________________________________________________________________________________

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 10-Q

    (MARK ONE)

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

                  For the quarterly period ended June 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: 0-13406


                          THE CHALONE WINE GROUP, LTD.
             (Exact Name of Registrant as Specified in Its Charter)


                California                                  94-1696731
      (State or Other Jurisdiction of
      Incorporation or Organization)        (I.R.S. Employer Identification No.)

             621 Airpark Road
             Napa, California                                  94558
 (Address of Principal Executive Offices)                   (Zip Code)

Registrant's Telephone Number, Including Area Code: 707-254-4200

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

  Yes      X      No
         _______       _______

Indicate  by check mark  whether  the  registrant  is an  accelerated  filer (as
defined in Rule 12b-2 of the Act).

  Yes             No     X
         _______       _______

The number of shares  outstanding of Registrant's  Common Stock as of August 13,
2003 was 12,075,503.

________________________________________________________________________________

<PAGE>


                    PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.                                               PAGE

         Consolidated Balance Sheets as of June 30, 2003, and
         December 31, 2002.                                                    3

         Consolidated Statements of Income for the three-month and
         six-month periods ended June 30, 2003 and 2002.                       4

         Consolidated Statements of Cash Flows for the six-month
         periods ended June 30, 2003 and 2002.                                 5

         Notes to Consolidated Financial Statements.                           6

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
         AND RESULTS OF OPERATIONS.                                            8

ITEM 3. DISCLOSURE ABOUT MARKET RISK.                                         12

ITEM 4. CONTROLS AND PROCEDURES.                                              15



                      PART II - OTHER INFORMATION

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.                  16

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.                                     16




                                       2

<PAGE>
<TABLE>
<CAPTION>

                          THE CHALONE WINE GROUP, LTD.
                           CONSOLIDATED BALANCE SHEETS
                (All amounts in thousands, except per share data)

                                     ASSETS

                                                                     June 30,            December 31,
                                                                       2003                  2002
                                                                 _________________    ____________________
                                                                   (UNAUDITED)
<S>                                                                      <C>                     <C>
Current assets:
  Accounts receivable, net                                                $13,560                 $15,770
  Note receivable                                                             213                     190
  Income tax receivable                                                       223                     223
  Inventory                                                                75,161                  81,272
  Prepaid expenses and other current assets                                   808                   1,000
                                                                 _________________    ____________________
    Total current assets                                                   89,965                  98,455
Investment in Chateau Duhart-Milon                                         10,516                  10,067
Non-current note receivable                                                   321                     447
Property, plant and equipment, net                                         78,718                  77,953
Goodwill                                                                    8,582                   8,582
Trademarks                                                                  2,870                   2,875
Other assets                                                                1,720                   1,815
                                                                 _________________    ____________________
    Total assets                                                         $192,692                $200,194
                                                                         ========                ========

                      LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
  Current maturities of long-term obligations                              $2,862                  $2,295
  Current portion of obligation under capital lease                           716                     716
  Revolving bank loan                                                      19,198                  18,523
  Accounts payable and accrued liabilities                                 11,073                  18,935
                                                                 _________________    ____________________
    Total current liabilities                                              33,849                  40,469
Long-term obligations, less current maturities                             45,455                  46,754
Long-term obligations, convertible subordinated debt                       11,000                  11,000
Obligation under capital lease, less current maturities                       936                   1,329
Liability on interest rate swap contract                                    1,319                   1,355
Deferred income taxes                                                         938                     923
                                                                 _________________    ____________________
    Total liabilities                                                      93,497                 101,829

Minority interest                                                           3,009                   3,572

Shareholders' equity:
  Common stock - authorized 15,000,000 shares no par
    value; issued and outstanding: 12,075,503 and
    17,075,101 shares                                                      76,476                  76,474
  Retained earnings                                                        22,294                  21,790
  Accumulated other comprehensive loss                                    (2,584)                 (3,471)
                                                                 _________________    ____________________
    Total shareholders' equity                                             96,186                  94,793
                                                                 _________________    ____________________
    Total liabilities and shareholders' equity                           $192,692                $200,194
                                                                         ========                ========

</TABLE>

           SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


                                       3
<PAGE>
<TABLE>
<CAPTION>

                          THE CHALONE WINE GROUP, LTD.
                       CONSOLIDATED STATEMENTS OF INCOME
               (All amounts in thousands, except per share data)

                                     Three months ended                    Six months ended
                                         June 30,           June 30,           June 30,           June 30,
                                     _____________________________________ ____________________________________
                                           2003               2002               2003               2002
                                     _________________  _________________  _________________  _________________
                                       (UNAUDITED)        (UNAUDITED)        (UNAUDITED)        (UNAUDITED)
<S>                                    <C>                 <C>                <C>                <C>
Gross revenues                         $       15,989      $      12,929      $      29,914      $      28,889
Excise taxes                                     (485)              (356)              (902)              (816)
                                     _________________  _________________  _________________  _________________
Net revenues                                   15,504             12,573             29,012             28,073
Cost of wines sold                            (10,478)            (8,391)           (19,391)           (18,541)
                                     _________________  _________________  _________________  _________________
    Gross profit                                5,026              4,182              9,621              9,532
Other operating income (expense), net              26                  5                 21               (402)
Selling, general and administrative
  expenses                                     (3,628)            (2,717)            (6,748)            (5,895)
                                     _________________  _________________  _________________  _________________
    Operating income                            1,424              1,470              2,894              3,235
Interest expense, net                          (1,129)              (782)            (2,504)            (1,690)
Other income (expense)                             45                (33)                98                (13)
Equity in net income of Chateau
  Duhart-Milon                                    453                586                453                734
Minority interests                                (48)              (413)               (87)              (619)
                                     _________________  _________________  _________________  _________________
    Income before income taxes                    745                828                854              1,647
Income taxes                                     (305)              (368)              (350)              (709)
                                     _________________  _________________  _________________  _________________
    Net income                         $          440      $         460      $         504      $         938
                                     =================  =================  =================  =================

Earnings per share - basic and diluted         $ 0.04             $ 0.04             $ 0.04             $ 0.08

Weighted average number of shares
  outstanding:
    Basic                                      12,075             12,069             12,075             12,069
    Diluted                                    12,079             12,309             12,079             12,115

</TABLE>

          SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                       4

<PAGE>

<TABLE>
<CAPTION>

                          THE CHALONE WINE GROUP, LTD.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                           (All amounts in thousands)

                                                                                       Six months ended
                                                                      ____________________________________________________
                                                                             June 30,                    June 30,
                                                                               2003                        2002
                                                                      ________________________    ________________________
                                                                            (UNAUDITED)                 (UNAUDITED)
<S>                                                                                   <C>                         <C>
Cash flows from operating activities:
  Net income                                                                            $ 504                       $ 938
  Adjustments to reconcile net income to net cash provided
    by operating activities:
      Depreciation and amortization                                                     2,925                       2,842
      Gain on disposal of property                                                       (14)                         (4)
      Equity in net income of Chateau Duhart-Milon                                      (453)                       (734)
      Increase in minority interests                                                       87                         619
    Changes in:
      Accounts and other receivables                                                    2,210                       (102)
      Inventories                                                                       6,111                       6,630
      Prepaid expenses and other assets                                                   287                       (258)
      Deferred income taxes                                                                 -                          23
      Accounts payable and accrued liabilities                                        (7,862)                    (16,298)
                                                                      ________________________    ________________________
    Net cash provided by (used in) operating activities                                 3,795                     (6,344)
                                                                      ________________________    ________________________
Cash flows from investing activities:
  Capital expenditures                                                                (3,685)                     (2,807)
  Proceeds from disposal of property and equipment                                         14                           7
  Net change of note receivable                                                           103                          97
  Distribution from Chateau Duhart-Milon                                                  870                         108
                                                                      ________________________    ________________________
    Net cash used in investing activities:                                            (2,698)                     (2,595)
                                                                      ________________________    ________________________
Cash flows from financing activities
  Borrowings on revolving bank loan, net                                                  675                       9,362
  Distributions to minority partner                                                     (650)                           -
  Net change in capital lease obligation                                                (393)                       (332)
  Repayment of long-term debt                                                           (731)                        (29)
  Proceeds (re-purchase of) from issuance of common stock                                   2                        (62)
                                                                      ________________________    ________________________
    Net cash (used in) provided by financing activities                               (1,097)                       8,939
                                                                      ________________________    ________________________
Net increase (decrease) in cash and equivalents                                             -                           -
Cash and equivalents at beginning of year                                                   -                           -
                                                                      ________________________    ________________________
Cash and equivalents at end of year                                                       $ -                         $ -
                                                                                          ===                         ===

Other cash flow information:
  Interest paid                                                                       $ 2,604                     $ 1,992
  Income taxes paid                                                                       219                         638
Non-cash investing and financing activities:
  Unrealized foreign currency gain                                                      $ 866                     $ 1,038
  Interest swap fluctuation, net                                                           36                         201

</TABLE>

           SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


                                       5

<PAGE>


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

     The  unaudited consolidated financial statements of the Chalone Wine Group,
Ltd.  ("the  Company") are prepared in  conformity  with  accounting  principles
generally  accepted  in the  United  States of  America  for  reporting  interim
financial  information,  and the rules and  regulations  of the  Securities  and
Exchange Commission. In the opinion of management, all adjustments necessary for
a fair presentation of the financial  position and results of operations for the
periods  presented  have been  included.  All such  adjustments  are of a normal
recurring  nature.  The results of operations for the three and six months ended
June 30, 2003 are not  necessarily  indicative of the operating  results for the
full  accounting  year  or  any  future  period.  These  unaudited  consolidated
financial statements should be read in conjunction with the audited consolidated
financial  statements  included  in the  Company's  Form 10-K for the year ended
December 31, 2002.

      The consolidated balance sheet at December 31, 2002, presented herein, has
been derived from the audited  consolidated  financial statements of the Company
for the year then ended, included in the Company's annual report on Form 10-K.


USE OF ESTIMATES IN PREPARATION OF FINANCIAL STATEMENTS

     The  preparation of the financial  statements in conformity with accounting
principles   generally  accepted  in  the  United  States  of  America  requires
management to make estimates and assumptions that affect the reported  financial
statement  amounts  and  related  disclosures  at  the  date  of  the  financial
statements. Actual results could differ from these estimates.



EARNINGS PER SHARE

     Basic  earnings  per share  ("EPS")  excludes  dilution  and is computed by
dividing net income  available to common  stockholders  by the weighted  average
number of common  shares  outstanding  for the period.  Diluted EPS reflects the
potential  dilution that could occur if  securities or other  contracts to issue
common stock (e.g.  stock options) were exercised and converted into stock.  For
all periods  presented,  the  difference  between  basic and diluted EPS for the
Company reflects the inclusion of dilutive stock options, the effect of which is
calculated using the treasury stock method.



DERIVATIVE FINANCIAL INSTRUMENTS

     The Company uses derivative  instruments  to manage  exposures to interest
rate  risks in  accordance  with  its  risk  management  policy.  The  Company's
objectives  for holding  derivatives  are to  minimize  the risks using the most
effective  methods  to  eliminate  or  reduce  the  exposure  to  interest  rate
fluctuations.  The Company formally  documents the relationship  between hedging
instruments  and  hedged  items as well as its  risk  management  objective  and
strategy for undertaking its hedging activities. The Company formally designates
derivatives  as  hedging  instruments  on the date the  derivative  contract  is
entered  into.  The Company  assesses,  both at inception of the hedge and on an
ongoing  basis,  whether  derivatives  used as  hedging  instruments  are highly
effective  in  offsetting  the changes in the fair value or cash flows of hedged
items. If it is determined that a derivative is not highly  effective as a hedge
or ceases to be highly  effective,  the Company  discontinues  hedge  accounting
prospectively.

     Changes in the fair value of derivative instruments designated as cash flow
hedges,  to the extent the hedges are highly  effective,  are  recorded in other
comprehensive income, net of related tax effects. The ineffective portion of the
cash flow  hedge,  if any,  is  recognized  in  current-period  earnings.  Other
comprehensive  income is relieved  when  current  earnings  are  affected by the
variability of cash flows relating to the derivative  hedged.  During the period
ended June 30, 2003,  the Company's  derivative  contracts  consisted only of an
interest rate swap used by the Company to convert a portion of its variable rate
long-term debt to fixed rate.

     The  Company  does  not enter into  financial  instruments  for  trading or
speculative purposes.  Payments or receipts on interest rate swap agreements are
recorded in interest  expense.  Forward  exchange  contracts  are used to manage
exchange  rate  risks on  certain  purchase  commitments,  generally  French oak
barrels,  denominated in foreign  currencies.  Gains and losses relating to firm
purchase  commitments are deferred and are recognized as adjustments of carrying
amounts of assets acquired or in income when the hedged transaction  occurs. The
nominal amounts and related foreign currency  transaction gains and losses,  net
of the impact of hedging, were not significant for the six months ended June 30,
2003 and 2002.

                                       6

<PAGE>


STOCK BASED COMPENSATION

     The  Company  accounts  for  stock-based  awards  to  employees  using  the
intrinsic value based method in accordance with APB No. 25, ACCOUNTING FOR STOCK
ISSUED TO EMPLOYEES and provides the pro forma disclosures  required by SFAS No.
123, ACCOUNTING FOR STOCK-BASED  COMPENSATION.  No compensation expense has been
recognized in the financial statements for employee stock arrangements.
     As of  January 1, 2003 the Company  adopted the disclosure  requirements of
SFAS 148,  ACCOUNTING  FOR STOCK BASED  COMPENSATION,  which  amends  Accounting
Principals  Board ("APB") No. 28 by adding to the list of disclosures to be made
for interim reporting periods.
     SFAS 123,  Accounting for Stock-Based Compensation, requires the disclosure
of pro forma net income and earnings per share had the Company  adopted the fair
value method as of the  beginning of fiscal year 1995.  Under SFAS 123, the fair
value of stock-based awards to employees is calculated through the use of option
pricing  models,  even though such models were  developed  to estimate  the fair
value  of  freely   tradable,   fully   transferable   options  without  vesting
restrictions, which significantly differ from the Company's stock option awards.
These  models  also  require  subjective  assumptions,  including  future  stock
volatility  and expected time to exercise,  which greatly  affect the calculated
values.  The Company's  calculations  were made using the  Black-Scholes  option
pricing model with the following  weighted average  assumptions:  expected life,
117 months  following  vesting;  stock  volatility of 32.7% to 33.5% for the six
months  ended  June 30,  2003 and 32.1% to 32.6% for the six months end June 30,
2002,  risk-free  interest rates of 3.43% to 3.83% for the six months ended June
30,  2003 and 4.85% to 4.92% for the six  months  ended  June 30,  2002,  and no
dividends  during the expected term. The Company's  calculations  are based on a
multiple option valuation approach and forfeitures are recognized as they occur.
     For  purposes of pro forma  disclosures,  the  estimated  fair value of the
options is amortized over the options'  vesting period.  Had the Company's stock
option and stock purchase plan been accounted for under SFAS No. 123, net income
and  earnings  per share  would  have been  reduced to the  following  pro forma
amounts (IN THOUSANDS, EXCEPT PER SHARE DATA).

<TABLE>
<CAPTION>


                                              Three months ended                        Six months ended
                                       ____________________________________    ___________________________________
Net income:                             June 30, 2003       June 30, 2002       June 30, 2003       June 30, 2002
                                       _________________   ________________    ________________    _______________
<S>                                    <C>                 <C>                 <C>                 <C>
       As reported                     $            440    $           460     $           504     $          938
       Compensation Expense,
          net of tax                   $           (167)   $           (30)    $          (190)    $         (379)
                                       _________________   ________________    ________________    _______________
       Pro forma                       $            273    $           430     $           314     $          559
Earnings per share:
       Basic                           $           0.04    $          0.04     $          0.04     $         0.08
       Diluted                         $           0.04    $          0.04     $          0.04     $         0.08
       Pro forma basic                 $           0.02    $          0.04     $          0.03     $         0.05
       Pro forma diluted               $           0.02    $          0.03     $          0.03     $         0.05
</TABLE>




NOTE 2 - COMPREHENSIVE INCOME

     Comprehensive  income includes unrealized foreign currency gains and losses
related to the Company's  investment in Chateau Duhart-Milon and gains or losses
relating to derivative  instruments.  The following is a  reconciliation  of net
income and comprehensive income (IN THOUSANDS):

<TABLE>
<CAPTION>

                                                           Three months ended                Six months ended
                                                                June 30,                        June 30,
                                                        _______________________         _______________________
                                                          2003            2002            2003            2002
                                                        _______         _______         _______         _______

<S>                                                     <C>             <C>             <C>             <C>
Net Income                                              $  440          $  460          $  504          $  938
Changes in fair value of derivatives; net of tax
  effect                                                  (206)           (232)           (178)           (119)
Foreign currency translation gain                          149              14             199              34
Comprehensive income                                       562           1,180             866           1,038
                                                        ______          ______          ______          ______
                                                        $  945          $1,422          $1,391          $1,891
                                                        ======          ======          ======          ======

</TABLE>



                                       7

<PAGE>

NOTE 3 - INVENTORIES

Inventories  are  stated at lower of cost  (first-in,  first-out)  or market and
consist of the following (IN THOUSANDS):

                                           June 30,       December 31,
                                        ________________________________
                                             2003             2002
                                        _______________  _______________
                                         (Unaudited)
 Bulk wine                              $       29,972   $       48,312
 Bottled wine                                   44,398           32,171
 Wine packaging supplies                           415              415
 Other                                             376              374
                                        _______________  _______________
 Total                                  $       75,161   $       81,272
                                        ===============  ===============



NOTE 4 - RECLASSIFICATION

     In July 2002,  the Company  shifted a  major  distribution  channel  from a
broker to a  distributor.  Commissions  and shipping costs incurred for sales to
the broker were recorded as selling,  general and administrative  expenses. Case
prices charged to the distributor  have been reduced by an amount equal to these
commission and shipping costs. This caused a reduction in gross revenues for the
three and six months ended June 30, 2003, when compared to previous periods. For
comparability  purposes,  for the three and six months  ended June 30,  2002 the
Company reclassified $868 and $1,566  respectively,  of commissions and shipping
costs from selling, general and administrative expenses to gross revenues.



NOTE 5 - COMMITMENTS AND CONTINGENCIES

     Future  minimum lease payments (excluding the effect of future increases in
payments  based on  indices  which  cannot be  estimated  at the  present  time)
required under non-cancelable  operating leases with terms in excess of one year
are as follows: (IN THOUSANDS)

                Calendar year:
                (six months remaining)
                            2003                   $    550
                            2004                      1,009
                            2005                        976
                            2006                      1,014
                            2007                        998
                         Thereafter                   5,443
                                               _____________
                            Total                  $ 10,539
                                               =============

     The Company contracts with various growers and certain wineries to supply a
large  portion of its future  grape  requirements  and a smaller  portion of its
future bulk wine  requirements.  The Company estimates that it has contracted to
purchase approximately 9,000 to 13,000 tons of grapes per year over the next ten
years. While most of these contracts stipulate that prices will be determined by
current market conditions at the time of purchase,  several long-term  contracts
provide for minimum  grape or bulk wine prices.  There were no  purchases  under
these contracts  during the three and six months ended June 30, 2003.  Purchases
under these contracts were $18,883,000 for the year ended December 31, 2002.


                                       8

<PAGE>


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

INTRODUCTION

     In the  ordinary  course  of  business,  the  Company  has made a number of
estimates and assumptions relating to the reporting of results of operations and
financial condition in the preparation of its financial statements in conformity
with accounting  principles  generally accepted in the United States of America.
Actual results could differ  significantly  from those estimates under different
assumptions and conditions.  The Company believes that the following  discussion
addresses the Company's most critical accounting policies,  which are those that
are most  important to the  portrayal of the Company's  financial  condition and
results. The Company constantly re-evaluates these significant factors and makes
adjustments where facts and circumstances dictate. Historically,  actual results
have not  significantly  deviated  from  those  determined  using the  necessary
estimates  inherent in the  preparation of financial  statements.  Estimates and
assumptions include, but are not limited to, customer receivables,  inventories,
assets held for sale, fixed asset lives, depletion allowances, contingencies and
litigation. The Company has also chosen certain accounting policies when options
were available, including:

     o    The  first-in,  first-out  (FIFO)  method to value a  majority  of our
          inventories;
     o    The intrinsic value method,  or APB Opinion No. 25, to account for our
          common stock incentive awards; and
     o    We record  an  allowance  for  credit  losses  based on  estimates  of
          customers' ability to pay. If the financial condition of our customers
          were to deteriorate, additional allowances may be required.

     These  accounting  policies  are  applied   consistently  for  all  periods
presented.  Our operating  results would be affected if other  alternatives were
used.


FORWARD LOOKING STATEMENTS

     From time to time, information provided by the Company,  statements made by
its employees,  or  information  included in its filings with the Securities and
Exchange Commission  (including this Form 10-Q) may contain statements which are
not historical facts, so called "forward looking  statements" that involve risks
and  uncertainties.  Forward-looking  statements  are made  pursuant to the safe
harbor provisions of the Private Securities  Litigation Reform Act of 1995. When
used in  this  Form  10-Q,  the  terms  "anticipates,"  "expects,"  "estimates,"
"intends,"  "believes," and other similar terms as they relate to the Company or
its management  are intended to identify such forward  looking  statements.  The
Company's  actual future results may differ  significantly  from those stated in
any forward-looking statements. Factors that may cause such differences include,
but are not  limited to (i)  reduced  consumer  spending or a change in consumer
preferences, which could reduce demand for the Company's wines; (ii) competition
from  numerous  domestic  and foreign  wine  producers  which  could  affect the
Company's ability to sustain volume and revenue growth; (iii) interest rates and
other business and economic  conditions which could increase  significantly  the
cost and risks of  borrowings  associated  with  present and  projected  capital
projects;  (iv) the price and  availability in the marketplace of grapes meeting
the  Company's  quality  standards  and other  requirements;  (v) the  effect of
weather,  agricultural  pests and  disease and other  natural  forces on growing
conditions  and, in turn,  the quality  and  quantity of grapes  produced by the
Company;  and (vi)  regulatory  changes which might  restrict or hinder the sale
and/or  distribution of alcoholic  beverages.  Each of these factors,  and other
risks pertaining to the Company,  the premium wine industry and general business
and economic  conditions,  are more fully discussed herein and from time to time
in other  filings with the  Securities  and Exchange  Commission,  including the
Company's annual report on Form 10-K for the year ended December 31, 2002.


                                       9

<PAGE>


DESCRIPTION OF THE BUSINESS

     The Company produces,  markets and sells super premium,  ultra premium, and
luxury-priced white and red varietal table wines, primarily Pinot Noir, Cabernet
Sauvignon,  Merlot, Syrah,  Chardonnay and Sauvignon Blanc. The Company owns and
operates  wineries in various  counties of California and Washington  State. The
Company's wines are made primarily from grapes grown at Moon Mountain  Vineyard,
Edna Valley Vineyard, Chalone Vineyard,  Company-owned vineyards adjacent to the
Acacia(TM)  Winery,  Hewitt Vineyard and Suscol Creek Vineyard in California and
the Canoe Ridge Vineyard in Washington State, as well as from purchased grapes.

     The wines are primarily sold under the labels  "Provenance  Vineyards(TM),"
"Chalone Vineyards(R)," "Moon Mountain Vineyards(R),"  "Dynamite  Vineyards(R),"
"Edna  Valley  Vineyard(R),"  "Acacia(TM),"  "Canoe  Ridge(R)  Vineyard,"  "Jade
Mountain(R)," "Sagelands Vineyard(R)," and "Echelon(TM)."

     In France,  the Company owns a minority interest in fourth-growth  Bordeaux
estate Chateau  Duhart-Milon  ("Duhart-Milon")  in partnership with Les Domaines
Barons de Rothschild (Lafite) ("DBR"). The vineyards of Duhart-Milon are located
adjacent  to  the  world-renowned  Chateau  Lafite-Rothschild  in  the  town  of
Pauillac.

     The Chalone Wine Group,  Ltd. was incorporated  under the laws of the State
of California  on June 27, 1969.  The Company  became a publicly held  reporting
company as the result of an initial public offering of common stock in 1984.



RESULTS OF OPERATIONS - SECOND QUARTER AND SIX MONTHS OF 2003 COMPARED TO SECOND
QUARTER AND SIX MONTHS OF 2002

<TABLE>
<CAPTION>

                                   Three months ended     Percent     Six months ended      Percent
                                  June 30,  June 30,      Change     June 30,  June 30,     Change
                                  ___________________  ____________  __________________   ____________
                                   2003      2002      2003 vs 2002   2003      2002      2003 vs 2002
                                  _______   _______    ____________  ________   ________  ____________

<S>                               <C>       <C>             <C>       <C>        <C>            <C>
Net revenues                      100.0%    100.0%          0.0%      100.0%     100.0%         0.0%
Cost of wines sold                (67.6)%   (66.7)%         1.3%      (66.8)%    (66.0)%        1.2%
                                  _______   _______                   _______   ________
    Gross profit                   32.4%     33.3%         (2.7)%      33.2%      34.0%        (2.4)%
Other operating expense, net        0.2%      0.0%        100.0%        0.1%      (1.4)%     (107.1)%
Selling, general and
  administrative expenses         (23.4)%   (21.6)%         8.3%      (23.3)%    (21.0)%       11.0%
                                  _______   _______                   _______   ________
    Operating income                9.2%     11.7%        (21.4)%      10.0%      11.5%       (13.0)%
Interest expense, net              (7.3)%    (6.2)%        17.7%       (8.6)%     (6.0)%       43.3%
Other income                        0.3%     (0.3)%      (200.0)%       0.3%       0.0%       100.0%
Equity in net income of Chateau
  Duhart-Milon                      2.9%     4.7%         (38.3)%       1.6%       2.6%       (38.5)%
Minority interests                 (0.3)%   (3.3)%        (90.9)%      (0.3)%     (2.2)%      (86.4)%
                                  _______   _______                   _______   ________
    Income before income taxes      4.8%     6.6%         (27.3)%       2.9%       5.9%       (50.8)%
Income taxes                       (2.0)%   (2.9)%        (31.0)%      (1.2)%     (2.5)%      (52.0)%
                                  _______   _______                   _______   ________
    Net income                      2.8%     3.7%         (24.3)%       1.7%       3.3%       (48.5)%
                                  _______   _______                   _______   ________

</TABLE>


NET REVENUES

     Net  revenues   for  the  three  months  ended  June  30,  2003   increased
approximately  23.3%,  or  $2,931,000  over  the  corresponding  period  in  the
preceding year. This increase was due to a 35.8% increase in second quarter case
sales  over  the  same  period  in the  preceding  year  offset  by  competitive
promotional allowances within the marketplace.

     Net revenues for the six months ended June 30, 2003 increased approximately
3.3% or $939,000,  over the  corresponding  period in the  preceding  year.  The
increase  reflected a 10.5% increase in case sales that were partially offset by
a change in product mix relative to the sales volume.



GROSS PROFIT

     Gross  profit  margin  for the three and six  months  ended  June 30,  2003
decreased 2.7% and 2.4%, respectively,  as compared to the corresponding periods
in the  preceding  year.  The  respective  decreases  were driven  primarily  by
continued  pressure to provide  competitive  promotional  allowances  within the
marketplace  and an overall change in the product mix of the current year's case
sales.


                                       10
<PAGE>

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

     Selling,  general and administrative  expenses for the three and six months
ended June 30, 2003, increased  approximately  $911,000 or 33.5% and $853,000 or
14.4%, respectively,  over the comparable periods in the prior year. This change
was primarily a result of higher sales and marketing  costs due to the Company's
increased sales efforts in an ever more challenging marketplace.

OPERATING INCOME

     Operating  income  for the  three  and six  months  ended  June  30,  2003,
decreased  $46,000 or 3.1% and  $341,000 or 10.5%,  respectively,  over the same
periods last year. The decrease  reflects the higher discounts  provided on wine
sales,  coupled with additional  costs  associated with the Company's  increased
sales and marketing efforts.

INTEREST EXPENSE

     Interest expense for the three and six months ended June 30, 2003 increased
$347,000  or 44.4% and  $814,000  or 48.2%,  respectively,  over the  comparable
periods in the prior year. The increase occurred as a result of several factors.
The interest accrued on to the Company's  $11,000,000  convertible  subordinated
promissory  notes issued in August 2002  contributed to the greatest part of the
increase.  To a lesser extent,  amortization  of debt renewal and  restructuring
costs  incurred  at  various  times in the prior  year were also a  contributing
factor.

EQUITY IN NET INCOME OF DUHART-MILON

     The Company's 23.5% equity  interest in the net income of Duhart-Milon  for
the three months and six months ended June 30, 2003 decreased  $133,000 or 22.7%
and $281,000 or 38.3%,  respectively,  over the comparable  periods in the prior
year. The decrease was a function of timing based on the release and shipment of
wines.

     The Company monitors its investment in Duhart-Milon  primarily  through its
on-going  communication  with DBR.  Such  communication  is  facilitated  by the
presence  of the  Company's  chairman  on DBR's  Board of  Directors,  and DBR's
representation  on the Company's Board of Directors.  Additionally,  various key
employees  of the Company make  periodic  visits to  Duhart-Milon's  offices and
production facilities.

     Since the investment in Duhart-Milon is a long-term investment  denominated
in a  foreign  currency,  the  Company  records  the gain or loss  for  currency
translation  in  other   comprehensive   income  or  loss,   which  is  part  of
shareholders' equity.

MINORITY INTEREST

     The financial  statements of Edna Valley Vineyard  ("EVV") are consolidated
with the Company's  financial  statements.  The interest in EVV  attributable to
parties  other than the Company is accounted for as a "minority  interest".  The
minority  interest in the net income of EVV for the three  months and six months
ended June 30,  2003 was  $48,000 and $87,000  respectively.  The  decreases  in
minority interest were $365,000 and $532,000 for the three and six-month periods
ended June 30, 2003, respectively,  when compared to the same periods last year.
The  decrease  was due to the  reduced net income of EVV as compared to the same
period  in  the  prior  year.  Principally,  competitive  case  sales  discounts
contributed to the reduction in EVV's net income.


NET INCOME AND EARNINGS PER SHARE

     As a result of the factors discussed above, reported net income for the six
months  ending  June 30, 2003  amounted  to $504,000 or $.04 per diluted  share,
compared to $938,000, or $.08 per diluted share a year ago.


                                       11

<PAGE>


LIQUIDITY AND CAPITAL RESOURCES

     Net  working  capital  decreased  $1,870,000  or 3.2% at June 30,  2003.  A
decrease  is  anticipated  as  additional  long-  term debt  obligations  become
progressively  current. The Company has historically financed its growth through
increases in borrowings and cash flow from operations.  Management  expects that
the Company's working capital needs will grow  significantly to support expected
future growth in sales volume.  Due to the lengthy aging and  processing  cycles
involved in premium wine production, expenditures for inventory and fixed assets
need to be made one to three years or more in advance of anticipated sales.

     The  Company   expects  to  finance  these  future  capital  needs  through
operations,  securities  offerings and  additional  borrowings.  There can be no
assurance  that the  Company  will be able to  obtain  this  financing  on terms
acceptable to the Company.



ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     The following  disclosures  should be read in conjunction with Management's
Discussion and Analysis of Financial Condition and Results of Operations.  These
disclosures  are intended to discuss  certain  material  risks of the  Company's
business as they appear to  management at this time.  However,  this list is not
exhaustive. Other risks may, and likely will, arise from time to time.


     OUR REVENUES AND OPERATING RESULTS FLUCTUATE SIGNIFICANTLY FROM QUARTER TO
     QUARTER

     We believe  period-to-period  comparisons of our operating  results are not
necessarily  meaningful,  and  cannot be  relied  upon as  indicators  of future
performance.  In addition, there can be no assurance that our revenues will grow
or be  sustained  in  future  periods  or  that  we will  maintain  our  current
profitability   in  the   future.   Significant   factors  in  these   quarterly
fluctuations,  none of which are within our  control,  are  changes in  consumer
demand for our wines,  the affect of weather and other natural forces on growing
conditions  and, in turn,  the quality  and  quantity of grapes  produced by us,
interest rates,  inventory  levels and the timing of releases for certain wines,
among other factors.  Consequently,  we have experienced, and expect to continue
to experience, seasonal fluctuations in revenues and operating results.

     Large portions of our expenses are fixed and difficult to reduce in a short
period of time.  In quarters  when  revenues do not meet our  expectations,  our
level of fixed expenses tends to exacerbate the adverse effect on net income. In
quarters when our operating  results are below the expectations of public market
analysts or investors, the price of our common stock may be adversely affected.

     REDUCED CONSUMER SPENDING COULD LESSEN DEMAND FOR OUR WINES AND HARM OUR
     BUSINESS

     Consumer  spending  trends and changes in consumer tastes has a substantial
impact on the wine industry and our business.  To the extent that wine purchases
are negatively  impacted by economic and other factors, or wine consumers reduce
consumption  of wine in favor of other  beverages,  demand  for our wines  could
decrease.

     OUR BUSINESS IS SEASONAL, WHICH COULD CAUSE OUR MARKET PRICE TO FLUCTUATE

     Our  business is subject to seasonal as well as quarterly  fluctuations  in
revenues and operating  results.  Our sales volume tends to increase  during the
summer months and the holiday season and decrease after the holiday season. As a
result,  our sales and earnings are typically highest during the fourth calendar
quarter and lowest in the first calendar  quarter.  Seasonal factors also affect
our level of borrowing.  For example, our borrowing levels typically are highest
during winter when we have to pay growers for grapes harvested and make payments
related to the grape harvest.  These and other factors may cause fluctuations in
the market price of our common stock.

     WE WILL NEED MORE WORKING CAPITAL TO GROW

     The premium wine industry is a capital-intensive  business,  which requires
substantial capital expenditures to develop and acquire vineyards and to improve
or expand wine production.  Further, the farming of vineyards and acquisition of
grapes and bulk wine require  substantial amounts of working capital. We project
the  need  for  significant  capital  spending  and  increased  working  capital
requirements  over the next several  years,  which must be financed by cash from
operations and, by additional borrowings or additional equity.

     OUR ACQUISITIONS AND POTENTIAL FUTURE ACQUISITIONS INVOLVE A NUMBER OF
     RISKS

     Our acquisition of Provenance Vineyards, Hewitt Ranch, Suscol Ranch, Staton
Hills Winery (renamed Sagelands  Vineyard),  the Jade Mountain brand,  enlarging
Canoe Ridge Vineyard and buying out our partners,  and expansion to the recently
acquired winery for the Provenance Vineyards (and potential future acquisitions)
involve risks  associated with  assimilating  these operations into our Company;

                                       12

<PAGE>

integrating,  retaining and motivating key personnel;  integrating  and managing
geographically-dispersed    operations    integrating    the    technology   and
infrastructures  of disparate  entities;  risks  inherent in the  production and
marketing  wine and  replanting of existing  vineyards from white wine grapes to
red wine grapes.

     We relied on debt financing to purchase Hewitt Ranch,  Suscol Ranch, Staton
Hills Winery, the Jade Mountain brand, enlarging Canoe Ridge Vineyard and buying
out our partners and other  vineyard  land and related  assets during the fiscal
year ended December 31, 2001.  Consequently our debt-to-equity  ratio is high in
relation to our historical  standards,  even after the successful  completion of
our rights  offering in November 2001. The interest costs  associated  with this
debt will increase our operating expenses and the risk of negative cash flow.


     OUR PROFITS DEPEND LARGELY ON SALES IN CERTAIN STATES AND ON SALES OF
     CERTAIN VARIETALS

     In the six months ended June 30, 2003,  approximately 89% of our wine sales
were  concentrated  in 17  states.  Changes in  national  consumer  spending  or
consumer  spending in these states and other regions of the country could affect
both the  quantity  and price  level of wines  that  customers  are  willing  to
purchase which could harm our business.

     Approximately  85% of our consolidated net revenues in the six months ended
June  30,  2003  were  concentrated  in our  four top  selling  varietal  wines.
Specifically,  sales of Chardonnay,  Cabernet Sauvignon,  Pinot Noir, and Merlot
accounted for 43%, 16%, 13% and 13% of our net revenues,  respectively.  Changes
in consumer  preferences  with respect to these varietal  wines could  adversely
affect our business.

     COMPETITION MAY HARM OUR BUSINESS

     The  premium  table  wine  industry  is  intensely  competitive  and highly
fragmented.  Our wines  compete in all of the premium wine market  segments with
many other  premium  domestic  and foreign  wines,  with  imported  wines coming
primarily  from the  Burgundy  and  Bordeaux  regions of France and, to a lesser
extent,  Italy,  Chile,  Argentina,  South Africa and Australia.  Our wines also
compete with  popular-priced  generic wines and with other  alcoholic  and, to a
lesser degree, non-alcoholic beverages, for shelf space in retail stores and for
marketing focus by our independent  distributors,  many of which carry extensive
brand portfolios.

     The wine industry has experienced  significant  consolidation.  Many of our
competitors have greater  financial,  technical,  marketing and public relations
resources  than we do.  Our sales may be harmed to the extent we are not able to
compete successfully against such wine or alternative beverage producers.


     OUR BUSINESS IS SUBJECT TO A VARIETY OF AGRICULTURAL RISKS

     Winemaking  and grape  growing  are  subject to a variety  of  agricultural
risks.  Various diseases,  pests, fungi,  viruses,  drought,  frosts and certain
other weather conditions can affect the quality and quantity of grapes available
to  us,  decreasing  the  supply  of  our  products  and  negatively   impacting
profitability.

     Many  California   vineyards  have  been  infested  in  recent  years  with
phylloxera. Our vineyard properties are primarily planted to rootstocks believed
to be  resistant to  phylloxera.  However,  there can be no  assurance  that our
existing vineyards, or the rootstocks we are now using in our planting programs,
will not become susceptible to current or new strains of phylloxera.

     Pierce's  Disease is a vine  bacterial  disease that has been in California
for more than 100 years. It kills  grapevines and there is no known cure.  Small
insects  called   sharpshooters  spread  this  disease.  A  new  strain  of  the
sharpshooter,  the glassy winged,  was discovered in Southern  California and is
believed to be migrating  north.  We are actively  supporting the efforts of the
agricultural  industry  to  control  this pest and are making  every  reasonable
effort to prevent  an  infestation  in our own  vineyards.  We cannot,  however,
guarantee that we will succeed in preventing contamination in our vineyards.

      Future government restrictions regarding the use of certain materials used
in grape growing may increase vineyard costs and/or reduce production.

     Grape growing  requires  adequate water supplies.  We generally  supply our
vineyards'  water needs through wells and reservoirs  located on our properties.
We believe that we either have,  or are currently  planning to insure,  adequate
water supplies to meet the needs of all of our vineyards. However, a substantial
reduction in water supplies  could result in material  losses of grape crops and
vines.

                                       13

<PAGE>

     WE MAY NOT BE ABLE TO GROW OR ACQUIRE ENOUGH QUALITY GRAPES FOR OUR WINES

     The adequacy of our grape supply is influenced by consumer  demand for wine
in relation to  industry-wide  production  levels.  While we believe that we can
secure  sufficient  supplies of grapes from a combination  of our own production
and from grape supply contracts with independent  growers,  we cannot be certain
that grape  supply  shortages  will not occur.  A shortage in the supply of wine
grapes could  result in an increase in the price of some or all grape  varieties
and a corresponding increase in our wine production costs.

     AN OVERSUPPLY OF GRAPES MAY ALSO HARM OUR BUSINESS

     Current  trends in the domestic and foreign  wine  industry  point to rapid
plantings of new vineyards and replanting of old vineyards to greater densities,
with the expected  result of  significantly  increasing the worldwide  supply of
premium wine grapes and the amount of wine which will be produced in the future.
This expected  increase in grape  production has resulted in an excess of supply
over demand and forces us to reduce, or not increase, our prices.

     WE DEPEND ON THIRD PARTIES TO SELL OUR WINE

     We sell our products primarily through independent distributors and brokers
for resale to retail outlets,  restaurants,  hotels and private clubs across the
United  States and in some  overseas  markets.  To a lesser  degree,  we rely on
direct sales from our wineries,  our wine library and direct mail.  Sales to our
largest distributor and to our twenty largest distributors  combined represented
approximately  35% and 76%,  respectively,  of our net  revenues  during the six
months ended June 30, 2003.  Effective July 1, 2002, the Company switched from a
single  broker to a  distributor  in  California.  The laws and  regulations  of
several states prohibit  changes of  distributors,  except under certain limited
circumstances,   making  it  difficult  to  terminate  a  distributor  for  poor
performance  without  reasonable cause, as defined by applicable  statutes.  Any
difficulty or inability to replace  distributors,  poor performance of our major
distributors  or our  inability to collect  accounts  receivable  from our major
distributors could harm our business.

     NEW REGULATIONS OR INCREASED REGULATORY COSTS COULD HARM OUR BUSINESS

     The wine  industry is subject to  extensive  regulation  by the Alcohol and
Tobacco  Tax and  Trade  Bureau  and  various  foreign  agencies,  state  liquor
authorities  and local  authorities.  These  regulations  and laws  dictate such
matters  as  licensing  requirements,  trade and  pricing  practices,  permitted
distribution  channels,   permitted  and  required  labeling,   advertising  and
relations  with  wholesalers  and  retailers.  Any  expansion  of  our  existing
facilities or development of new vineyards or wineries may be limited by present
and  future  zoning  ordinances,  environmental  restrictions  and  other  legal
requirements.  In addition,  new  regulations  or  requirements  or increases in
excise taxes, income taxes,  property and sales taxes or international  tariffs,
could reduce our profits. Future legal or regulatory challenges to the industry,
either individually or in the aggregate, could harm our business.

     ADVERSE PUBLIC OPINION ABOUT ALCOHOL MAY HARM OUR BUSINESS

     A number of research  studies  suggest  that  various  health  benefits may
result from the moderate  consumption of alcohol, but other studies suggest that
alcohol  consumption  does not have any health benefits and may in fact increase
the risk of stroke,  cancer and other  illnesses.  If an  unfavorable  report on
alcohol  consumption gains general support,  it could harm the wine industry and
our business.

     WE USE PESTICIDES AND OTHER HAZARDOUS SUBSTANCES IN THE OPERATION OF OUR
     BUSINESS

     We use  pesticides and other  hazardous  substances in the operation of our
business. If hazardous substances are discovered on, or emanate from, any of our
properties,  and their release presents a threat of harm to public health or the
environment, we may be held strictly liable for the cost of remediation. Payment
of such costs could have a material  adverse  effect on our business,  financial
condition and results of operations.  We maintain  insurance against these kinds
of risks, and others,  under various insurance policies.  However, our insurance
may not be adequate or may not  continue to be  available at a price or on terms
that are satisfactory to us.

     CONTAMINATION OF OUR WINES WOULD HARM OUR BUSINESS

     We are  subject to certain  hazards and product  liability  risks,  such as
potential  contamination,  through  tampering or otherwise,  of  ingredients  or
products.  Contamination  of any of our  wines  could  result  in the need for a
product  recall  that could  significantly  damage our  reputation  for  product
quality,  which we believe is one of our principal  competitive  advantages.  We
maintain  insurance  against  these kinds of risks,  and others,  under  various
general  liability  and  product  liability  insurance  policies.  However,  our
insurance  may not be adequate or may not continue to be available at a price or
on terms that are satisfactory to us.

                                       14

<PAGE>


     THE LOSS OF KEY EMPLOYEES WOULD DAMAGE OUR REPUTATION AND BUSINESS

     Our success depends to some degree upon the continued  services of a number
of key  employees.  Although some key employees are under  employment  contracts
with us for specific  terms,  the loss of the services of one or more of our key
employees  could harm our business and our  reputation,  particularly  if one or
more of our key  employees  resigns to join a competitor  or to form a competing
company. In such an event, despite provisions in our employment contracts, which
are designed to prevent the unauthorized disclosure or use of our trade secrets,
practices or procedures by such personnel under these  circumstances,  we cannot
be certain  that we would be able to enforce  these  provisions  or prevent such
disclosures.


     SHIFTS IN FOREIGN EXCHANGE RATES OR THE IMPOSITION OF ADVERSE TRADE
     REGULATIONS COULD HARM OUR BUSINESS

     We conduct some of our import and export  activity  for wine and  packaging
supplies in foreign currencies.  We purchase foreign currency on the spot market
on an as-needed  basis and engage in limited  financial  hedging  activities  to
offset the risk of exchange rate  fluctuations.  There is a risk that a shift in
certain foreign exchange rates or the imposition of unforeseen and adverse trade
regulations  could adversely impact the costs of these items and have an adverse
impact on our operating results.

     In addition,  the  imposition of unforeseen  and adverse trade  regulations
could have an adverse  effect on our  imported  wine  operations.  Export  sales
accounted for approximately 2% of total consolidated  revenue for the six months
ended  June 30,  2003.  We expect the volume of  international  transactions  to
increase, which may increase our exposure to future exchange rate fluctuations.

     INFRINGEMENT OF OUR TRADEMARKS MAY DAMAGE OUR BRAND NAMES OR OUR BUSINESS

     Our wines are branded consumer products,  and we distinguish our wines from
our  competitors'  by enforcement of our  trademarks.  There can be no assurance
that  competitors  will refrain from  infringing our marks or using  trademarks,
trade names or trade dress which dilute our intellectual  property  rights,  and
any such  actions may require us to become  involved  in  litigation  to protect
these  rights.  Litigation  of this  nature can be very  expensive  and tends to
divert management's time and attention.


     THE MARKET PRICE OF OUR COMMON STOCK FLUCTUATES

     All of the  foregoing  risks,  among  others not known or mentioned in this
report,  may have a  significant  effect on the market price of our shares.  The
stock markets have  experienced  extreme price and volume trading  volatility in
recent months and years.  This  volatility  has had a substantial  effect on the
market prices of securities of many companies for reasons  frequently  unrelated
or disproportionate  to the specific company's  operating  performance and could
similarly affect our market price.

     DECREASED CASH FLOW COULD LIMIT OUR ABILITY TO SERVICE OUR DEBT

     As a result  of  incurring  debt,  we are  subject  to the  risks  normally
associated  with  debt  financing,  including  the  risk  that  cash  flow  from
operations  will be  insufficient  to meet  required  payments of principal  and
interest.  Our ability to satisfy our  obligations  to pay interest and to repay
debt is dependent on our future performance.  Our performance  depends, in part,
on prevailing  economic  conditions  and  financial,  business and other factor,
including factors beyond our control.



     OUR DEBT FINANCING AGREEMENTS CONTAIN RESTRICTIVE COVENANTS WITH WHICH WE
     MAY NOT BE ABLE TO COMPLY

     Our existing line of credit and long-term debt financing agreements contain
restrictive financial covenants. These covenants require us, among other things,
to maintain specified levels of net income, working capital,  tangible net worth
and financial ratios. Our ability to comply with restrictive financial covenants
depends upon our future operating performance.  Our future operating performance
depends,  in part, on general  industry  conditions and other factors beyond our
control.



ITEM 4.    CONTROLS AND PROCEDURES

     Within the 90-day  period  prior to the date of this  report,  the  Company
carried out an evaluation,  under the supervision and with the  participation of
the  Company's  management,  including  its Chief  Executive  Officer  and Chief
Financial  Officer,  of the  effectiveness  of the design and  operation  of the
Company's  disclosure  controls and procedures.  Based on that  evaluation,  the
Chief Executive Officer and Chief Financial Officer concluded that the Company's
disclosure  controls and  procedures  are  effective in a timely manner to alert
them to material  information  relating to the Company,  which is required to be
disclosed  by the  Company in the  reports  that it files or  submits  under the
Securities  Exchange Act of 1934. There have been no significant  changes in our
internal  or other  factors  that  could  significantly  affect  these  controls
subsequent to the evaluation date,  including any corrective actions with regard
to significant deficiencies and material weaknesses.

                                       15

<PAGE>


PART II. - OTHER INFORMATION

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

     The Company's 2003 Annual Meeting of Shareholders was held at the Company's
executive  offices,  621 Airpark  Road,  Napa,  California,  on May 29, 2003. In
attendance,  in person  or by proxy,  were  11,178,938  shares of the  Company's
Common  Stock,  or  approximately  92.6% of the  total  votes  outstanding.  The
following actions were taken:

     ELECTION OF  DIRECTORS.  All eleven  positions  on the  Company's  Board of
Directors were to be filled for new one-year  terms,  and all nominees were duly
elected,  each  nominee  receiving  in  excess of 96% of the  total  votes.  The
directors  thus  elected,  with the precise votes for,  against and  abstaining,
were:


            DIRECTOR                   FOR        AGAINST     ABSTAIN
            ________                   ___        _______     _______

John Diefenbach                    11,159,406      19,532        0
Marcel Gani                        11,158,711      20,227        0
Mark A. Hojel                      11,160,055      18,883        0
Yves-Andre Istel                   10,812,403     366,535        0
C. Richard Kramlich                11,160,604      18,334        0
George E. Meyers                   10,950,417     228,521        0
James H. Niven                     10,810,853     368,085        0
Phillip M. Plant                   11,128,317      50,621        0
Eric de Rothschild                 10,812,544     366,394        0
Christophe Salin                   10,815,751     363,187        0
Thomas B. Selfridge                10,919,789     259,149        0


     RATIFICATION  OF  AUDITORS.  The  appointment  of  Moss-Adams  LLP  as  the
Company's  independent auditors for the fiscal year ending December 31, 2003 was
ratified,  with  11,154,725  votes for,  16,737  votes  against  and 7,476 votes
abstaining.

     APPROVAL  OF  2003  EMPLOYEE  STOCK  PURCHASE  PLAN.  The  adoption  of the
Company's 2003 Employee Stock Purchase Plan was approved,  with 11,084,862 votes
for, 62,869 votes against and 31,207 votes abstaining.


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

     (a) Exhibits.

         31.1 Certification of Chief Financial Officer.
         31.2 Certification of Chief Executive Officer.
         32.1 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
              Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
         32.2 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
              Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

     (b) Reports on Form 8-K.

         During the second  quarter  ended June 30, 2003,  the Company filed the
         following  Current  Reports  on Form  8-K:  May 9, 2003  (Item 5).  The
         Company  issued a press  release  announcing  its  first  quarter  2003
         financial results

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<PAGE>


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

DATED:  AUGUST 13, 2003              THE CHALONE WINE GROUP, LTD.
_______________________              ____________________________
                                                        (Registrant)


                                        /s/ THOMAS B. SELFRIDGE
                                     ___________________________________________
                                     Thomas B. Selfridge
                                     President and Chief Executive Officer


DATED:  AUGUST 13, 2003                 /s/ SHAWN M. CONROY BLOM
_______________________              ___________________________________________
                                     Shawn M. Conroy Blom
                                     Vice President and Chief Financial Officer













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