UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 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, 2003

                                       OR


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

     For the transition period from _____________________to_____________________


                         Commission File Number 0-11688


                          AMERICAN ECOLOGY CORPORATION
                          ----------------------------
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

                 DELAWARE                            95-3889638
                 --------                            ----------
     (State or other jurisdiction of              (I.R.S. Employer
      incorporation or organization)            Identification Number)

               Lakepointe Centre I,
            300 E. Mallard, Suite 300
                  Boise, Idaho                              83706
                  ------------                              -----
     (Address of principal executive offices)             (Zip Code)


                                 (208) 331-8400
                                 --------------
              (Registrant's telephone number, including area code)

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

Indicate  by  check  mark  whether  the  registrant  is an accelerated filer (as
defined  in  Rule  12b-2  of  the  Act).
                                  Yes [ ]   No [X]

At November 12, 2003 Registrant had outstanding 16,972,946 shares of its Common
Stock.


<PAGE>
                          AMERICAN ECOLOGY CORPORATION
                      QUARTERLY REPORT ON FORM 10-Q FOR THE
                      THREE MONTHS ENDED SEPTEMBER 30, 2003


                                TABLE OF CONTENTS


                         PART I.  FINANCIAL INFORMATION



                                                                            PAGE
Item 1.     Financial Statements

            Consolidated Balance Sheets
              (Unaudited)                                                     4

            Consolidated Statements of Operations
              (Unaudited)                                                     5

            Consolidated Statements of Cash Flows
              (Unaudited)                                                     6

            Notes to Consolidated Financial Statements                        7

Item 2.     Management's Discussion and Analysis of Financial Condition and
            Results of Operations                                            19

Item 3.     Quantitative and Qualitative Disclosures About Market Risk       28

Item 4.     Controls and Procedures                                          28


                          PART II.   OTHER INFORMATION


Item 1.     Legal Proceedings                                                28

Item 2.     Changes in Securities and Use of Proceeds                        30

Item 3.     Defaults Upon Senior Securities                                  30

Item 4.     Submission of Matters to a Vote of Security Holders              30

Item 5.     Other Information                                                30

Item 6.     Exhibits and Reports on Form 8-K                                 31

            Signatures                                                       31


                                        2
<PAGE>
OFFICERS
--------
Stephen A. Romano
Chief Executive Officer, President and Chief Operating Officer

James R. Baumgardner
Senior Vice President, Chief Financial Officer
Treasurer and Secretary

Michael J. Gilberg
Vice President and Controller

DIRECTORS
---------
Roger P. Hickey, Chairman
President, Chicago Partners

David B. Anderson
Principal, Lochborn Partners LLC

Rotchford L. Barker
Independent Businessman

Roy C. Eliff
Independent Businessman

Edward F. Heil
Sole Member
E.F. Heil, LLC

Stephen A. Romano
Chief Executive Officer, President and Chief Operating Officer

Stephen M. Schutt
Vice President
Nuclear Fuel Services, Inc.


CORPORATE OFFICE
----------------
Lakepointe Centre I
American Ecology Corporation
300 East Mallard Drive, Suite 300
Boise, Idaho 83706
(208) 331-8400
(208) 331-7900 (fax)
www.americanecology.com
-----------------------


COMMON STOCK
------------
American Ecology Corporation's common stock trades on the Nasdaq National Market
under the symbol ECOL.


FINANCIAL REPORTS
-----------------
A copy of American Ecology Corporation Annual and Quarterly Reports, as filed on
Form 10-K and 10-Q with the Securities and Exchange Commission, may be obtained
by writing:
Lakepointe Centre I
300 E. Mallard, Suite 300
Boise, Idaho 83706
or at www.americanecology.com
      -----------------------


TRANSFER AGENT
--------------
Mellon Investor Services LLC
Overpeck Centre
85 Challenger Road
Ridgefield Park, New Jersey 07660
(201) 296-4000
or at www.mellon-investor.com
      -----------------------


AUDITOR
-------
Moss Adams LLP
1001 Fourth Avenue, Suite 2900
Seattle, WA 98154


                                        3
<PAGE>
<TABLE>
<CAPTION>
PART I. FINANCIAL INFORMATION
-----------------------------
ITEM 1. FINANCIAL STATEMENTS.

                                            AMERICAN ECOLOGY CORPORATION
                                            CONSOLIDATED BALANCE SHEETS
                                       ($ IN 000'S EXCEPT PER SHARE AMOUNTS)

                                                                            September 30,2003    December 31, 2002
                                                                           -------------------  -------------------
<S>                                                                        <C>                  <C>
                                                                               (Unaudited)
ASSETS
Current Assets:
  Cash and cash equivalents                                                $            6,503   $              135
  Receivables, net                                                                     13,425               10,460
  Income taxes receivable                                                                   1                  740
  Prepayments and other                                                                 1,257                  498
  Deferred income taxes                                                                    --                2,745
  Assets held for sale or closure                                                       1,845               10,722
                                                                           -------------------  -------------------
    Total current assets                                                               23,031               25,300

Cash and investment securities, pledged                                                   244                  244
Property and equipment, net                                                            28,017               26,998
Facility development costs                                                              6,478               27,430
Deferred income taxes                                                                   8,284                5,539
Other assets                                                                               53                  129
Assets held for sale or closure                                                         2,254                1,485
                                                                           -------------------  -------------------
    Total Assets                                                           $           68,361   $           87,125
                                                                           ===================  ===================

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
  Current portion of long term debt                                        $            1,494   $            1,985
  Accounts payable                                                                      3,599                2,192
  Accrued liabilities                                                                   6,080                4,166
  Accrued closure and post closure obligation, current portion                            882                  882
  Income taxes payable                                                                     --                   23
  Current liabilities of assets held for sale or closure                                3,662                7,965
                                                                           -------------------  -------------------
    Total current liabilities                                                          15,717               17,213

Revolving line of credit                                                                   --                  603
Long term accrued liabilities                                                             470                2,372
Long term debt                                                                          4,567                5,972
Accrued closure and post closure obligation, excluding current portion                  9,364                9,318
Liabilities of assets held for sale or closure, excluding current portion               5,114                5,699
                                                                           -------------------  -------------------
    Total liabilities                                                                  35,232               41,177
                                                                           -------------------  -------------------

Commitments and contingencies
Stockholders' equity:
  Convertible preferred stock, 1,000,000 shares authorized,
     Designated as follows:
       Series D cumulative convertible preferred stock, $.01 par value,
       0 and 100,001 shares issued and outstanding;                                        --                    1
  Common stock, $.01 par value, 50,000,000 authorized, 16,967,946
    and 14,539,264 shares issued and outstanding                                          170                  145
  Additional paid-in capital                                                           54,686               55,789
  Accumulated deficit                                                                 (21,727)              (9,987)
                                                                           -------------------  -------------------
    Total stockholders' equity                                                         33,129               45,948
                                                                           -------------------  -------------------
Total Liabilities and Stockholders' Equity                                 $           68,361   $           87,125
                                                                           ===================  ===================
</TABLE>


See notes to consolidated financial statements.


                                        4
<PAGE>
<TABLE>
<CAPTION>
                                                   AMERICAN ECOLOGY CORPORATION
                                              CONSOLIDATED STATEMENTS OF OPERATIONS
                                                           (UNAUDITED)
                                              ($ IN 000'S EXCEPT PER SHARE AMOUNTS)


                                                                 Three Months Ended Sept 30,        Nine Months Ended Sept 30,
                                                                    2003             2002             2003             2002
                                                              ----------------  ---------------  ---------------  ---------------
                                                                                  (Restated)                        (Restated)
<S>                                                           <C>               <C>              <C>              <C>
Revenue                                                       $        17,324   $       11,048   $       40,115   $       35,077
Direct operating costs                                                 10,383            6,417           22,423           18,433
                                                              ----------------  ---------------  ---------------  ---------------

Gross profit                                                            6,941            4,631           17,692           16,644
Selling, general and administrative expenses                            3,302            2,691           11,088            8,439
                                                              ----------------  ---------------  ---------------  ---------------
Income from operations                                                  3,639            1,940            6,604            8,205

Interest income                                                           312                7              334               31
Interest expense                                                           60              221              219              726
Loss on write off of Ward Valley facility development costs                --               --           20,951               --
Other income (loss)                                                        20               35              113             (290)
                                                              ----------------  ---------------  ---------------  ---------------

Net income (loss) before income tax, discontinued
operations, and cumulative effect of change in accounting
principal                                                               3,911            1,761          (14,119)           7,220
Income tax expense (benefit)                                               18             (226)              73             (226)
                                                              ----------------  ---------------  ---------------  ---------------

Net income (loss) before discontinued operations and
cumulative effect of change in accounting principal                     3,893            1,987          (14,192)           7,446
Gain (loss) from discontinued operations -
El Centro Landfill                                                        (15)             178            4,945              497
(Loss) from discontinued operations - Oak Ridge
LLRW Facility                                                            (400)          (1,099)          (2,429)          (1,898)
                                                              ----------------  ---------------  ---------------  ---------------

Net Income (loss) before cumulative effect of change in
accounting principle                                                    3,478            1,066          (11,676)           6,045
Cumulative effect of change in accounting principle                        --               --               --           13,141
                                                              ----------------  ---------------  ---------------  ---------------

Net income (loss)                                                       3,478            1,066          (11,676)          19,186
Preferred stock dividends                                                  --              100               64              297
                                                              ----------------  ---------------  ---------------  ---------------

Net income (loss)  available to common shareholders           $         3,478   $          966   $      (11,740)  $       18,889
                                                              ================  ===============  ===============  ===============

Basic earnings (loss) from continuing operations                          .23              .12             (.86)             .51
Basic earnings (loss) from discontinued operations                       (.02)            (.06)             .15             (.10)
Basic earnings from cumulative effect of
accounting change                                                          --               --               --              .92
                                                              ----------------  ---------------  ---------------  ---------------
Basic earnings (loss) per share                               $           .21   $          .06   $         (.71)  $         1.33
                                                              ================  ===============  ===============  ===============

Diluted earnings (loss) from continuing operations                        .22              .12             (.86)             .45
Diluted earnings (loss) from discontinued operations                     (.02)            (.06)             .15             (.09)
Diluted earnings from cumulative effect of
accounting change                                                          --               --               --              .83
                                                              ----------------  ---------------  ---------------  ---------------
Diluted earnings (loss) per share                             $           .20   $          .06   $         (.71)  $         1.19
                                                              ================  ===============  ===============  ===============

Dividends paid per common share                               $            --   $           --   $           --   $           --
                                                              ================  ===============  ===============  ===============
</TABLE>


See notes to consolidated financial statements.


                                        5
<PAGE>
<TABLE>
<CAPTION>
                                  AMERICAN ECOLOGY CORPORATION
                              CONSOLIDATED STATEMENTS OF CASH FLOWS
                                     (UNAUDITED, $ IN 000'S)

                                                               Nine Months Ended September 30,
                                                           -------------------------------------
                                                                 2003                2002
                                                           -----------------  ------------------
<S>                                                        <C>                <C>
Cash flows from operating activities:                                             (Restated)
  Net income (loss)                                        $        (11,676)  $          19,186
  Adjustments to reconcile net income (loss) to net
    cash provided by operating activities:
  Depreciation, amortization and accretion                            5,324               4,480
  (Income) loss from discontinued operations                         (2,516)              1,401
  Cumulative effect of change in accounting principle                    --             (13,141)
  Write off of Ward Valley project                                   20,951                  --
Changes in assets and liabilities:
  Receivables                                                        (2,907)                167
  Other assets                                                         (758)               (287)
  Accounts payable and accrued liabilities                            3,011              (4,076)
  Closure and post closure obligation                                  (803)               (789)
  Income taxes payable                                                  716                (230)
                                                           -----------------  ------------------
    Net cash provided by operating activities                        11,342               6,711

Cash flows from investing activities:
  Capital expenditures                                               (4,941)             (2,469)
                                                           -----------------  ------------------
    Net cash used by investing activities                            (4,941)             (2,469)

Cash flows from financing activities:
  Payments of indebtedness                                           (2,667)             (6,072)
  Retirement of series D preferred stock                             (6,406)                 --
  Stock options and warrants exercised                                3,671               1,133
                                                           -----------------  ------------------
    Net cash provided by (used in) financing activities              (5,402)              4,939
                                                           -----------------  ------------------

Increase (Decrease) in cash and cash equivalents                        999                (697)
Net cash provided by (used in) discontinued operations                5,369                (335)
Cash and cash equivalents at beginning of period                        135               4,217
                                                           -----------------  ------------------
Cash and cash equivalents at end of period                 $          6,503   $           3,185
                                                           =================  ==================

Supplemental disclosures of cash flow information:
Cash paid during the year for:
  Interest                                                 $            219   $             726
  Income taxes paid                                                      96                   4
Non-cash investing and financing activities:
  Stock issuance-director's compensation                                 30                  44
  Assets acquired through capital lease                                 167                  --
  Preferred stock dividends accrued                                      --                 297
  Transfer of prepaid assets to settle closure liability                 --                 462
</TABLE>


See notes to consolidated financial statements.


                                        6
<PAGE>
AMERICAN ECOLOGY CORPORATION
NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS

NOTE 1.  BASIS OF PRESENTATION

In  the opinion of management, the accompanying unaudited consolidated financial
statements  contain  all adjustments and disclosures necessary to present fairly
the  financial  position,  results  of  operations,  and  cash flows of American
Ecology  Corporation  and  its  wholly-owned subsidiaries (the "Company"). These
financial  statements and notes should be read in conjunction with the financial
statements  and  notes  included in the Company's Annual Report on Form 10-K for
the  year  ended  December  31,  2002,  filed  with  the Securities and Exchange
Commission.

The  previously reported 2002 quarterly information has been restated.  See Note
9.

Certain  reclassifications of prior quarter amounts have been made to conform to
current  quarter  presentation,  none  of  which  affect previously recorded net
income.

NOTE 2.  EARNINGS  PER  SHARE

Basic  earnings  per  share are computed based on net income available to common
stockholders and the weighted average number of common shares outstanding during
the  quarter.  Diluted earnings per share reflect the assumed issuance of common
shares  for  outstanding  options and conversion of warrants. The computation of
diluted  earnings per share does not assume exercise or conversion of securities
whose  exercise  price  is greater than the average common share market price as
the  assumed  conversion  of these securities would increase earnings per share.
The computation of diluted loss per share does not assume exercise or conversion
of  any  securities  as the assumed conversion of securities would decrease loss
per  share.

<TABLE>
<CAPTION>
                                                                            THREE MONTHS ENDED        NINE MONTHS ENDED
                                                                         ------------------------  -----------------------
           ($in thousands except per share amounts)                         2003         2002         2003        2002
                                                                         -----------  -----------  ----------  -----------
                                                                                       (Restated)               (Restated)
<S>                                                                      <C>          <C>          <C>         <C>
Income (loss) before discontinued operations and cumulative
    effect of accounting change                                          $    3,893   $    1,987   $ (14,192)  $    7,446
Income (loss) from operations of discontinued segments                         (415)        (921)      2,516       (1,401)
Cumulative effect of accounting change                                           --           --          --       13,141
                                                                         -----------  -----------  ----------  -----------
Net income (loss)                                                             3,478        1,066     (11,676)      19,186
Preferred stock dividends                                                        --          100          64          297
                                                                         -----------  -----------  ----------  -----------
Net income (loss) available to common shareholders                       $    3,478   $      966   $ (11,740)  $   18,889
                                                                         ===========  ===========  ==========  ===========

Weighted average shares outstanding-
  Common shares                                                              16,974       14,518      16,473       14,236
Effect of dilutive shares
  Series E Warrants                                                              --        1,015          --          948
  Chase Bank Warrants                                                           732          583          --          544
  Stock Options                                                                 172          120          --          109
                                                                         -----------  -----------  ----------  -----------

Average shares                                                               17,878       16,236      16,473       15,837
                                                                         ===========  ===========  ==========  ===========
Basic earnings (loss) per share from continuing operations               $      .23   $      .12   $    (.86)  $      .51
Basic earnings (loss) per share from discontinued operations                   (.02)        (.06)        .15         (.10)
Basic earnings per share from cumulative effect of accounting change             --           --          --          .92
                                                                         -----------  -----------  ----------  -----------
Basic earnings (loss) per share                                          $      .21   $      .06   $    (.71)  $     1.33
                                                                         ===========  ===========  ==========  ===========

Diluted earnings (loss) per share from continuing operations             $      .22   $      .12   $    (.86)  $      .45
Diluted earnings (loss) per share from discontinued operations                 (.02)        (.06)        .15         (.09)
Diluted earnings per share from cumulative effect of accounting change           --           --          --          .83
                                                                         -----------  -----------  ----------  -----------
Diluted earnings (loss) per share                                        $      .20   $      .06   $    (.71)  $     1.19
                                                                         ===========  ===========  ==========  ===========
</TABLE>


                                        7
<PAGE>
NOTE 3.  EQUITY

In  1996,  the  Company issued 300,000 shares of Series E Redeemable Convertible
Preferred  Stock  ("Series  E Preferred Stock") that were later retired in 1998.
The  Series E Preferred Stock carried warrants ("Series E Warrants") to purchase
3,000,000 shares of common stock with a $1.50 per share exercise price. In April
2002  one Series E holder exercised 650,000 warrants, then in February 2003, the
remaining  2,350,000  Series  E  Warrants  were  exercised.  The  Company issued
2,350,000  shares  of  common stock and received $3,525,000 in cash. No Series E
warrants  are  now  outstanding.

In  September 1995, the Board of Directors authorized issuance of 105,264 shares
of  preferred  stock  designated  as  8  3/8%  Series  D  Cumulative Convertible
Preferred  Stock  ("Series  D  Preferred  Stock"),  which were sold in a private
offering  to  present  and  past members of the Board of Directors. In 1999, one
Series  D  holder converted 5,263 preferred shares to 69,264 common shares. Each
of  the  remaining 100,001 shares of Series D Preferred Stock was convertible at
any  time  at  the option of the holder into 17.09 shares of common stock, which
was  equivalent  to  a  conversion  price  of $3.71 per share due to dilution by
subsequent  sales  of  common  stock.

In  January  2003,  the  Company  offered to repurchase all outstanding Series D
Preferred  Stock for the original sales price of $47.50 a share plus accrued but
unpaid  dividends.  Repurchase was subject to approval by the Company's Board of
Directors  and  primary bank. The offer was accepted by all Series D holders and
approved  by  the  Board  of  Directors and the bank.  On February 28, 2003, the
Company repurchased the remaining 100,001 shares of Series D Preferred Stock for
$47.50  a share plus accrued but unpaid dividends of $16.56 a share, for a total
payment  of  $6,406,000.

NOTE  4.  OPERATING  SEGMENTS

The Company operates with two segments based on its internal reporting structure
and  nature of services offered, Operating Disposal Facilities and Non-Operating
Disposal Facilities. The Operating Disposal Facility segment includes facilities
accepting  industrial,  hazardous  and  radioactive  waste.  The  Non-Operating
Disposal  Facility  segment  includes  facilities  that  are no longer accepting
waste,  no  longer owned by the Company, or represent proposed new disposal site
development  projects  presently  under  litigation.

On  December 27, 2002, the Company discontinued commercial operations in its Low
Level  Radioactive  Waste  ("LLRW")  Processing and Field Services segment which
aggregated,  volume-reduced,  and  performed  remediation  and other services on
radioactive  material.  All prior segment information has been restated in order
to  present the operations at the Oak Ridge facility, including the former Field
Services  division,  as  discontinued  operations.

Effective  December  31,  2002,  the  Company classified the El Centro municipal
landfill  as  an  asset  held for sale due to the expected sale of the facility,
which  occurred  on  February  13,  2003. All prior segment information has been
restated in order to present the El Centro landfill as a discontinued operation.

Income  taxes are assigned to Corporate, but all other items are included in the
segment  where they originated.  Inter-company transactions have been eliminated
from  the  segment  information  and  are  not  significant  between  segments.


                                        8
<PAGE>
Summarized financial information concerning the Company's reportable segments is
shown  in  the  following  table  ($  in  thousands).

<TABLE>
<CAPTION>
                                                    Operating      Non-Operating      Discontinued
                                                     Disposal         Disposal       Processing and
                                                    Facilities       Facilities      Field Services    Corporate     Total
-----------------------------------------------------------------------------------------------------------------------------
<S>                                               <C>              <C>               <C>               <C>          <C>
THREE MONTHS ENDED SEPTEMBER 30, 2003
-------------------------------------
Revenue                                           $       17,319   $             5   $            --   $       --   $ 17,324
Direct operating cost                                     10,260               123                --           --     10,383
                                                  ---------------  ----------------  ----------------  -----------  ---------
Gross profit (loss)                                        7,059              (118)               --           --      6,941
S,G&A                                                      1,820                 1                --        1,481      3,302
                                                  ---------------  ----------------  ----------------  -----------  ---------
Income (loss) from operations                              5,239              (119)               --       (1,481)     3,639
Interest expense (income)                                      1                --                --         (253)      (252)
Other income                                                  (1)               21                --           --         20
                                                  ---------------  ----------------  ----------------  -----------  ---------
Income (loss) before income tax
and discontinued operations                                5,237               (98)               --       (1,228)     3,911
Income tax expense                                            --                --                --           18         18
Discontinued operations                                      (15)               --              (400)          --       (415)
                                                  ---------------  ----------------  ----------------  -----------  ---------
Net Income (loss)                                          5,222               (98)             (400)      (1,246)     3,478
                                                  ===============  ================  ================  ===========  =========
Depreciation, amortization, and accretion         $        1,495   $             4   $            --   $       10   $  1,509
Capital Expenditures                              $        1,790   $            --   $            --   $       --   $  1,790
Total Assets                                      $       41,021   $         6,517   $         4,099   $   16,724   $ 68,361
-----------------------------------------------------------------------------------------------------------------------------
THREE MONTHS ENDED SEPTEMBER 30, 2002 (RESTATED)
------------------------------------------------
Revenue                                           $       10,954   $            94   $            --   $       --   $ 11,048
Direct operating cost                                      5,953               464                --           --      6,417
                                                  ---------------  ----------------  ----------------  -----------  ---------
Gross profit (loss)                                        5,001              (370)               --           --      4,631
S,G&A                                                      1,560               (42)               --        1,089      2,691
                                                  ---------------  ----------------  ----------------  -----------  ---------
Income (loss) from operations                              3,441              (412)               --       (1,089)     1,940
Interest expense (income)                                    214                --                --           --        214
Other income (expense)                                        32                 2                --            1         35
                                                  ---------------  ----------------  ----------------  -----------  ---------
Income (loss) before income tax
and discontinued operations                                3,259              (410)               --       (1,088)     1,761
Income tax expense (benefit)                                  --                --                --         (226)      (226)
Discontinued operations                                      273                --            (1,194)          --       (921)
                                                  ---------------  ----------------  ----------------  -----------  ---------
Net Income (loss)                                 $        3,532   $          (410)  $        (1,194)  $     (862)  $  1,066
                                                  ===============  ================  ================  ===========  =========
Depreciation, amortization, and
accretion                                         $        1,571   $           114   $           137   $       17   $  1,839
Capital Expenditures                              $          708   $             6   $            79   $       30   $    823
Total Assets                                      $       46,214   $        27,544   $         7,840   $    5,823   $ 87,421
</TABLE>

<TABLE>
<CAPTION>
                                                    Operating      Non-Operating      Discontinued
                                                     Disposal         Disposal       Processing and
                                                    Facilities       Facilities      Field Services    Corporate     Total
-----------------------------------------------------------------------------------------------------------------------------
<S>                                               <C>              <C>               <C>               <C>          <C>
NINE MONTHS ENDED SEPTEMBER 30, 2003
------------------------------------
Revenue                                           $       40,055   $            60   $            --   $       --   $ 40,115
Direct operating cost                                     22,071               352                --           --     22,423
                                                  ---------------  ----------------  ----------------  -----------  ---------
Gross profit (loss)                                       17,984              (292)               --           --     17,692
S,G&A                                                      5,477             1,802                --        3,809     11,088
                                                  ---------------  ----------------  ----------------  -----------  ---------
Income (loss) from operations                             12,507            (2,094)               --       (3,809)     6,604
Interest expense (income)                                     39                --                --         (154)      (115)
Other Income (expense)                                        28                85                --           --        113


                                        9
<PAGE>
Write off of Ward Valley facility                             --            20,951                --           --     20,951
                                                  ---------------  ----------------  ----------------  -----------  ---------
Income (loss) before income tax
and discontinued operations                               12,496           (22,960)               --       (3,655)   (14,119)
Income tax expense (benefit)                                  --                --                --           73         73
Discontinued operations                                    4,945                --            (2,429)          --      2,516
                                                  ---------------  ----------------  ----------------  -----------  ---------
Net Income (loss)                                         17,441           (22,960)           (2,429)      (3,728)   (11,676)
                                                  ===============  ================  ================  ===========  =========
Depreciation, amortization, and accretion         $        5,398   $             6   $            --   $       30   $  5,434
Capital Expenditures                              $        5,853   $            23   $           451   $       --   $  6,327
Total Assets                                      $       41,021   $         6,517   $         4,099   $   16,724   $ 68,361

-----------------------------------------------------------------------------------------------------------------------------
NINE MONTHS ENDED SEPTEMBER 30, 2002 (RESTATED)
-----------------------------------------------
Revenue                                           $       34,803   $           274   $            --   $       --   $ 35,077
Direct operating cost                                     17,389             1,044                --           --     18,433
                                                  ---------------  ----------------  ----------------  -----------  ---------
Gross profit (loss)                                       17,414              (770)               --           --     16,644
S,G&A                                                      5,656                97                --        2,686      8,439
                                                  ---------------  ----------------  ----------------  -----------  ---------
Income (loss) from operations                             11,758              (867)               --       (2,686)     8,205
Interest expense                                             655                --                --           40        695
Other income (expense)                                        67              (485)               --          128       (290)
                                                  ---------------  ----------------  ----------------  -----------  ---------
Income (loss) before income tax,
discontinued operations and
cumulative effect of change in
accounting principle                                      11,170            (1,352)               --       (2,598)     7,220
Income tax expense (benefit)                                  --                --                --         (226)      (226)
Discontinued operations                                      497                --            (1,898)          --     (1,401)
Cumulative effect of change in
accounting principle                              $       14,983   $         1,548   $        (3,390)  $       --   $ 13,141
                                                  ---------------  ----------------  ----------------  -----------  ---------
Net Income (loss)                                 $       26,650   $           196   $        (5,288)  $   (2,372)  $ 19,186
                                                  ===============  ================  ================  ===========  =========
Depreciation, amortization, and
accretion                                         $        4,689   $           343   $           406   $       49   $  5,487
Capital Expenditures                              $        2,279   $             6   $           314   $       30   $  2,629
Total Assets                                      $       46,214   $        27,544   $         7,840   $    5,823   $ 87,421
</TABLE>

NOTE  5.  STOCK  OPTION  PLANS

The  Company  has  two  stock-based  compensation plans, which are accounted for
under  the  recognition  and  measurement  principles  of  APB  Opinion  No. 25,
Accounting  for  Stock  Issued  to  Employees  and  related  Interpretations. No
stock-based employee compensation cost is reflected in net income. The following
table illustrates the effect on net income and earnings per share if the Company
applied  the  fair  value  recognition  provisions  of  FASB  Statement No. 123,
Accounting  for  Stock-Based  Compensation,  to stock-based compensation for the
three  and  nine  months  ended  September  30,  2003  and  2002:

<TABLE>
<CAPTION>
                                                                      Three Months Ended       Nine Months Ended
                                                                   -----------------------  -----------------------
                                                                      2003        2002         2003        2002
                                                                   ----------  -----------  ----------  -----------
<S>                                                                <C>         <C>          <C>         <C>
Net income (loss), as reported                                     $    3,478  $    1,066   $ (11,676)  $   19,186
Deduct: Total stock-based employee compensation expense
determined under fair value based method for all awards, net of
related tax effects                                                     (127)         (47)       (885)        (283)
                                                                   ----------  -----------  ----------  -----------
Pro forma net income (loss)                                        $   3,351   $    1,019   $ (12,561)  $   18,903
                                                                   ==========  ===========  ==========  ===========

EARNINGS (LOSS) PER SHARE:
   Basic - as reported                                             $     .21   $      .06   $    (.71)  $     1.33
                                                                   ==========  ===========  ==========  ===========
   Basic - pro forma                                               $     .20   $      .06   $    (.77)  $     1.31
                                                                   ==========  ===========  ==========  ===========
   Diluted - as reported                                           $     .20   $      .06   $    (.71)  $     1.19
                                                                   ==========  ===========  ==========  ===========
   Diluted - pro forma                                             $     .19   $      .06   $    (.77)  $     1.17
                                                                   ==========  ===========  ==========  ===========
</TABLE>


                                       10
<PAGE>
<TABLE>
<CAPTION>
The stock option plan summary and changes during the three and nine months ended
September  30  are  as  follows:

                                                                    Three Months Ended         Nine Months Ended
                                                                 ------------------------  ------------------------
                                                                    2003         2002         2003         2002
                                                                 -----------  -----------  -----------  -----------
<S>                                                              <C>          <C>          <C>          <C>
Options outstanding, beginning of period                          1,470,724      954,150      753,150    1,128,650
Granted                                                                  --       17,500      813,724      147,500
Exercised                                                                --     (105,500)     (68,500)    (107,500)
Canceled                                                             (2,000)    (101,000)     (29,650)    (403,500)
                                                                 -----------  -----------  -----------  -----------
Options outstanding, end of period                                1,468,724      765,150    1,468,724      765,150
                                                                 ===========  ===========  ===========  ===========

Weighted average exercise price of options, beginning of period  $     3.90   $     3.08   $     3.42   $     2.90
Weighted average exercise price of options granted               $       --   $     2.66   $     4.30   $     1.92
Weighted average exercise price of options exercised             $       --   $     1.27   $     1.68   $     1.29
Weighted average exercise price of options canceled              $     2.30   $     1.27   $     7.35   $     2.16
Weighted average exercise price of options, end of period        $     3.90   $     3.56   $     3.90   $     3.56

Options exercisable at end of period                                936,692      764,650      936,692      764,650
                                                                 ===========  ===========  ===========  ===========

Options available for future grant at end of period                 418,776    1,191,850      418,776    1,191,850
                                                                 ===========  ===========  ===========  ===========
</TABLE>

The following table summarizes stock options outstanding under the Company's
option plans as of September 30, 2003:

<TABLE>
<CAPTION>
                        Weighted
                         average                       Weighted                      Weighted
                        remaining                      average                       average
Range of exercise   contractual life     Number     exercise price     Number     exercise price
price per share          (years)       outstanding     per share     exercisable     per share
------------------  -----------------  -----------  ---------------  -----------  ---------------
<S>                 <C>                <C>          <C>              <C>          <C>
$1.00 - $1.47                     3.7      119,500  $          1.33      119,500  $          1.33
$1.60 - $2.25                     6.4      127,000  $          1.99      127,000  $          1.99
$2.42 - $3.50                     8.6      461,329  $          2.94      271,769  $          2.89
$3.75 - $5.00                     7.6      532,884  $          4.30      311,731  $          4.15
   $6.50                          9.4      173,011  $          6.50       51,692  $          6.50
  $10.13                          0.7       55,000  $         10.13       55,000  $         10.13
                                       -----------                   -----------
                                        1,468,724                       936,692
                                       ===========                   ===========
</TABLE>

As  of  September 30, 2003, the 1992 Stock Option Plan for Employees had options
outstanding  to  purchase  943,724  common  shares  with 98,076 shares remaining
available  for  issuance  under  option  grants.  The 1992 Stock Option Plan for
Directors had options outstanding to purchase 525,000 common shares with 320,700
shares  remaining available for issuance under option grants.  The fair value of
each option grant is estimated using the Black-Scholes option-pricing model with
2003  assumptions  of  a  ten  year  option  term,  volatility of  83-105% and a
discount  rate  of  3.75-4.25%.

NOTE 6.   INCOME TAXES

Income  tax  expense  differs  from  that calculated using applicable income tax


                                       11
<PAGE>
rates  to  pretax  income  due  primarily  to the presence of net operating loss
carry-forwards  and  a  valuation  allowance.

The Company has historically recorded a valuation allowance for certain deferred
tax assets due to inherent uncertainties regarding future operating results, and
limitations on utilization of acquired net operating loss carry forwards for tax
purposes.  The  realization  of a significant portion of net deferred tax assets
is  based  in  part  on  the  Company's  estimates of the timing of reversals of
certain  temporary  differences  and  on the generation of taxable income before
such  reversals.  During  2002,  the  Company reevaluated the deferred tax asset
valuation  allowance and determined it was "more likely than not" that a portion
of  the  deferred  tax  asset  would  be  realizable.  Consequently, the Company
decreased  the  portion  of  the  valuation  allowance  related to its operating
facilities.

The  Company's  net  operating  loss  ("NOL")  carry  forward  is  approximately
$44,000,000  at  September  30,  2003.  Of  this  carry  forward,  approximately
$2,745,000  is  limited  pursuant  to the net operating loss limitation rules of
Internal  Revenue  Code  Section 382 and begins to expire in 2006. The remaining
unrestricted  net  operating loss carry forward expires at various dates between
2010  and  2020

At September 30, 2003, the Company had approximately $24,000,000 of deferred tax
assets  and  a  corresponding  valuation allowance of $15,761,000, leaving a net
deferred  tax  asset  of  $8,284,000  representing  the  expected utilization of
deferred  tax  assets  in  the  foreseeable  future.

On  March 26, 2003, the Company wrote off $20,951,000 in Ward Valley, California
disposal  site  development  costs  and  therefore  does  not  expect to realize
previously  estimated  taxable income in 2003. Management expects the $8,284,000
of  deferred  tax  asset  to  be  realized  in years subsequent to 2003, and has
classified  the total net deferred tax asset as a long term asset on its balance
sheet.

NOTE 7.  LITIGATION

Significant  developments  have  occurred  on  the following legal matters since
December  31,  2002:

US ECOLOGY, INC. V. THE STATE OF CALIFORNIA, ET AL., CASE NO.GIC747562, SUPERIOR
---------------------------------------------------
COURT OF THE STATE OF CALIFORNIA FOR THE COUNTY OF SAN DIEGO

In  May 2000, subsidiary US Ecology, Inc., sued the State of California, et. al.
("the  State")  for monetary damages exceeding $162 million. The suit stems from
the  State's abandonment of the Ward Valley low-level radioactive waste ("LLRW")
disposal project. California law requires the state to build a disposal site for
LLRW  produced  in  California,  Arizona,  North Dakota and South Dakota; member
states  of  the Southwestern Compact.  US Ecology was selected in 1985 to locate
and  license  the  site using its own funds on a reimbursable basis. In 1993, US
Ecology  obtained  a  license  from  the  State  and  entered  a  ground  lease.

The  State successfully defended the license against court challenges and, until
Governor  Gray  Davis  took office, actively pursued conveyance of the site from
the  federal  government.  In  September  2000,  the  Superior  Court  granted
California's motion to dismiss all causes of action, which the Company appealed.
In  September  2001, the California Fourth Appellate District Court remanded the
case  for  trial  on promissory estoppel grounds. The case was tried in Superior
Court  for  the  County  of  San  Diego  during  February  and  March  2003.

On  March  26,  2003,  the Superior Court issued a Statement of Decision finding
that  the  Company  failed  to establish causation and that its claim is further
barred by the doctrine of unclean hands. The latter finding was based on actions
the  Court  concluded  had created obstacles to an agreement between the federal
government  and  the  State  to  convey  the site. The Court also found that key
elements  of  the  Company's promissory estoppel claim had been proven at trial.
Specifically,  the  Court  ruled  that  the  State  made a clear and unambiguous
promise  to US Ecology in 1988 to use its best efforts to acquire the site, that
Governor  Davis'  administration  abandoned this promise, and that the Company's
reliance  on  the  State's  promise was reasonable and foreseeable. However, the
Court  found  that  the  State's  breach  of  its best efforts promise was not a
substantial factor in causing damages to US Ecology since the federal government
had  continued  to  resist  the  land  transfer.

Based  on  the  uncertainty  of  recovery  following  the  trial court's adverse


                                       12
<PAGE>
decision,  the Company wrote off the $20,951,000 deferred site development asset
at  March  31,  2003.

On May 2, 2003, the Company filed a motion to vacate and enter new judgment with
the  trial  court,  arguing that the March 26 decision misapplied the law to the
facts.  On  May  30,  2003,  this motion was denied without comment. On June 26,
2003,  the Company filed a notice of appeal with the California Fourth Appellate
District  Court.

The  Company's  financial  interest  in  the pending claim against the State was
improved by an amendment to the November 13, 1998 Ward Valley Interest Agreement
and  Assignment  entered into by American Ecology and its former primary lender.
This  June  27, 2003 amendment, entered into by the Company and the successor in
interest to that lender, provides that any monetary damages obtained shall first
be  allocated  to  the  Company  to  recover past and future litigation fees and
expenses  relating to the case. Thereafter, any remaining amount recovered shall
be divided equally between the Company and the former lender. The 1998 agreement
had  provided that the first $29.6 million less up to $1.0 million in legal fees
and  expenses  would  be  owed to the former lender, with any remaining recovery
reserved  to  the  Company.

In  early  July,  the  Company engaged the law firm of Cooley Godward on a fixed
price  plus  contingency basis to pursue the appeal, paying the fixed fee at the
time  of  engagement.  A briefing schedule has not been set. No assurance can be
given  that  the Company will prevail on appeal or reach a settlement to recover
any  portion  of  its  investment.

MANCHAK  V.  US  ECOLOGY,  INC., U.S. DISTRICT COURT FOR THE DISTRICT OF NEVADA,
--------------------------------
CIVIL  ACTION  NO.  96-494.

In March 1996, Frank Manchak, Jr. ("Plaintiff" or "Manchak") filed suit alleging
infringement  of  a  sludge treatment patent to stabilize hazardous waste at the
Company's  Beatty,  Nevada  hazardous  waste disposal facility. Plaintiff sought
unspecified  damages  for  infringement,  treble  damages,  interest,  costs and
attorney  fees.  On  October 17, 2002, the US District Court for the District of
Nevada  granted  the  Company's motion for summary judgment to dismiss the suit.
Manchak's  motion  for  reconsideration  was denied on January 8, 2003.  Manchak
appealed; however, plaintiff failed to timely file its appellant's brief and the
Company  moved  to  dismiss the appeal. On July 2, 2003, the US Court of Appeals
for  the  Federal  Circuit  granted  the Company's motion to dismiss, and denied
plaintiff's  request  for  an  extension of time and relief from page/word brief
limitations.  On  July 20, 2003 the plaintiff filed a motion for reconsideration
with  the  appellate  court  and  later filed for en banc review by the Court of
Appeals for the Federal Circuit. Both the motion for reconsideration and en banc
review  were  denied  by the Court of Appeals on September 3, 2003.  The Company
considers  the  matter  closed.

ENTERGY  ARKANSAS,  INC.  ET  AL, CENTRAL INTERSTATE LOW-LEVEL RADIOACTIVE WASTE
--------------------------------------------------------------------------------
COMMISSION  AND  US  ECOLOGY,  INC. ("PLAINTIFFS") V. STATE OF NEBRASKA, ET AL.,
------------------------------------------------------------------------------
CASE NO. 4:98CV3411, U.S. DISTRICT COURT, DISTRICT OF NEBRASKA

This  action  was  brought  in  federal  court  in  December of 1999 by electric
utilities  that generate low-level radioactive waste ("LLRW") within the Central
Interstate  Low-Level  Radioactive  Waste  Compact  (CIC). CIC member states are
Nebraska,  Kansas,  Oklahoma,  Arkansas,  and  Louisiana.  The  action  seeks
declaratory  relief  and  damages  for  bad  faith  in  the  State of Nebraska's
processing  and ultimate denial of US Ecology's application to site, develop and
operate  a  LLRW disposal facility near Butte, Nebraska. US Ecology is the CIC's
contractor  and  developer.  The  CIC  was  originally  named as a defendant and
subsequently  realigned  as  a  plaintiff. US Ecology intervened as a plaintiff.

The  CIC sought to recover contributions made by the utilities and US Ecology to
the  CIC  for  pre-licensing project costs of approximately $95 million and $6.2
million,  respectively,  and removal of the State of Nebraska from the licensing
process.  The  Eighth  Circuit  Court  of  Appeals  subsequently  dismissed  the
utilities'  and  US  Ecology's independent claims against Nebraska for breach of
the  good faith provision of the Compact, and for denial of due process based on
sovereign  immunity.  The  utilities  and  US  Ecology  subsequently filed cross
claims  against  the  CIC  for  breach  of  contract  and  the  imposition  of a
constructive  trust.

On  September  30,  2002,  the  US  District  Court for the District of Nebraska
entered  judgment  against  Nebraska  in  favor  of  the  CIC  for $153 million,
including  approximately  $50 million for prejudgment interest.  Of this amount,
US  Ecology's share was for a $6.2 million contribution and $6.1 for prejudgment
interest.  The $6.2 million contribution is included in the balance sheet amount
of  $6,478,000  of  capitalized  facility  development  costs.  The  Court  also
dismissed  the  utilities'  and US Ecology's cross claims for breach of contract
and  imposition of a constructive trust, finding that it was premature to decide


                                       13
<PAGE>
the  merits  of these claims and leaving the question open for future resolution
if  necessary.  The  State  appealed the judgment to the Eighth Circuit Court of
Appeals.

The case was argued before the Eighth Circuit on June 12, 2003. No assurance can
be  given  that the trial court's decision will be affirmed on appeal or that US
Ecology  will  recover  its  contributions  or  interest  thereon.

MATTIE  CUBA,  ET AL. V. AMERICAN ECOLOGY ENVIRONMENTAL SERVICES CORPORATION, ET
--------------------------------------------------------------------------------
AL., CAUSE  NO. 2000-092,  4TH  JUDICIAL  DISTRICT  COURT,  RUSK  COUNTY,  TEXAS
----

This  suit  was  brought  in  November  2000  by 28 named plaintiffs against the
Company  and  named  subsidiaries, the former owners and approximately 60 former
customers  of  its Winona, Texas facility. Plaintiffs seek recovery for personal
injuries,  property  damages  and  exemplary  damages based on negligence, gross
negligence,  nuisance  and  trespass.  The  Company  filed  a motion for summary
judgment  in  July  2002  based on lack of evidence. In November 2002, the trial
court  granted partial summary judgment, dismissing certain causes of action and
reducing  the  number  of plaintiffs, but preserving other causes of action. The
Company  subsequently  filed  a  motion  for  summary judgment seeking dismissal
against  all of the adult plaintiffs on statute of limitations grounds. On March
26,  2003,  the  court  granted  this motion and dismissed the adult plaintiffs.
Seven  minors  and  one  intervenor  remain  party  to  the lawsuit. The Company
believes  plaintiffs'  remaining  case  is  without  merit  and will continue to
vigorously  defend  the  matter. No assurance can be given that the Company will
prevail  or  that  the  matter  can be favorably resolved. The Company's current
insurance  carrier is paying for defense of this matter subject to the Company's
$250,000 deductible, which has been fully accrued in prior periods.

NOTE 8.  COMMITMENTS AND CONTINGENCIES

Effective  January  1,  2003,  the  Company  established  the  American  Ecology
Corporation  Management  Incentive  Plan.  The  Plan  provides  for  selected
participants  to  receive  bonuses  based  on  pre-tax  operating income levels.
Bonuses  under  the  plan are to be paid out over three years with maximum bonus
payments  in  any  one  year  of  $1,125,000 if pre-tax operating income exceeds
$12,000,000.

In  February  2003,  the  Company  entered  into employment agreements with four
executive  employees.  The  agreements  expire  December  31, 2004 and 2005, and
provided  for  aggregate  minimum annual salaries of $639,000.  On September 30,
2003,  the  Company  terminated the employment of one of the four executives and
recognized  $235,000  in expenses for payroll and related benefits. At September
30,  2003  the  commitment  for  the three remaining employment contracts is for
aggregate  minimum  annual  salaries  of  $484,000.

The  Company's  primary  financial  assurance  policies expired on September 27,
2003,  but  were  extended  to  December 19, 2003. As part of the extension, the
Company was required to increase the collateral for the policies from $1,150,000
to  $3,258,000.  The  Company  issued an irrevocable standby letter of credit in
favor of the insurance company to meet its collateral obligation. The Company is
negotiating with the insurance company to extend the financial policies.  If the
current policies are not renewed or replaced by December 19, 2003, the insurance
company  may  require additional collateral.  No assurance can be given that the
Company  will  reach  agreement  with  the  insurance  company.

While the Company has been negotiating with the insurance company for renewal of
the  financial assurance policies, the total value of the policies has decreased
from  $51,000,000  at December 31, 2002 to $32,000,000 at September 30, 2003 due
to  the  sale  of the Company's El Centro Municipal Landfill, and performance of
closure  work  at several Company facilities covered by the financial assurance.

The  Company's  contract  with  the  US  Army Corps of Engineers (USACE) expires
during  the  second quarter of 2004 unless extended for an additional 5 years at
the  option  of the USACE. While the Company believes that the USACE will extend
the  contract for an additional 5 years, there is no assurance that the contract
will  be  extended.

NOTE 9.  ACCOUNTING CHANGES AND RESTATEMENT

Effective  January  1,  2002,  the  Company  implemented  Statement of Financial


                                       14
<PAGE>
Accounting Standards No. 143, "Accounting for Asset Retirement Obligations" (FAS
143)  under  the  early adoption provisions.  FAS 143 requires a liability to be
recognized as part of the fair value of future asset retirement obligations, and
an  associated  asset  to  be  recognized  as part of the carrying amount of the
underlying  asset.  Previously  the  Company recorded a closure and post closure
obligation  for  the  pro-rata amount of space used of the total permitted space
available.  On  January 1, 2002, in accordance with FAS 143, this obligation was
valued at the current closure cost, increased by a cost of living adjustment for
the  estimated  time  of  payment,  and  discounted  back  to its present value.

In  further  accordance  with  FAS 143, upon calculation of the asset retirement
obligation  the  Company  also  recorded  an associated asset for the retirement
obligation.  This  asset  is  amortized  over  the  estimated useful life of the
related  long-lived  asset.  FAS  143  allows  aggregation  of certain assets in
calculating and subsequently amortizing this asset. During the fourth quarter of
2002,  the  Company  reassessed  its  methodology  for  applying  FAS  143  and
disaggregated  certain  individual facility assets. In recalculating the overall
asset under the revised methodology, the Company recorded a $3,182,000 reduction
with  no  corresponding  change  in  the  recorded  liability. Consequently, the
initial  2002  gain on implementation of the new accounting standard recorded in
the  first  quarter  of  2002  was  reduced  by $3,182,000, and the amortization
associated  with  the asset was reduced from what was previously recorded during
the  first  three  quarters  of  2002.  The  following restatements were made to
account  for  this  change in FAS 143 implementation methodology (in thousands):

<TABLE>
<CAPTION>
                                             3 Months Ending     Nine Months Ending
                                           September 30, 2002    September 30, 2002
                                           -------------------  --------------------
<S>                                        <C>                  <C>
Reported Net Income                        $             1,032  $            22,284
Effect of Restatement:
   Cumulative Effect of Accounting Change                   --               (3,182)
   Amortization                                             34                   84
                                           -------------------  --------------------
Restated Net Income                        $             1,066  $            19,186
                                           ===================  ====================

Reported Diluted EPS                       $               .06  $              1.39
Effect of Restatement:
   Cumulative Effect of Accounting Change                   --                 (.20)
   Amortization                                             --                  .01
                                           -------------------  --------------------
Restated EPS                               $               .06  $              1.20
                                           ===================  ====================
</TABLE>

NOTE 10.  CLOSURE AND POST CLOSURE OBLIGATIONS

Closure and post closure obligations are recorded when environmental assessments
and/or  remedial actions are probable, and the costs can be reasonably estimated
consistent  with  Statement of Financial Accounting Standards No. 5. The Company
performs  periodic  reviews  of  both non-operating and operating facilities and
revises  its  accruals  for  estimated post-closure, remediation and other costs
when  necessary.  The Company's recorded liabilities are based on best estimates
of  current  costs  and  are updated periodically to reflect current technology,
laws  and regulations, inflation and other economic factors. Changes to reported
closure  and  post  closure  obligations  were  as  follows  (in  thousands):

<TABLE>
<CAPTION>
                                  Accrued Closure and      Closure Obligation of Assets    Total Closure and Post
                                Post Closure Obligation      Held for Sale or Closure       Closure Obligations
                               -------------------------  ------------------------------  ------------------------
<S>                            <C>                        <C>                             <C>
December 31, 2002 obligation   $                 10,200   $                       6,560   $                16,760
Accretion of obligation                             716                              85                       801
Payment of obligation                              (803)                           (461)                   (1,264)
Adjustment of obligation                            133                          (1,107)                     (974)
                               -------------------------  ------------------------------  ------------------------
September 30, 2003 obligation  $                 10,246   $                       5,077   $                15,323
                               =========================  ==============================  ========================
</TABLE>

On February 13, 2003, the Company sold substantially all of the assets of the El
Centro  landfill. The sale included transfer of the accrued landfill closure and
post  closure  obligation,  which  was  $1,107,000  at  the  date  of  the sale.


                                       15
<PAGE>
At  September  30, 2003, $244,000 of pledged cash and investment securities were
legally  restricted.  The  pledged cash has been set aside to settle any closure
and  post  closure  obligations  that  are  not  directly  paid  by the Company.

NOTE 11. OPERATING LEASE BUY OUT

On  August  3,  2000,  the  Company entered into a $2,000,000 equipment sale and
leaseback transaction based on the sale of specified equipment and rolling stock
to  a  third  party lessor. The Company received $2,000,000 in proceeds from the
asset  sale  and  entered  into  an operating lease for the use of the equipment
beginning  August  8,  2000 with monthly payments scheduled through September 8,
2006.  The Company realized a $1,098,000 gain on the sale of the equipment to be
amortized  over  the  life  of  the  lease.

On  March  28, 2003 the Company exercised an early buyout of the operating lease
for  $1,159,000  and  recorded equipment purchases with a book value of $702,000
along with a reduction in the deferred gain of $457,000. In conjunction with the
early  buyout,  the Company recorded an impairment charge of $225,000 on certain
equipment  at  the  discontinued  Oak  Ridge  facility.

NOTE 12. DISCONTINUED  OPERATIONS

As of September 30, 2003, "Assets held for sale or closure" consisted of certain
assets  at  the  El  Centro municipal waste disposal facility (which the Company
sold  to  a wholly-owned subsidiary of Allied Waste Industries, Inc. on February
13,  2003),  and  the  assets  and  liabilities  of  the  discontinued Oak Ridge
processing  and  field  services  operations  classified  as  "Held  for sale or
closure".  Accordingly,  the revenue, costs and expenses and cash flows for each
of  these  operations  have been excluded from continuing operations results and
reported  as  "Income (loss) from discontinued operations" and "Net cash used by
discontinued  operations".  Prior  periods  have  been  restated  to reflect the
discontinued  operations.  The assets and liabilities of discontinued operations
included  within  the consolidated balance sheet as of September 30, 2003 are as
follows  (in  thousands):

<TABLE>
<CAPTION>
                                      Processing and Field   El Centro Disposal    Total Assets Held
                                        Services Facility         Facility        for Sale or Closure
                                      ---------------------  -------------------  --------------------
<S>                                   <C>                    <C>                  <C>
Current assets
--------------
    Current assets                    $               1,058  $               235  $              1,293
    Property & equipment, net                           552                   --                   552
                                      ---------------------  -------------------  --------------------
                                                      1,610                  235                 1,845
                                      =====================  ===================  ====================
Non-current assets
------------------
    Property, plant & equipment, net                  1,509                   --                 1,509
    Other                                                48                  697                   745
                                      ---------------------  -------------------  --------------------
                                                      1,557                  697                 2,254
                                      =====================  ===================  ====================
Current liabilities
-------------------
    Accounts payable & accruals                       3,624                   --                 3,624
    Current portion long term debt                       38                   --                    38
                                      ---------------------  -------------------  --------------------
                                                      3,662                   --                 3,662
                                      =====================  ===================  ====================
Non-current liabilities
-----------------------
    Closure/post closure obligations                  5,077                   --                 5,077
    Long-term debt                                       33                   --                    33
    Other                                                 4                   --                     4
                                      ---------------------  -------------------  --------------------
                                                      5,114                   --                 5,114
                                      =====================  ===================  ====================
</TABLE>

Operating  results for the discontinued operations were as follows for three and
nine  months  ending  September  30:

<TABLE>
<CAPTION>
                                          Processing and Field    El Centro Disposal    Total Discontinued
($in thousands)                           Services Operations          Facility             Operations
                                         ----------------------  --------------------  --------------------
<S>                                      <C>                     <C>                   <C>
Three Months Ending September 30, 2003
--------------------------------------
Revenues, net                            $                 (22)  $                (7)  $               (29)
Operating income (loss)                                   (556)                  (15)                 (571)
Net income (loss)                                         (400)                  (15)                 (415)


                                       16
<PAGE>
Basic earnings (loss) per share                           (.02)                   --                  (.02)
Diluted earnings (loss) per share                         (.02)                   --                  (.02)

Three Months Ending September 30, 2002
--------------------------------------
Revenues, net                            $               4,105   $               620   $             4,725
Operating income (loss)                                   (614)                  188                  (426)
Net income (loss)                                       (1,194)                  273                  (921)
Basic earnings (loss) per share                           (.08)                  .02                  (.06)
Diluted earnings (loss) per share                         (.08)                  .02                  (.06)

Nine Months Ending September 30, 2003
-------------------------------------
Revenues, net                            $               1,997   $               462   $             2,488
Operating income (loss)                                 (2,349)                   59                (1,719)
Net income (loss)                                       (2,429)                4,945                 2,931
Basic earnings (loss) per share                           (.14)                  .29                   .18
Diluted earnings (loss) per share                         (.14)                  .29                   .18

Nine Months Ending September 30, 2002
-------------------------------------
Revenues, net                            $              14,018   $             1,836   $            15,854
Operating income (loss)                                 (1,093)                  483                  (610)
Net income (loss)                                       (1,898)                  497                (1,401)
Basic earnings (loss) per share                           (.12)                  .03                  (.09)
Diluted earnings (loss) per share                         (.12)                  .03                  (.09)
</TABLE>

El  Centro  Disposal  Facility.  On  February  13, 2003, the Company sold its El
------------------------------
Centro  municipal  and industrial waste landfill to a subsidiary of Allied Waste
Industries,  Inc.  ("Allied")  for  $10  million  cash  at  closing  and  future
volume-based  royalty payments. Under the Agreement, Allied will pay the Company
minimum  royalties  of  at  least  $215,000  annually.  Once Allied has paid the
Company  $14,000,000 in royalties, it will no longer be obligated to pay minimum
annual  royalties,  but  will  still  be  required  to pay royalties if disposal
volumes  exceed  the  minimum  volume threshold. The Purchase Agreement provides
incentives  for  Allied to bring Texas Class 1 industrial waste to the Company's
adjacent  hazardous  waste  facility.

The  Company  sold  $7,047,000  of  property  and  equipment  in  exchange  for
$10,000,000  of cash, royalties valued at $858,000, and the assumption by Allied
of  $1,098,000  of  closure liabilities.  A gain of $4,909,000 was recognized in
discontinued  operations  related  to  this  sale.

The  royalties,  valued  at  $858,000, represent the present value of 5 years of
minimum  royalty  payments.  Annual  payments  in excess of $215,000 or payments
subsequent  to  2007  would  be included in Other Income at the time of receipt.
This royalty represents substantially all of the assets held by the discontinued
El  Centro  disposal facility.  Royalty payments are expected to be received for
at  least  five  years.  After fiscal year 2003, the El Centro disposal facility
should  realize interest income and other income from the royalty payments which
would  not  be  classified  as  discontinued  operations  due to their recurring
nature.  The $92,000 in royalties received since the sale has been recorded as a
reduction  in  the  royalties  due.

For  segment  reporting  purposes,  El  Centro  landfill  operating results were
previously  classified  as  "Operating  Disposal  Facilities".

Oak  Ridge  Processing  Facility  and  Field Services.  During 2002, the Company
-----------------------------------------------------
offered  for  sale  its  LLRW  Processing Facility and Field Services operations
based  in  Oak Ridge, TN, but was unable to consummate a sale based on continued
commercial operations. On December 27, 2002, the Company discontinued commercial
waste processing. Since then, the Company has removed accumulated waste from the
facility and undertaken extensive radiological surveys to improve the facility's
marketability. All customer waste was removed by July 2003.  Radiological survey
work  was  nearing completion at September 30, 2003. Detailed information on the


                                       17
<PAGE>
amount and character of waste removed was used to refine initial cost estimates.
This  resulted  in an additional accrual of $911,000 for the three months ending
March  31,  2003,  $465,000 for the three months ending June 30, 2003 and $0 for
the  three  months  ending  September  30,  2003.

On June 10, 2003, the Company entered into a non-binding letter of intent with a
potential  buyer  based  on  sale  of the Oak Ridge facility's assets, including
certain  licenses, buildings and equipment, for a nominal sales price along with
buyer  assumption  of  specified  liabilities.  On  November 3, 2003 the parties
extended  the  non-binding  letter of intent until December 3, 2003. There is no
assurance  that the Company will be able to sell the Oak Ridge facility on terms
favorable  to  the  Company.

On  March  28,  2003,  the  Company  recorded an additional impairment charge of
$225,000  on  certain  Oak Ridge equipment acquired under the early buyout of an
operating  lease.

On  December  27,  2002,  management informed all employees that the Company was
discontinuing  commercial processing at the Oak Ridge facility and implemented a
substantial  reduction in the facility's labor force. Terminated union employees
were compensated for prior service, provided health coverage through January 31,
2003,  and  presented  with  a  proposed severance package. Terminated non-union
employees  were  paid  severance  in accordance with written Company policy. For
employees covered under the collective bargaining agreement, the Company entered
into  good  faith  severance negotiations with union representatives. Both sides
amended  their original proposals during these negotiations. On July 16, 2003, a
final  severance  agreement  was  executed  with the union providing $152,000 of
severance  to  the  terminated  union  employees  and  a release from all claims
related to their employment with the Company. During the third quarter of  2003,
the  Company paid and recognized this obligation and associated payroll taxes in
the  amount  of  approximately  $175,000.

Costs incurred at the Oak Ridge facility to prepare the facility for sale during
the  three  and  nine months ended September 30, 2003 are summarized as follows:
(in  thousands  $000)

<TABLE>
<CAPTION>
                                                              Three Months   Nine Months
                                                              -------------  ------------
<S>                                                           <C>            <C>
Net operating costs in excess of previous accrual             $         400  $        828
Additional impairment of property and equipment                          --           225
Increase in estimated cost for disposal of waste at facility             --         1,376
                                                              -------------  ------------

Disposal costs for the period ended September 30, 2003        $         400  $      2,429
                                                              =============  ============
</TABLE>

Cost  changes for Oak Ridge facility on-site activities and disposal liabilities
for  removed  wastes  are  as  follows:

<TABLE>
<CAPTION>
($in thousands)            December 31, 2002  Cash Payments   Adjustments  September 30, 2003
                           -----------------  --------------  -----------  ------------------
<S>                        <C>                <C>             <C>          <C>
Waste disposal liability               1,827         (3,089)        3,923               2,661
On-site discontinued
operation cost liability               1,800         (2,296)          828                 332
</TABLE>

The  adjustments  represent  differences  between the estimated costs accrued at
December  31,  2002, actual costs incurred during 2003, and changes in estimated
future  costs  for  waste  disposition. The adjustment amounts in the above roll
forward  analysis  do not directly correspond to the Income statement due to the
offsetting  impact  of  revenue  recognized  from  discontinued  operations  for
customer  waste  shipments.

NOTE  13.  FACILITY  DEVELOPMENT  COSTS

The  Company  is  involved  in litigation requiring estimates of timing and loss
potential  whose  disposition  is controlled by the judicial process. During the
quarter  ended March 31, 2003, the Company wrote off its entire $20,951,000 Ward
Valley deferred site development asset following an adverse trial court decision
which cast substantial doubt on the Company's ability to recover its investment.
Decisions  to  accrue  costs or write off assets are based on specific facts and
circumstances  pertaining  to  each  case and management's evaluation of present
circumstances.  See  Note  7.


                                       18
<PAGE>
The  Company continues to believe that the facility development costs which were
capitalized  for  development  of the proposed Butte, Nebraska disposal facility
will  be  realized,  although  no  assurance can be given that a favorable trial
court  decision  will  be  affirmed  on  appeal.  See  Note  7.

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

This document contains forward-looking statements that involve known and unknown
risks  and  uncertainties  which  may  cause actual results in future periods to
differ materially from those indicated herein.  These risks include, but are not
limited to, the ability to sell Oak Ridge processing facility assets, compliance
with  and  changes  to  applicable  laws,  regulations  and permits, exposure to
litigation, access to capital, access to insurance and financial assurances, new
technologies,  competitive  environment,  labor  disputes,  general  economic
conditions,  and  loss  or  diminution of major contracts. The Form 10-K for the
year  ending  December 31, 2002 contains additional risk factors and an expanded
disclosure  of  these  risks.  When  the  Company uses words like "will", "may,"
"believes," "expects," "anticipates," "should," "estimates," "project," "plans,"
their  opposites  and similar expressions, the Company is making forward-looking
statements.  These  terms are most often used in statements relating to business
plans,  strategies,  anticipated  benefits  or projections about the anticipated
revenues,  earnings or other aspects of our operating results. The Company makes
these statements in an effort to keep stockholders and the public informed about
our  business  based  on  management's current expectations about future events.
Such  statements  should be viewed with caution and are not guarantees of future
performance  or  events.  As  noted  elsewhere  in  this report, our business is
subject  to uncertainties, risks and other influences, many of which the Company
has  no  control  over.  Additionally,  these  factors,  either  alone  or taken
together,  could  have a material adverse effect on the Company and could change
whether  any  forward-looking  statement  ultimately  turns  out to be true. The
Company  undertakes  no  obligation  to publicly release updates or revisions to
these  statements.  The  following discussion should be read in conjunction with
the  audited  consolidated  financial  statements and the notes thereto filed on
Form  10-K  for  the  year  ending  December  31,  2002.

Unless otherwise described, changes discussed relate to the increase or decrease
from  the  three and nine month period ended September 30, 2002 to the three and
nine  month  period  ended  September  30,  2003.

INTRODUCTION
------------

The  Company  is  a  hazardous, PCB, industrial and radioactive waste management
company  providing transportation, treatment and disposal services to commercial
and  government  entities  including,  but not limited to, nuclear power plants,
petro-chemical  refineries,  steel  mills,  the  U.S.  Department  of  Defense,
biomedical  facilities,  universities and research institutions. The majority of
its  revenues  are derived from fees charged for use of the Company's four fixed
waste  disposal  facilities.  The  Company  and  its  predecessors  have been in
business  for  51  years.

OVERALL COMPANY PERFORMANCE
---------------------------

The  Company's  financial  performance  for  the  three  and  nine  months ended
September  30,  2003  was  substantially different than the first three and nine
months  of 2002. Quarter to quarter comparisons are difficult and are materially
affected  by  a  series  of  events  that  include  a large single event project
undertaken  in  early  2002  at  the  Company's Richland, Washington facility, a
large,  single event project started in August 2003 at the Company's Grand View,
Idaho  facility,  unusually  high  litigation expenses in early 2003 and related
write  off,  costs  to  discontinue the Company's Oak Ridge, Tennessee low-level
radioactive  waste  processing  businesses,  a  gain  on  sale  of the El Centro
landfill assets in early 2003, and changes in accounting standards. These events
are  discussed  in  more  detail  below.

Ward  Valley  Litigation  Expenses:  Due  to  the adverse California state court
----------------------------------
decision  on  March  26,  2003,  the  Company  wrote off $20,951,000 of facility
development costs for the Ward Valley project. This is reported as Loss on write
off  of  Ward Valley facility development costs in the Consolidated Statement of
Operations.  Litigation  and  related  costs  totaling  $0  and  $1,786,000 were
incurred  and  included  in SG&A during the three and nine months, respectively,
ending  September  30,  2003.  The  Company has appealed the Ward Valley ruling.
Minimal  future  costs  are expected based on a fixed price legal representation
agreement  entered  and  paid  in  July,  2003  for  this  appeal.


                                       19
<PAGE>
Army  Corps  of  Engineers Fort Greely, Alaska Project:  The Company performed a
-------------------------------------------------------
large  waste packaging and disposal project at its Richland, Washington facility
during  the  quarter ended March 31, 2002. This represented 29% of first quarter
2002  revenues  and  produced  significantly  higher  quarterly earnings for the
Richland  operation.

New Jersey PCB Clean-up Project:  The  Company's  Grand  View, Idaho facility is
--------------------------------
performing  an  approximately $10,000,000 transportation and disposal project in
the  third  and  fourth quarters of 2003. This project represented $5,400,000 or
31%  of  third  quarter  2003  revenues.

FAS 143: The Company implemented FAS 143 on January 1, 2002.  FAS 143 requires a
--------
liability  to be recognized as part of the fair value of future asset retirement
obligations  and  an  associated  asset to be recognized as part of the carrying
amount  of  the  underlying  asset.  The implementation of FAS 143 resulted in a
$13,141,000  cumulative effect of change in accounting principle gain during the
quarter  ended  March  31,  2002.

Sale  of  El  Centro:  On  February  13,  2003,  the  Company sold the El Centro
---------------------
municipal  waste  landfill  to  Allied Waste and recognized a $4,909,000 gain on
sale. This gain was included in discontinued operations during the quarter ended
March  31,  2003.

Oak  Ridge  Disposal  Plan:  On  December  27,  2002,  the  Company discontinued
---------------------------
operations  at  the  Oak  Ridge facility and recognized $7,018,000 of additional
estimated  costs  to implement its asset and liability disposal plan. During the
three  and  nine  months  ended  September  30, 2003, the Company identified and
incurred an additional $400,000 and $2,429,000, respectively, in costs to remove
waste  from  the  facility  and  prepare  the  facility for sale. This primarily
reflects  pricing  information  on the specific quantity and type of waste which
became  known  when  the  wastes  were prepared for shipment to off-site service
providers.

The  Company's  contract  with  the  US  Army Corps of Engineers (USACE) expires
during  the  second quarter of 2004 unless extended for an additional 5 years at
the  option  of the USACE. While the Company believes that the USACE will extend
the  contract for an additional 5 years, there is no assurance that the contract
will  be  extended.

A significant portion of the Company's revenue is attributable to discrete waste
clean-up  projects  ("Event  Business").  The one-time nature of  Event Business
necessarily  creates variability in revenue and earnings. This can produce large
quarter  to  quarter  swings. Management's strategy is to continue expanding its
recurring  customer  business  ("Base  Business")  while simultaneously securing
Event Business. When the Company's Base Business covers fixed costs, much of the
Event  Business  revenue  falls through to the bottom line. This strategy, which
takes  advantage of the high fixed cost nature of the business, was demonstrated
in  the  three  months  ending  September  30, 2003 when the large event project
undertaken by the Company's Grand View, Idaho facility contributed significantly
to  earnings.

CRITICAL  ACCOUNTING  POLICIES
------------------------------

In  preparing  the  financial  statements,  management  makes many estimates and
assumptions  that  affect  the  Company's  financial  position  and  results  of
operations.  Disposal  Facility  Accounting,  Accounting  for  Discontinued
Operations,  Litigation, Income Taxes, and Project Accounting involve subjective
judgments,  estimates  and  assumptions  that  would likely produce a materially
different  financial  position  and result of operations if different judgments,
estimates,  or  assumptions  were  used.  These  matters  are  discussed  below.

DISPOSAL  FACILITY  ACCOUNTING
In  general  terms,  a  disposal  cell  development asset exists for the cost of
building  usable  disposal  space  and  a  closure liability exists for closing,
maintaining  and  monitoring  the disposal unit once this space has been filled.
Major  assumptions  and  judgments used to calculate cell development assets and
closure  liabilities  are  as  follows:

-    Personnel  and  equipment  costs  incurred  to construct disposal cells are
     capitalized  as  a  cell  development  asset.

-    The  cell  development  asset  is amortized as each available cubic yard of
     disposal  space  is  filled.  Periodic  independent  engineering survey and
     inspection  reports  are  used to determine the remaining volume available.
     These  reports  take  into account waste volume, compaction rates and space
     reserved  for  capping filled cells. Additionally, changes in the estimated
     useful  lives  of the cells or related expansion plans have a direct effect
     on  the  amortization expense related to those cells during future periods.


                                       20
<PAGE>
-    The closure liability is the present value based on a current cost estimate
     prepared by an independent engineering firm of the costs to close, maintain
     and  monitor  filled  disposal  units.  Management  estimates the timing of
     payment,  accretes the current cost estimate by an estimated cost of living
     (1.5%),  and  then discounts (9.3%) the accreted current cost estimate back
     to  a  present  value.  The  final  payments  of  the closure liability are
     estimated  as  being paid in 2056 based upon current permitted capacity and
     estimated  annual  usage.

ACCOUNTING  FOR  DISCONTINUED  OPERATIONS
Accounting  for discontinued operations requires numerous subjective and complex
judgments,  estimates  and  assumptions that materially affect financial results
and  position  of  discontinued  operations.

At  December  27,  2002,  the  Company  discontinued  operation  of  its  former
Processing  and  Field  Services  segment  in Oak Ridge, Tennessee facility. The
discontinued  operations  were  accounted  for  under Emerging Issues Task Force
("EITF")  Issue  No. 94-3 Liability Recognition for Certain Employee Termination
Benefits  and  Other Costs to Exit an Activity (including Certain Costs Incurred
in  a  Restructuring),  which  requires  a  liability  to be recognized when the
decision  to  exit  the  segment  was  made. EITF 94-3 was chosen as the guiding
literature  rather  than  Statement  of  Financial  Accounting Standards No. 146
Accounting  for  Costs  Associated  with  Exit or Disposal Activities (FAS 146),
which  requires  a  liability to be recognized at the time that the liability is
incurred.  FAS  146  is required for exit activities entered into after December
31,  2002  but  was  optional  for  exit  activities prior to December 31, 2002.
Approximately  $1,800,000  of liabilities was recognized as of December 31, 2002
under  EITF  94-3  that  would  not  have been recognized until incurred had the
Company  adopted  FAS  146  prior  to  December  27,  2002.

The Company recognized $400,000 and $1,204,000 in incremental liabilities and $0
and  $225,000 for impairment of equipment as of the three and nine months ending
September  30,  2003,  respectively,  for  discontinuation of its Oak Ridge LLRW
Processing  and  Field  Services  operations.  The  Oak Ridge facility completed
removal  of customer waste in July 2003. Due to the ongoing nature of efforts to
prepare  the  facility  for sale, the cost estimate to exit from the segment may
change  further,  potentially  by  a  material  amount.

LITIGATION

The  Company  is  involved  in litigation requiring estimates of timing and loss
potential  whose  disposition  is controlled by the judicial process. During the
quarter  ended  March  31,  2003,  the  Company  wrote off $20,951,000 due to an
adverse  trial  court  decision  which  cast  substantial doubt on the Company's
ability  to  recover  its  investment  in  the  Ward Valley, California disposal
project.  The  decision to accrue costs or write off assets is based on specific
facts  and  circumstances pertaining to each case and management's evaluation of
present  circumstances.

On  September  30,  2002,  the  US  District  Court for the District of Nebraska
entered  judgment  against  Nebraska  in  favor  of  the  CIC  for $153 million,
including  approximately  $50 million for prejudgment interest.  Of this amount,
US  Ecology's share was for a $6.2 million contribution and $6.1 for prejudgment
interest.  The $6.2 million contribution is included in the balance sheet amount
of  $6,478,000 of capitalized facility development costs. The State appealed the
judgment  to  the  Eighth  Circuit  Court  of  Appeals.

The case was argued before the Eighth Circuit on June 12, 2003. No assurance can
be  given  that the trial court's decision will be affirmed on appeal or that US
Ecology  will  recover  its  contributions  or  interest  thereon.


INCOME  TAXES
The Company has historically recorded a valuation allowance against its deferred
tax  assets  in  accordance with FAS 109, Accounting for Income Taxes. This past
valuation  allowance reflected management's past belief that due to a history of
tax losses and prospects for the Company's business, it would likely not utilize
portions  of  the  deferred  tax assets prior to their expiration. The valuation
allowance  is  based on management's contemporaneous evaluation of whether it is
more  likely  than  not that the Company will be able to utilize some, or all of
the  deferred  tax  assets.  During  2002,  the  Company  assessed the valuation


                                       21
<PAGE>
allowance  and reversed approximately $8,284,000 of the valuation allowance that
the  Company  expected  to  utilize in the foreseeable future.  During the three
months  ended  March  31, 2003, the Company reclassified the entire net deferred
tax  asset  as  long  term, given that no taxable income is expected during 2003
following  write  off  of  the  Ward  Valley  project.

RESULTS  OF  OPERATIONS
-----------------------

The following table presents, for the periods indicated, the operating costs as
a percentage of revenues in the consolidated income statement:

<TABLE>
<CAPTION>
                                            Three Months Ended                                Nine Months Ended
                                            ------------------                                -----------------
                                                           (Restated)                                         (Restated)
                                                           ----------                                         ----------
        ($ in 000's)            September 30, 2003      September 30, 2002       September 30, 2003       September 30, 2002
                              ----------------------  -----------------------  -----------------------  -----------------------
                                  $           %           $            %           $            %           $            %
                              ---------  -----------  ----------  -----------  ----------  -----------  ----------  -----------
<S>                           <C>        <C>          <C>         <C>          <C>         <C>          <C>         <C>
Revenue                          17,324                  11,048                   40,115                   35,077
Direct operating costs           10,383        59.9%      6,417         58.1%     22,423         55.9%     18,433         52.6%
                              ---------               ----------               ----------               ----------

Gross profit                      6,941        40.1%      4,631         41.9%     17,692         44.1%     16,644         47.4%
SG & A                            3,302        19.1%      2,691         24.4%     11,088         27.6%      8,439         24.1%
                              ---------               ----------               ----------               ----------

Income from operations            3,639        21.0%      1,940         17.6%      6,604         16.5%      8,205         23.4%

Interest income                     312         1.8%          7          0.1%        334          0.8%         31          0.1%
Interest expense                     60         0.3%        221          2.0%        219          0.5%        726          2.1%
Loss on write off of
Ward Valley                          --         0.0%         --          0.0%     20,951         52.2%         --          0.0%
Other income (expense)               20         0.1%         35          0.3%        113          0.3%       (290)        -0.8%
                              ---------               ----------               ----------               ----------

Net income (loss) before
income taxes                      3,911        22.6%      1,761         15.9%    (14,119)       -35.2%      7,220         20.6%
Income tax expense                   18         0.1%       (226)        -2.0%         73          0.2%       (226)        -0.6%
                              ---------               ----------               ----------               ----------

Net income (loss) before
discontinued operations and
cumulative effect of
accounting change                 3,893        22.5%      1,987         18.0%    (14,192)       -35.4%      7,446         21.2%
                              =========               ==========               ==========               ==========
</TABLE>

COMPARISON OF THREE MONTHS ENDED SEPTEMBER 30, 2003 AND 2002
------------------------------------------------------------

REVENUE
-------

For the three months ended September 30, 2003, the Company reported consolidated
revenue  of  $17,324,000,  a  57% increase from the $11,048,000 reported for the
same period in 2002. During the three months ending September 30, 2003 and 2002,
$4,225,000  and  $3,853,000  or 24% of revenue, represented work performed under
contract  with  the  U.S.  Army  Corps  of Engineers. The Army and other federal
agencies continue to ship waste under this contract to the Company's Grand View,
Idaho facility. During the three months ending September 30, 2003, $5,400,000 or
31%  of  revenue, represented work performed under one contract for a New Jersey
PCB  clean-up  project.

Operating  Disposal  Facilities
-------------------------------
The  Richland,  Washington  LLRW  disposal  facility's  revenue  increased
substantially  for  the  three  months  ended  September 30, 2003 above the same
period  in  2002.  This  increase  in  revenue was due to receipts of relatively
higher  levels  of  radiation  in  the  waste shipments received.  Also, while a
significant  portion  of  the  Richland  facility's  revenue is regulated by the
Washington Utilities and Transportation Commission, the facility accepts certain
wastes  that  are  not  subject to rate regulation.  Revenues from this non rate
regulated  waste  increased.

At  the Grand View, Idaho disposal facility, revenue increased 96% from the same
period last year. During the third quarter of 2003, the facility disposed of 77%
more  tons  than the same period last year. Management expects the Army Corps of
Engineers  and other federal agencies to continue shipping to the facility under
these  contracts facility through the fourth quarter of 2003 and beyond. The New


                                       22
<PAGE>
Jersey  PCB  clean-up contract is expected to result in an additional $4,600,000
of  revenue  during  the  fourth  quarter  of  2003.

At  the  Beatty,  Nevada  hazardous  treatment  and  disposal  facility, revenue
decreased  $538,000  for the three months ended September 30, 2003 from the same
period  in  2002, although revenue did increase from the second quarter of 2003.
The lower revenue was primarily due to decreased waste volumes caused by general
economic  weakness  and fewer projects to bid. However, the Company and the site
did  experience  an increase in bid activity in the quarter. No assurance can be
given  that these bids will result in increased revenue in future periods At the
Robstown,  Texas  hazardous  treatment  and disposal facility, revenue increased
$440,000  for  the three months ended September 30, 2003 over the same period in
2002. The increase in revenue and waste volume resulted from an increase in both
Base  and  Event  work performed during the quarter, as the Company began to see
increased  volume from remediation projects and increased activity from existing
customers.

DIRECT OPERATING COSTS
----------------------

For  the  three  months  ended September 30, 2003, consolidated direct operating
costs  increased 62% to $10,383,000 (60% of revenue) compared to $6,417,000 (58%
of  revenue) for the same period in 2002. The relatively higher direct operating
costs  reflect  the  low  margin  revenue on the New Jersey PCB clean-up project
which  was  still very beneficial to the Company due to the size of the project.
The  Company  continues its efforts to minimize direct costs through operational
improvements.

Operating  Disposal  Facilities
-------------------------------

Direct  costs  at  the Richland, Washington; Robstown, Texas; and Beatty, Nevada
facilities  essentially  remained  flat.  The  increase  in  consolidated direct
operating  costs  for  the Company were driven by an increase in direct costs at
the Grand View, Idaho facility of $4,244,000. This increase was due to increased
volumes  of  waste  received  and  related  transportation  costs. Approximately
$3,300,000  of  the  increase  in  direct  operating costs at Grand View was for
transportation  costs  related  to  the  New  Jersey  PCB  clean-up  project.

Non  Operating  Disposal  Facilities
------------------------------------

Non  Operating  Disposal  Facilities incur primarily engineering, laboratory and
other  contractor  expenses  and  labor  costs  required  to  meet the Company's
obligations  subsequent to operational use. For the three months ended September
30,  2003 and 2002, the Company reported $8,000 and $344,000 of expenses related
to  litigation  on  proposed  development  projects, and $114,000 and $58,000 of
costs  in  2003  and  2002  to  remediate or close facilities subsequent to use.

GROSS  PROFIT
-------------

For  the  quarter,  the  significantly  higher  revenue  allowed  the Company to
generate  a  50%  increase  in  gross  profit, pushing quarterly gross profit to
$6,941,000  compared  with a gross profit of $4,631,000 last year. The increased
disposal  revenue  at  the Grand View, Richland, and Robstown facilities allowed
the  Company  to  take advantage of the relatively high fixed cost nature of the
business  and realize more fall through to the bottom line. Relative to revenue,
gross  margin  declined  slightly  to  40% of revenue compared to 42% of revenue
during  the  same  quarter last year due to the New Jersey PCB project's low but
still  significant  margin.

SELLING, GENERAL AND ADMINISTRATIVE COSTS (SG&A)
------------------------------------------------

For  the  three  months  ended  September 30, 2003, the Company reported SG&A of
$3,302,000  (19%  of  revenue),  a  23%  increase  in  absolute dollars from the
$2,691,000  (24%  of  revenue) for the same three months of 2002, but a decrease
relative  to  revenue.  The  increase  in SG&A resulted from a number of factors
including  $235,000  accrued  for payroll and benefits on an employment contract
terminated  on September 30, 2003, and an additional $50,000 of costs associated
with  the  Company's  financial  assurance  program.


                                       23
<PAGE>
Non  Operating  Disposal  Facilities
------------------------------------

Non  Operating  Disposal  Facilities  incur primarily legal costs to protect the
Company's  investment  in  disposal  site  development  projects in Ward Valley,
California  and  Butte,  Nebraska. For the three months ended September 30, 2003
and  2002,  the  Company  reported  $1,000  and  $42,000  of  SG&A  expenses,
respectively,  at  Non  Operating  Disposal  Facilities.  Substantially all 2002
expenses  were  legal  costs  associated  with  the  Nebraska  litigation.

COMPARISON OF NINE MONTHS ENDED SEPTEMBER 30, 2003 AND 2002
-----------------------------------------------------------

REVENUE
-------

For  the nine months ended September 30, 2003, the Company reported consolidated
revenue  of  $40,115,000,  14% higher than the $35,077,000 reported for the same
period  in  2002.  During  the  nine  months ending September 30, 2003 and 2002,
$12,083,000 and $10,724,000 or 30% and 21% of revenue, respectively, represented
work  performed under contract with the U.S. Army Corps of Engineers. During the
nine months ending September 30, 2003, $5,400,000 or 14% of revenue, represented
work  performed  for  the  New  Jersey  PCB  clean-up  project.

Operating  Disposal  Facilities
-------------------------------
At the Company's Grand View, Idaho disposal facility, revenue increased 68% over
the  same  nine  months  last  year.  During  the first nine months of 2003, the
facility  disposed  of  substantially  increased waste volumes, mostly under the
Army  Corps of Engineers contract, due to increased shipments from both the Army
and  other  federal  agencies  utilizing  the  contract. It is expected that the
federal  government  will  continue  to ship significant volumes of waste to the
facility  for  the  remainder  of  2003  and  in  2004.

The  Richland,  Washington  facility's revenue decreased $1,890,000 for the nine
months  ended  September  30, 2003 from the same period in 2002. The decrease in
revenue  was  primarily  due  to a large clean-up project performed for the Army
Corps  of  Engineers  (Fort  Greely, Alaska Project), unrelated to the Company's
Idaho  site  contract,  during the first quarter of 2002.  This business was not
replaced in 2003. A majority of the Richland facility's revenue is controlled by
a  stipulated  rate  agreement  with  the  Washington Utility and Transportation
Commission  that  caps  annual  rate  regulated  revenue at $5,438,000  in 2003.

In  the  nine  months  ending  September 30, 2003, revenue at the Beatty, Nevada
disposal  facility  was  $657,000  lower  than  the  same  nine  months in 2002,
primarily  due  to  decreased waste volumes received for treatment and disposal.
General  economic  weakness  resulted  in  reduced  waste  production  and fewer
remedial  projects.  The  Beatty site continues to experience transportation and
state  tax  disadvantages in competing for business in the California industrial
waste  market.

At  the  Robstown,  Texas  hazardous  treatment  and  disposal facility, revenue
decreased  $1,999,000 for the nine months ended September 30, 2003 from the same
period  in 2002. This decrease was due to reduced event business. Like Richland,
a large first half 2002 event project was not replaced in 2003. General economic
weakness  was  also  a  factor.

DIRECT OPERATING COSTS
----------------------

For  the  nine  months  ended  September 30, 2003, consolidated direct operating
costs increased 22% to $22,423,000 (60% of revenue) compared to $18,433,000 (58%
of  revenue)  in the same period in 2002. The relatively higher direct operating
costs  reflect  the significant amount of low margin revenue realized on the New
Jersey  PCB  clean-up  project  during  the  period.  The  Company continues its
efforts  to  minimize  direct  costs  through  improved  operational efficiency.

Operating  Disposal  Facilities
-------------------------------

Direct  costs  at  the  Richland, Washington; Robstown, Texas and Beatty, Nevada
facilities essentially remained flat. The increase in direct operating costs was
caused  by  increases  in  direct  cost  at  the  Grand  View, Idaho facility of


                                       24
<PAGE>
$4,743,000  due  to  increased  waste  volumes and related transportation costs.
Approximately $3,300,000 of the increase in direct operating costs at Grand View
was  for New Jersey PCB clean-up project transportation costs which are variable
in  nature.

Non  Operating  Disposal  Facilities
------------------------------------

Non  Operating  Disposal  Facilities incur primarily engineering, laboratory and
other  contractor  expenses  and  labor  costs  required  to  meet the Company's
obligations  subsequent  to operational use. For the nine months ended September
30, 2003 and 2002, the Company reported $32,000 and $814,000 of expenses related
to  licensing  facilities  for initial use and $320,000 and $233,000 in 2003 and
2002  to  remediate  or  close  facilities  subsequent  to  use.

GROSS  PROFIT
-------------

For  the nine months ending September 30, 2003 gross profit increased $1,048,000
to $17,692,000 (44% of revenue) from $16,644,000 million (47% of revenue) during
the  same  nine  months  last year. The increased gross profit in the first nine
months of 2003 reflect a large project, increased shipments under the Army Corps
of  Engineers  contract at the Grand View facility, and the fixed cost nature of
the  Company's  disposal  facilities.

SELLING, GENERAL AND ADMINISTRATIVE COSTS (SG&A)
------------------------------------------------

For  the  nine  months  ended  September  30, 2003, the Company reported SG&A of
$11,088,000  (28%  of  revenue),  a  31%  increase  from  the $8,439,000 (24% of
revenue)  for  the same nine months of 2002. The primary increase in SG&A is due
to  $1,790,000  in  2003  legal and related fees associated with the Ward Valley
trial.  Also  contributing to the higher SG&A were higher insurance costs, costs
to  upgrade  accounting  and  information  systems,  and  costs  associated with
staffing  changes, including relocation and the buyout of an executive contract.
While  spending  on  information systems was higher in the nine months 2003 than
the  same  nine  months  of  2002,  management  expects  that  the investment in
information  systems  infrastructure  will  improve  efficiencies  and  not  be
recurring  in  future  periods.

COMPARISON OF THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2003 AND 2002
---------------------------------------------------------------------

INTEREST INCOME
---------------

For  the  nine  months  ended September 30, 2003, the Company earned $334,000 of
interest income, an increase from $31,000 in the same period of 2002. During the
three  months  ended  September  30,  2003,  the  Company received the remaining
$95,000  in 1996 Federal Income Tax refunds plus interest of $302,000.  Interest
income  is  earnings  on tax refunds, cash balances, restricted investments, and
notes  receivable  of  which the Company traditionally maintains minimal amounts
and  are  a  function  of  prevailing  market  rates.  The  Company  received
approximately  $10,000,000  from  the  February  13,  2003 sale of the El Centro
municipal  waste  landfill.  This  cash  was utilized to support operations, for
capital  expenditures  and  to  fund  retirement of Series D Preferred Stock and
accrued  dividends.  The  balance  has  been  maintained  in  very  short  term
investments.  Based  on  anticipated  cash  balances and low interest rates, the
Company  does  not  anticipate  significant  interest  income  in  the  future.

INTEREST  EXPENSE
-----------------

For  the  three  months  ended September 30, 2003, the Company reported interest
expense  of  $60,000,  a  decrease  of $161,000 from the corresponding period in
2002.  The  primary cause of this decrease was the refinancing of the $8,500,000
industrial  revenue  bond ("IRB") for the Grand View, Idaho facility, which bore
an  interest  rate  of  8.25%. The IRB was substantially refinanced in November,
2002  through  a  $7,000,000,  five  year,  fully  amortizing term loan from the
Company's  primary  lender,  Wells Fargo Bank. The term loan provides a variable
interest  rate  at  either  the  bank's  prime  rate or an offshore rate plus an
applicable  margin  based upon the Company's performance. For the three and nine
months  ended  September 30, 2003, the interest rate paid on the majority of the
outstanding  term  loan  was  3.5%.  Additional  reductions  in interest expense
reflect  management's  initiative to retire high cost debt and incur no new debt


                                       25
<PAGE>
other than periodic short term borrowings under the Company's line of credit. At
September  30,  2003,  the  line  of  credit  had  a  zero  balance.


OTHER INCOME (LOSS)
-------------------

Other Income is composed of the following ($ in thousands):

<TABLE>
<CAPTION>
                                                      Three Months Ended September 30,       Nine Months Ended September 30,
                                                          2003               2002               2003               2002
                                                    ----------------  ------------------  ----------------  ------------------
<S>                                                 <C>               <C>                 <C>               <C>
Litigation accrual related to GM settlement         $             --  $               --  $             --  $            (740)
Payment received, National Union settlement                       --                  --                --                250
Other litigation related settlements                              --                  --                --                100
Insurance claim refunds                                           --                  --                --                 27
Data processing services                                          --                  28                 8                 55
Cash receipts for sale or rent of property rights                 20                  --               100                 --
Other miscellaneous income, net                                   --                   7                 5                 18
                                                    ----------------  ------------------  ----------------  ------------------

Total other income (loss)                           $             20  $               35  $            113  $            (290)
                                                    ================  ==================  ================  ==================
</TABLE>


INCOME TAXES
------------

The components of the income tax provision (benefit) were as follows (in
thousands):

<TABLE>
<CAPTION>
                                Three Months Ended September 30,      Nine Months Ended September 30,
                                   2003                2002               2003               2002
                             -----------------  ------------------  ----------------  ------------------
<S>                          <C>                <C>                 <C>               <C>
State tax expense (benefit)  $              18  $            (226)  $             73  $            (226)
                             =================  ==================  ================  ==================
</TABLE>

The  tax effects of temporary differences between income for financial reporting
and  taxes  give  rise  to  deferred tax assets and liabilities. The Company has
historically  recorded a valuation allowance for certain deferred tax assets due
to  uncertainties  regarding  future  operating  results, and for limitations on
utilization  of acquired net operating loss carry forwards for tax purposes. The
potential  realization  of  a  significant portion of net deferred tax assets is
based  in  part on the Company's estimates of the timing of reversals of certain
temporary  differences  and  on  the  generation  of  taxable income before such
reversals.  In  2002,  the  Company reevaluated the deferred tax asset valuation
allowance,  determined  it was then "more likely than not" that a portion of the
deferred  tax  asset  would  be  realizable,  and  decreased  the portion of the
valuation  allowance  related  to  its  operating  facilities.

During  the  quarter  ended  March  31,  2003,  the Company wrote off its entire
$20,951,000  Ward  Valley  asset.  This  large write off effectively assures the
Company  of  a  tax  loss in 2003. Due to this expected loss, the $8,284,000 net
deferred  tax  asset  has  been  classified  as long term. Management expects to
realize  a  portion  of  this  asset  in  2004.

The  net operating loss carry forward was approximately $44,000,000 at September
30, 2003. Of this carry forward, approximately $2,745,000 is limited pursuant to
the net operating loss limitation rules of Internal Revenue Code Section 382 and
begins  to  expire  in 2006. The remaining unrestricted net operating loss carry
forward  expires  at  various  dates  between  2010  and  2020.

SEASONAL EFFECTS
----------------

Operating  revenues  are  generally  lower  in the winter months than the warmer
summer  months  when  more short duration, one-time remediation projects tend to
occur.  However,  both  disposal  and  processing  revenue  are more affected by
market  conditions  than  seasonality.


                                       26
<PAGE>
CAPITAL RESOURCES AND LIQUIDITY
-------------------------------

At September 30, 2003, cash and cash equivalents totaled $6,503,000, an increase
of  $6,368,000 from December 31, 2002. The increase in cash was primarily due to
the  sale  of El Centro for $10,000,000 in cash. The Company expects the primary
uses  of  cash  balances  during  the remainder of 2003 to be for disposition of
waste  removed from the Oak Ridge, Tennessee facility. In September of 2003, the
Company's  insurance  policy  for  financial  assurance  at  its hazardous waste
disposal facilities was extended to December 19, 2003. This required the Company
to post additional collateral through a standby letter of credit. It is expected
that  the  cost  and  cash  collateral requirements to renew this insurance will
increase.  Depending  on  collateral  requirements,  the  new terms could have a
material,  adverse  impact  on  the  Company's  available  cash.

On  February  28,  2003,  the Company repurchased all 100,001 shares of Series D
Preferred  Stock  outstanding for a net cash outflow of $2,800,000 after netting
out  $3,525,000 in cash received for 2,350,000 common shares issued for exercise
of  the Series E Warrants. Repurchase of the Series D Preferred Stock eliminated
an  8  3/8%  debt  instrument due to the preferred stockholders, and removed the
potential  dilution that the conversion of these shares would have had on common
stockholders.  In  addition  to  regularly  scheduled debt payments, the Company
early  retired  $1,014,000 of relatively high cost debt in the first nine months
of 2003 and retired an additional $658,000 of debt secured by equipment included
in  the sale of the El Centro landfill. These preferred stock and debt reduction
actions  reflect  continuing  management  initiatives  to  improve the Company's
balance  sheet  and  maximize  asset  utilization.

On  March  28,  2003 the Company exercised an early buyout of an operating lease
for  $1,159,000  and  recorded equipment purchases with a book value of $702,000
along with a reduction in the deferred gain of $457,000. In conjunction with the
early  buyout,  the Company recorded an impairment charge of $225,000 on certain
equipment utilized at the discontinued Oak Ridge operation which was included in
the early lease buyout.  The early lease buyout accomplished a primary objective
of  repaying  Wells  Fargo  Bank $500,000 required by the Bank as a condition of
approving the Company's repurchase of the Series D Preferred Stock. In addition,
the  Company cleared title to certain leased equipment at the Oak Ridge facility
to support ongoing efforts to sell the facility. Lastly, buyout of the operating
lease eliminated an expensive source of capital, improving the Company's overall
cost  of  capital.

During  the  first  nine  months  of  2003, the Company's days sales outstanding
("DSO")  decreased  at  September  30,  2003,  compared  to  December  31, 2002.
Continued  improvement in cash and receivable balances is a priority. Management
expects that implementation of its new information system and hiring of a credit
and  collections  manager  will  continue  to  improve  DSO.

As  of  September  30,  2003  and December 31, 2002, the Company's liquidity, as
measured  by  the current ratio, remained at 1.5 to 1.0.  The primary changes to
working  capital  were  earnings,  the  sale  of  El  Centro  for  $10,000,000,
repurchase  of the Series D Preferred Stock which resulted in a net cash outflow
of $2,800,000, debt retirement, and $4,941,000 in capital expenditures paid with
cash.  The  majority  of these capital expenditures were for construction of new
disposal  capacity  at  the  Grand  View,  Idaho  facility.

The debt to equity ratio increased to 1.1:1.0 at September 30, 2003, compared to
0.9:1.0  at  fiscal  year-end 2002. The increase in the Company's debt to equity
ratio  reflects  the  $20,951,000  write  off  of  the  Ward  Valley asset. This
outweighed  the  Company's  operating  earnings  and  repayment of approximately
$5,900,000  in  liabilities  during  the  first nine months of 2003. The debt to
equity  ratio  is  defined  as  total liabilities divided by stockholders equity

On  September 30, 2003, the Company had a $6,000,000 revolving line of credit in
place  with Wells Fargo Bank in Boise, Idaho maturing June 15, 2004. The line of
credit  is  secured  by the Company's accounts receivable. At September 30, 2003
and  December  31, 2002, the outstanding balance on the revolving line of credit
was  $0  and $603,000, respectively. The Company borrows and repays according to
business demands and availability of cash. It currently reserves $3,508,000 as a
letter  of  credit  used  as collateral for an insurance policy and a lien bond.

A  $4,500,000  disposal capacity expansion at the Grand View, Idaho facility was
completed  in  the  third  quarter  of 2003.  The Company expects higher capital
spending  at  its  Robstown,  Texas  facility as efforts continue to upgrade the
facility  and  increase  operational  efficiency.

The  Company's  Oak  Ridge  facility continues to require cash. Usage of cash is
expected  to  increase  as  waste  shipped  off  site  is managed and billed. At
September 30, 2003, the Company's Oak Ridge facility had liabilities expected to
be  paid  in  2003  of  $3,700,000.


                                       27
<PAGE>
The  Company believes that cash on hand and cash flow from operations, augmented
as needed by periodic borrowings under the line of credit, will be sufficient to
meet  the  Company's  cash  needs  for  the  foreseeable  future.

ITEM 3.   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

The  Company  does not maintain equities, commodities, derivatives, or any other
instruments  for  trading  or  any  other  purposes,  and  does  not  enter into
transactions  denominated  in  currencies  other  than  the  U.S.  Dollar.

The Company has minimal interest rate risk on investments or other assets as the
amount  held  is  traditionally  the minimum requirement imposed by insurance or
government  agencies.  At  September  30,  2003,  $244,000 is held in short term
pledged  investment  accounts.  An  additional  $4,500,000 is held in short term
investments  available  for  utilization  by  the  Company  in  2003 for capital
expenditures  and  payment  of  accrued  liabilities.  Together these items earn
interest  at  approximately  2%,  and  comprise  7%  of  assets.

The  Company  has  interest rate risk on debt instruments.  On October 28, 2002,
the  Company substantially refinanced the 8.25% fixed rate $8,500,000 Industrial
Revenue  Bond  with  a $7,000,000 five year term loan from the Company's primary
lender.  The term loan provides for a variable interest rate of the bank's prime
rate  or  an  offshore  rate  plus  an  applicable margin that is based upon the
Company's  performance.  At September 30, 2003 the interest rate incurred by the
Company  was  3.5%  on  the  outstanding term loan balance of $5,833,000.  As of
September  30,  2003, each 1% change in the term loan interest rate would result
in  an  annual  $51,000  change  in  interest  expense.

ITEM 4.   CONTROLS AND PROCEDURES.

(a)  As  of  the  end  of  the  quarter  prior  to  the  filing  of this report,
Company management, under the direction of the Chief Executive Officer and Chief
Financial  Officer, carried out an evaluation of the effectiveness of the design
and  operation  of  the Company's disclosure controls and procedures pursuant to
Rule  13a-14  of the Securities Exchange Act of 1934 (Exchange Act).  Based upon
that evaluation, the Chief Executive Officer and Chief Financial Officer believe
that  the  Company's  disclosure controls and procedures are effective in timely
alerting  them to material information required to be disclosed in the Company's
Exchange  Act  filings.

(b)  The  Company  maintains  a  system of internal controls that is designed to
provide reasonable assurance that its records and filings accurately reflect the
transactions  engaged in.  For the quarter ending September 30, 2003, there were
improvements to the Company's systems used to record and summarize transactions.
The  improvements  have  enabled  the  Company  to  identify and modify internal
controls  as  well  as  operational  procedures.

PART II OTHER INFORMATION.
--------------------------
ITEM 1.   LEGAL PROCEEDINGS.

Significant  developments  have  occurred  on  the following legal matters since
December  31,  2002:

US ECOLOGY, INC. V. THE STATE OF CALIFORNIA, ET AL., CASE NO.GIC747562, SUPERIOR
---------------------------------------------------
COURT OF THE STATE OF CALIFORNIA FOR THE COUNTY OF SAN DIEGO

In  May 2000, subsidiary US Ecology, Inc., sued the State of California, et. al.
("the  State")  for monetary damages exceeding $162 million. The suit stems from
the  State's abandonment of the Ward Valley low-level radioactive waste ("LLRW")
disposal project. California law requires the state to build a disposal site for
LLRW  produced  in  California,  Arizona,  North Dakota and South Dakota; member
states  of  the Southwestern Compact.  US Ecology was selected in 1985 to locate
and  license  the  site using its own funds on a reimbursable basis. In 1993, US
Ecology  obtained  a  license  from  the  State  and  entered  a  ground  lease.

The  State successfully defended the license against court challenges and, until
Governor  Gray  Davis  took office, actively pursued conveyance of the site from
the  federal  government.  In  September  2000,  the  Superior  Court  granted
California's motion to dismiss all causes of action, which the Company appealed.
In  September  2001, the California Fourth Appellate District Court remanded the


                                       28
<PAGE>
case  for  trial  on promissory estoppel grounds. The case was tried in Superior
Court for the County of San Diego during February and March 2003.

On  March  26,  2003,  the Superior Court issued a Statement of Decision finding
that  the  Company  failed  to establish causation and that its claim is further
barred by the doctrine of unclean hands. The latter finding was based on actions
the  Court  concluded  had created obstacles to an agreement between the federal
government  and  the  State  to  convey  the site. The Court also found that key
elements  of  the  Company's promissory estoppel claim had been proven at trial.
Specifically,  the  Court  ruled  that  the  State  made a clear and unambiguous
promise  to US Ecology in 1988 to use its best efforts to acquire the site, that
Governor  Davis'  administration  abandoned this promise, and that the Company's
reliance  on  the  State's  promise was reasonable and foreseeable. However, the
Court  found  that  the  State's  breach  of  its best efforts promise was not a
substantial factor in causing damages to US Ecology since the federal government
had  continued  to  resist  the  land  transfer.

Based  on  the  uncertainty  of  recovery  following  the  trial court's adverse
decision,  the Company wrote off the $20,951,000 deferred site development asset
at  March  31,  2003.

On May 2, 2003, the Company filed a motion to vacate and enter new judgment with
the  trial  court,  arguing that the March 26 decision misapplied the law to the
facts.  On  May  30,  2003,  this motion was denied without comment. On June 26,
2003,  the Company filed a notice of appeal with the California Fourth Appellate
District  Court.

The  Company's  financial  interest  in  the pending claim against the State was
improved by an amendment to the November 13, 1998 Ward Valley Interest Agreement
and  Assignment  entered into by American Ecology and its former primary lender.
This  June  27, 2003 amendment, entered into by the Company and the successor in
interest to that lender, provides that any monetary damages obtained shall first
be  allocated  to  the  Company  to  recover past and future litigation fees and
expenses  relating to the case. Thereafter, any remaining amount recovered shall
be divided equally between the Company and the former lender. The 1998 agreement
had  provided that the first $29.6 million less up to $1.0 million in legal fees
and  expenses  would  be  owed to the former lender, with any remaining recovery
reserved  to  the  Company.

In  early  July,  the  Company engaged the law firm of Cooley Godward on a fixed
price  plus  contingency basis to pursue the appeal, paying the fixed fee at the
time  of  engagement.  A briefing schedule has not been set. No assurance can be
given  that  the Company will prevail on appeal or reach a settlement to recover
any  portion  of  its  investment.

MANCHAK  V.  US  ECOLOGY,  INC., U.S. DISTRICT COURT FOR THE DISTRICT OF NEVADA,
--------------------------------
CIVIL  ACTION  NO.  96-494.

In March 1996, Frank Manchak, Jr. ("Plaintiff" or "Manchak") filed suit alleging
infringement  of  a  sludge treatment patent to stabilize hazardous waste at the
Company's  Beatty,  Nevada  hazardous  waste disposal facility. Plaintiff sought
unspecified  damages  for  infringement,  treble  damages,  interest,  costs and
attorney  fees.  On  October 17, 2002, the US District Court for the District of
Nevada  granted  the  Company's motion for summary judgment to dismiss the suit.
Manchak's  motion  for  reconsideration  was denied on January 8, 2003.  Manchak
appealed; however, plaintiff failed to timely file its appellant's brief and the
Company  moved  to  dismiss the appeal. On July 2, 2003, the US Court of Appeals
for  the  Federal  Circuit  granted  the Company's motion to dismiss, and denied
plaintiff's  request  for  an  extension of time and relief from page/word brief
limitations.  On  July 20, 2003 the plaintiff filed a motion for reconsideration
with  the  appellate  court  and  later filed for en banc review by the Court of
Appeals for the Federal Circuit. Both the motion for reconsideration and en banc
review  were  denied  by the Court of Appeals on September 3, 2003.  The Company
considers  the  matter  closed.

ENTERGY  ARKANSAS,  INC.  ET  AL, CENTRAL INTERSTATE LOW-LEVEL RADIOACTIVE WASTE
--------------------------------------------------------------------------------
COMMISSION  AND  US  ECOLOGY,  INC. ("PLAINTIFFS") V. STATE OF NEBRASKA, ET AL.,
------------------------------------------------------------------------------
CASE NO. 4:98CV3411, U.S. DISTRICT COURT, DISTRICT OF NEBRASKA

This  action  was  brought  in  federal  court  in  December of 1999 by electric
utilities  that generate low-level radioactive waste ("LLRW") within the Central
Interstate  Low-Level  Radioactive  Waste  Compact  (CIC). CIC member states are
Nebraska,  Kansas,  Oklahoma,  Arkansas,  and  Louisiana.  The  action  seeks
declaratory  relief  and  damages  for  bad  faith  in  the  State of Nebraska's
processing  and ultimate denial of US Ecology's application to site, develop and
operate  a  LLRW disposal facility near Butte, Nebraska. US Ecology is the CIC's


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<PAGE>
contractor  and  developer.  The  CIC  was  originally  named as a defendant and
subsequently  realigned  as  a  plaintiff. US Ecology intervened as a plaintiff.

The  CIC sought to recover contributions made by the utilities and US Ecology to
the  CIC  for  pre-licensing project costs of approximately $95 million and $6.2
million,  respectively,  and removal of the State of Nebraska from the licensing
process.  The  Eighth  Circuit  Court  of  Appeals  subsequently  dismissed  the
utilities'  and  US  Ecology's independent claims against Nebraska for breach of
the  good faith provision of the Compact, and for denial of due process based on
sovereign  immunity.  The  utilities  and  US  Ecology  subsequently filed cross
claims  against  the  CIC  for  breach  of  contract  and  the  imposition  of a
constructive  trust.

On  September  30,  2002,  the  US  District  Court for the District of Nebraska
entered  judgment  against  Nebraska  in  favor  of  the  CIC  for $153 million,
including  approximately  $50 million for prejudgment interest.  Of this amount,
US  Ecology's share was for a $6.2 million contribution and $6.1 for prejudgment
interest.  The $6.2 million contribution is included in the balance sheet amount
of  $6,478,000  of  capitalized  facility  development  costs.  The  Court  also
dismissed  the  utilities'  and US Ecology's cross claims for breach of contract
and  imposition of a constructive trust, finding that it was premature to decide
the  merits  of these claims and leaving the question open for future resolution
if  necessary.  The  State  appealed the judgment to the Eighth Circuit Court of
Appeals.

The case was argued before the Eighth Circuit on June 12, 2003. No assurance can
be  given  that the trial court's decision will be affirmed on appeal or that US
Ecology  will  recover  its  contributions  or  interest  thereon.

MATTIE  CUBA,  ET AL. V. AMERICAN ECOLOGY ENVIRONMENTAL SERVICES CORPORATION, ET
--------------------------------------------------------------------------------
AL., CAUSE NO. 2000-092, 4TH JUDICIAL DISTRICT COURT, RUSK COUNTY, TEXAS
---

This  suit  was  brought  in  November  2000  by 28 named plaintiffs against the
Company  and  named  subsidiaries, the former owners and approximately 60 former
customers  of  its Winona, Texas facility. Plaintiffs seek recovery for personal
injuries,  property  damages  and  exemplary  damages based on negligence, gross
negligence,  nuisance  and  trespass.  The  Company  filed  a motion for summary
judgment  in  July  2002  based on lack of evidence. In November 2002, the trial
court  granted partial summary judgment, dismissing certain causes of action and
reducing  the  number  of plaintiffs, but preserving other causes of action. The
Company  subsequently  filed  a  motion  for  summary judgment seeking dismissal
against  all of the adult plaintiffs on statute of limitations grounds. On March
26,  2003,  the  court  granted  this motion and dismissed the adult plaintiffs.
Seven  minors  and  one  intervenor  remain  party  to  the lawsuit. The Company
believes  plaintiffs'  remaining  case  is  without  merit  and will continue to
vigorously  defend  the  matter. No assurance can be given that the Company will
prevail  or  that  the  matter  can be favorably resolved. The Company's current
insurance  carrier is paying for defense of this matter subject to the Company's
$250,000  deductible,  which  has  been  fully  accrued  in  prior  periods.

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS.

On  February  28,  2003,  the Company repurchased all 100,001 shares of Series D
Preferred  Stock for the original sales price of $47.50 a share plus accrued but
unpaid  dividends of $16.56 a share.  A total cost of $6,406,000 was incurred to
complete  the  repurchase.

During  February,  2003,  three  remaining  Series  E  warrant holders exercised
2,350,000  Series  E  warrants  with  an  exercise  price  of  $1.50  per share.
Consequently,  the  Company issued 2,350,000 shares of common stock and received
$3,525,000  in  cash.  There  are  no  Series  E  warrants  outstanding.

ITEM 3.  DEFAULTS  UPON  SENIOR  SECURITIES.

NONE

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

NONE

ITEM 5.  OTHER  INFORMATION.

NONE


                                       30
<PAGE>
ITEM 6.  EXHIBITS  AND  REPORTS  ON  FORM  8-K.

     (a)  The  following  exhibits  are  filed  as  part  of  this  report:

Exhibit  31.1  Certification  of September 30, 2003 Form 10-Q by Chief Executive
               Officer  dated  November  12,  2003

Exhibit  31.2  Certification  of September 30, 2003 Form 10-Q by Chief Financial
               Officer  dated  November  12,  2003

Exhibit  32.1  Certification  of September 30, 2003 Form 10-Q by Chief Executive
               Officer  dated  November  12,  2003

Exhibit  32.2  Certification  of September 30, 2003 Form 10-Q by Chief Financial
               Officer  dated  November  12,  2003

     (b)  Reports  on  Form  8-K.

               On  July  28,  2003, the Company issued an 8-K to announce second
               quarter  2003  earnings.
               On  October 23, 2003, the Company issued an 8-K to announce third
               quarter  2003  earnings.


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.


                                     AMERICAN ECOLOGY CORPORATION
                                     (Registrant)


Date:  November 12, 2003             By: /s/ Stephen A. Romano
                                     -------------------------------
                                     Stephen A. Romano
                                     President, Chief Executive Officer and
                                     Chief Operating Officer

Date:  November 12, 2003             By:/s/ James R. Baumgardner
                                     -------------------------------
                                     James R. Baumgardner
                                     Senior Vice President, Chief Financial
                                     Officer, Secretary and Treasurer


                                       31
<PAGE>
                                    EXHIBIT INDEX

Exhibit                                Description
-------                                -----------

Exhibit  31.1  Certification  of September 30, 2003 Form 10-Q by Chief Executive
               Officer  dated  November  12,  2003
Exhibit  31.2  Certification  of September 30, 2003 Form 10-Q by Chief Financial
               Officer  dated  November  12,  2003
Exhibit  32.1  Certification  of September 30, 2003 Form 10-Q by Chief Executive
               Officer  dated  November  12,  2003
Exhibit  32.2  Certification  of September 30, 2003 Form 10-Q by Chief Financial
               Officer  dated  November  12,  2003


                                       32
<PAGE>