SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

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

         For the quarterly period ended June 30, 2001

                                       OR

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

         For the transition period from ______________to ______________
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                         Commission file number 0-32513


                                   ICOA, INC.
                                   ----------
             (Exact name of Registrant as Specified in Its Charter)

                Nevada                                     87-0403239
    -------------------------------            ---------------------------------
    (State or Other Jurisdiction of            (IRS Employer Identification No.)
     Incorporation or Organization)

                  111 Airport Road, Warwick, Rhode Island 02889
                  ---------------------------------------------
             (Address of Principal Executive Offices with Zip Code)

        Registrant's Telephone Number, Including Area Code: 401-739-9205
                                                            ------------

---------------------------------------------------------------------------------
Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report.


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 ___

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE
PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes ____No __

APPLICABLE ONLY TO CORPORATE ISSUERS:

The number of shares of common stock outstanding as of August 9, 2001 was
55,792,961

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PART I - FINANCIAL INFORMATION

ITEM 1.       Unaudited Consolidated Balance Sheets at June 30, 2001

              Unaudited Consolidated Statements of Operations for the three
              months and six months ended June 30, 2001 and 2000

              Unaudited Consolidated Statements of Cash Flows for the three
              months and six months ended June 30, 2001 and 2000

              Notes to the Unaudited Consolidated Financial Statements

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

PART II - OTHER INFORMATION

ITEM 6.       Exhibits and Reports on Form 8-K

SIGNATURES


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                                          ICOA, INC. AND SUBSIDIARY
                                          -------------------------
                                         CONSOLIDATED BALANCE SHEET
                                         --------------------------

                                                JUNE 30, 2001
                                                -------------
                                                 (Unaudited)
                                                 -----------

                                                   ASSETS
                                                   ------

CURRENT ASSETS:
     Cash                                                                                $          54,091
     Prepaid expenses and other current assets                                                     179,245
     Advance to officer                                                                            166,181
                                                                                           ----------------
        TOTAL CURRENT ASSETS                                                                       399,517

EQUIPMENT, net                                                                                      20,728

OTHER ASSETS:
     Advance to affiliates                                                                           2,400
     Deposits                                                                                        7,225
                                                                                           ----------------
        TOTAL OTHER ASSETS                                                                           9,625
                                                                                           ----------------

                                                                                         $         429,870
                                                                                           ================

                                    LIABILITIES AND STOCKHOLDERS' DEFICIT
                                    -------------------------------------

CURRENT LIABILITIES:
     Accounts payable and accrued expenses                                               $         429,565
     Due to officer                                                                                  1,000
     Notes payable                                                                                 327,657
                                                                                           ----------------
        TOTAL CURRENT LIABILITIES                                                                  758,222

CONVERTIBLE DEBENTURES, net of conversion benefit                                                1,084,250

NOTE PAYABLE                                                                                        26,270

STOCKHOLDERS' DEFICIT:
     Common stock, $.0001 par value; authorized shares - 150,000,000 shares;
        50,349,847 shares issued and outstanding                                                     5,035
     Additional paid-in capital                                                                  5,684,781

     Accumulated deficit                                                                        (7,128,688)
                                                                                           ----------------
        TOTAL STOCKHOLDERS' DEFICIT                                                             (1,438,872)
                                                                                           ----------------
                                                                                         $         429,870
                                                                                           ================


                                     See notes to financial statements.

                                                      3

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                                                      ICOA, INC. AND SUBSIDIARY

                                                CONSOLIDATED STATEMENTS OF OPERATIONS
                                                             Unaudited)


                                                                  Three Months Ended June 30,         Six Months Ended June 30,
                                                              ---------------------------------  ----------------------------------
                                                                     2001             2000              2001              2000
                                                              ---------------  ----------------  ----------------  ----------------

REVENUES                                                      $         7,329  $              -  $          7,329  $              -

COST OF SERVICES                                                          138                 -               138                 -
                                                              ---------------  ----------------  ----------------  ----------------
GROSS PROFIT                                                            7,191                 -             7,191                 -

OPERATING EXPENSES:
    Selling, general and administrative                               849,799           108,180           994,462           261,154
    Depreciation                                                        1,171               493             2,341               802
                                                              ---------------  ----------------  ----------------  ----------------
       TOTAL OPERATING EXPENSES                                       850,970           108,673           996,803           261,956
                                                              ---------------  ----------------  ----------------  ----------------

OPERATING LOSS                                                       (843,779)         (108,673)         (989,612)         (261,956)

INTEREST EXPENSE                                                     (719,900)           (6,606)         (813,982)          (12,512)
                                                              ---------------  ----------------  ----------------  ----------------

NET LOSS                                                      $    (1,563,679) $       (115,279) $     (1,803,594) $       (274,468)
                                                              ===============  ================  ================  ================
BASIC AND DILUTED NET LOSS PER SHARE                          $         (0.03) $           0.00  $          (0.04) $          (0.01)
                                                              ===============  ================  ================  ================
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING                         46,419,820        38,090,854        43,350,214        36,238,985
                                                              ===============  ================  ================  ================


                                                 See notes to financial statements.

                                                                 4
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                                           ICOA, INC. AND SUBSIDIARY
                                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                  (Unaudited)


                                                                               Six Months Ended June 30,
                                                                               -------------------------
                                                                                  2001            2000
                                                                                --------        --------

CASH FLOWS FROM OPERATING ACTIVITIES:
     Net loss                                                           $        (1,803,594) $       (274,468)
                                                                        -------------------  ----------------
     Adjustments to reconcile net loss to
        net cash used in operating activities:
           Depreciation                                                               2,341               802
           Beneficial conversion                                                    779,466                 -
           Finance fees                                                              16,889                 -
     Changes in assets and liabilities:
        Prepaid expenses and other current assets                                  (179,245)                -
        Advance to officers                                                         (19,325)          (73,925)
        Other assets                                                                 (6,300)                -
        Accounts payable and accrued expenses                                       325,065            12,512
                                                                        -------------------  ----------------
                                                                                    918,891           (60,611)
                                                                        -------------------  ----------------

NET CASH USED IN OPERATING ACTIVITIES                                              (884,703)         (335,079)
                                                                        -------------------  ----------------
CASH FLOWS FROM INVESTING ACTIVITIES
     Capital expenditures                                                           (12,976)           (1,000)
                                                                        -------------------  ----------------
NET CASH USED IN INVESTING ACTIVITIES                                               (12,976)           (1,000)
                                                                        -------------------  ----------------
CASH FLOWS FROM FINANCING ACTIVITIES:
     Proceeds from notes payable                                                      5,223            32,822
     Proceeds from officer                                                            1,000                 -
     Proceeds from issuance of common stock                                          19,000           304,100
     Proceeds from convertible debentures                                           910,000                 -
                                                                        -------------------  ----------------
NET CASH PROVIDED BY FINANCING ACTIVITIES                                           935,223           336,922
                                                                        -------------------  ----------------
INCREASE (DECREASE) IN CASH                                                          37,544               843

CASH - BEGINNING OF PERIOD                                                           16,547             1,932
                                                                        -------------------  ----------------
CASH - END OF PERIOD                                                    $            54,091  $          2,775
                                                                        ===================  ================
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
     INFORMATION:
        No cash payments were made for income taxes or
           interest during each of the above periods

NON-CASH INVESTING AND FINANCING ACTIVITIES:
        Interest converted to note                                      $            16,790  $              -
                                                                        ===================  ================
        Conversion of Debentures                                        $           275,750  $              -
                                                                        ===================  ================

                                       See notes to financial statements.


                                                       5

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                            ICOA, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1--Basis of Interim Financial Statement Presentation

         The accompanying unaudited consolidated financial statements have been
         prepared in accordance with generally accepted accounting principles
         for interim information. Accordingly, they do not include all of the
         information and footnotes required by generally accepted accounting
         principles for complete financial statements. The results of operations
         for the interim periods shown in this report are not necessarily
         indicative of expected results for any future interim period or for the
         entire fiscal year. ICOA, Inc. and Subsidiary (the "Company"), believe
         that the quarterly information presented includes all adjustments
         (consisting only of normal, recurring adjustments) necessary for a fair
         presentation in accordance with generally accepted accounting
         principles. The accompany consolidated financial statements should be
         read in conjunction with the Company's Form SB-2.

Note 2--Convertible Debentures

         During the quarter ended June 30, 2001, holders converted $275,750
         principal amount of such notes and $17,362 of accrued interest into
         8,876,865 shares of the Company's common stock.

         In May and June 2001, the Company issued 9% Convertible Debentures (the
         "2001 Debentures") in the aggregate face amount of $800,000. $400,000
         worth of 2001 Debentures has a maturity date of May 14, 2003, and
         another $400,000 worth of 2001 Debentures has a maturity date of June
         13, 2003. The 2001 Debentures are convertible into shares of the
         Company's common stock at a conversion price for each share of common
         stock equal to the lower of 80% of the average of the three lowest
         closing bid prices of the Company's common stock for the 30 trading
         days immediately preceding the date of issuance of the 2001 Debenture
         being converted, and 70% of the average of the three lowest closing bid
         prices for the common stock for the 60 trading days immediately
         preceding the date of receipt of a notice of conversion. The 2001
         Debentures bear interest at the rate of 9% per annum, payable quarterly
         in the form of cash or additional shares of the Company's common stock.

         The Company has recorded a beneficial conversion of $700,00 on the 2001
         Debentures which was charged to interest expense.

Note 3--Common Stock

         On June 25, 2001 the Company granted 944,444 options, at par value, to
         two individuals for consulting services valued under the Black Scholes
         method at $35,839. These options were converted into shares of the
         Company's common stock on June 28, 2001.

Note 4--Recent Accounting Pronouncements

         In July 2001, FASB issued SFAS No. 141, "Business Combinations." SFAS
         No. 141 requires the purchase method of accounting for business
         combinations initiated after June 30, 2001 and eliminates the
         pooling-of-interests method. We believe that the adoption of SFAS No.
         141 will not have a significant impact on our financial statements.

         In July 2001, FASB issued SFAS No. 142, "Goodwill and Other Intangible
         Assets", which is effective for fiscal years beginning after December
         15, 2001. SFAS No. 142 requires, among other things, the discontinuance
         of goodwill amortization. In addition, the standard includes provisions
         upon adoption for the reclassification of certain existing recognized
         intangibles as goodwill, reassessment of the useful live of existing
         recognizable intangibles, reclassification of certain intangibles out
         of previously reported goodwill and the testing for impairment of
         existing goodwill and other intangibles. We are currently assessing but
         have not yet determined the impact of SFAS No. 142 on our financial
         position and results of operations.

                                       6
<PAGE>

Item 2. - Management's Discussion and Analysis of or Plan of Operations

THE FOLLOWING ANALYSIS OF THE RESULTS OF OPERATIONS AND FINANCIAL CONDITION OF
THE COMPANY SHOULD BE READ IN CONJUNCTION WITH THE CONSOLIDATED FINANCIAL
STATEMENTS, INCLUDING THE NOTES THERETO OF THE COMPANY, CONTAINED ELSEWHERE IN
THE FORM 10-QSB.

ICOA, Inc. has deployed an Internet pay phone terminal network. In the second
quarter of 2001, the Company completed the installation of 63 out of 70
terminals to be installed in San Francisco International Airport and
simultaneously, brought up its Network Operations Center at Qwest's Burbank, CA
Cyber Center. An additional 50 terminals are expected to be installed in Los
Angeles International Airport during the third quarter of 2001. The Company has
engaged the Telweb(R) division of Schlumberger, to supply the terminals, and
provide technical assistance with the installations.

In addition, during the second quarter of 2001, the Company completed the
requirements for re-listing to the Over The Counter Bulletin Board (OTCBB) on
May 15, 2001.

Results of operations

Quarter ended June 30, 2001 as compared to quarter ended June 30, 2000

Revenue

The Company's principal source of revenue is derived from the ownership and
operation of Internet Pay Fax Terminals. On June 1, 2001 the first terminals
were activated in San Francisco International Airport. The Company generated
$7,329 in revenue from these terminals.

Selling, general and administrative expenses

General and administrative expenses consist primarily of:
o        employee compensation and related expenses (including payroll taxes and
         benefits) for executive, administrative and operations personnel
o        professional fees associated with deployment of our Internet Pay Fax
         Terminals, and completion of the registration process with the SEC
o        commissions associated with securing the airport locations
o        travel and entertainment
o        facility and office-related costs such as rent, insurance, maintenance
         and telephone.

These costs increased 785% from $108,180 in 2000 to $849,799 in 2001. Management
expects general and administrative expenses in future periods to run at
increased levels over year 2000 in support of the growth of the business.

Interest expense

Interest expense consists of interest accrued on loans and convertible notes
payable. Interest expense increased from $6,606 for the three months ended June
30, 2000 to $719,900 for the three months ended June 30, 2001. The increase is
primarily attributable to the interest accrued on convertible notes, and the
beneficial conversion terms of convertible notes charged to expense in May and
June 2001.

For the three months ended June 30, 2001, the Company lost $1,563,679 as
compared to a loss of $115,279 for the three months ended June 30, 2000. The
increased loss is mainly due to additional interest expense associated with our
convertible equity notes, legal expense associated with additional SB-2 filings,
payment of commissions in connection with securing the airport locations, and
travel related to the execution of our business plan.

Income taxes

No provision for federal and state income taxes has been recorded as the Company
incurred net operating losses since January 1, 1998 (Inception). The net
operating losses will be available to offset any future taxable income. Given
the Company's limited operating history, losses incurred to date and the
difficulty in accurately forecasting future results, management does not believe
that the realization of the potential future benefits of these carry forwards
meets the criteria for recognition of a deferred tax asset required by generally
accepted accounting principles. Accordingly, a full 100% valuation allowance has
been provided.

                                       7
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Liquidity and capital resources

Cash and cash equivalents were $2,775 and $233,336 at June 30, 2001 and June 30,
2000, respectively.

For the six months ended June 30, 2001 the Company had a working capital deficit
of $358,705. Capital expenditures amounted to $5,248.

During May and June 2001, the Company raised an aggregate of $718,500 (net of
expenses) from a private placement of convertible debt.

On July 25, 2001, the Company received notice from World Capital, Inc. (lessor),
that they had decided not to fund the previously announced $1,600,000 equipment
lease to finance 125 WebCenter3000(TM) terminal installations at San Francisco
and Los Angeles International Airports. The Company has notified World Capital
they are in violation of the equipment lease, and further legal action is being
contemplated if this matter is not resolved, including legal action to uphold
our rights under the equipment lease and/or to seek a refund of our prepayment
amount. We do not know the outcome of any potential legal action or other
attempt to resolve the dispute. In addition, under the circumstances, we are
seeking other potential sources of funding for the installation of our
equipment.

During the second quarter, the investors in the convertible debentures converted
approximately $275,750 of notes and received approximately 9.6 million shares.
Subsequent to the quarter end, investors converted approximately $22,000 of
notes and received approximately 1.7 million shares.

The Company has satisfied its cash requirements to date primarily through
private placements of common stock, warrants, debentures convertible into shares
of common stock and the issuance of common stock in lieu of payment for
services. Also, officers have at times loaned the Company funds to provide
working capital.

We believe that the $1,360,000 proceeds received this year from the convertible
debt private placements, cash on hand, additional funding from our investors,
and anticipated revenues will be sufficient to meet anticipated short term cash
requirements through the end of the third quarter, although we do not expect to
generate positive cash flow from operations until at least late in the third
quarter of 2001. We need to raise a minimum of $2,000,000 through public or
private debt or sale of equity to produce additional working terminals, to
continue expanding our communications services, voice, facsimile, data and
electronic publishing network and the service operation center, and to develop
and implement additional contracts at airports, hotels and retail locations in
order to continue placing our terminals in strategic positions. Such financing
may not be available when needed. Even if such financing is available, it may be
on terms that are materially adverse to your interests with respect to dilution
of book value, dividend preferences, liquidation preferences, or other terms. If
we are unable to obtain financing on reasonable terms, we could be forced to
delay, scale back or eliminate certain product and service development programs.
In addition, such inability to obtain financing on reasonable terms could have a
material adverse effect on our business, operating results, or financial
condition.

The report of our independent auditors on our financial statements for the years
ended December 31, 2000 and 1999 contains an explanatory paragraph, which
indicates that we have incurred losses and have a working capital deficiency.
This report raises substantial doubt about our ability to continue as a going
concern. This report is not viewed favorably by analysts or investors and may
make it more difficult for us to raise additional debt or equity financing
needed to run our business.

Forward-looking statements in this report may prove to be materially inaccurate.
In addition to historical information, this report contains forward-looking
information that involves risks and uncertainties. The words "may", "will",
"expect", "anticipate", "continue", "estimate", "project", "intend" and similar
expressions are intended to identify forward-looking statements. Actual results
may differ materially from those included within the forward-looking statements
as a result of factors, including the risks described above and factors
described elsewhere in this report.

                                        8
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                           PART II - OTHER INFORMATION

         Item 6.  Exhibits and Reports on Form 8-K

                  a) Exhibits

                           None.

                  b) Reports on Form 8-K

         Current report on Form 8-K filed May 25, 2001, reporting Item 5 (Other
Events) and Item 7 (Exhibits).


                                       9
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                                   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 duly authorized.

Date:  August 13, 2001
                                                        ICOA, INC.



                                                         /s/ Erwin Vahlsing, Jr.
                                                         -----------------------
                                                         Erwin Vahlsing, Jr.
                                                         Chief Financial Officer


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