<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                   FORM 10-K/A
                                 AMENDMENT NO.1

FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
(mark one)
 X  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
---
OF 1934
   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES AND
---
EXCHANGE ACT OF 1934

      For the transition period from _______________ to __________________

                         Commission File Number 0-23852

                      PROJECT SOFTWARE & DEVELOPMENT, INC.
             (Exact name of registrant as specified in its charter)


                MASSACHUSETTS                         04-2448516
       (State or other jurisdiction of            (I.R.S. employer
       incorporation or organization)             identification number)

                 100 CROSBY DRIVE, BEDFORD, MASSACHUSETTS 01730
          (Address of principal executive offices, including zip code)
                                 (781) 280-2000
              (Registrant's telephone number, including area code)

           Securities registered pursuant to Section 12(b) of the Act:
                                      None
           Securities registered pursuant to Section 12(g) of the Act:
                          Common Stock, $.01 par Value
                          ----------------------------
                                (Title of Class)
                                ----------------

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

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to the Form 10-K.
                             ------

As of December 15, 2000, the aggregate market value of the voting stock held by
non-affiliates of the Registrant was approximately $137,826,709 based on the
last sale price of such stock on such date.

Number of shares outstanding of the Registrant's common stock as of the latest
practicable date: 22,074,351 shares of common stock, $.01 par value per share,
as of December 15, 2000.


                                       1
<PAGE>   2

     Part III of the Registrants' Annual Report on Form 10-K is hereby amended
by deleting the text thereof in its entirety and substituting the following:

                                    PART III

     ITEM 10. DIRECTORS AND OFFICERS OF THE REGISTRANT.

     The directors and executive officers of the Company as of September 30,
2000 are as follows. Messrs. Drapeau and Fishman are Class III Directors, whose
terms expire in 2002. Messrs. Daniels and McMullen are Class I Directors, whose
terms expire in 2003. Messrs. Sayre and Stanzler are Class II Directors, whose
terms expire in 2001.

<TABLE>
<CAPTION>
NAME                                AGE              POSITION
<S>                                 <C>              <C>
Norman E. Drapeau, Jr.              40               President and Chief Executive Officer and
                                                     Director - Class III

Robert L. Daniels                   58               Executive Chairman of the  Board - Class I

Peter J. Rice                       48               Executive Vice President, Chief Financial
                                                     Officer and Treasurer

William J. Sawyer                   55               Executive Vice President - Operations

Ted D. Williams                     52               Executive Vice President - Worldwide Sales

John W. Young                       48               Executive Vice President - Products and
                                                     Technology

Craig Newfield                      41               Vice President & General Counsel

Richard P. Fishman (1)              54               Director - Class III

John A. McMullen (1)                59               Director - Class I

Stephen B. Sayre (2)                49               Director - Class II

Alan L. Stanzler (2)                57               Director - Class II
</TABLE>

     NORMAN E. DRAPEAU, JR. joined the Company in 1982 as an applications
analyst. Since that time, he has held various positions with the Company,
including, from 1984 to 1987, that of Manager of Customer Support and from 1989
through 1991, that of Director, Product Marketing. In 1991, Mr. Drapeau was
appointed Vice President, Corporate Marketing, in 1992 was

                                       2
<PAGE>   3

appointed Vice President - Americas and in July 1996 was appointed Executive
Vice President - Worldwide Sales and Marketing, serving in that capacity until
January 1998. In January 1998, Mr. Drapeau was appointed Executive Vice
President and Chief Operating Officer and was also elected a director of the
Company. In May 1998, Mr. Drapeau was elected President and Chief Executive
Officer.

     ROBERT L. DANIELS founded the Company in 1968 and has been a director since
that time. Mr. Daniels served as Chairman of the Board and Chief Executive
Officer from 1968 to 1996 and as President from 1968 to 1995. Mr. Daniels
resigned as Chairman of the Board in August 1996 and as an employee of the
Company in December 1996. Mr. Daniels acted as an executive consultant to the
Company from that time until August 1997. In May 1998, Mr. Daniels rejoined the
Company and was elected Executive Chairman of the Board.

     PETER J. RICE joined the Company in 2000 as Executive Vice President of
Finance and Administration, Chief Financial Officer, and Treasurer. From 1998 to
2000, Mr. Rice was Vice President of Finance and Administration, Chief Financial
Officer, and Treasurer of Interleaf, a developer of e-publishing and e-content
software products. Interleaf was sold to Broadvision, Inc. in 2000. From 1995 to
1998, Mr. Rice was Vice President, Chief Financial Officer and Treasurer for
Media 100, Inc. From 1990 to 1995, Mr. Rice was Vice President, Corporate
Controller and Chief Accounting Officer of M/A Com, Inc. Prior there to, Mr.
Rice held senior financial management positions at Apollo Computer and Atex,
Inc.

     WILLIAM J. SAWYER joined the Company in 1978 as an applications consultant
and served in various sales and services positions from 1978 to 1984. Mr. Sawyer
was a Vice President of the Company from 1984 to 1990 and Executive Vice
President from 1990 until November 1997. In November 1997, Mr. Sawyer left the
Company and joined Peritus Software Services, Inc., a software application
company, as Vice President, Operations. Mr. Sawyer rejoined the Company in
October 1998 as Executive Vice President of Operations.

     TED D. WILLIAMS originally joined the Company in 1984 and served as
Director, MAXIMO until 1988. From 1988 to 1993, Mr. Williams was President and
Chief Operating Officer of Comac Systems Corporation, a software application
company. In 1993, Mr. Williams rejoined the Company as Director, Eastern
Regional Sales. He was appointed Vice President- North American Sales in 1996
and Vice President- Worldwide Sales in January 1998. In October, 1998, Mr.
Williams was appointed Executive Vice President- Worldwide Sales.

     JOHN W. YOUNG originally joined the Company in 1985 and served until 1988
as MAXIMO Product Manager. From 1988 to 1992, Mr. Young was Vice President of
Sales of Comac Systems Corporation, a software application company. In 1992 he
rejoined the Company as Director of MAXIMO Product Design, was appointed Vice
President - Research and Development of the Company in 1995 and was appointed
Executive Vice President - Products and Technology of the Company in 1998.

     CRAIG NEWFIELD joined the Company as Vice President, General Counsel and
Clerk in September 2000. From October 1997 through August 2000 Mr. Newfield was
Vice President, General Counsel and Clerk of Interleaf, Inc., a developer of
e-publishing and e-content software products. Interleaf was sold to Broadvision,
Inc. in 2000. From April 1996 through September

                                       3
<PAGE>   4

1997, Mr. Newfield was General Counsel and Secretary of OneWave, Inc., a
start-up internet software product and services vendor, since re-named as Primix
Solutions. From February 1993 to April 1996, Mr. Newfield served as in-house
counsel for Marcam Corporation, a business application (ERP) software products
and services vendor.

     RICHARD P. FISHMAN was elected as a director in March 1999. Mr. Fishman is
currently Executive Vice President at MacAndrews & Forbes Group, Inc., where he
is responsible for venture capital investing. From 1995 through 1998, Mr.
Fishman served as Managing Director of GeoPartners Research, Inc., a strategy
and management consulting firm, where he headed the firm's venture capital
activities. From 1995 to 1997, Mr. Fishman was also Of Counsel at the law firm
of Akin, Gump, Strauss, Hauer & Feld L.L.P. Mr. Fishman served as President and
Chief Executive Officer of Thinking Machines Corporation from 1993 to 1994 and
was a partner at the law firm of Milbank, Tweed, Hadley & McCloy from 1987 until
1993.

     JOHN A. MCMULLEN was elected as a director in April 2000. Mr. McMullen is
the Managing Principal of Cambridge Meridian Group, Inc. a strategy-consulting
firm that serves Fortune 500 and technology-based companies with which he has
been employed since 1985. Mr. McMullen taught business strategy at Harvard Law
School from the mid 1980's to 1990 and, as one of the original members of CMGI's
Board of Directors, served on that Board from 1988 through 1999. He currently
serves on the Board of Ezenia!, Inc., a Nasdaq listed company, in a term that
began in 2000. In addition, he serves, or has served, on the Boards of twelve
other private, chiefly technology-oriented companies. From 1993 to 1997 he was
an informal advisor to Senator Bill Bradley (NJ). In 1998 he ran for the United
States Senate from Vermont.

     STEPHEN B. SAYRE was elected as a director in September 1998. Mr. Sayre is
currently the Vice President of Marketing for Idiom, Inc. From 1994 to 2000, he
was the Senior Vice President of Marketing at Lotus Development Corporation, a
subsidiary of IBM Corporation. Prior to joining Lotus in 1994, Mr. Sayre was
President of Boston Treasury Systems and has held other senior executive level
positions with Cullinet Software and Easel Corporation.

     ALAN L. STANZLER was elected as a director in May 1998. Mr. Stanzler served
as a director of the Company from 1992 to 1994, and as Clerk of the Company from
1990 to 1996. Mr. Stanzler is a member of the law firm of Maselan Jones &
Stanzler, P.C. From 1995 to 1998, Mr. Stanzler was a member of the law firm of
Davis, Malm & D'Agostine, P.C. and from 1978 to 1995 he was a partner in the law
firm of Finnegan & Stanzler, P.C.

     All directors hold office until the expiration of their respective terms as
described above and until their respective successors are duly elected and
qualified. Executive officers of the Company are appointed by and serve at the
discretion of the Board of Directors.

     SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

     Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and persons who own more than 10% of a registered class
of the Company's equity securities, to file reports of ownership and changes in
ownership with the Securities and Exchange Commission (the "SEC"). Officers,
directors and greater-than-10% stockholders are

                                       4
<PAGE>   5

required by SEC regulations to furnish the Company with copies of all Section
16(a) forms they file.

     Based solely upon review of Forms 3 and 4 and amendments thereto furnished
to the Company during fiscal 2000 and Forms 5 and amendments thereto furnished
to the Company with respect to fiscal 2000, or written representations that Form
5 was not required, the Company believes that all Section 16(a) filing
requirements applicable to its officers, directors and greater-than-10%
stockholders were fulfilled in a timely manner, except that Mr. Rice was late in
filing one Form 3 and Mr. Fishman. reported one transaction on a late Form 4 and
reported four other transactions that were reportable on Form 4s on a Form 5.
After investigating these matters, the Company has concluded that any omissions
were inadvertent, and that none of the transactions gave rise to liability under
Section 16(b) of the Exchange Act for recapture of short-swing profits.


                                       5
<PAGE>   6

     ITEM 11. EXECUTIVE COMPENSATION.

     Summary Compensation Table. The following table sets forth certain
information concerning the compensation earned by the Company's Chief Executive
Officer and the four other most highly paid executive officers of the Company
(collectively, the "named executive officers") for services rendered in all
capacities to the Company during fiscal 2000.

                           SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
                                                                                    Long-term
                                                                                   Compensation
                                                                                      Awards
                                           Annual Compensation                     -------------
                             ------------------------------------------------       Securities       All Other
                             Fiscal                              Other Annual       Underlying      Compensation
Name and Principal Position   Year     Salary($)      Bonus($)   Compensation      options(#)(1)      ($)(2)
---------------------------  ------    ---------      --------   ------------      -------------   ------------
<S>                          <C>       <C>         <C>           <C>               <C>             <C>
Norman E. Drapeau, Jr.         2000     $317,500   $137,495(3)            ---         200,000           $2,400
  President and                1999     $295,000   $375,414(4)            ---         200,000           $2,500
  Chief Executive Officer      1998     $224,375           ---     $30,241(5)          60,000           $2,375

Robert L. Daniels              2000     $317,500   $137,495(3)            ---             ---              ---
  Executive Chairman of the    1999     $295,000   $375,414(4)            ---             ---              ---
  Board                        1998     $110,625           ---            ---             ---              ---

John W. Young                  2000     $197,500    $67,690(3)            ---          60,000           $2,400
  Executive Vice-President     1999     $185,000    $88,166(4)            ---          90,000           $2,500
  Products and Technology      1998     $160,000           ---            ---          40,000           $2,375

William J. Sawyer (5)          2000     $196,672    $67,690(3)                         55,000           $2,400
  Executive Vice President     1999     $172,591    $88,166(4)    $30,000 (7)          90,000           $2,500
  of Operations                1998      $18,750(6)        ---     $6,154 (8)             ---              ---

Ted D. Williams                2000     $192,502    $67,926(3)                         55,000           $2,400
Executive Vice President       1999     $168,750           ---   $174,983 (9)          70,000           $2,500
Worldwide Sales                1998     $135,000           ---    $71,180 (9)          20,000           $2,375
</TABLE>

-------------------------
(1)  Represents shares of Common Stock issuable upon exercise of stock options
     granted under the Company's 1994 Stock Option Plan or under the 1999 Equity
     Incentive Plan. All share numbers in this Proxy Statement have been
     adjusted to reflect the Company's two-for-one stock split effected by means
     of a stock dividend on December 15, 1999.

(2)  The amounts reported represent contributions made by the Company pursuant
     to the Company's 401(k) Plan and Trust for fiscal 2000 and for the fiscal
     years ended September 30, 1999 and 1998 ("fiscal 1999" and "fiscal 1998,"
     respectively).

(3)  Represents bonuses paid under the Company's 2000 Executive Bonus Plan.

(4)  Represents bonuses paid under the Company's 1999 Executive Bonus Plan.

(5)  Represents commissions paid under Mr. Drapeau's individual incentive
     compensation plan as Executive Vice President Worldwide Sales designed to
     reward him for achievement of quarterly and annual revenue and contribution
     targets.

(6)  Mr. Sawyer left the Company in November 1997 and returned in October 1998.

(7)  Represents a bonus paid when Mr. Sawyer was rehired.

(8)  Represents payment for unused vacation time in connection with Mr. Sawyer's
     departure from the Company.

                                       6
<PAGE>   7

(9)  Represents commissions paid under Mr. Williams's individual incentive
     compensation plan as Vice President Worldwide Sales designed to reward him
     for achievement of quarterly and annual revenue and contribution targets.

     Option Grants in Last Fiscal Year. The following table sets forth certain
information regarding stock options granted during fiscal 2000 by the Company to
the named executive officers.

<TABLE>
<CAPTION>
                                            OPTION GRANTS IN LAST FISCAL YEAR
--------------------------------------------------------------------------------------------------------------------
                                                                                             Potential Realizable
                                                                                               Value at Assumed
                                 Number of                                                   Annual Rate of Stock
                                Securities    Percent of Total                              Price Appreciation for
                                Underlying     Options Granted    Exercise                      Option Term(4)
                                  Options      to Employees in     Price      Expiration        --------------
            Name              Granted (#)(1)  Fiscal Year(%)(2)  ($/Sh)(3)       Date          5%($)       10%($)
            ----              --------------  -----------------  ---------       ----       ------------------------
<S>                           <C>             <C>                <C>          <C>           <C>          <C>
Norman E. Drapeau, Jr .               80,000              4.6%     $59.125       01/11/10   $2,974,400   $ 7,536,800
                                      30,000              1.7%     $29.375       04/13/10   $  554,400   $ 1,404,300
                                      90,000              5.2%     $24.0625      06/05/10   $6,501,825   $11,634,525
--------------------------------------------------------------------------------------------------------------------
Robert L. Daniels                      -----             -----        -----         -----        -----         -----
--------------------------------------------------------------------------------------------------------------------
Jack W. Young                         30,000              1.7%     $59.125       01/11/10   $1,115,400   $ 2,826,300
                                      30,000              1.7%     $24.0625      06/05/10   $2,167,275   $ 3,878,175
--------------------------------------------------------------------------------------------------------------------
William J. Sawyer                     25,000              1.4%     $59.125       01/11/10   $  929,500   $ 2,355,250
                                      30,000              1.7%     $24.0625      06/05/10   $2,167,275   $ 3,878,175
--------------------------------------------------------------------------------------------------------------------
Ted D. Williams                       25,000              1.4%     $59.125       01/11/10   $  929,500   $ 2,355,250
                                      30,000              1.7%     $24.0625      06/05/10   $2,167,275   $ 3,878,175
--------------------------------------------------------------------------------------------------------------------
</TABLE>

-----------------------
(1)  Represents shares of Common Stock issuable upon exercise of incentive stock
     options granted under the Company's 1999 Equity Incentive Plan.

(2)  The Company granted to employees options for the purchase of an aggregate
     of 1,733,750 shares of Common Stock in fiscal 2000 pursuant to the 1999
     Equity Incentive Plan.

(3)  All options were granted at exercise prices not less than the fair market
     value of the Common Stock on the date of grant.

(4)  Potential realizable value means the value of the shares of Common Stock
     underlying the option, at the specified assumed annual rates of stock price
     appreciation, compounded over the option term (10 years). Actual gains, if
     any, realized on stock option exercises are dependent on the future
     performance of the Common Stock and overall stock market conditions. There
     can be no assurance that the values reflected in this table will be
     realized.

(5)  All such options expire ten years after the date of grant, and first become
     exercisable as to 25% of the shares covered on the first anniversary of the
     date of grant and as to a further 25% annually thereafter, subject to
     acceleration in certain circumstances.


                                       7
<PAGE>   8

     Option Exercises and Fiscal Year-End Values. The following table sets forth
certain information concerning stock options exercised during fiscal 2000 and
stock options held as of September 30, 2000 by each of the named executive
officers.

                 AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
                        AND FISCAL YEAR-END OPTION VALUES

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------------
                              Shares                         Number of Unexercised              Value of Unexercised
                             Acquired           Value              Options at                   In-The-Money Options
                                On            Realized          Fiscal Year-end                at Fiscal Year End($)(2)
                                                                ---------------                ------------------------
---------------------------------------------------------------------------------------------------------------------------
         Name                Exercise(#)        ($)(1)   Exercisable(#)  Unexercisable(#)  Exercisable($)  Unexercisable($)
         ----                -----------        ------   --------------  ----------------  --------------  ----------------
---------------------------------------------------------------------------------------------------------------------------
<S>                          <C>             <C>         <C>             <C>               <C>             <C>
Norman E. Drapeau, Jr.             20,000    $1,167,873         224,498          315,000     $1,223,647           $687,593
---------------------------------------------------------------------------------------------------------------------------
Robert L. Daniels                   -----         -----           -----            -----          -----              -----
---------------------------------------------------------------------------------------------------------------------------
John W. Young                      33,000    $1,180,263          79,998          115,000     $  380,000           $317,898
---------------------------------------------------------------------------------------------------------------------------
William J. Sawyer                  15,000    $  780,687          30,000          110,190     $  172,035           $316,487
---------------------------------------------------------------------------------------------------------------------------
Ted D. Williams                    26,644    $  974,172          33,356           95,000     $  191,792           $240,005
---------------------------------------------------------------------------------------------------------------------------
</TABLE>

------------------------
(1)  Value is based on the last sale price of the Common Stock on the exercise
     date, as reported by the Nasdaq Stock Market, or the price at which shares
     acquired upon exercise of the option were actually sold (in the event of a
     concurrent exercise and sale), less the applicable option exercise price.

(2)  Value is based on the last sale price of the Common Stock on September 29,
     2000, as reported by the Nasdaq Stock Market ($15.547 per share), less the
     applicable option exercise price. These values have not been and may never
     be realized. Actual gains, if any, on exercise will depend on the value of
     the Common Stock on the date of the sale of the shares.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

     Alan L. Stanzler and Stephen B. Sayre served on the Compensation Committee
during fiscal 2000. Neither Mr. Stanzler nor Mr. Sayre, nor any executive
officer of the Company, has any relationship requiring disclosure by the Company
pursuant to item 402(j) of Regulation S-K promulgated by the SEC.

DIRECTORS' COMPENSATION

     Members of the Board of Directors who are not employees of the Company or
one of the Company's subsidiaries ("Non-Employee Directors") receive a quarterly
fee of $2,500. Non-Employee Directors also receive fees of $1,000 for each
meeting of the Board of Directors and $750 for each meeting of a committee of
the Board which they attend, provided that no fee is paid with respect to a
committee meeting if the committee meeting is held on the same date as a Board
meeting. Non-Employee Directors receive $500 for participating in a telephonic
Board or committee meeting. Non-Employee Directors are reimbursed for
out-of-pocket expenses incurred in the performance of their duties as directors
of the Company. Directors who are employees of the Company are not paid any
separate fees for serving as directors.

     Pursuant to the 1999 Equity Incentive Plan, each Non-Employee Director
elected or appointed to the Board at the time of an annual meeting of
stockholders or special meeting in lieu thereof, upon first joining the Board,
is automatically granted an option to purchase 27,000 shares of Common Stock
(each an "Initial Option"). Each Non-Employee Director is eligible to

                                       8
<PAGE>   9

receive an additional option to purchase 27,000 shares of Common Stock (each an
"Additional Option") as follows: (i) each Class II and Class III Non-Employee
Director in office on the date of the special meeting in lieu of annual meeting
of stockholders held with respect to the Company's 1999 fiscal year, which was
held on April 25, 2000, was automatically granted an Additional Option and (ii)
upon the Final Vesting Date, as defined below, of any Initial Option or
Additional Option held by a Non-Employee Director whose term in office will
continue after such Final Vesting Date, or who has been nominated by the Board
of Directors for election to a term that will continue after such date, such
Non-Employee Director is automatically granted an Additional Option.

     In lieu of a grant of an Initial Option as described above, in the event
that a Non-Employee Director is first elected or appointed to the Board at any
time other than at an annual meeting of stockholders or special meeting in lieu
thereof, such Non-Employee Director upon first being so elected or appointed is
automatically granted an option for a number of shares of Common Stock equal to
the sum of (i) 18,000 plus (ii) 9,000 multiplied by N/365 where "N" is the
number of days remaining between the date of such election or appointment of
such Non-Employee Director and the first anniversary of the date of the
Company's most recent annual meeting of stockholders or special meeting in lieu
thereof (the "Prorated Shares").

     Each Initial Option and each Additional Option has an exercise price equal
to the fair market value of the Common Stock on the date of grant (determined in
accordance with the terms of the 1999 Equity Incentive Plan). All Initial
Options granted to Non-Employee Directors elected or appointed to the Board at
the time of an annual meeting of stockholders or special meeting in lieu
thereof, and all Additional Options, vest in three equal installments
immediately before each of the first three annual meetings of stockholders or
special meetings in lieu thereof following the date of grant of such option,
provided in each case that at such time the Non-Employee Director is then in
office as a director. With respect to an Initial Option granted to a
Non-Employee Director who is elected or appointed to the Board at any time other
than at an annual meeting of stockholders or special meeting in lieu thereof,
the option vests as to the Prorated Shares immediately before the first annual
meeting of stockholders or special meeting in lieu thereof following the date of
grant of such Initial Option and as to the remaining 18,000 shares in two equal
installments immediately before each of the second and third annual meetings of
stockholders or special meetings in lieu thereof following the date of grant of
such Initial Option, provided in each case that at such time the Non-Employee
Director is then in office as a director. The date on which the last such
installment of any option vests is herein referred to as its "Final Vesting
Date." All such options expire on the date which is five years from the date of
grant.

     ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

PRINCIPAL STOCKHOLDERS

     The following table sets forth certain information with respect to the
beneficial ownership of the Company's Common Stock as of January 10, 2001 by (i)
each person known by the Company to own beneficially more than five percent of
the Common Stock as of such date, (ii) each director of the Company, (iii) each
named executive officer, (iv) each expected nominee

                                       9
<PAGE>   10

as a director of the Company and (v) all executive officers and directors of the
Company as a group:

<TABLE>
<CAPTION>
                                                                                     Shares Beneficially
                                                                                          Owned (1)
                                                                                          ---------
Name                                                                             Number               Percent
----                                                                             ------               -------
<S>                                                                             <C>                    <C>
Robert L. Daniels (2)(3).............................................           4,821,620              17.9%
  100 Crosby Drive
  Bedford, MA  01730
Kopp Investment Advisors, Inc. (4)...................................           2,151,400               8.9%
  6600 France Avenue South
  Edina, MN  55435
Susan H. Daniels (2)(3)(5)...........................................           1,311,758               5.6%
  100 Crosby Drive
  Bedford, MA  01730
Fidelity Management & Research Company (6) ..........................           1,457,100               6.2%
  82 Devonshire Street
  Boston, MA  02109
Norman E. Drapeau, Jr. (7)...........................................             244,498               1.1%
John W. Young (7)....................................................              87,498                  *
Ted D. Williams (8)..................................................              42,147                  *
William J. Sawyer (9)................................................              40,677                  *
Alan L. Stanzler (10)................................................              55,500                  *
Stephen B. Sayre (7).................................................              29,000                  *
Richard P. Fishman (11)..............................................              37,100                  *
John A. McMullen (12) ...............................................               9,500                  *
All directors and executive officers as a group......................           5,379,040              20.4%
  (11 persons)(2)(3) (7)(8)(9)(10)(11)(12)
</TABLE>

-------------------------
* Less than one percent.

(1)  The persons named in this table have sole voting and investment power with
     respect to the shares listed, except as otherwise indicated. The inclusion
     herein of shares listed as beneficially owned does not constitute an
     admission of beneficial ownership.

(2)  Excludes 160,400 shares held in three trusts for the benefit of Mr.
     Daniels' children and 4,400 shares held by Mr. Daniels as custodian for the
     benefit of a minor child. Each of Robert L. Daniels and Susan H. Daniels
     disclaims beneficial ownership of these shares.

(3)  Includes shares held by Robert L. Daniels as sole Trustee of the 1996
     Daniels Voting Trust (the "Voting Trust"). Of the 2,112,516 shares subject
     to the Voting Trust, 1,056,258 are owned beneficially by Mr. Daniels and
     1,056,258 are owned beneficially by Susan H. Daniels. Mr. Daniels, as
     Trustee, has sole voting power with respect to the shares subject to the
     Voting Trust. Mr. Daniels also owns 2,709,104 shares free of the Voting
     Trust, and Susan Daniels also owns 255,500 shares free of the Voting Trust.
     The Voting Trust will terminate upon the written agreement of the parties
     or the fifth anniversary of the creation of the Voting Trust, whichever
     comes first. Each of Mr. Daniels and Susan Daniels disclaims beneficial
     ownership of the shares beneficially owned by the other. Robert and Susan
     Daniels are divorced.

                                       10
<PAGE>   11

(4)  This information is as of September 30, 2000 and is based upon a report on
     Schedule 13F filed by Kopp Investment Advisors, Inc. with the Securities
     and Exchange Commission .

(5)  Excludes 10,400 shares held by Susan H. Daniels as Trustee of the Susan
     Daniels Family Charitable Foundation. Susan H. Daniels disclaims ownership
     of these shares.

(6)  This information is as of September 30, 2000 and is based upon a report on
     Schedule 13F filed by FMR Corporation with the Securities and Exchange
     Commission.

(7)  Represents shares issuable pursuant to outstanding stock options
     exercisable within 60 days of the date of this table.

(8)  Includes 39,606 shares issuable pursuant to outstanding stock options
     exercisable within 60 days of the date of this table.

(9)  Includes 36,250 shares issuable pursuant to outstanding stock options
     exercisable within 60 days of the date of this table.

(10) Includes 42,000 shares issuable pursuant to outstanding stock options
     exercisable within 60 days of the date of this table.

(11) Includes 24,000 shares issuable pursuant to outstanding stock options
     exercisable within 60 days of the date of this table.

(12) Includes 9,000 shares issuable pursuant to outstanding stock options
     exercisable within 60 days of the date of this table.

     ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

     Norman E. Drapeau, Jr., the Company's President and Chief Executive
Officer, received an interest free loan from the Company during fiscal 1999 in
the amount of $150,000, which was the largest aggregate amount of indebtedness
owed by Mr. Drapeau to the Company during fiscal 1999. The loan was intended as
an advance against Mr. Drapeau's future bonuses. The loan was repaid in full in
November 2000.


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<PAGE>   12

                                   SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

Dated: January 26, 2001

                                   PROJECT SOFTWARE & DEVELOPMENT, INC.


                                   By: /s/ Norman E. Drapeau, Jr.
                                       -----------------------------------------
                                       Norman E. Drapeau, Jr.
                                       President and Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities and on the dates indicated.

<TABLE>
<S>                                     <C>                                <C>
/s/ Norman E. Drapeau, Jr.              President and Chief                January 26, 2001
----------------------------            Executive Officer
Norman E. Drapeau, Jr.                  (Principal Executive
                                        Officer)

/s/ Robert L. Daniels                   Executive Chairman of              January 26, 2001
----------------------------            the Board
Robert L. Daniels

/s/ Peter J. Rice                       Executive Vice President,          January 26, 2001
----------------------------            Chief Financial Officer
Peter J. Rice                           and Treasurer
                                        (Principal Financial and
                                        Accounting Officer)

/s/ Richard P. Fishman                  Director                           January 26, 2001
----------------------------
Richard P. Fishman

/s/ John A. McMullen                    Director                           January 26, 2001
----------------------------
John A. McMullen

/s/ Stephen B. Sayre                    Director                           January 26, 2001
----------------------------
Stephen B. Sayre

/s/ Alan L. Stanzler                    Director                           January 26, 2001
----------------------------
Alan L. Stanzler
</TABLE>

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