UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

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

For the quarterly period ended March 31, 2002

[ ]  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 0-14983

                               NUTRITION 21, INC.
                               ------------------
             (Exact Name of Registrant as Specified in its Charter)

                NEW YORK                                          11-2653613
-----------------------------------------                    -------------------
      (State or other jurisdiction of                        (I.R.S. Employer
      incorporation or organization)                         Identification No.)

         4 Manhattanville Road
         Purchase, New York                                       10577-2197
-----------------------------------------                    -------------------
(Address of Principal Executive Offices)                          (Zip Code)

Registrant's telephone number, including Area Code:           (914) 701-4500
                                                          ----------------------

          Securities registered pursuant to Section 12(b) of the Act:

                                      NONE

           Securities registered pursuant to Section 12(g) of the Act:

                    Common Stock (Par Value $.005 Per Share)
                    ----------------------------------------
                                 Title of Class

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding twelve (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 ninety (90) days.

         Yes     X                No
             ---------               -------


The number of shares outstanding of Registrant's Common Stock as of May 12,
2002: 33,048,655

<PAGE>


                               NUTRITION 21, INC.

                                      INDEX


PART I     FINANCIAL INFORMATION                                            PAGE
------     ---------------------                                            ----


ITEM 1     Consolidated Financial Statements (unaudited)

           Consolidated Balance Sheets at March 31, 2002
             and June 30, 2001                                                 3

           Consolidated Statements of Operations for the three
             and nine months ended March 31, 2002 and  2001                    5

           Consolidated Statement of Stockholders' Equity for
             the nine months ended March 31, 2002                              6

           Consolidated Statements of Cash Flows for the nine
             months ended March 31, 2002 and 2001                              7

           Notes to Unaudited Consolidated Financial Statements                8

ITEM 2     Management's Discussion and Analysis of
             Financial Condition and Results of Operations                    12

ITEM 3     Quantitative and Qualitative Disclosures
             About Market Risk                                                16

PART II    OTHER INFORMATION

ITEM 1     Legal Proceedings                                                  17

ITEM 5     Other Information                                                  17

ITEM 6     Exhibits and Reports on Form 8-K                                   17

                                       2
<PAGE>


                               NUTRITION 21, INC.
                           CONSOLIDATED BALANCE SHEETS
                        (in thousands, except share data)

                                                            March 31,   June 30,
                                                               2002        2001
                                                            ---------   --------
                                                           (unaudited)  (Note 1)
ASSETS

Current assets:
    Cash and cash equivalents                                $ 4,179     $ 5,355
    Accounts receivable (less allowance for
    doubtful accounts of $26 at March 31, 2002
    and $45 at June 30, 2001)                                  1,963       3,963

    Other receivables                                          1,573       1,650

    Inventories                                                1,436       1,322

    Prepaid expenses and other current assets                    479         475
                                                             -------     -------
         Total current assets                                  9,630      12,765

Property and equipment, net                                      513         633

Patents and trademarks (net of accumulated
amortization of $12,111 at March 31, 2002
and $10,375 at June 30, 2001)                                 17,277      18,682

Goodwill                                                       7,107       6,491

Other assets                                                     205         316
                                                             -------     -------
TOTAL ASSETS                                                 $34,732     $38,887
                                                             =======     =======

See accompanying notes to consolidated financial statements.

                                       3
<PAGE>


                               NUTRITION 21, INC.
                           CONSOLIDATED BALANCE SHEETS
                        (in thousands, except share data)


                                                           March 31,    June 30,
                                                             2002        2001
LIABILITIES, REDEEMABLE PREFERRED STOCK AND               ---------    --------
 STOCKHOLDERS' EQUITY                                    (unaudited)    (Note 1)
Current liabilities;
    Current portion of long-term debt                      $     --    $  1,125
    Accounts payable and accrued expenses                     2,018       3,371
    Contingent payments payable                                  41       1,855
    Preferred dividends payable                                   6          22
                                                           --------    --------
        Total current liabilities                             2,065       6,373

Other long-term obligations                                      --         122
                                                           --------    --------
TOTAL LIABILITIES                                             2,065       6,495
                                                           --------    --------
COMMITMENTS AND CONTINGENT LIABILITIES
REDEEMABLE PREFERRED STOCK:

Series E convertible preferred, 1,500 shares issued:
    191 shares outstanding at June 30, 2001                      --         191

Series F convertible preferred, 575 shares issued:
    227 shares outstanding at June 30, 2001                      --         227

STOCKHOLDERS' EQUITY:

Preferred stock, $0.01 par value, authorized
    5,000,000 shares

Series G convertible preferred, 1,769 shares issued:
    471 and 941 shares outstanding at March 31, 2002
    and June 30, 2001, respectively (aggregate
    liquidation value - $477)                                   471         941

Common stock, $0.005 par value, authorized
  65,000,000 shares;
    33,048,655 and 32,342,818 shares issued and
    outstanding at March 31, 2002 and June 30, 2001,
    respectively                                                165         161

Additional paid-in capital                                   63,930      63,196

Accumulated deficit                                         (31,777)    (32,324)

Less:  treasury stock, at cost, 136,000 common shares          (122)         --
                                                           --------    --------
TOTAL STOCKHOLDERS' EQUITY                                   32,667      31,974
                                                           --------    --------
TOTAL LIABILITIES, REDEEMABLE PREFERRED STOCK
  AND STOCKHOLDERS' EQUITY                                 $ 34,732    $ 38,887
                                                           ========    ========

See accompanying notes to consolidated financial statements.

                                       4
<PAGE>


                               NUTRITION 21, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                 (in thousands, except share and per share data)
                                   (unaudited)

                                    Three Months Ended      Nine Months Ended
                                         March 31,              March 31,
                                    ------------------     -------------------
                                      2002       2001        2002        2001
                                     ------     ------     -------     -------
Net sales                            $3,912     $6,034     $10,544     $15,700
Other revenues                           75        375         304       2,222
                                     ------     ------     -------     -------
REVENUES                              3,987      6,409      10,848      17,922
Cost of goods sold                    1,274      1,913       3,385       4,753
                                     ------     ------     -------     -------
GROSS PROFIT                          2,713      4,496       7,463      13,169
Research and development
  expenses                              276        233         686       1,743
Selling, general &
  administrative expenses             2,058      2,721       5,516       8,267
Depreciation and amortization           641        798       1,962       2,639
Restructuring and other charges          --         --          --       2,448
                                     ------     ------     -------     -------

OPERATING (LOSS) INCOME                (262)       744        (701)     (1,928)
Interest income (expense), net          (35)       (30)        (20)         27
Other income                             --      2,106       1,794       2,337
                                     ------     ------     -------     -------

(LOSS) INCOME BEFORE INCOME TAXES      (297)     2,820       1,073         436
Income tax provision (benefit)         (100)       562         366          87
                                     ------     ------     -------     -------

NET (LOSS) INCOME                    $ (197)    $2,258     $   707     $   349
                                     ======     ======     =======     =======

    Basic earnings per share         $(0.01)    $ 0.07     $  0.02     $  0.01
                                     ======     ======     =======     =======

    Diluted earnings per share       $(0.01)    $ 0.07     $  0.02     $  0.01
                                     ======     ======     =======     =======


    Weighted average number of
      common shares - basic          32,995     31,956      32,523      31,601
                                     ======     ======     =======     =======

    Weighted average number
      of common shares and
      equivalents - diluted          33,018     33,358      32,550      31,704
                                     ======     ======     =======     =======

See accompanying notes to consolidated financial statements.

                                       5
<PAGE>


                               NUTRITION 21, INC.
                 CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                        (in thousands, except share data)
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                              Additional
                                  Preferred Stock                               Paid-In     Accumulated        Treasury
                                      Series G            Common Stock          Capital        Deficit          Stock       Total
                                SHARES           $      SHARES          $          $              $               $           $
                                ------          ---     ----------     ---      -------       --------          -----      -------

<S>                                <C>         <C>      <C>           <C>       <C>           <C>                <C>        <C>
Balance at June 30, 2001           941         $941     32,342,818    $161      $63,196       $(32,324)          $ --       $31,974

Preferred stock dividends
declared                            --           --             --      --           --            (39)            --          (39)
Conversion of Series E
preferred stock to
common stock                        --           --        155,605       1          193             --             --          194

Conversion of Series G
preferred stock to common stock   (470)        (470)       686,232       3          467             --             --           --
Compensation related to
issuance of warrants to
non-employees                       --           --             --      --           74             --             --           74
Premium on redemption of
Series F preferred stock            --           --             --      --           --           (121)            --         (121)
Repurchase of common stock
for treasury                        --           --      (136,000)      --           --             --           (122)        (122)

Net income for the period           --           --         --          --           --            707             --          707
                                   ---         ----     ----------    ----      -------       ---------         ------     -------
Balance at March 31, 2002          471         $471     33,048,655    $165      $63,930       $(31,777)         $(122)     $32,667
                                   ===         ====     ==========    ====      =======       =========         ======     =======
</TABLE>

          See accompanying notes to consolidated financial statements.

                                       6
<PAGE>


                               NUTRITION 21, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (in thousands)
                                   (unaudited)

                                                              Nine months Ended
                                                                  March 31,
                                                              -----------------
                                                               2002       2001
                                                              ------     ------
Cash flows from operating activities:
  Net income                                                  $  707     $  349
  Adjustments to reconcile net income to net
    cash provided by operating activities:
    Depreciation and amortization                              1,962      2,639
    Loss (gain) on  sale of equipment                            (55)         6
    Other non-cash items                                          74         35
    Changes in operating assets and liabilities:
      Accounts receivable                                       2001        621
      Other receivables                                          334     (1,470)
      Inventories                                               (130)       220
      Prepaid and other current assets                            (4)       434
      Other assets                                               111         35
      Accounts payable and accrued expenses                   (1,473)      (637)
                                                              ------     ------
        Net cash provided by operating activities              3,527      2,232
                                                              ------     ------
Cash flows from investing activities:
  Contingent payments for acquisitions                        (2,746)    (4,658)
  Purchases of property and equipment                            (82)      (133)
  Payments for patents and trademarks                           (325)      (190)
  Proceeds from sale of assets                                   100          3
                                                              ------     ------
    Net cash used in investing activities                     (3,053)    (4,978)
                                                              ------     ------
Cash flows from financing activities:
  Debt repayments                                             (1,125)    (1,125)
  Purchase of common stock for treasury                         (122)        --
  Preferred stock dividends paid                                 (55)       (85)
  Redemption of redeemable preferred stock                      (348)       (90)
                                                              ------     ------
    Net cash used in financing activities                     (1,650)    (1,300)
                                                              ------     ------
Net decrease in cash and cash equivalents                     (1,176)    (4,046)
Cash and cash equivalents at beginning of period               5,355      8,488
                                                              ------     ------
Cash and cash equivalents at end of period                    $4,179     $4,442
                                                              ======     ======




See accompanying notes to consolidated financial statements.

                                       7
<PAGE>


                               NUTRITION 21, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       ($ in thousands, except share data)
                                   (unaudited)


Note 1    BASIS OF PRESENTATION

          The accompanying unaudited consolidated financial statements have been
          prepared in accordance with accounting  principles  generally accepted
          in the United States for interim  financial  information  and with the
          instructions   to  Form  10-Q  and  Article  10  of  Regulation   S-X.
          Accordingly,  they do not include all of the information and footnotes
          required by  accounting  principles  generally  accepted in the United
          States  for  complete   financial   statements.   In  the  opinion  of
          management,  all adjustments (consisting of normal recurring accruals)
          considered  necessary  for a fair  presentation  have  been  included.
          Operating results for the three and nine month periods ended March 31,
          2002  are  not  necessarily  indicative  of the  results  that  may be
          expected for the year ending June 30, 2002.

          The balance  sheet at June 30, 2001 has been  derived from the audited
          financial  statements  at that  date but does not  include  all of the
          information and footnotes  required by generally  accepted  accounting
          principles for complete financial statements. For further information,
          refer to the consolidated  financial  statements and footnotes thereto
          included  in the  Company's  Annual  Report  on Form 10-K for the year
          ended June 30, 2001.

          Certain  reclassifications  have been made to the prior period amounts
          in order to conform to the current period presentation.

Note 2    SIGNIFICANT ACCOUNTING PRONOUNCEMENTS

          In July 2001, the Financial Accounting Standards Board ("FASB") issued
          statement  of  Financial   Accounting   Standards  ("SFAS")  No.  141,
          "Business  Combinations,"  and  SFAS  No.  142,  "Goodwill  and  Other
          Intangible   Assets."   SFAS  No.  141   prohibits   the  use  of  the
          pooling-of-interests  method of accounting  for business  combinations
          initiated  after June 30, 2001. SFAS No. 142 changes the way companies
          account for goodwill in that goodwill will no longer be amortized, but
          should be tested for impairment at least annually. The Company elected
          to adopt early SFAS No. 142 in the quarter  ended  September 30, 2001.
          See Note 9 for  further  discussion  on the  impact of SFAS No. 142 on
          Nutrition 21's financial position and results of operations.

          In October  2001,  the FASB issued SFAS No. 144,  "Accounting  for the
          Impairment or Disposal of Long-Lived  Assets." The FASB's new rules on
          asset  impairment   supersede  SFAS  No.  121,   "Accounting  for  the
          Impairment  of  Long-Lived  Assets  and for  Long-Lived  Assets  to be
          Disposed  of," and will be  effective  for the  Company's  fiscal year
          beginning  July 1,  2002.  Management  does  not  anticipate  that the
          adoption of SFAS No. 144 will have a material impact on Nutrition 21's
          financial position or results of operations.

Note 3    INVENTORIES

          The  components  of  inventories  at March 31,  2002 and June 30, 2001
          were:

                                                     March 31,          June 30,
                                                       2002               2001
                                                     --------           -------
                         Raw materials                  $374              $471
                         Finished goods                1,062               851
                                                       -----               ---
                         Total inventories            $1,436             1,322
                                                      ======             =====


                                       8
<PAGE>


                               NUTRITION 21, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       ($ in thousands, except share data)
                                   (unaudited)

Note 4    REDEEMABLE PREFERRED STOCK

          During  the nine  months  ended  March  31,  2002,  191  shares of the
          Company's Series E Preferred Stock and accrued  dividends thereon were
          converted into 155,605 shares of the Company's common stock.

          During  the nine  months  ended  March  31,  2002,  227  shares of the
          Company's Series F Preferred Stock (F preferred) and accrued dividends
          thereon were redeemed for $348. As a result of these transactions, the
          Company  recorded a premium on  redemption  of $121  representing  the
          excess of the  consideration  paid over the carrying value of the then
          outstanding F preferred.

          During  the three  months  ended  March 31,  2002,  470  shares of the
          Company's  Series G Preferred Stock were converted into 686,232 shares
          of the Company's common stock.

Note 5    EARNINGS PER SHARE

          The following  table sets forth the  computation  of basic and diluted
          earnings (loss) per share for the periods indicated.

<TABLE>
<CAPTION>
                                                                    Three months ended                    Nine months ended
        Basic (loss) earnings per share:                                 March 31,                           March 31,
                                                                  2002              2001              2002              2001
                                                               ----------        ----------        ----------        ----------
<S>                                                            <C>               <C>               <C>               <C>
        Net (loss) income                                           $(197)           $2,258              $707              $349
            Less: Dividends on preferred shares                        (6)              (26)              (39)              (82)
                 Premium on redemption of
                 preferred stock                                       --               (56)             (121)              (55)
                                                               ----------        ----------        ----------        ----------
        Net (loss) income available to common
        stockholders                                                $(203)          $(2,176)             $547              $212
                                                                   ======          ========              ====              ====
        Weighted average shares:                               32,995,281        31,956,121        32,522,768        31,600,900
                                                               ==========        ==========        ==========        ==========
        Basic (loss) earnings per share                            $(0.01)            $0.07             $0.02             $0.01
                                                                  =======             =====             =====             =====
        Diluted (loss) earnings per share:
        Net (loss) income available to common
        stockholders                                                $(203)           $2,176              $547              $212
          Add:  Dividends and premium on
          preferred stock                                              --                82                --                --
                                                               ----------        ----------        ----------        ----------
        Net (loss) income available to common
        stockholders                                                $(203)           $2,258              $547              $212
                                                                   ======            ======              ====              ====
        Weighted average shares:                               32,995,281        31,956,121        32,522,768        31,600,900
          Plus incremental shares from assumed conversions:
            Preferred stock                                            --         1,366,936                --                --
            Stock option plans                                     22,439            34,548            27,018           103,547
                                                                   ------      ----- ------            ------           -------
        Adjusted weighted average shares                       33,017,720        33,357,605        32,549,786        31,704,447
                                                               ==========        ==========        ==========        ==========
        Diluted (loss) earnings per share                          $(0.01)            $0.07             $0.02             $0.01
                                                                  =======             =====             =====             =====
</TABLE>

        Diluted  (loss)  earnings per share for the three and nine month periods
        ended March 31,  2002,  do not reflect the  incremental  shares from the
        assumed  conversion  of preferred  stock  (759,814  and 479,181  shares,
        respectively) as the effect of such inclusion would be antidilutive.

                                       9
<PAGE>


                               NUTRITION 21, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        (in thousands, except share data)
                                   (unaudited)


Note 6    OTHER INCOME

          In the nine months ended March 31, 2002, the Company recorded as other
          income $1.8 million from the settlement of patent  infringement claims
          related to  chromium  picolinate  and a sale of  assets.  At March 31,
          2002,  cash  proceeds of $0.6  million from the  settlements  and $0.2
          million from the sale of assets to an Officer of the  Company,  remain
          to be collected.

Note 7    INCOME TAXES

          The  effective  tax rate for the three and nine  month  periods  ended
          March 31, 2002 was 34%, as compared to 20% in the comparable periods a
          year  ago.  The  difference  in  tax  rates  is due  primarily  to the
          utilization of net operating  losses and tax credit  carryforwards  in
          the prior year.

Note 8    SEGMENT REPORTING

          A summary of business data for the Company's reportable segments is as
          follows:

          Information by business segment (in thousands):

                                        Three months ended    Nine months ended
                                             March 31,            March 31,
                                         2002        2001       2002      2001
                                        ------      ------    -------   -------
              REVENUES
              Nutritional Products      $3,912      $6,385    $10,483   $16,154
              Pharmaceutical Products       75          24        365     1,768
                                        ------      ------    -------   -------
                                        $3,987      $6,409    $10,848   $17,922
                                        ======      ======    =======   =======

              OPERATING (LOSS) INCOME
              Nutritional Products      $ (305)       $762      $(929)  $(3,591)
              Pharmaceutical Products       43         (18)       228     1,663
                                        ------        ----     ------   -------
                                        $ (262)       $744      $(701)  $(1,928)
                                        ======        ====     ======   =======

         The operations of the Company are principally in the United States.

         One nutritional  product segment customer  accounted for  approximately
         32% of the segment revenue in the nine months ended March 31, 2002.

Note 9   INTANGIBLE ASSETS

         The Company adopted SFAS No. 142 effective July 1, 2001. Under SFAS No.
         142,  goodwill  is no longer  amortized  but  reviewed  for  impairment
         annually,  or more frequently if certain  indicators arise. The Company
         is required to complete the initial step of a  transitional  impairment
         test within six months of adoption of SFAS No. 142 and to complete  the
         final step of the transitional impairment test by the end of the fiscal
         year.  The initial step was  completed  in the first  quarter of fiscal
         2002. If indicators of impairment arise,  including but not limited to,
         a significant adverse change in the business  environment or regulatory
         areas that may affect the  Company's  projected  cash flows  associated
         with income producing intangible assets, there can be no assurance that
         the Company may not incur impairment charges in the future. Goodwill in
         the amount of $4.1  million  included in patents and  trademarks  since
         acquisition  (although  accounted  for  separately  by the  Company and
         included  therein  because  of its  estimated  economic  life) has been
         reclassified in the accompanying  balance sheets in accordance with the
         requirements  of SFAS No. 142. Had the Company been  accounting for its
         goodwill  under SFAS No. 142 for all periods  presented,  the Company's
         net income and earnings per share would have been as follows:

                                       10
<PAGE>


                               NUTRITION 21, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       ($ in thousands, except share data)
                                   (unaudited)

Note 9   INTANGIBLE ASSETS, (CONTINUED)


                                        Three months ended     Nine months ended
                                             March 31,             March 31,
                                         2002        2001       2002       2001
                                        ------      ------     ------     ------
Reported net (loss) income:             $ (197)     $2,258     $  707     $  349
  Add back goodwill amortization,
    net of tax                              --          73         --        240
                                        ------      ------     ------     ------
Adjusted net income (loss)              $ (197)     $2,331     $  707     $  589
                                        ======      ======     ======     ======
Basic (loss) earnings per share:
  Reported net (loss) income            $(0.01)     $ 0.07     $ 0.02     $ 0.01

  Goodwill amortization, net of tax         --          --         --         --
                                        ------      ------     ------     ------
Adjusted net (loss) income              $(0.01)     $ 0.07     $ 0.02     $ 0.01
                                        ======      ======     ======     ======
Diluted earnings per share:
  Reported net (loss) income            $(0.01)     $ 0.07     $ 0.02     $ 0.01
  Goodwill amortization, net of tax         --          --         --       0.01
                                        ------      ------     ------     ------
Adjusted net (loss) income              $(0.01)     $ 0.07     $ 0.02     $ 0.02
                                        ======      ======     ======     ======


Note 10  SUPPLEMENTAL CASH FLOW INFORMATION
                                                               Nine months Ended
                                                                   March 31,

                                                                 2002     2001
                                                                 ----     ----
Supplemental disclosure of cash flow information:
      Cash paid for interest                                     $ 57     $180
      Cash paid for income taxes                                 $979     $229

Supplemental schedule of non-cash financing activities:
      Obligation for purchase of property & equipment            $137     $129
      Obligation for N21 contingent payment                      $ 41     $884
      Obligation for Lite Bites contingent payment               $ --     $162
      Issuance of common stock for Series E conversion           $194       --
      Issuance of common stock for Series G conversion           $470       --

                                       11
<PAGE>


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

          The  following  discussion  should  be read in  conjunction  with  the
          consolidated  financial  statements  and related  notes thereto of the
          Company included elsewhere herein.

          GENERAL

          The  Company's  revenues  are  primarily  derived  from  the  sale  of
          nutrition products to manufacturers of vitamin and mineral supplements
          and sales of  nutrition  bars and  other  related  dietary  supplement
          products  marketed  under the trademark  "Lite Bites" (the "Lite Bites
          Business"). The Company has, in addition, received royalty and license
          income from users of its patented technologies.

          Cost of goods sold  includes  both direct and  indirect  manufacturing
          costs.  Research  expenses  include  internal  expenditures as well as
          expenses associated with third party collaborators.  Selling,  general
          and  administrative  expenses  include  salaries and overheads,  third
          party fees and expenses, royalty expenses for licenses and trademarks,
          and costs associated with the selling of the Company's  products.  The
          Company capitalizes patent costs and acquisition-related  goodwill and
          intangible  assets,  and amortizes them,  excluding goodwill effective
          July 1, 2001, over periods of one to twenty years.

          RESULTS OF OPERATIONS

          REVENUES

          Net sales for the three and nine month periods ended March 31, 2002 of
          $3.9 million and $10.5 million,  respectively,  decreased $2.1 million
          and $5.2  million,  respectively,  when  compared to $6.0  million and
          $15.7  million,  respectively,  for the same  periods a year ago.  The
          decrease in net sales primarily reflected continued softness in retail
          sales  of  vitamin  and  mineral  supplements  as well  as  continuing
          industry consolidation. Net sales for the quarter were up 37% from the
          prior quarter. This increase was primarily attributable to an increase
          in products sold into the weight loss and sports nutrition segments of
          the industry.  The Company  believes that this increase may signal the
          beginning of a recovery in this channel of its business.

          Other revenues of $75 thousand and $0.3 million for the three and nine
          month  periods  ended  March 31,  2002,  respectively,  declined  $0.3
          million  and $1.9  million,  respectively,  when  compared to the same
          periods a year ago. Other revenues for the nine months ended March 31,
          2001 included $1.5 million in  non-recurring  license fees earned from
          Biosynexus  Incorporated in accordance with License Agreements entered
          into in August 2000.

          COST OF GOODS SOLD

          Cost of goods sold for the three months and nine month  periods  ended
          March  31,  2002 of  $1.3  million  and  $3.4  million,  respectively,
          decreased $0.6 million and $1.4 million,  respectively,  when compared
          to $1.9 million and $4.8 million,  respectively, for the same period a
          year ago. The reduction in cost of goods primarily reflects the impact
          of lower  sales for the three and nine months  ended  March 31,  2002.
          Gross  margin  on  product  sales of 67.4% and 67.9% for the three and
          nine month  periods ended March 31, 2002,  respectively,  declined 0.9
          and 1.8  percentage  points,  respectively,  when compared to the same
          periods a year  earlier.  The decline is due  primarily to the product
          mix, with lower margin products accounting for a greater proportion of
          the Company's revenues.

          RESEARCH AND DEVELOPMENT EXPENSES

          Research  costs were $0.3  million for the three month  periods  ended
          March 31, 2002  compared to $0.2  million for the three  months  ended
          March 31, 2001,  while research costs for the nine-month  period ended
          March 31 2002 of $0.7 million  decreased $1.0 million when compared to
          $1.7  million for the same period a year ago.  The  decrease in fiscal
          2002   principally   reflects   cost  savings   attributable   to  the
          restructuring  undertaken  by the  Company  in the  second  quarter of
          fiscal 2001,  and the  Company's  decision to  terminate  its Internet
          business at that time.

                                       12
<PAGE>


ITEM 2 -  MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF  FINANCIAL  CONDITION  AND
          RESULTS OF OPERATIONS (CONTINUED)

          SELLING, GENERAL AND ADMINISTRATIVE EXPENSES (SG&A)

          SG&A  expense  for the three and nine month  periods  ended  March 31,
          2002, of $2.1 and $5.5 million,  respectively,  decreased $0.6 million
          and $2.8 million,  respectively,  when  compared to $2.7 million,  and
          $8.3  million,  respectively,  for the same  periods a year  ago.  The
          decrease  is  due  primarily  to  cost  savings   attributable   to  a
          restructuring  undertaken by the Company  during the second quarter of
          fiscal 2001,  reductions in advertising  and consulting  expenditures,
          and containment of non-strategic expenditures.

          DEPRECIATION AND AMORTIZATION

          Depreciation  and  amortization  for the three and nine month  periods
          ended March 31, 2002 of $0.6 million and $2.0  million,  respectively,
          decreased  $0.2 million and $0.6 million when compared to $0.8 million
          and $2.6 million,  respectively,  for the same periods a year ago. The
          decrease is due primarily to the expiration of a composition-of-matter
          patent  in  August  2000  and  the  early   adoption   of   accounting
          pronouncements  relating to goodwill and other intangible  assets. See
          Note 9.

          OPERATING LOSS

          The operating  loss for the three months ended March 31, 2002 was $0.3
          million  compared to an operating  profit of $0.7 million for the same
          period a year ago.  The decline in  operating  profits is due to lower
          revenue in the current  quarter as a result of  continued  softness in
          retail sales of vitamin and mineral  supplements as well as continuing
          industry  consolidation.  The operating loss for the nine months ended
          March 31, 2002 was $0.7 million  compared to an operating loss of $2.0
          million for the same period a year ago. The decrease in the  operating
          loss  principally  reflects the  benefits  realized as a result of the
          restructuring undertaken by the Company during fiscal year 2001.

          OTHER INCOME

          Other  income  for the nine  months  ended  March 31,  2002,  was $1.8
          million due  primarily to amounts  earned on the  settlement of patent
          infringement  lawsuits,  as well as  gains  resulting  from  licensing
          certain rights to sell lysostaphin for research purposes to an Officer
          of the Company.

          INCOME TAX PROVISION (BENEFIT)

          Income tax benefit for the three month  period  ended March 31,  2002,
          was $0.1 million  compared to an income tax  provision of $0.6 million
          for the same period a year ago. Income taxes for the nine months ended
          March 31, 2002 were $400  thousand  compared to $87  thousand  for the
          same period a year ago. The  effective  tax rate was 34% for the three
          and  nine-month  periods ended March 31, 2002.  For the three and nine
          month periods ended March 31, 2001,  the Company's  effective tax rate
          was 20% due primarily to the realization of the Company's  federal net
          loss carry forwards and credits.

          BUSINESS SEGMENT

          The Company operates in two business  segments,  Nutritional  Products
          and Pharmaceutical Products.

          NUTRITIONAL PRODUCTS

          Nutritional  product  revenues  for the three and nine  month  periods
          ended  March  31,  2002,   were  $3.9   million  and  $10.5   million,
          respectively,   a  decrease  of  $2.5   million   and  $5.7   million,
          respectively,  when  compared  to  $6.4  million  and  $16.2  million,
          respectively,  for the  same  periods  a year  ago.  The  decrease  in
          revenues is  primarily  due to the softness in retail sales of vitamin
          and mineral supplements as well as continuing industry consolidation.

                                       13
<PAGE>


ITEM 2 -  MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF  FINANCIAL  CONDITION  AND
          RESULTS OF OPERATIONS (CONTINUED)

          Nutritional products operating loss was $0.3 million and $1.0 million,
          respectively,  for the three and nine month  periods  ended  March 31,
          2002  as  compared  to an  operating  profit  of $0.7  million  and an
          operating loss of $3.6 million,  respectively,  for the same periods a
          year  ago.  The  decline  in  operating  profit of $1.0  million  when
          comparing the three-month  periods is due primarily to lower revenues,
          resulting  from the  softness in retail  sales of vitamins and mineral
          supplements  as  well  as  continuing  industry   consolidation.   The
          reduction in operating  loss when  comparing  the  nine-month  periods
          principally  reflects  the  benefits  realized  from  a  restructuring
          undertaken by the Company during fiscal 2001.

          PHARMACEUTICAL PRODUCTS

          Pharmaceutical product revenues were $75 thousand and $0.4 million for
          the three and nine-month periods ended March 31, 2002, compared to $24
          thousand and $1.8 million in the comparable  periods a year ago. There
          were no significant license fees earned in the current fiscal periods,
          in comparison with the $1.5 million in fees earned in the prior fiscal
          year.

          Pharmaceutical  products  operating  income was $43  thousand and $0.2
          million  for the three and nine month  periods  ended  March 31,  2002
          compared to an  operating  loss of $18  thousand  in the three  months
          ended March 31, 2001 and an  operating  profit of $1.7 million for the
          nine months ended March 31, 2001.  There were no  significant  license
          fees earned in the current  periods,  which was the primary reason for
          the decline.

          LIQUIDITY AND CAPITAL RESOURCES

          Cash and cash equivalents at March 31, 2002 were $4.2 million compared
          to $5.4  million at June 30, 2001.  As of March 31, 2002,  the Company
          had working  capital of $7.6 million  compared to a $6.4 million as of
          June 30,  2001.  The  increase  in working  capital  was the result of
          continued  strong trade  collections,  collections  of monies due from
          patent infringement suits, and a reduction in current liabilities.

          During the nine months ended March 31, 2002,  net cash of $3.1 million
          was used in investing  activities compared to net cash of $5.0 million
          used in investing  activities  for the  comparable  period a year ago.
          Contingent  payments  for  acquisitions  declined  $1.9 million due to
          lower sales in the current periods.  Cash used in financing activities
          for the nine months ended March 31, 2002 was $1.6 million  compared to
          $1.3  million for the same  period a year ago.  During the nine months
          ended  March  31,  2002,  cash  payments  of $0.3  and  $0.1  million,
          respectively, were made for the redemption of Series F preferred stock
          and the  repurchase  of the  Company's  common stock for the treasury,
          respectively.

          The Company's  primary  sources of financing are cash  generated  from
          continuing  operations and up to $4.0 million from a revolving line of
          credit expiring  December 14, 2002, with Fleet National Bank. Based on
          certain criteria,  the availability under the revolving line of credit
          at March 31, 2002 was $2.1 million. At March 31, 2002, the Company had
          no borrowings under the revolving line of credit.

          The Company  believes that cash  generated  from  operations  and cash
          available under the line of credit will provide  sufficient  liquidity
          to fund operations for the next twelve months.

          Future  acquisition  activities  and any  increases in  marketing  and
          research and development  expenses over the present levels may require
          additional funds. The Company intends to seek any necessary additional
          funding through  arrangements  with corporate  collaborators,  through
          public  or  private  sales  of  its   securities,   including   equity
          securities,  or through bank financing arrangements.  The Company does
          not currently have any specific  arrangements for additional financing
          and  there  can  be no  assurance  that  additional  funding  will  be
          available at all or on terms acceptable to the Company.

                                       14
<PAGE>


ITEM 2 -  MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF  FINANCIAL  CONDITION  AND
          RESULTS OF OPERATIONS (CONTINUED)


          CRITICAL ACCOUNTING POLICIES AND ESTIMATES

          The preparation of the consolidated  financial statements requires the
          Company to make  estimates  and  judgments  that  affect the  reported
          amounts of assets, liabilities and expenses. On an on-going basis, the
          Company   evaluates  its   estimates,   including   those  related  to
          uncollectible accounts receivable,  inventories, goodwill, intangibles
          and other  long-lived  assets.  The  Company  bases its  estimates  on
          historical  experience  and on  various  other  assumptions  that  are
          believed  to be  reasonable  under the  circumstances,  the results of
          which form the basis for making judgments about the carrying values of
          assets  and  liabilities  that are not  readily  apparent  from  other
          sources.   Actual  results  may  differ  from  these  estimates  under
          different assumptions or conditions.

          The Company believes the following critical accounting policies affect
          its more  significant  judgments and estimates used in the preparation
          of its consolidated financial statements:

          o  The  Company  maintains   allowances  for  uncollectible   accounts
             receivable for estimated losses resulting from the inability of its
             customers to make required payments.  If the financial condition of
             the  Company's  customers  were  to  deteriorate,  resulting  in an
             impairment of their ability to make payments, additional allowances
             may be required.

          o  The Company  carries  inventories at the lower of cost or estimated
             net  realizable   value.  If  actual  market  conditions  are  less
             favorable  than those  projected by management  write-downs  may be
             required.

          o  Property, plant and equipment,  goodwill,  patents,  trademarks and
             other  intangible  assets  owned  by  the  Company  are  amortized,
             excluding  goodwill  effective July 1, 2001,  over their  estimated
             useful lives. Useful lives are based on management's estimates over
             the period  that such  assets  will  generate  revenue.  Intangible
             assets are reviewed for  impairment  whenever  events or changes in
             circumstances  indicate that the carrying value of an asset may not
             be recoverable. Future adverse changes in market conditions or poor
             operating results of underlying  capital  investments or intangible
             assets  could  result in  losses or an  inability  to  recover  the
             carrying  value  of such  assets,  thereby  possibly  requiring  an
             impairment charge in the future.

          SIGNIFICANT ACCOUNTING PRONOUNCEMENTS

          In  June  2001,  the  Financial   Accounting  Standards  Board  issued
          Statements  of  Financial   Accounting  Standards  No.  141  "Business
          Combinations",  and No. 142  "Goodwill and other  Intangible  Assets",
          effective for fiscal years  beginning  after December 15, 2001.  Under
          the new  rules,  goodwill  will no  longer  be  amortized  but will be
          subject to annual  impairment tests in accordance with the Statements.
          If  indicators of  impairment  arise,  including but not limited to, a
          significant  adverse change in the business  environment or regulatory
          areas that may affect the Company's  projected  cash flows  associated
          with income  producing  intangible  assets,  there can be no assurance
          that the Company may not incur impairment charges in the future. Other
          intangible  assets will  continue to be  amortized  over their  useful
          lives. Also see Note 9.

          In October  2001,  the FASB issued SFAS No. 144,  "Accounting  for the
          Impairment or Disposal of Long-Lived  Assets." The FASB's new rules on
          asset  impairment   supersede  SFAS  No.  121,   "Accounting  for  the
          Impairment  of  Long-Lived  Assets  and for  Long-Lived  Assets  to be
          Disposed  of," and will be  effective  for the  Company's  fiscal year
          beginning  July 1,  2002.  Management  does  not  anticipate  that the
          adoption of SFAS No. 144 will have a material impact on Nutrition 21's
          financial position or results of operations.

                                       15
<PAGE>


ITEM 3 -  QUANTITIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

          Market  risk  represents  the risk of changes in value of a  financial
          instrument,  derivative or  non-derivative,  caused by fluctuations in
          interest rates,  foreign exchange rates and equity prices. The Company
          has no financial instruments that give it exposure to foreign rates or
          equity prices.

                                       16
<PAGE>


          PART II - OTHER INFORMATION





ITEM 1 -  LEGAL PROCEEDINGS

          The Company in the ordinary  course of its business has brought patent
          infringement  actions  against  companies  that it believes  have sold
          chromium picolinate in violation of the Company's patent rights. As of
          this date,  two actions  are  ongoing,  and the Company is  evaluating
          bringing additional actions.


ITEM 5 -  OTHER INFORMATION

          Commencing May 14, 2002, the Company's  common stock will trade on the
          Nasdaq SmallCap Market.


ITEM 6 -  REPORTS ON FORM 8-K

          (A)  EXHIBITS

               None

          (B)  REPORTS

               NONE

                                       17
<PAGE>


                               NUTRITION 21, INC.

                                   SIGNATURES



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





                                                          NUTRITION 21, INC.
                                                          ------------------
                                                              Registrant






Date:  May 14, 2002                By: /s/ GAIL MONTGOMERY
                                       -------------------
                                       Gail Montgomery
                                       President and Chief Executive Officer
                                       (Principal Executive Officer)


                                       /s/ ALAN J. KIRSCHBAUM
                                       ----------------------
                                       Alan J. Kirschbaum
                                       Sr. Vice President Finance and Treasurer
                                       (Principal Financial Officer)


                                       18