the $10.1 million in principal and accrued  interest on the
Notes had been converted into an aggregate of 1,375,676 shares of Common Stock.

                                  Page 8 of 16
<PAGE>

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

This Management's  Discussion and Analysis of Financial Condition and Results of
Operations  for the three and nine  months  ended  September  30, 1996 and 1995,
should be read in conjunction with the  Management's  Discussion and Analysis of
Financial  Condition and Results of Operations included in the Company's 10K for
the year ended December 31, 1995.

This Management's  Discussion and Analysis of Financial Condition and Results of
Operations   contains   forward-looking   statements  which  involve  risks  and
uncertainties.  The Company's actual results may differ significantly from those
anticipated by the forward-looking  statements.  Factors that might cause such a
difference  include,  but are not limited to, those  discussed  below and in the
Company's report on Form 10-K for the year ended December 31, 1995.

Overview

VidaMed has a limited  history of  operations  and has  experienced  significant
operating losses since  inception.  As of September 30, 1996, the Company had an
accumulated  deficit  of  $48.8  million.  The  Company  commenced  sales of its
TransUrethral  Needle Ablation  ("TUNA")  system in late 1993.  Revenues for the
three and nine months ended September 30, 1995 also include consulting  revenues
and electronic component sales by Scionex, a wholly-owned subsidiary acquired in
June 1994.  Sales by Scionex to third parties have been  discontinued  as of the
end of 1995 as Scionex has directed all of its  activities  to  development  and
production of the  radiofrequency  generators for the TUNA System.  Revenues for
the  quarters  ended  September  30,  1996 and  1995  include  license  fees for
distribution  rights in Japan  and for the  quarter  ended  September  30,  1995
includes a United Kingdom government grant which ended June 30, 1996.

VidaMed anticipates that a substantial amount of its revenues from product sales
in the future  will be from  sales in the United  States.  The  Company  filed a
premarket 510(k) notification with the Food and Drug Administration  ("FDA") for
the TUNA System in March 1996.  The Company  will not be permitted to market the
TUNA  System  for  BPH in the  United  States  until  approval  of  such  510(k)
notification is received.  The company received FDA clearance to market the TUNA
System in the United  States on October 8, 1996.  Currently,  VidaMed  sells its
products primarily  internationally to distributors who resell to physicians and
hospitals.  Sales to distributors  are made on open credit terms and may include
volume purchase  discounts and extended payment terms.  Therefore,  distributors
may  purchase  several  months of  inventory  at one time to take  advantage  of
discounts  and extended  payment  terms.  While  revenue from product  sales are
generally  recognized at the time of shipment  (net of allowances  for discounts
and  estimated  returns),  a  portion  of the  Company's  initial  shipments  to
distributors  have not been recognized as revenues due to extended payment terms
or limited sell  through  experience  associated  with these  distributors.  The
Company anticipates continuing this revenue recognition policy;  however, as its
distributor  relationships mature, the Company believes that it will recognize a
greater portion of revenues upon shipment.

The Company  expects its  operating  losses to continue  through at least fiscal
year 1996 as it  continues  to expend  substantial  resources  in  expansion  of
marketing  and  sales  activities  as a result  of recent  FDA  approval  of the
Company's 510(k)  notification  for the TUNA System,  funding clinical trials in
support of regulatory and reimbursement approvals, and research and development.
The Company's future  profitability



                                  Page 9 of 16
<PAGE>

will be dependent  upon,  among other  factors,  market  acceptance  of the TUNA
System and availability of third-party  reimbursement  for procedures  performed
with the TUNA System.

Although the Company has received  FDA approval of its 510(k)  notification  for
the TUNA System for  treatment  of BPH and has  commenced  marketing of the TUNA
System in the United States, there can be no assurance that the TUNA System will
be deemed clinically or cost effective by health care providers and payors, will
be deemed  superior to other  current and  emerging  methods for treating BPH or
will  achieve  significant  market  acceptance  in  the  United  States  market.
Furthermore,   determinations   as  to   eligibility  of  the  TUNA  System  for
reimbursement by private and governmental  health payors are made by such payors
independently of the FDA approval,  and, accordingly,  there can be no assurance
that the TUNA procedure will be eligible for  reimbursement in the United States
under either private or governmental  healthcare payment systems.  Ineligibility
of TUNA procedures for reimbursement would have an adverse effect on the ability
of the TUNA System to achieve market  acceptance.  Failure of the TUNA System to
achieve  market  acceptance in the United  States would have a material  adverse
effect on  business,  financial  condition  and  results  of  operations  of the
Company.

The  Company  does not have a backlog of orders for its  products  in  countries
where the TUNA  System is  approved  and  anticipates  that it will  continue to
manufacture and ship orders after their receipt.  Accordingly,  the Company does
not anticipate that it will develop a significant backlog in the future.

Results of Operations

Net revenue for the three  months  ended  September  30, 1996  decreased  59% to
$295,000  from $724,000 in the three months ended  September  30, 1995.  Product
sales in the third  quarter of 1996  decreased  60% to $245,000 from $615,000 in
the same period in 1995. The decrease in product sales between the third quarter
of 1995 and 1996 is the result of the  discontinuance  of Scionex sales to third
party  customers in 1996,  shipment of products for clinical  evaluation  to the
Japanese  distributor in 1995 and the completion of a U.K.  government  grant in
the  Company's  second  quarter of 1996.  For the first nine  months of 1996 net
revenue  decreased 43% to $1,385,000 from  $2,411,000  during the same period in
1995.  Product  sales  for  the  first  nine  months  of 1996  decreased  46% to
$1,121,000  from  $2,083,000  during the same  period in 1995.  The  decrease in
product sales is primarily due to the  discontinuance  of Scionex sales to third
party customers.  Scionex had sales of approximately  $725,000 in the first nine
months of 1995.

Cost of product  sales  decreased  33% to  $709,000  in the three  months  ended
September 30, 1996 from $1,058,000 in the three months ended September 30, 1995.
For the nine months ended September 30, 1996 cost of product sales decreased 19%
to  $2,331,000  from  $2,887,000  in the same  period in 1995.  The  decrease is
primarily due to lower product sales in the first nine months of 1996,  although
excess overhead caused by decreased production partially offset the reduction.

Research and  development  expenses  decreased  33% to  $1,249,000  in the three
months  ended  September  30, 1996 from  $1,869,000  in the three  months  ended
September  30, 1995.  For the nine months ended  September 30, 1996 research and
development  expenses  decreased 19% to $3,999,000  from  $4,957,000 in the same
period in 1995.  The decrease was primarily due to lower clinical trial expenses
in 1996, but was partially offset by an increase in product development material
costs.  The  decrease in clinical  trial costs is due to the  completion  of the
enrollment in the U.S. clinical trials in 1995.

Selling,  general and administrative  expenses increased 9% to $1,891,000 in the
three months ended  September 30, 1996 from $1,736,000 in the three months ended
September  30,  1995.  For the nine months  ended

                                 Page 10 of 16
<PAGE>

September 30, 1996 selling,  general and administrative expenses increased 6% to
$5,502,000  from  $5,209,000  in the same  period  in  1995.  The  increase  was
primarily due to increased sales and marketing  expense incurred in anticipation
of the U.S. TUNA product launch.  Sales and administrative  personnel were hired
throughout  1996 in  preparation  of U.S.  commercial  introduction  of the TUNA
System.

Total operating  expenses in the three months ended September 30, 1996 decreased
17% to $3,848,000  from $4,662,000 in the three months ended September 30, 1995.
Total  operating  expenses  for the first nine  months of 1996  decreased  9% to
$11,832,000 from $13,053,000 in the same period in 1995.

Other income for the three and nine months ended  September 30, 1996 was $10,000
and $19,000, respectively, compared to other income of $20,000 and other expense
of $301,000 for the  comparable  periods in 1995.  This change in the nine month
amount is primarily due to interest earned on proceeds from the IPO in June 1995
and Convertible Notes issued March 1996 offsetting interest expense in 1996.

The net loss for the three and nine month periods  ended  September 30, 1996 was
$3,544,000 and $10,428,000, respectively, compared to $3,918,000 and $10,943,000
for the comparable periods in 1995.

Liquidity and Capital Resources

At September  30, 1996 the  Company's  cash,  cash  equivalents  and  short-term
investments  were  $9,962,000,  compared to $13,690,000 at December 31, 1995. In
June 1995 the Company  completed an initial public offering of 3,565,000  shares
of Common Stock at a price to the public of $6.50 per share. The net proceeds of
the  offering  to  the  Company,  after  deducting  underwriting  discounts  and
expenses,  were $20.8 million. In March 1996, the Company completed the issuance
of $10.1 million in convertible  subordinated  notes. As of June 30, 1996 all of
the $10.1  million in  principal  and  accrued  interest on these notes had been
converted into an aggregate of 1,375,676 shares of Common Stock.

In April 1995, the Company  obtained a $3,000,000  secured credit  facility.  To
date, the Company has borrowed  $3,000,000 under this facility.  Borrowings bear
interest at the prime rate plus 3% per annum plus additional  lump-sum  interest
of 15% of each  borrowing,  payable at  maturity.  Repayment is based on a three
year amortization schedule.

In January and  February  1996,  the Company  repaid  $2,700,000  in  previously
outstanding  notes payable  issued by the Company in January and February  1995.
Interest on these notes accrued at the prime rate.

During the nine months ended September 30, 1996 and 1995,  VidaMed consumed cash
in operations of $9,372,000 and  $9,770,000,  respectively.  The changes in cash
used in operations  were due to decreased  research and  development  associated
with  clinical  trial  costs  offset  in  part  by  increased  selling  expenses
associated with the anticipated U.S. TUNA product launch.

Although VidaMed believes that its current capital  resources and cash generated
from the sale of products will be sufficient to meet the Company's operating and
capital  requirements  through the next twelve months, there can be no assurance
that the Company will not require  additional  financing within this time frame.
There can be no  assurance  that  additional  financing,  if  required,  will be
available  on  satisfactory  terms or at all.  In any event,  VidaMed may in the
future seek to raise additional  funds through bank  facilities,  debt or equity
offerings or other sources of capital.  VidaMed's  future  liquidity and capital
requirements  will  depend on  numerous  other  factors,  including  progress of
clinical trials,  actions related to regulatory and reimbursement  matters,  and
the extent to which the TUNA system gains market acceptance.


                                 Page 11 of 16
<PAGE>


                                  VIDAMED, INC.

PART II: OTHER INFORMATION

Item 1.     Legal Proceedings

            None

Item 2.     Changes in Securities

            None

Item 3.     Defaults upon Senior Securities

            None

Item 4.     Submission of Matters to a Vote of Security Holders

            None

Item 5.     Other Information

            None

Item 6.     Exhibits and Reports on Form 8-K

                     a) Exhibits

                         (11.1) Statement Re: Computation of Net Loss Per Share

                         (27.1)  Financial Data Schedule

                     b) Reports on Form 8-K. No reports on Form 8-K were filed
                          during the quarter ended September 30, 1996.



                                 Page 12 of 16
<PAGE>

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


                                       VIDAMED, INC.

Date:    November 12, 1996             By:     /s/   James A. Heisch
      --------------------------            ------------------------
                                            James A. Heisch
                                            President, Chief Executive Officer,
                                            Chief Financial Officer
                                            (Principal Financial Officer)

Date:    November 12, 1996             By:    /s/   Thomas M. Fahey
      -----------------------------        ------------------------
                                            Thomas M. Fahey
                                            Director of Finance
                                            (Principal Accounting Officer)



                                 Page 13 of 16
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INDEX TO EXHIBITS



EXHIBIT
NUMBER   DESCRIPTION

 11.1    Statement regarding computation of net loss per share

 27.1    Financial Data Schedule


                                 Page 14 of 16