U.S. SECURITIES AND EXCHANGE COMMISSION

			   Washington, D.C.  20549

				  FORM 10-QSB


(MARK ONE)
[X]  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
      ACT OF 1934 - FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2001

[ ]  TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE EXCHANGE
      ACT OF 1934 FOR THE TRANSITION PERIOD FROM ________ TO________

		       COMMISSION FILE NUMBER  0-25380


			ULTRADATA SYSTEMS, INCORPORATED
	(Exact name of small business issuer as specified in its charter)

       Delaware                                      43-1401158
(State or other jurisdiction of         (I.R.S. Employer Identification No.)
  incorporation or organization)

9375 Dielman Industrial Drive, St. Louis, MO                63132
(Address of principal executive offices)                 (Zip Code)


Issuer's telephone number, including area code:  (314) 997-2250

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

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

Class                                Outstanding as of  July 19, 2001
Common, $.01 par value                             3,249,533

Transitional Small Business Disclosure Format     Yes [ ]   No [X]





			ULTRADATA SYSTEMS, INCORPORATED
				  FORM 10-QSB
			       March 31, 2001
				     INDEX               File No. 0-25380

PART I - FINANCIAL INFORMATION                                    PAGE

     Item 1.  Unaudited Financial Statements

	      Balance Sheets at
	       March 31, 2001 and December 31, 2000                 3.

	      Statements of Operations
	       for the three months ended March 31, 2001 and 2000   4.

	      Statements of Cash Flows
	       for the three months ended March 31, 2001 and 2000   5.

	      Notes to Financial Statements                         6.

     Item 2.  Management's Discussion and Analysis of Financial
	       Condition and Results of Operations                  7.

PART II - OTHER INFORMATION                                         11.

	       Signatures                                           11.



ULTRADATA SYSTEMS, INCORPORATED
Balance Sheets
As of March 31, 2001 and December 31, 2000

						March 31,     December 31,
						  2001           2000
					      (Unaudited)
---------------------------------------------------------------------------
		 Assets
Current assets:
 Cash and cash equivalents                    $ 1,334,397      $ 1,842,983
 Restricted cash                                  767,813          767,724
 Trade accounts receivable, net of allowance
  for doubtful accounts of $117,556               189,570          673,475
 Inventories                                    2,081,299        1,780,255
 Prepaid expenses and other current assets        241,693          229,637
						---------        ---------
Total current assets                            4,614,772        5,294,074
						---------        ---------
Property and equipment, net                       602,733          617,794
						---------        ---------
Total property and equipment                      602,733          617,794
						---------        ---------
Deferred compensation trust investments,
 available for sale                                68,842           84,605
Investment in Talon Research and
 Development, Ltd.                                796,520          825,757
Advances to affiliates                            150,000          150,000
Advertising credits                                62,421           62,421
Other assets                                        9,444            8,594
						---------        ---------
Total assets                                  $ 6,304,732      $ 7,043,245
						=========        =========

		 Liabilities and Stockholders' Equity

Current liabilities:
 Accounts payable                                 116,041          164,319
 Accrued expenses and other liabilities           151,480          218,996
						---------        ---------
Total current liabilities                         267,521          383,315
						---------        ---------
Deferred rent                                       4,354            6,220
Deferred compensation liability                    71,656           87,329
						---------        ---------
Total liabilities                                 343,531          476,864
						---------        ---------
Stockholders' equity (Notes 3 and 7):
 Preferred Stock, $0.01 par value,
  4,996,680 shares authorized, none
  outstanding                                           -                -
 Series A convertible preferred stock,
  3,320 shares authorized, 1,606 shares
  outstanding with a stated value of $1,000     1,606,000        1,616,000
 Common stock, $.01 par value; 10,000,000
  shares authorized; 3,535,646 shares
  issued and outstanding March 31,2001;
  3,519,586 shares issued and outstanding
  December 31, 2000                                35,356           35,196
 Additional paid-in capital                     9,874,354        9,861,970
 Accumulated deficit                           (4,250,794)      (3,737,190)
 Treasury stock (326,171 shares at cost)         (942,311)        (942,311)
 Notes receivable issued for purchase of
  common stock                                   (208,157)        (205,819)
 Accumulated other comprehensive (loss)
  income, net                                    (153,247)         (61,465)
						---------        ---------
Total stockholders' equity                      5,961,201        6,566,381
						---------        ---------
Total liabilities and stockholders' equity    $ 6,304,732      $ 7,043,245
						=========        =========
See accompanying summary of accounting policies and notes to financial
statements.


ULTRADATA SYSTEMS, INCORPORATED
Statements of Operations

					      Three months ended March 31,
						  2001            2000
					      -----------------------------
						       (Unaudited)

Net sales                                     $  185,842      $  281,405

Cost of sales                                    146,190         169,089
						--------        --------
Gross profit                                      39,652         112,316
						--------        --------
Selling expense                                   51,010          70,677
General and administrative expenses              454,067         449,818
Research and development expense                 128,794          96,233
						--------        --------
						 633,871         616,728
						--------        --------
Operating loss                                  (594,219)       (504,412)

Other income:
 Interest and dividend income                     33,702          37,775
 Equity in earnings (losses) of affiliates        46,767         (65,316)
 Other, net                                          146          12,018
						--------        --------
Total other income (loss)                         80,615         (15,522)
						--------        --------
Loss before income tax expense                  (513,604)       (519,935)
Income tax expense                                     -               -
						--------        --------
Net loss                                      $ (513,604)     $ (519,935)

Less preferred stock dividends                   (45,450)              -
						--------        --------
Net loss available to common shareholders     $ (559,054)     $ (519,935)
						========        ========
Loss per share:
 Basic and diluted                            $    (0.18)     $    (0.17)
						========        ========
Weighted Average Shares Outstanding:
 Basic and diluted                             3,193,772       3,105,235
					       =========       =========

See accompanying summary of accounting policies and notes to financial
statements.



ULTRADATA SYSTEMS, INCORPORATED

Statements of Cash Flows
					  Three months ended
					       March 31,
					 2001             2000
					      (Unaudited)
					 ----------------------

Cash flows from operating activities:
 Net loss                                $ (513,604)    $ (519,935)

 Adjustments to reconcile net loss to
  net cash provided by (used in)
  operating activities:
  Depreciation and amortization              49,979         58,980
  Inventory reserve for obsolescence              -         30,000
  Equity in (earnings) losses of
   unconsolidated affiliates                (46,767)        65,315
  Realized loss (gain) on investments             -        (10,602)
  Non-cash compensation expense               2,544              -

  Increase (decrease) in cash due to
   changes in operating assets and
   liabilities:
   Trade accounts receivable, net           483,905      1,044,240
   Inventories                             (301,044)      (106,736)
   Prepaid expenses and other current
    assets                                  (15,242)       (38,905)
   Accounts payable                         (48,278)        40,940
   Accrued expenses and other liabilities   (67,516)      (153,494)
   Deferred rent                             (1,866)        (1,866)
   Deferred compensation trust liability    (15,673)        11,858
					   --------       --------
  Net cash (used in) provided by operating
   activities                              (473,562)       419,795
					   --------       --------
Cash flows from investing activities:
 Deferred compensation trust investments        (16)        (8,634)
 Advances to affiliated company                   -         (4,669)
 Capital expenditures                       (34,919)       (46,644)
					   --------       --------
  Net cash used in investing activities     (34,935)       (59,947)
					   --------       --------
Cash flows from financing activities:
 Exercise of employee stock options               -        314,625
 Restricted cash                                (89)         8,396
					   --------       --------
  Net cash provided by (used in) financing
   activities                                   (89)       323,021
					   --------       --------
Net increase (decrease) in cash and cash
 equivalents                               (508,586)       682,869

Cash and cash equivalents at beginning
 of period                                1,842,983      1,220,134
					  ---------      ---------
Cash and cash equivalents at end of
 period                                  $1,334,397     $1,903,003
					  =========      =========

See accompanying summary of accounting policies and notes to financial
statements.


		    ULTRADATA SYSTEMS, INCORPORATED

			     March 31, 2001

Summary of Significant Accounting Policies

Basis of Presentation

The accompanying interim financial statements included herein have been
prepared by Ultradata Systems, Incorporated (the "Company"), without audit
in accordance with generally accepted accounting principles and pursuant to
the rules and regulations of the Securities and Exchange Commission for
interim financial information.  Certain information and footnote disclosures
normally included in financial statements prepared in accordance with
generally accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations, although the Company believes that
the disclosures made are adequate to make the information presented not
misleading. The Company's investment in Talon Research and Development, Ppty.,
Auckland, NZ  Ltd. of 22.6% is accounted for using the equity method.

In the opinion of management, the information furnished for the three-month
periods ended March 31, 2001 and 2000, respectively, includes all adjustments,
consisting solely of normal recurring accruals necessary for a fair
presentation of the financial results for the respective interim periods and
is not necessarily indicative of the results of operations to be expected for
the entire fiscal year ending December 31, 2001.  It is suggested that the
interim financial statements be read in conjunction with the audited
consolidated financial statements for the year ended December 31, 2000, as
filed with the Securities and Exchange Commission on Form 10-KSB (Commission
File Number 0-25380).

Use of Estimates

The financial statements have been prepared in conformity with generally
accepted accounting principles and, as such, include amounts based on informed
estimates and adjustments by management, with consideration given to
materiality. Actual results could vary from those estimates.

Reclassifications

Certain 2000 balances have been reclassified to conform to the 2001
presentation.  In the fourth quarter 2000, the Company changed the way it
accounts for certain sales incentives, in accordance with EITF Issue
No. 00-25.  Accordingly, the Company has restated the financial statements
for the first quarter 2000 to reflect this change.  The Company reduced sales
and selling expense by $8,282.

Note 1. Nature of Operations

The principal business activity of Ultradata Systems, Incorporated (the
Company), located in St. Louis, Missouri, is the design, manufacture, and
sale of hand-held electronic information products.

Note 2. Inventories
	Inventories consist of the following:

			       March 31,        December 31,
				2001               2000
--------------------------------------------------------------
Raw Materials                 $1,409,010        $1,262,820
Work in Process                   57,393            57,393
Finished Goods                 1,174,622         1,020,803
			       ---------         ---------
			       2,641,025         2,341,016
Reserve for obsolescence        (559,726)         (560,761)
			       ---------         ---------
			      $2,081,299        $1,780,255
			       =========         =========
Note 3. Prepaid Expenses

Prepaid expenses consist of the following:

				March 31,        December 31,
				  2001               2000
----------------------------------------------------------------
Prepaid advertising           $  189,344          $  201,225
Prepaid insurance                 23,806               5,461
Other prepaid expenses            28,543              22,951
				 -------             -------
			      $  241,693          $  229,637
				 =======             =======

Note 4. Accrued Expenses and Other Liabilities

Accrued expenses and other liabilities consist of the following:

				March 31,        December 31,
				  2001               2000
----------------------------------------------------------------
Accrued vacation              $   75,625          $   82,990
Accrued sales commissions
 and royalties                         -              14,758
Payroll and payroll-related
 liabilities                      20,208              42,294
Accrued advertising               20,659               1,563
Other                             34,988              77,391
				 -------             -------
			      $  151,480          $  218,996

Note 5. Preferred Stock Conversion

During March 2001, preferred shareholders have converted 10 shares of
preferred stock into 16,060 shares of common stock.

Note 6. Subsequent Events

	(A) Conversion of preferred stock

	After March 31, 2001, preferred shareholders converted 18 additional
	preferred shared into 40,058 common shares.

	(B) Factoring Agreement

	On July 3, 2001, the Company entered into an accounts receivable
	factoring agreement for a maximum facility of $500,000.  Under the
	agreement, the factor advances 80% of the face value of the
	receivables sold by the company.  The company is charged a variable
	percentage fee based upon the length of the collection period.  All of
	the Company's accounts receivable, contracts, inventories, and
	intangibles are pledged as collateral under this agreement.

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

YOU SHOULD NOT RELY ON FORWARD LOOKING STATEMENTS

This quarterly report contains a number of forward-looking statements
regarding our future prospects.  Among the forward-looking statements are
descriptions of our plans to restructure the marketing program for the Road
Whiz(tm) line of products, to introduce Triplink(tm) and GPS products to the
market, and to develop products based on a GPS/Internet technology.  These
forward-looking statements are a true statement of our present intentions,
but are neither predictions of the future nor assurances that any of our
intentions will be fulfilled.  Many factors beyond our control could act to
thwart Ultradata in its efforts to develop and market its products.  Among
these factors are:

     * The difficulty of attracting mass-market retailers to a seasonal
       product like the Road Whiz(tm);
     * The breadth and depth of competition in the GPS market, which will
       make introduction of our product with a limited marketing budget
       difficult;
     * The difficulty of attracting qualified engineering and marketing
       personnel to our company.

There may also be factors that we have not foreseen which could interfere with
our plans.  In addition, changing circumstances may cause us to determine that
a change in plans will be in the best interests of Ultradata.  For this reason,
you should not place undue reliance on any of the forward-looking statements
in this report.

Readers are urged to carefully review and consider the various disclosures
made by the Company in this report and in the Company's report Form 10-KSB
filed with the Securities and Exchange Commission.

The analysis of the Company's financial condition, capital resources and
operating results should be viewed in conjunction with the accompanying
financial statements, including the notes thereto.


OVERVIEW

Since 1987 we have been engaged in the business of manufacturing and marketing
handheld computers that provide travel information.  The products are based
upon a data compression technology that we developed, portions of which we
have patented.  Recent developments in communications technology have opened
up new opportunities for us to use our technology.  Therefore, we still sell
our handheld computers, but over the past three years we have been expanding
the scope of our operations:

     * In 1998 we acquired an interest in Talon Research & Development, Ltd.,
       which manufactures GPS (global positioning satellite) antennas that
       can be combined with our database to create a variety of travel
       products.  We currently own 22.6% of Talon.

     * Early in 2001 we introduced, in joint venture with Rand McNally, the
       Rand McNally Triplink(tm), a handheld computer that enables the user
       to download travel information from the Rand McNally Website.

     * During the first quarter of 2001 we shipped the first production units
       of our Travel*Star 24(tm), which combines our travel information with
       a GPS antenna to enable a driver to obtain his location and directions
       to his destination while he drives.

     * We have begun development of an enhanced version of our GPS product
       that will include a cellular transceiver to permit the driver to use
       the product to access the Internet while traveling.

Each of our consumer products is designed to allow the consumer to access
useful information stored in a convenient manner.  Our handheld computers
generally sell at retail prices between $19.95 and $49.95 per unit.  The
products are in the three largest retail mass-market chains in the country
plus many other locations.  The new TRAVEL*STAR 24 is offered at retail for
about $400, which should make it very competitive in the auto aftermarket.

Its portability and the fact that it requires no elaborate installation offer
advantages over the more expensive in-car systems.

RESULTS OF OPERATIONS

Three Months Ended March 31, 2001 Compared to Three Months Ended March 31,
2000

Operating results for the first quarter of 2001 were not significantly
different from the first quarter of 2000.  Handheld travel computers, which
were our only product offerings until this summer, continue to be promoted
primarily as gift items.  Sales are, therefore, heaviest in the 4th quarter
holiday season, with some surges during the summer travel months and around
Mother's Day and Father's Day.  The first quarter is, therefore, generally a
period of minimal sales, usually less than 5% of annual sales.  We expect the
seasonality of our sales to level out to some extent during the coming years
due to expansion of our product line into GPS navigation systems and Internet
appliances.

Sales. During the first three months of 2001, net sales totaled $185,842,
34% less than the $281,405 in sales recorded in the first quarter of 2000.

Gross Profit.  Gross profit margin for the current quarter was only 14.1%
of sales compared to 39.9% for the first quarter of 2000.  Gross profit in
early 2001 was low primarily due to higher cost of microchips remaining in
inventory from the chip shortage in 2000.  This problem will be reduced as
we exhaust the higher-priced inventory because of the reduced price currently
paid for microchips in 2001.

S,G&A Expense.  Selling expenses dropped somewhat on a quarter-to-quarter
basis, reflecting the relative efficiency of our focus on mass-market
distribution channels.  General and administrative expenses were virtually
unchanged with respect to the first quarter of 2000.

R&D Expense.  Research and development expense in the first quarter of 2001
increased 33.8% from the first quarter of 2000 due primarily to the fact that
the capitalization of the TRAVEL*STAR 24(tm) software tools developed over
the last 18 month has ended and the amortization of those costs has begun.

The Company posted a net loss from operations of ($594,219) for the quarter
ended March 31, 2001 compared to a net loss from operations of ($504,412) for
the quarter ended March 31, 2000.

Other Income.  Other income for the first quarter of 2001 totaled $80,615
compared with a loss of ($15,222) for the same period in 2000.  During the
first quarter of 2000, we recorded a loss of $120,128 attributable to our
investment in Influence Data, LLC.  At the end of 2000, we wrote off all of
the investment, since our joint-venture partner terminated its operational
support of the venture.  As a result, "Equity in earnings of affiliates" for
the first quarter of 2001 represents only our interest in Talon Research and
Development Ltd.  Talon's contribution was $46,767, 14.7% less than for the
first quarter of 2000.

As a result of the foregoing, the Company posted a net loss available to
common shareholders of ($559,054), or ($0.18) per basic and diluted common
share, for the three-month period ended March 31, 2001, compared to a net
loss available to common shareholders of ($519,935), or ($0.17) per basic and
diluted common share, for the three-month period ended March 31, 2000.  The
Company was required to record an imputed dividend of $45,450 during the
three-month period ended March 31, 2001 as a result of its sale of Series A
redeemable convertible preferred stock in May of 2000.

FINANCIAL CONDITION AND LIQUIDITY

At March 31, 2001, the Company had $1,334,397 in cash and cash equivalents,
compared to $1,842,983 at December 31, 2000.  The Company's operating
activities used cash totaling $457,784, primarily due to its losses for the
quarter.  Accounts receivable decreased by $483,905 due to collections on
sales in the last quarter of 2000.  Inventories increased by $301,044 due to
manufacturing for the spring deliveries, substantially offsetting the cash
collected on accounts receivable.  Smaller cash-flow items roughly balanced
so that the losses for the quarter approximated the cash used in operations.

Net cash used by investing activities for the quarter ended March 31, 2001
totaled $34,935 and was 41.7% below the $59,947 used in the first quarter of
2000.

Net cash used in financing activities for the quarter ended March 31, 2001
was negligible compared to $323,021 provided by these activities in 2000 when
$314,625 arose from the exercise of employee stock options.

Our operating losses over the past three years have had an adverse effect on
our working capital.  Nevertheless, at March 31, 2001 we still had over $4.3
million in working capital, which we believe to be substantially greater than
most companies of our size.  So we do have sufficient working capital to
sustain our operations and introduce our new products, provided that we can
realize our sales projections in our handheld business through our strategy
of developing mass-market customers and opening new distribution channels.

Our cash position was aided in 2000 by the sale of Series A Preferred Stock
in May 2000 to two investment funds. The Company recently reached an agreement
in principle with the holders of the Series A Preferred Stock, and is
presently preparing the definitive agreements.  The agreements will provide
that the Series A shares will be converted into Series B shares with a face
value equal to the current conversion value of the Series A shares (i.e., face
value plus 11.25% accrual since date of issue) plus 10% of the face value.
The Company will redeem a portion of the Series B shares each month by paying
$70,000 per month through October 2001 and $90,000 thereafter until the shares
are fully redeemed.  The shareholders will retain the right to convert their
shares prior to redemption, except that the number of shares they may acquire
on conversion will be limited to 20% of the trading volume for the quarter
preceding conversion.  The Company has made this arrangement in order to
relieve the threat of massive dilution that the Preferred Stock presently
poses to potential investors in the Company's common stock.  Management does
not expect that the payments will significantly affect the Company's ability
to finance its ongoing business during 2001.  Management expects that, with
the new products, the fourth quarter of 2001 will generate sufficient revenue
and cash to permit operations beyond 2001.

Because the Company has stabilized the cash requirements of our handheld
business, its working capital and cash reserves appear to be sufficient to
sustain over the coming year the level of business during 2001.  There remains
one near-term liquidity issue: the cash needed for development of new products.
The Company's $1 million credit facility with Southwest Bank expired on July
1, 2001.  Management has obtained a $500,000 replacement facility with KBK
Financial, an asset-based lender, which it believes will be sufficient to
finance the purchase orders expected for the fourth quarter.


			ULTRADATA SYSTEMS, INCORPORATED
				     10QSB
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:

	  None


				  SIGNATURES


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

July 27, 2001                     /s/  Monte Ross
				  Monte Ross, CEO
				  (Duly authorized officer and
				   principal financial officer)