________________________


                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D. C. 20549

                                    FORM 10-Q


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

                 For the quarterly period ended October 31, 2002


                          Commission File Number 0-944


                              POSSIS MEDICAL, INC.

                            9055 Evergreen Boulevard

                        Minneapolis, Minnesota 55433-8003

                                 (763) 780-4555

     A Minnesota Corporation              IRS Employer ID No. 41-0783184

                        _________________________________


     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___

     The number of shares  outstanding of the Registrant's  Common Stock,  $0.40
par value, as of November 15, 2002 was 17,283,409.


                        ________________________________

<PAGE>


                              POSSIS MEDICAL, INC.

                                      INDEX



PAGE

PART I.  FINANCIAL INFORMATION

 ITEM 1. Financial Statements

           Consolidated Balance Sheets, October 31, 2002
           and July 31, 2002........................................      3

           Consolidated Statements of Operations for the three months
           ended October 31, 2002 and 2001..........................      4

           Consolidated Statements of Cash Flows for the
           three months ended October 31, 2002 and 2001 ............      5

           Notes to Consolidated Financial Statements...............      6

 ITEM 2. Management's Discussion and Analysis of Financial
           Condition and Results of Operations......................      8

 ITEM 3. Quantitative and Qualitative Disclosure about
           Market Risks ............................................     14

 ITEM 4. Controls and Procedures....................................     14


PART II. OTHER INFORMATION


 ITEM 6. Exhibits and Reports on Form 8-K...........................     16

         SIGNATURES.................................................     17
         CERTIFICATIONS.............................................     18

<PAGE>


PART 1   FINANCIAL INFORMATION


 ITEM 1.  FINANCIAL STATEMENTS


                      POSSIS MEDICAL, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                 October 31, 2002           July 31, 2002
ASSETS

<S>                                                                                 <C>                     <C>
CURRENT ASSETS:
     Cash and cash equivalents.........................................             $ 21,039,325              $ 18,556,663
     Trade receivables (less allowance for doubtful
          accounts and returns of $505,000 and
          $582,000, respectively)......................................                6,562,243                 5,873,358
     Inventories.......................................................                3,960,052                 4,134,817
     Prepaid expenses and other assets.................................                  350,801                   762,615
     Deferred tax asset................................................                  646,000                   646,000
               Total current assets....................................               32,558,421                29,973,453

PROPERTY AND EQUIPMENT, net............................................                3,120,165                 3,092,644

DEFERRED TAX ASSET.....................................................               10,728,400                11,623,000

TOTAL ASSETS...........................................................             $ 46,406,986              $ 44,689,097



LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:
     Trade accounts payable............................................             $  1,403,672              $  1,262,711
     Accrued salaries, wages, and commissions..........................                2,186,331                 2,471,557
     Other liabilities.................................................                1,475,459                 1,200,763
               Total current liabilities...............................                5,065,462                 4,935,031

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS' EQUITY:
     Common stock-authorized, 100,000,000 shares
          of $0.40 par value each; issued and outstanding,
          17,282,159 and 17,274,222 shares, respectively...............                6,912,864                 6,909,689
Additional paid-in capital.............................................               78,434,202                78,385,073
Unearned compensation..................................................                   (8,400)                  (18,900)
Retained deficit.......................................................              (43,997,142)              (45,521,796)
               Total shareholders' equity..............................               41,341,524                39,754,066

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY.............................             $ 46,406,986              $ 44,689,097


<FN>
See notes to consolidated financial statements.
</FN>
</TABLE>

<PAGE>

                      POSSIS MEDICAL, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
              FOR THE THREE MONTHS ENDED OCTOBER 31, 2002 AND 2001
                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                      2002                   2001
<S>                                                                               <C>                   <C>
Product Sales...........................................................          $ 12,681,903           $  9,585,268
     Cost of sales and other expenses:
     Cost of medical products...........................................             3,388,698              2,999,982
     Selling, general and administrative................................             5,767,702              4,689,465
     Research and development...........................................             1,152,196              1,031,320
               Total cost of sales and other expenses...................            10,308,596              8,720,767
Operating income........................................................             2,373,307                864,501
Interest income.........................................................                66,347                  4,027
Income before income taxes..............................................             2,439,654                938,528
Provision for income taxes..............................................               915,000                   --

Net income..............................................................          $  1,524,654            $   938,528

Net income per common share:
     Basic..............................................................                 $0.09                  $0.06
     Diluted............................................................                 $0.08                  $0.05

Weighted average number of common shares
  assumed outstanding:
     Basic..............................................................            17,278,291             16,858,181
     Diluted............................................................            18,285,859             18,260,374

<FN>
See notes to consolidated financial statements.
</FN>
</TABLE>

<PAGE>


                      POSSIS MEDICAL, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
              FOR THE THREE MONTHS ENDED OCTOBER 31, 2002 AND 2001
                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                           2002              2001
<S>                                                                                   <C>               <C>
OPERATING ACTIVITIES:
Net income .......................................................................    $  1,524,654      $    938,528
Adjustments to reconcile net income to net
  cash provided by (used in) operating activities:
     Depreciation.................................................................         537,828           508,159
     Loss on disposal of assets...................................................          34,000              --
     Stock compensation expense...................................................          19,100            26,100
     Deferred taxes...............................................................         894,600              --
     Expense reimbursement from city government...................................            --             (67,788)
     Writedown due to impairment of asset.........................................            --              70,000
     Increase in receivables......................................................        (688,885)          (69,762)
     Increase in inventories......................................................         (30,186)         (115,154)
     Decrease in other current assets.............................................         411,814           142,337
     Increase (decrease) in trade accounts payable................................         140,961          (152,511)
     (Decrease) increase in accrued expenses and other current liabilities........         (10,530)          300,850
Net cash provided by operating activities.........................................       2,833,356         1,580,759

INVESTING ACTIVITIES:
Additions to property and equipment...............................................        (394,398)         (340,601)

Net cash used in investing activities.............................................        (394,398)         (340,601)

FINANCING ACTIVITIES:
Proceeds from issuance of stock and exercise of options and warrants..............          43,704           638,688
Repayment of long-term debt.......................................................            --             (26,522)
Net cash provided by financing activities.........................................          43,704           612,166

INCREASE IN CASH AND CASH EQUIVALENTS.............................................       2,482,662         1,852,324

CASH AND CASH EQUIVALENTS AT BEGINNING OF QUARTER.................................      18,556,663         9,515,751
CASH AND CASH EQUIVALENTS AT END OF QUARTER.......................................    $ 21,039,325      $ 11,368,075

SUPPLEMENTAL CASH FLOW DISCLOSURE:
Inventory transferred to property and equipment...................................    $     47,951      $       --



<FN>
See notes to consolidated financial statements.
</FN>
</TABLE>

<PAGE>


                      POSSIS MEDICAL, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

     1. BASIS OF PRESENTATION

     The  accompanying  unaudited  consolidated  financial  statements have been
prepared in accordance  with  accounting  principles  generally  accepted in the
United  States  of  America  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 of America  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.  The  accompanying  consolidated  financial  statements and notes
should  be read  in  conjunction  with  the  audited  financial  statements  and
accompanying notes thereto included in the Company's 2002 Annual Report.

     2. INTERIM FINANCIAL STATEMENTS

     Operating results for the three month period ended October 31, 2002 are not
necessarily  indicative  of the results that may be expected for the year ending
July 31, 2003.

     3. INVENTORIES

     Inventories  are  stated at the lower of cost (on the  first-in,  first-out
basis) or market. Inventory balances were as follows:

                                       October 31,        July 31,
                                          2002             2002

     Finished goods..........          $1,232,798       $1,444,973
     Work-in-process.........             953,107          805,911
     Raw materials...........           1,774,147        1,883,933
                                       $3,960,052       $4,134,817

     4. PROPERTY AND EQUIPMENT

     Property is carried at cost and depreciated using the straight-line  method
over the estimated  useful lives of the various  assets.  Property and equipment
balances and corresponding lives were as follows:

                                          October 31,   July 31,
                                            2002         2002        Life

     Leasehold improvements...........   $1,454,833   $1,454,833   10 years
     Equipment........................    6,882,708    7,536,959   3 to 10 years
     Assets in construction...........      199,863      138,271   N/A
                                          8,537,404    9,130,063
     Less accumulated depreciation....    5,417,239    6,037,419
     Property and equipment - net.....   $3,120,165   $3,092,644

<PAGE>


     5. SEGMENT AND GEOGRAPHIC INFORMATION AND CONCENTRATION OF CREDIT RISK

     The  Company's   operations  are  in  one  business  segment,  the  design,
manufacture and distribution of cardiovascular medical devices.  Possis Medical,
Inc. evaluates revenue performance based on the worldwide revenues of each major
product line and profitability  based on an enterprise-wise  basis due to shared
infrastructures to make operating and strategic decisions.

     Total revenues by United States and outside the United States for the three
months ended October 31, 2002 and 2001 are as follows:

                                            2002           2001

     United States.....................  $12,399,421    $9,503,818
     Outside the United States.........      282,482        81,450
     Total revenues....................  $12,681,903    $9,585,268

     6. NET INCOME PER COMMON SHARE

     Basic  income per common  share is computed by dividing  net income for the
period by the weighted  average number of common shares  outstanding  during the
period.  Diluted  earnings per share is computed using the treasury stock method
by dividing net income by the weighted  average number of common shares plus the
dilutive effect of outstanding stock options, stock warrants and shares issuable
under the employee stock purchase plan.

     7. COMMON STOCK

     During the three  months  ended  October 31,  2002,  stock  options for the
purchase of 7,937 shares of the Company's  common stock were exercised at prices
between $3.94 and $10.82 per share.


     8. NEW ACCOUNTING PRONOUNCEMENTS

     In fiscal 2003,  the Company  adopted  Statement  of  Financial  Accounting
Standards (SFAS) No. 143,  "Accounting for Asset Retirement  Obligations."  SFAS
No. 143 requires  entities to record the fair value of a liability  for an asset
retirement obligation in the period in which it is incurred.  When the liability
is  initially  recorded,  the  entity  capitalizes  the cost by  increasing  the
carrying  amount of the related  long-lived  asset.  Over time, the liability is
accreted  to its  present  value  each  period,  and  the  capitalized  cost  is
depreciated  over the useful life of the related asset.  Upon  settlement of the
liability,  an entity either settles the  obligation for its recorded  amount or
incurs a gain or loss upon  settlement.  There  was no  impact on the  Company's
financial statements due to the adoption of SFAS No. 143.

<PAGE>


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

     Forward-Looking Statements

     Certain  statements  made  in  Management's   Discussion  and  Analysis  of
Financial  Condition and Results of  Operations  and elsewhere in this Form 10-Q
are "forward-looking statements" as defined in the Private Securities Litigation
Reform Act of 1995.  Such statements can be identified by the use of terminology
such as "anticipate,"  "believe,"  "could,"  "estimate,"  "expect,"  "forecast,"
"intend," "may," "plan,"  "possible,"  "project,"  "should," "will," and similar
words or expressions.  Our  forward-looking  statements  relate to the Company's
ability to increase  sales of disposable and capital  equipment;  its ability to
obtain  additional  FDA approvals;  the ability to open up new foreign  markets,
such as Japan; customer responses to the Company's marketing strategies;  future
revenue levels,  gross margins,  expense levels;  ability to retain and motivate
skilled  employees  especially  sales  positions;  deferred tax asset  valuation
allowance;  earnings per share;  future equity financing needs and the Company's
ability to develop new products and enhance existing ones. These forward-looking
statements are based on current  expectations and assumptions and entail various
risks and  uncertainties  that could cause actual  results to differ  materially
from those expressed in such  forward-looking  statements.  Certain factors that
may affect whether these  anticipated  results occur include clinical and market
acceptance of our products;  factors  affecting the health care industry such as
restricting sales time at interventional labs;  consolidation,  cost containment
and trends  toward  managed  care;  changes in  supplier  requirements  by group
purchasing organizations;  delays, unanticipated costs or other difficulties and
uncertainties  associated  with lengthy and costly new product  development  and
regulatory  clearance  processes;  changes in governmental laws and regulations;
changes in  reimbursement;  the  development  of new  competitive  products  and
compounds that may make our products obsolete;  sudden restrictions in supply of
key materials and  deterioration of general market and economic  conditions.  We
also  caution you not to place undue  reliance  on  forward-looking  statements,
which speak only as of the date made. Any or all  forward-looking  statements in
this  report  and in any  other  public  statements  we make  may turn out to be
inaccurate  or false.  They can be affected by inaccurate  assumptions  we might
make or by known or  unknown  risks and  uncertainties.  Except as  required  by
federal   securities   laws,   we   undertake  no   obligation   to  update  any
forward-looking  statement.  A discussion  of these and other factors that could
impact the Company's  future results are set forth in the risk factors  included
in Exhibit  99 to the  Company's  Form 10-K for the year ended July 31,  2002 as
filed with the Securities and Exchange Commission.


     Critical Accounting Policies

     The consolidated  financial  statements include accounts of the Company and
all  wholly-owned  subsidiaries.  The  preparation  of financial  statements  in
conformity with accounting  principles  generally  accepted in the United States
requires  management to make estimates and assumptions in certain  circumstances
that  affect  amounts  reported  in  the  accompanying   consolidated  financial
statements  and related  footnotes.  In preparing  these  financial  statements,
management has made its best estimates and judgments of certain amounts included
in the  financial  statements,  giving due  consideration  to  materiality.  The
Company's  most critical  accounting  policies are those  described  below.  The
Company  believes that the amounts  reported will be materially  accurate due to
the  accounting  policies  described  below.   However,   application  of  these
accounting  policies involves the exercise of judgment and use of assumptions as
to future uncertainties and, as a result, actual results could differ from these
estimates.

<PAGE>

     Revenue Recognition

     Revenues  associated with products that are already  maintained at customer
locations are recognized  when the Company  receives a valid purchase order from
the customer.  At this time,  ownership and risk of loss is  transferred  to the
customer.  Revenues  associated  with  products  that are not  maintained at the
customer  locations are  recognized and title and risk of loss is transferred to
the  customer  when a valid  purchase  order is received  and the  products  are
received at the customer's location.  Provisions for returns are recorded in the
same period the related revenues are recognized.

     Allowance for Returns

     Accounts  receivable  are  reduced  by an  allowance  for items that may be
returned  in the  future.  The  estimated  allowance  for  returns is based upon
historical   experience,   information   received  from  our  customers  and  on
assumptions  that  are  believed  to  be  reasonable  under  the  circumstances.
Management,  on a quarterly  basis,  evaluates the adequacy of the allowance for
returns.  Management  believes  the  amount  of the  allowance  for  returns  is
appropriate;  however,  actual  returns  incurred could differ from the original
estimate, requiring adjustments to the allowance.

     Allowance for Doubtful Accounts

     Accounts receivable are reduced by an allowance for amounts that may become
uncollectible in the future.  Substantially all of the Company's receivables are
due from health care  facilities  located in the United  States.  The  estimated
allowance  for  doubtful  accounts  is  based  upon  the age of the  outstanding
receivables  and the payment  history  and  creditworthiness  of each  customer.
Management,  on a quarterly  basis,  evaluates the adequacy of the allowance for
doubtful accounts.  Management believes the amount of the allowance for doubtful
accounts is appropriate;  however,  nonpayment of accounts could differ from the
original estimate, requiring adjustments to the allowance.

     Inventories

     Inventories  are  valued at the  lower of cost or  market.  On a  quarterly
basis,  management assesses the inventory quantities on hand to estimated future
usage and sales and, if necessary,  writes down to market the value of inventory
deemed excess or obsolete.

     Warranty Reserve

     The Company  provides a one-year  limited  warranty on its AngioJet  System
drive unit and a limited warranty on AngioJet System  disposable  products.  The
warranty  reserve is established at the time products are sold and is based upon
historical  frequency of claims relating to the Company's  products and the cost
to  replace  disposable  products  and to repair  drive  units  under  warranty.
Management,  on a  quarterly  basis,  evaluates  the  adequacy  of the  warranty
reserve.  Management believes the amount of the warranty reserve is appropriate;
however,  actual  claims  incurred  could  differ  from the  original  estimate,
requiring adjustments to the reserve.

<PAGE>

     Deferred Tax Asset Valuation Allowance

     The Company became profitable starting in the third quarter of fiscal 2001.
It has maintained profitability for seven quarters,  including the first quarter
of fiscal  2003.  Prior to the fourth  quarter of fiscal  2002,  the Company had
reduced its net deferred tax asset to zero through a valuation  allowance due to
the  uncertainty of realizing such asset.  In the fourth quarter of fiscal 2002,
the  Company  reassessed  the  likelihood  that the  deferred  tax asset will be
recovered  from  future  taxable  income.  Due to the  previous  two full years'
operating results projected forward, the Company reduced its valuation allowance
on the deferred tax asset by $12,269,000. Management will continue to assess the
likelihood that the balance of the deferred tax asset will be realizable and the
valuation allowance will be adjusted accordingly.

     Results of Operations

     Three Month Periods Ended October 31, 2002 and 2001

     Total product  sales for the three months ended October 31, 2002  increased
$3,097,000,  or 32%, to $12,682,000  compared to $9,585,000 in the first quarter
of 2001. The Company  recorded  pre-tax net income for the quarter ended October
31, 2002 of $2,440,000,  or $0.13 per diluted share.  This compared to a pre-tax
net income of $939,000,  or $0.05 per share,  for the quarter  ended October 31,
2001.  The Company  recorded  after-tax net income for the quarter ended October
31,  2002 of  $1,525,000,  or $0.08  per  diluted  share.  This  compared  to an
after-tax  net income of  $939,000,  or $0.05 per share,  for the quarter  ended
October 31, 2001.

     Revenue - AngioJet System

     U.S.  AngioJet  System  revenue for the three months ended October 31, 2002
increased $2,896,000, or 30%, to $12,399,000 compared to $9,504,000 in the first
quarter of 2001. The Company markets the AngioJet(R) Rheolytic(TM)  Thrombectomy
System (AngioJet System) worldwide. The AngioJet System consists of a drive unit
(capital  equipment),  which powers a disposable pump and a family of disposable
catheters,  each aimed at a specific indication for use. The main factors in the
revenue increase were increased sales resulting from the Company commencing U.S.
marketing of the AngioJet System with additional  catheter  models.  The Company
began  marketing the XMI(R) (XMI) catheter for the removal of blood clots in leg
(peripheral)  arteries in March 2001 and for coronary use in December  2001, the
XVG(R) in April 2002 for the removal of blood clots in peripheral arteries,  and
the  Xpeedior(R)  Plus 120 in August 2002 to remove  blood  clots in  peripheral
arteries.  In  addition,  the  Company's  Xpeedior  catheters  continue  to have
increased  acceptance  by  physicians.  The  Xpeedior  catheters  are the  first
catheters  marketed by the Company  based upon its  proprietary  Cross-Stream(R)
Technology. This exclusive technology platform intensifies the action at the tip
of the  catheter,  which doubles the clot removal rate and triples the treatable
vessel size compared to other available  mechanical  thrombectomy devices on the
market today.  In addition,  Cross-Stream  Technology has been able to deal more
effectively  with "mural  thrombus,"  the older,  more  organized  material that
adheres to vessel walls and can complicate patient results.

<PAGE>

     In April 2002, the Company released to the U.S. market the new 5 French XVG
catheter for use in removing blood clots from peripheral  arteries  greater than
or equal to 3mm in diameter.  The 140cm XVG catheter  becomes the highest power,
long catheter in the Possis product line, which includes the LF-140 and the XMI.
The XVG incorporates the proprietary  Cross-Stream  technology platform,  and is
optimized  for vessels  3-8mm in diameter.  The  combination  of longer  length,
Cross-Stream technology,  higher clot removal rate, and improved pushability and
trackability  should make this a  versatile  catheter  for  dealing  with larger
vessels, more distal vessels, and older, more problematic clot burdens.

     In August 2002,  the Company  released to the U.S.  market the new Xpeedior
Plus 120  catheter  for use in  removing  blood clots from  peripheral  arteries
greater than or equal to 3mm in diameter.  The Xpeedior  Plus 120 catheter is an
improved  version of our Xpeedior  100.  Compared to the  Xpeedior  100, the new
catheter's  longer length will allow the physician to treat more distal vessels.
The  Xpeedior  Plus 120 also has the added  features  of dual  marker  bands,  a
braided shaft and a sleek tapered tip for greater ease of use.

     As of October 31, 2002, the Company had a total of 898 domestic drive units
in the field,  compared to 726 drive units at October 31, 2001, and 863 units as
of July 31, 2002.  During the  three-month  periods  ended  October 31, 2002 and
2001, the Company sold  approximately  9,500 and 7,500 catheters,  respectively.
This was a 27% increase in unit catheter sales in the current year from the same
prior year period. The average catheter  utilization rate per installed domestic
drive unit was 10.6 in the first quarter, compared to a rate of 10.5 in the same
prior year  period,  and  compared  to a rate of 10.9 in the  fourth  quarter of
fiscal  2002.  The Company sold 46 and 44 U.S.  domestic  drive units during the
three months ended October 31, 2002 and 2001, respectively.

     The Company employs a variety of flexible drive unit  acquisition  programs
including  outright  purchase and various  evaluation  programs.  The purchasing
cycle for the  AngioJet  System drive unit varies  depending  on the  customer's
budget cycle.  The Company has signed  contracts with six  purchasing  groups in
order to accelerate  orders and increase market  penetration.  These  purchasing
groups evaluate and screen new medical  technologies on behalf of their members,
and  once  they  recommend  a  technology,  such as the  AngioJet  System,  they
negotiate  pre-determined  discounts on behalf of their members.  In return, the
Company  receives  access to the recommended  vendor list,  along with marketing
support  provided by the  purchasing  group.  The  purchasing  groups  receive a
marketing fee on their member  purchases from the Company.  These  discounts and
marketing fees have been offset by the increase in sales to the member hospitals
of the  purchasing  group.  There has been no  material  negative  effect on the
Company's  margins due to these  discounts  and  marketing  fees.  The discounts
reduce gross revenue on the income statement,  while marketing fees are included
in selling, general and administrative expense on the income statement.

     The  Company  expects  U.S.  AngioJet  System  sales  to  continue  to grow
primarily through obtaining additional  FDA-approved product uses,  introduction
of new  catheter  models for  existing  indications,  more face time  selling to
existing  accounts,  peer-to-peer  selling,  and  the  publication  of  clinical
performance and cost-effectiveness data.

     Foreign sales of the AngioJet System for the three months ended October 31,
2002 and 2001 were $282,000 and $81,000,  respectively. The increase in sales is
primarily due to the  introduction of the XMI and XVG catheters and the increase
in drive unit sales in the European market. The Company is currently negotiating
with one of its  current  European  distributors  to expand  their  distribution
territory in Europe.  In Japan, the coronary  AngioJet System clinical study was
completed in April 1998 and a regulatory  filing was  completed in November 1999
with the Japanese  Ministry of Health and Welfare  (MHW).  The Company  believes
that we have assembled all the information required by the MHW in support of our
LF140 coronary catheter  submission.  Our prospective  Japanese distributor must
make  the  submission  of this  information  to MWH.  Our  prospective  Japanese
distributor  had made this final  submission  dependent on reaching a commercial
agreement  with the  Company.  The  Company is  currently  negotiating  with its
prospective  Japanese  distributor to resolve key issues  relating to regulatory
submissions,  ownership of regulatory  approvals  for our coronary  products and
distribution  following  regulatory  approval.  The  Company  also is  exploring
possible  alternative  regulatory  and  distribution  in  case  the  key  issues
associated with its prospective Japanese distributor can not be resolved.

<PAGE>

     The Company  believes  that the  treatment  of blood clots in the  coronary
vessels,  peripheral vessels,  vessels in the brain and vascular grafts, provide
significant worldwide marketing opportunities for the AngioJet System.

     Cost of Medical Products

     Cost of medical  products  increased  $389,000 to  $3,389,000  in the three
month period ended  October 31, 2002 over the same period in the previous  year.
This increase is primarily due to the  significant  growth in the U.S.  AngioJet
System product sales.  Medical product gross margins  improved by $2,708,000 for
the three  months  ended  October 31, 2002 over the same period in the  previous
year. This resulted in gross margins of 73% and 69%, respectively, for the three
months ended  October 31, 2002 and 2001.  The  improvement  in gross margins was
driven  by  higher  volumes  of the  XMI,  XVG and  Xpeedior  catheters,  and an
improvement  in the long and middle  catheter  product  mix in the three  months
ended  October 31, 2002 as compared to same period in the previous  fiscal year.
This was offset by the  impact of higher  international  sales  versus the prior
year period.  The Company  believes that gross margins will be in the low to mid
seventies, as a percent of sales, for the remainder of fiscal 2003.

     Selling, General and Administrative Expense

     Selling,  general and administrative  expense increased  $1,078,000 for the
three months ended October 31, 2002, compared to the same period in the previous
year.  The primary  factors in the expense  increase  for the three months ended
October 31,  2002 were the  $375,000  additional  expenses  associated  with the
growth in the sales force versus a year ago, sales meeting  expense of $105,000,
increased  marketing fees of $121,000 paid to our purchasing groups,  additional
$83,000 of patient enrollment expenses associated with marketing clinical trials
and higher  medical  insurance  expense of  $170,000.  The Company  expects that
selling,  general and administrative expense will increase in fiscal 2003 due to
the anticipated growth in U.S. AngioJet System revenue.

     Research and Development Expense

     Research and development expense increased $121,000, or 12%, to $1,152,000,
in the three months ended October 31, 2002,  when compared to the same period in
the prior year.  This  increase was  primarily due to the shifting of priorities
between various  development  projects.  The Company  believes that research and
development  expense for  AngioJet  System  applications  will  increase for the
remainder of fiscal 2003 as the Company completes the development of its current
products  and invests in the  development  of new AngioJet  System  thrombectomy
applications and related products including its occlusion  guidewire,  including
the initiation of new investigational clinical trials.

<PAGE>

     Interest Income

     Interest  income  decreased  $8,000 in the three months  ended  October 31,
2002, when compared to the same period in the prior year. The decrease is due to
declining  market  interest  rates.  The Company  expects  interest  income on a
quarterly  basis to remain the same during the  remainder of fiscal 2003 as cash
is generated from operations but is offset by lower interest rates.

     Provision For Income Taxes

     The Company  recorded a provision  for income taxes of $915,000 or 37.5% of
income before income taxes for the three months ended October 31, 2002.  The tax
provision for the three months ended October 31, 2001 was reduced to zero due to
the  utilization of a net operating loss  carry-forward  and because the related
deferred tax asset was fully reserved.

     The Company became profitable starting in the third quarter of fiscal 2001.
It has maintained profitability for seven quarters,  including the first quarter
of fiscal  2003.  Prior to the fourth  quarter of fiscal  2002,  the Company had
reduced its net deferred tax asset to zero through a valuation  allowance due to
the  uncertainty of realizing such asset.  In the fourth quarter of fiscal 2002,
the  Company  reassessed  the  likelihood  that the  deferred  tax asset will be
recovered  from  future  taxable  income.  Due to the  previous  two full years'
operating  results  projected  forward,  the Company  has reduced its  valuation
allowance on the deferred tax asset by  $12,269,000.  Approximately  $11,526,000
was recorded as a tax benefit in fiscal 2002. The remaining  $743,000 relates to
disqualified  stock options that are recorded in the  Consolidated  Statement of
Changes  in  Shareholders'  Equity.  Management  will  continue  to  assess  the
likelihood that the balance of the deferred tax asset will be realizable and the
valuation  allowance will be adjusted  accordingly.  The Company expects that if
operations continue to improve in fiscal 2003, the remaining valuation allowance
will be reduced to zero by the end of fiscal 2003.


     Liquidity and Capital Resources

     The Company's cash and cash equivalents totaled approximately $21.0 million
at October 31, 2002 versus $18.6 million at July 31, 2002.

     The $2,483,000 net increase in cash and cash equivalents in the most recent
three-month  period was  primarily  due to the net cash  provided  by  operating
activities  of  $2,833,000.  Net  cash  provided  by  operating  activities  was
primarily  due to the net income of  $1,525,000,  depreciation  of  $538,000,  a
decrease  in  deferred  tax asset of  $895,000,  a decrease  in other  assets of
$412,000  and an  increase  in  accounts  payables  of  $141,000.  This net cash
provided by operating  activities  was partially  offset by an increase in trade
receivables  of $689,000.  Depreciation  includes  company-owned  drive units at
customer  locations,  as well as property  and  equipment.  The  decrease in the
deferred  tax  asset  was  due to the  utilization  of the  net  operating  loss
carryovers to offset current taxes payable. The decrease in other assets was due
to the collection of a grant receivable and the reduction of prepaid  insurance.
The  Company  received  a grant  from the  National  Institute  of  Neurological
Disorders  and  Stroke  in  the  amount  of  $248,000.  The  grant  helped  fund
development of the AngioJet NV150 catheter for ischemic stroke.  The increase in
accounts  payable  was due to the timing of the  payment of  accounts  payables.
Trade  receivables  increased due to the increase in revenue for the three month
period ending  October 31, 2002 as compared to revenue for the last three months
of fiscal  2002.  Cash used in  investing  activities  of  $394,000  was for the
purchase of property and  equipment.  Net cash provided by financing  activities
was  $44,000,  which  resulted  from the cash  received in  connection  with the
exercise of stock options.

<PAGE>

     The Company  announced  that its Board of Directors has authorized a common
share  repurchase  program  for up to $4 million of its common  shares to offset
potential  dilution from employee  stock  options.  Under the  repurchase  plan,
Possis  may buy back  shares of its  outstanding  stock from time to time in the
open market,  commencing  immediately  and extending  until April 30, 2004.  The
timing of any purchases and the number of shares to be purchased  will depend on
a number of factors,  including management's assessment of market conditions and
the Company's cash position.  The stock repurchase  program does not include any
specific price targets and may be suspended or terminated at any time.


     Outlook

     The  Company  expects  that  overall  revenue  from  the  AngioJet  System,
primarily  in the  United  States,  will be in the range of $54  million  to $57
million in fiscal  2003.  Gross margin for fiscal 2003 is expected to be between
70%  and  75%  of  total  sales.  The  Company  expects  selling,   general  and
administrative  expenses to increase in fiscal 2003 due to anticipated growth in
revenue. Research and development expenditures are expected to increase from the
fiscal 2002 level as the Company  completes  development of projects and invests
in  development of new AngioJet  System  thrombectomy  applications  and related
products  including  clinical  trials.  The Company expects diluted earnings per
share  before  income  taxes  for the full  year in the range of $0.54 to $0.64.
Diluted earnings per share after income taxes is estimated to be in the range of
$0.34 to $0.40,  not including  any  potential tax benefit  related to a further
reduction of the deferred tax asset valuation allowance.  The quarterly earnings
progression will depend on the timing of various R&D expenses including clinical
trials.  In  addition,  the Company  expects  that  increasing  working  capital
investments  in trade  receivables  and  inventory  will be  required to support
growing product sales. The Company's  primary source of cash is from its product
sales. Collections of the trade receivables resulting from the product sales are
reviewed monthly to ensure that the customers are paying in a timely manner. The
Company's use of cash is for payment of normal trade accounts  payable,  capital
equipment purchases,  employee  compensation and other normal business expenses,
all on terms that are customary in the industry. The Company is current with its
vendors.


  ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     The Company  invests  its excess cash in money  market  mutual  funds.  The
market risk on such investments is minimal.

     The product sales for the Company's foreign  subsidiary are in U.S. Dollars
("USD").  At the end of October  2002,  the amount of  currency  held in foreign
exchange was approximately  $1,000 USD. The market risk on the Company's foreign
subsidiary operations is minimal.

<PAGE>

  ITEM 4. CONTROLS AND PROCEDURES

     (a) Evaluation of disclosure controls and procedures.  The term "disclosure
controls and  procedures"  is defined in Rules  13a-14(c)  and  15d-14(c) of the
Securities and Exchange Act of 1934 ("Exchange  Act").  These rules refer to the
controls  and other  procedures  of a company  that are  designed to ensure that
information  required to be  disclosed by a company in the reports that it files
under the Exchange Act is recorded,  processed,  summarized and reported  within
required  time  periods.  Our chief  executive  officer and our chief  financial
officer have evaluated the  effectiveness of the Company's  disclosure  controls
and procedures as of October 31, 2002, (the  "Evaluation  Date"),  and they have
concluded  that, as of the Evaluation  Date,  such controls and procedures  were
effective at ensuring  that required  information  will be disclosed on a timely
basis in our  reports  filed  under  the  Securities  Exchange  Act of 1934,  as
amended.

     (b)  Changes  in  internal  controls.  We  maintain  a system  of  internal
accounting  controls that are designed to provide reasonable  assurance that our
books and records  accurately  reflect our transactions and that our established
policies and  procedures are carefully  followed.  For the quarter ended October
31, 2002, there were no significant changes to our internal controls or in other
factors that could significantly  affect our internal controls,  and we have not
identified any significant  deficiencies or material  weaknesses in our internal
controls.

<PAGE>


PART II.  OTHER INFORMATION


  ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

  (a)  Exhibits

     Certain of the following  exhibits are incorporated by reference from prior
filings.  The form with which each  exhibit was filed and the date of filing are
indicated below.

Exhibit                                Description

 3.1    Articles of incorporation as amended and restated to date (incorporated
        by reference to Exhibit [3.1] of the Company's Annual Report on Form
        10-K for the fiscal year ended July 31, 1994).

 3.2    Bylaws as amended and restated to date (incorporated by reference to
        Exhibit [3.2] of the Company's Annual Report on Form 10-K for the fiscal
        year ended July 31, 1999)




  (b)  Reports on Form 8-K

     Possis Medical,  Inc. filed no reports on Form 8-K during the quarter ended
October 31, 2002.

<PAGE>



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.



                                      POSSIS MEDICAL, INC.



DATE:  November 26, 2002              BY:      /s/
                                         ROBERT G. DUTCHER
                                         Chairman, President and
                                         Chief Executive Officer





DATE:  November 26, 2002              BY:      /s/
                                         EAPEN CHACKO
                                         Vice President of Finance and
                                         Chief Financial Officer


<PAGE>


     Certification  of Chief Executive  Officer,  Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002

I, Robert G. Dutcher, certify that:

     1. I have reviewed this  quarterly  report on Form 10-Q of Possis  Medical,
Inc. (Possis Medical);

     2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not  misleading  with respect to the period covered by this quarterly
report;

     3. Based on my knowledge,  the financial  statements,  and other  financial
information  included in this quarterly  report,  fairly present in all material
respects the financial condition, results of operations and cash flows of Possis
Medical as of, and for, the periods presented in this quarterly report;

     4. Possis  Medical's  other  certifying  officer and I are  responsible for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     a. designed such disclosure controls and procedures to ensure that material
information relating to Possis Medical, including its consolidated subsidiaries,
is made known to us by others  within those  entities,  particularly  during the
period in which this quarterly report is being prepared;

     b. evaluated the effectiveness of Possis Medical's  disclosure controls and
procedures  as of a date  within  90  days  prior  to the  filing  date  of this
quarterly report (the "Evaluation Date"); and

     c.  presented  in  this  quarterly   report  our   conclusions   about  the
effectiveness of the disclosure  controls and procedures based on our evaluation
as of the Evaluation Date;

     5. Possis Medical's other certifying officer and I have disclosed, based on
our most recent evaluation, to Possis Medical's auditors and the audit committee
of Possis  Medical's  board of directors (or persons  performing  the equivalent
function):

     a. all  significant  deficiencies  in the design or  operation  of internal
controls  which  could  adversely  affect  Possis  Medical's  ability to record,
process,  summarize and report  financial  data and have  identified  for Possis
Medical's auditors any material weaknesses in internal controls; and

     b. any fraud,  whether or not material,  that involves  management or other
employees who have a significant role in Possis Medical's internal controls; and

     6. Possis Medical's other  certifying  officer and I have indicated in this
quarterly report whether there were significant  changes in internal controls or
in other factors that could significantly affect internal controls subsequent to
the date of our most recent  evaluation,  including any corrective  actions with
regard to significant deficiencies and material weaknesses.


Date: November 26, 2002               /s/
                                  Robert G. Dutcher
                                  Chairman, President and
                                  Chief Executive Officer

<PAGE>


     Certification  of Chief Financial  Officer,  Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002

     I, Eapen Chacko, certify that:

     1. I have reviewed this  quarterly  report on Form 10-Q of Possis  Medical,
Inc. (Possis Medical);

     2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not  misleading  with respect to the period covered by this quarterly
report;

     3. Based on my knowledge,  the financial  statements,  and other  financial
information  included in this quarterly  report,  fairly present in all material
respects the financial condition, results of operations and cash flows of Possis
Medical as of, and for, the periods presented in this quarterly report;

     4. Possis  Medical's  other  certifying  officer and I are  responsible for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     a. designed such disclosure controls and procedures to ensure that material
information relating to Possis Medical, including its consolidated subsidiaries,
is made known to us by others  within those  entities,  particularly  during the
period in which this quarterly report is being prepared;

     b. evaluated the effectiveness of Possis Medical's  disclosure controls and
procedures  as of a date  within  90  days  prior  to the  filing  date  of this
quarterly report (the "Evaluation Date"); and

     c.  presented  in  this  quarterly   report  our   conclusions   about  the
effectiveness of the disclosure  controls and procedures based on our evaluation
as of the Evaluation Date;

     5. Possis Medical's other certifying officer and I have disclosed, based on
our most recent evaluation, to Possis Medical's auditors and the audit committee
of Possis  Medical's  board of directors (or persons  performing  the equivalent
function):

     a. all  significant  deficiencies  in the design or  operation  of internal
controls  which  could  adversely  affect  Possis  Medical's  ability to record,
process,  summarize and report  financial  data and have  identified  for Possis
Medical's auditors any material weaknesses in internal controls; and

     b. any fraud,  whether or not material,  that involves  management or other
employees who have a significant role in Possis Medical's internal controls; and

     6. Possis Medical's other  certifying  officer and I have indicated in this
quarterly report whether there were significant  changes in internal controls or
in other factors that could significantly affect internal controls subsequent to
the date of our most recent  evaluation,  including any corrective  actions with
regard to significant deficiencies and material weaknesses.


Date: November 26, 2002               /s/
                                  Eapen Chacko
                                  Chief Financial Officer
                                  Vice President of Finance

<PAGE>



     CERTIFICATION  PURSUANT TO 18 U.S.C.  SECTION 1350, AS ADOPTED  PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


     In connection with this quarterly  report of Possis  Medical,  Inc. on Form
10Q for the period  ended  October  31,  2002 as filed with the  Securities  and
Exchange  Commission  on the date hereof ("the  Report"),  I, Robert G. Dutcher,
Chief Executive Officer of Possis Medical, Inc., certify,  pursuant to 18 U.S.C.
Section 1350, as adopted  pursuant to Section 906 of the  Sarbanes-Oxley  Act of
2002, that:

     1. The report fully  complies  with the  requirements  of Section  13(a) or
15(d) of the Securities Exchange Act of 1934; and

     2.  The  information  contained  in this  report  fairly  presents,  in all
material respects,  the financial  condition and results of operations of Possis
Medical, Inc.




 November 26, 2002                    /s/
                                  Robert G. Dutcher
                                  Chief Executive Officer

<PAGE>


     CERTIFICATION  PURSUANT TO 18 U.S.C.  SECTION 1350, AS ADOPTED  PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


     In connection with this quarterly  report of Possis  Medical,  Inc. on Form
10Q for the period  ended  October  31,  2002 as filed with the  Securities  and
Exchange  Commission on the date hereof ("the Report"),  I, Eapen Chacko,  Chief
Financial  Officer  of Possis  Medical,  Inc.,  certify,  pursuant  to 18 U.S.C.
Section 1350, as adopted  pursuant to Section 906 of the  Sarbanes-Oxley  Act of
2002, that:

     1. The report fully  complies  with the  requirements  of Section  13(a) or
15(d) of the Securities Exchange Act of 1934; and

     2.  The  information  contained  in this  report  fairly  presents,  in all
material respects,  the financial  condition and results of operations of Possis
Medical, Inc.




November 26, 2002                     /s/
                                  Eapen Chacko
                                  Chief Financial Officer

<PAGE>