_______________________________________________

                       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 April 30, 2002


                          Commission File Number 0-944

                              POSSIS MEDICAL, INC.

                          9055 Evergreen Boulevard N.W.

                        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, $.40 par
value, as of May 31, 2002 was 17,254,584.

                        ________________________________

<PAGE>



                              POSSIS MEDICAL, INC.

                                      INDEX


                                                                       PAGE


PART I.           FINANCIAL INFORMATION

     ITEM 1.      Financial Statements

                  Consolidated Balance Sheets, April 30, 2002
                  and July 31, 2001....................................     3

                  Consolidated Statements of Operations for the three
                  months and nine months ended April 30, 2002 and 2001.     4

                  Consolidated Statements of Cash Flows for the
                  nine months ended April 30, 2002 and 2001 ...........     5

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

     ITEM 2.      Management's Discussion and Analysis of Financial
                  Condition and Results of Operations..................     9

     ITEM 3.      Quantitative and Qualitative Disclosures
                  About Market Risk....................................    14



PART II.          OTHER INFORMATION

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

     SIGNATURES........................................................    17

<PAGE>


PART I   FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

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

<TABLE>
<CAPTION>
                                                                                     April 30, 2002           July 31, 2001

ASSETS

<S>                                                                                    <C>                     <C>
CURRENT ASSETS:
     Cash and cash equivalents.........................................                $16,822,024             $  9,515,751
     Trade receivables (less allowance for doubtful
        accounts and returns of $588,000 and
        $659,000, respectively)........................................                  5,364,297                4,268,114
     Inventories.......................................................                  4,260,220                4,216,629
     Prepaid expenses and other assets.................................                    440,790                  342,995

              Total current assets.....................................                 26,887,331               18,343,489

PROPERTY AND EQUIPMENT, net............................................                  3,211,726                3,665,751

TOTAL ASSETS   ........................................................                $30,099,057              $22,009,240


LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:
     Trade accounts payable............................................               $  1,178,396             $  1,321,485
     Accrued salaries, wages, and commissions..........................                  2,527,449                1,532,912
     Current portion of long-term debt.................................                      --                      94,310
     Other liabilities.................................................                  1,202,615                  989,556
               Total current liabilities...............................                  4,908,460                3,938,263

COMMITMENTS AND CONTIGENCIES

SHAREHOLDERS' EQUITY:
     Common stock-authorized, 100,000,000 shares
        of $0.40 par value each; issued and outstanding,
        17,242,528 and 16,822,023 shares, respectively.................                  6,897,011                6,728,809
     Additional paid-in capital........................................                 78,118,706               75,411,387
     Unearned compensation.............................................                    (29,400)                 (22,700)
Retained deficit.......................................................                (59,795,720)             (64,046,519)
               Total shareholders'equity...............................                 25,190,597               18,070,977

TOTAL LIABILITIES AND SHAREHOLDERS'EQUITY..............................                $30,099,057              $22,009,240


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

<PAGE>







                      POSSIS MEDICAL, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)


<TABLE>
<CAPTION>

                                                                     For Three Months Ended             For Nine Months Ended
                                                                 April 30, 2002   April 30, 2001    April 30, 2002   April 30, 2001

<S>                                                             <C>               <C>              <C>               <C>
Product sales..............................................     $10,755,468       $7,411,418       $30,564,524       $20,936,545
Cost of sales and other expenses:
     Cost of medical products..............................       3,154,204        2,545,998         9,364,681         8,615,364
     Selling, general and administrative...................       4,946,690        3,905,729        14,094,704        12,888,529
     Research and development..............................       1,023,776        1,038,298         3,045,815         3,774,013
           Total cost of sales and other expenses..........       9,124,670        7,490,025        26,505,200        25,277,906

Operating income (loss)....................................       1,630,798          (78,607)        4,059,324        (4,341,361)
Interest income............................................          56,124          107,333           191,475           399,718
Net income (loss)..........................................     $ 1,686,922       $   28,726       $ 4,250,799       $(3,941,643)

Net income (loss) per common share:
       Basic...............................................            $.10             $.00              $.25             $(.24)
       Diluted.............................................            $.09             $.00              $.23             $(.24)

Weighted average number of common shares
   outstanding:
       Basic...............................................      17,175,755       16,749,538        17,016,921        16,720,968
       Diluted.............................................      19,025,729       16,841,733        18,697,652        16,720,968














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

<PAGE>


                      POSSIS MEDICAL, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                FOR THE NINE MONTHS ENDED APRIL 30, 2002 AND 2001
                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                         2002                       2001

<S>                                                                                 <C>                       <C>
OPERATING ACTIVITIES:
Net income (loss)...............................................................    $  4,250,799              $ (3,941,643)

Adjustments to reconcile net income (loss) to net
  Cash provided by (used in) operating activities:
     (Gain) loss on asset disposal .............................................          (3,626)                    8,564
     Depreciation...............................................................       1,585,477                 1,398,840
     Stock compensation expense.................................................         175,640                   130,359
     Expense reimbursement from city government.................................         (83,866)                 (101,938)
     Writedown due to impairment of assets......................................          70,000                     --
     Increase in receivables....................................................      (1,096,183)                 (994,865)
     Increase in inventories....................................................        (580,591)                 (106,143)
     (Increase) decrease in other assets........................................         (97,795)                  206,597
     Decrease in trade accounts payable.........................................        (143,089)                 (965,162)
     Increase in accrued and other current liabilities..........................       1,197,949                    75,921
     Net cash provided by (used in) operating activities........................       5,274,715                (4,289,470)

INVESTING ACTIVITIES:
Additions to property and equipment.............................................        (667,946)               (1,185,010)
Proceeds from the disposal of assets............................................           7,120                     1,402
Proceeds from maturity of marketable securities................................             --                  20,245,000
Purchase of marketable securities...............................................            --                 (13,585,845)
Net cash (used in) provided by investing activities.............................        (660,826)                5,475,547

FINANCING ACTIVITIES:
Proceeds from issuance of stock and exercise of options
   and warrants.................................................................       2,718,906                   196,843
Repayment of long-term debt.....................................................         (26,522)                   (8,077)
Proceeds from notes payable.....................................................            --                      36,504
Net cash provided by financing activities.......................................       2,692,384                   225,270

INCREASE IN CASH AND CASH EQUIVALENTS ..........................................       7,306,273                 1,411,347
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD................................       9,515,751                 4,053,429
CASH AND CASH EQUIVALENTS AT END OF PERIOD......................................     $16,822,024                $5,464,776

SUPPLEMENTAL CASH FLOW DISCLOSURE:
Issuance of restricted stock....................................................         $36,000                   $23,900
Accrued payroll taxes related to restricted stock...............................         (12,600)                   46,643









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

<PAGE>


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

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 2001 Annual Report.

2.   INTERIM FINANCIAL STATEMENTS

     Operating results for the three and nine month periods ended April 30, 2002
are not necessarily  indicative of the results that may be expected for the year
ending July 31, 2002.

3.   INVENTORIES

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

                                           April 30,               July 31,
                                             2002                    2001

                 Finished goods           $1,952,502             $1,935,590
                 Work-in-process           1,011,129              1,432,536
                 Raw materials             1,296,589                848,503
                                          $4,260,220             $4,216,629

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:

                                      April 30,       July 31,
                                        2002            2001      Life
    Leasehold improvements           $1,454,833     $1,454,833    10 years
    Equipment                         7,617,099      6,814,596    3 to 10 years
    Assets in construction              110,879        255,502    N/A
                                      9,182,811      8,524,931
    Less accumulated depreciation     5,971,085      4,859,180
    Property and equipment - net     $3,211,726     $3,665,751

<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-wide  basis due to shared
infrastructures to make operating and strategic decisions.

     Total  revenues  by United  States and  outside  the  United  States are as
follows:

                                 Three Months Ended         Nine Months Ended
                                April 30    April 30     April 30      April 30
                                  2002        2001         2002          2001

   United States............  $10,639,218  $7,344,698  $30,212,274   $20,626,680
   Outside United States....      116,250      66,720      352,250       309,865
   Total revenues...........  $10,755,468  $7,411,418  $30,564,524   $20,936,545

6.  NET INCOME (LOSS) PER COMMON SHARE

     Basic net income (loss) per common share is computed by dividing net income
(loss)  for  the  period  by  the  weighted  average  number  of  common  shares
outstanding  during the period.  Diluted net income 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.  Diluted
loss per share does not include  outstanding  stock options,  stock warrants and
shares issuable under the employee stock purchase plan in the computation  since
the impact would have been anti-dilutive because of the net loss.

7.  COMMON STOCK

     During the nine months ended April 30, 2002, stock options and warrants for
the purchase of 356,014  shares of the Company's  common stock were exercised at
prices between $3.94 and $17.50 per share.

     During the nine months  ended April 30,  2002,  the Company  issued  63,242
shares in connection with its employee stock purchase plan.

     During the nine months  ended April 30,  2002,  the  Company  issued  2,124
shares of restricted stock to the outside members of the Board of Directors.  In
addition,  875 shares of restricted  stock were  cancelled in lieu of paying the
withholding taxes.

8.  IMPAIRMENT OF LONG-LIVED ASSETS

     During the nine months ended April 30, 2002, the Company  expensed  $70,000
(included  in  selling,  general  and  administrative  expense)  relating to the
write-down of a fixed asset to net realizable value to net realizable value. The
value of this fixed  asset was  determined  to be impaired  due to the  unlikely
continued use of this fixed asset.

<PAGE>

9.   NEW ACCOUNTING PRONOUNCEMENTS

     In August 2001,  the  Financial  Accounting  Standards  Board (FASB) issued
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.  SFAS No.  143 is
effective for the Company in fiscal 2003. The Company has not yet determined the
impact of SFAS No. 143 on its financial position and results of operations.

     In  September  2001,  the FASB  issued SFAS No.  144,  "Accounting  for the
Impairment  or Disposal of  Long-Lived  Assets."  SFAS No. 144 replaces SFAS No.
121,  "Accounting  for the  Impairment of Long-Lived  Assets and for  Long-Lived
Assets to be Disposed  Of." The FASB  issued SFAS No. 144 to  establish a single
accounting  model,  based on the framework  established in SFAS No. 121, as SFAS
No. 121 did not address the accounting for a segment of a business accounted for
as a discontinued  operation  under  Accounting  Principle Board Opinion No. 30,
"Reporting  the Results of  Operations - Reporting  the Effects of Disposal of a
Segment of a Business and Extraordinary, Unusual and Infrequent Occurring Events
and Transactions." SFAS No. 144 also resolves significant  implementation issues
related to SFAS No. 121. The  provisions  of SFAS No. 144 are  effective for the
Company in fiscal 2003,  and  generally,  are to be applied  prospectively.  The
Company  has not yet  determined  the  impact of SFAS No.  144 on its  financial
position and results of operations.

<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 certain other sections of this
Form 10-Q are "forward-looking  statements" as defined in the Private Securities
Litigation  Reform Act of 1995,  including  statements  regarding  the Company's
ability  to  increase   disposable  sales;  its  ability  to  obtain  additional
FDA-approvals;  the expected receipt of Japanese regulatory approvals;  customer
responses  to the  Company's  marketing  strategies;  the  Company's  ability to
introduce new catheter models;  future revenue levels,  gross margins,  expenses
levels and earnings per share,  future equity  financing needs and the Company's
ability to develop new products.  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 consolidation, cost
containment and trends toward managed care; 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  products and
compounds by competitors that may compete with our products or make our products
obsolete;  sudden  restrictions in supply of key materials and  deterioration of
general  market and economic  conditions.  These and other risk factors that may
affect our results are  included in the  Company's  Form 10-K for the year ended
July 31, 2001 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 does not believe there is a great  likelihood that materially  different
amounts would be reported  related 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.

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  when a valid purchase order is received and
the products are received at the customer's  location.  At this time,  title and
risk of loss is transferred to the customer. Provisions for returns are recorded
in the same period the related revenues are recognized.

<PAGE>

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 various
other  assumptions that are believed to be reasonable  under the  circumstances.
Management,  on a quarterly  basis,  evaluates  the  adequacy of the reserve for
returns.


Allowance for Doubtful Accounts

     Accounts receivable are reduced by an allowance for amounts that may become
uncollectable 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 credit  worthiness  of each  customer.
Management,  on a quarterly  basis,  evaluates  the  adequacy of the reserve for
doubtful accounts.


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 the value of  inventory  deemed
obsolete or excess to market.

Warranty Reserve

     The Company  provides a one year limited  warranty on its  AngioJet  System
drive unit and an unlimited warranty on AngioJet System disposable products. The
warranty  reserve is based upon historical  experience 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.


Results of Operations

Three and Nine Month Periods Ended April 30, 2002 and 2001

     Total  product  sales for the three months  ended April 30, 2002  increased
$3,344,000,  or 45%, to  $10,755,000  compared to $7,411,000  for the comparable
period in fiscal 2001.  Total  product sales for the nine months ended April 30,
2002 increased  $9,628,000,  or 46%, to $30,565,000  compared to $20,937,000 for
the comparable  period in fiscal 2001. The Company recorded a net profit for the
quarter ended April 30, 2002 of $1,687,000,  or $.09 per diluted share, compared
to a net income of $29,000, or $.00 per diluted share, in the comparable quarter
in 2001.  For the nine months ended April 30, 2002,  the Company  recorded a net
profit  of  $4,251,000  or $.23 per  diluted  share,  compared  to a net loss of
$3,942,000, or $.24 per diluted share, in the same period in 2001.

<PAGE>

Revenue - AngioJet System

     U.S.  AngioJet  System  revenue for the three  months  ended April 30, 2002
increased 45% to $10,639,000  from  $7,345,000 for the same period in 2001. U.S.
AngioJet  System  revenue for the nine months ended April 30, 2002 increased 46%
to $30,212,000  from  $20,627,000 in 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.
The main factors in the revenue increase were increased sales resulting from the
Company  commencing  U.S.  marketing of the AngioJet  System with an  additional
labeling claim for the XMI(TM)135  (XMI) catheter for the removal of blood clots
in leg (peripheral) arteries in March 2001 and for coronary use in December 2001
and  the  increased  acceptance  of  the  Company's   Xpeedior(R)  catheters  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.

     In April  2002,  the Company  released to the U.S.  market the new 5 French
XVG(TM)  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  XMI135.  The XVG  incorporates  the  proprietary  Cross-Stream
technology  platform,  and it is optimized  for vessels  3-8mm in diameter.  The
combination of longer length, Cross-Stream technology, higher clot removal rate,
improved  pushability and trackability should make this a versatile catheter for
dealing with larger vessels,  more distal vessels,  and older,  more problematic
clot burdens.

     As of April 30, 2002,  the Company had a total of 823 domestic  drive units
in the field, compared to 615 drive units at April 30, 2001, and 771 units as of
January 31,  2002.  During the three month  period  ended  April 30,  2002,  the
Company's worldwide catheter sales increased  approximately 33% to approximately
8,400  catheters  versus  approximately  6,300  catheters in the same prior year
period.  During  the nine month  period  ended  April 30,  2002,  the  Company's
worldwide  catheter sales increased  approximately  35% to approximately  24,000
catheters versus  approximately  17,800 catheters in the same prior year period.
The average catheter utilization rate per installed domestic drive unit was 10.2
in the second  quarter of fiscal  2002,  compared  to a rate of 10.4 in the same
prior year  period,  and  compared  to a rate of 10.6 in the  second  quarter of
fiscal 2002. The Company sold 40 and 127 drive units worldwide  during the three
and nine  months  ended  April 30,  2002  compared  to 38 and 123  drive  units,
respectively, in the same periods in the prior year.

     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. The benefit for
the  Company is 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.

<PAGE>

     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 and nine month periods
ended April 30, 2002 were $116,000 and $352,000,  respectively. This compared to
foreign sales of the AngioJet System of $67,000 and $310,000,  respectively, for
the same periods the previous  year.  The limited  foreign sales are due to cost
constraints in overseas  markets that result in lower margins.  Due to the lower
margins,  the Company is not actively seeking to expand its distribution network
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  is  actively
responding to MHW regulatory  issues and expects Japanese  approval for coronary
use of the  AngioJet  System in calendar  year 2002.  Once  Japanese  regulatory
approval is received, the Company must apply for and secure adequate third-party
reimbursement  for AngioJet use. The Company  expects this to be a six to twelve
month process.

     The Company believes that the treatment of blood clots in coronary vessels,
peripheral  vessels,  dialysis  access grafts and neuro vessels are  significant
worldwide marketing opportunities for the AngioJet System.

Revenue - Vascular Grafts

     Vascular  graft sales were $0 and  $75,000 for the nine months  ended April
30,  2002  and  2001,  respectively.  All  of  the  vascular  graft  sales  were
Perma-Seal(R) Dialysis Access Grafts. No additional sales of Perma-Seal Dialysis
Access Grafts are expected.  Currently, the Company has put all graft activities
on hold as it concentrates its efforts on the development on new AngioJet System
applications.  All assets  relating to the  vascular  graft  business  have been
written off in prior periods.

Cost of Medical Products

     Cost of medical  products  increased  $608,000 to  $3,154,000  in the three
month period ended April 30, 2002 over the same period in the previous year, and
increased  $749,000 to $9,365,000 for the nine month period ended April 30, 2002
over the same period in the previous year.  These increases are primarily due to
the significant  growth in the U.S. AngioJet System product sales. Gross margins
improved by $2,736,000 to  $7,601,000,  or 71% as a percentage of product sales,
for the three months ended April 30, 2002,  over the same period in the previous
year. Gross margins improved  $8,879,000 to $21,200,000,  or 69% as a percentage
of product  sales,  for the nine month period ended April 30, 2002 over the same
period in the previous  year.  This compares to gross margins as a percentage of
product  sales of 66% and 59% for each of the three and nine month periods ended
April 30, 2001. The improvement in gross margins was primarily  driven by higher
volumes of XMI and Xpeedior  catheters  that have a lower per unit cost compared
to the  catheters  they  replaced and an  improvement  in the  coronary  product
catheter  mix in the three and nine  months  ended April 30, 2002 as compared to
same  periods in the  previous  fiscal  year.  The Company  believes  that gross
margins  as a  percentage  of product  sales will be in the high  sixties to low
seventies as a percent to sales for the remainder of fiscal 2002.

<PAGE>

Selling, General and Administrative Expense

     Selling,   general  and  administrative  expense  increased  $1,041,000  to
$4,947,000 for the three months ended April 30, 2002 and increased $1,206,000 to
$14,095,000  for the nine  months  ended  April 30,  2002,  compared to the same
periods in previous  year. The primary  factors in the expense  increase for the
three  months  ended  April 30,  2002 were the  increase  in the sales  force of
$216,000,  commissions  of  $153,000,  marketing  studies of $131,000 and higher
corporate  incentives of $138,000.  The primary factors for the expense increase
for the  nine  months  ended  April  30,  2002  were an  increase  in  corporate
incentives of $722,000,  higher  commissions  of $373,000 and marketing  fees to
group purchasing organizations due to increased AngioJet System product sales of
$192,000.  The reduction in costs related to the work force reduction in January
2001 and a reduction in health insurance premiums partially offset these expense
increases.  The Company expects selling,  general and administrative  expense to
increase for the remainder of fiscal 2002 due to the anticipated  growth in U.S.
AngioJet System revenue.

Research and Development Expense

     Research and development  expense decreased $15,000,  or 1%, to $1,024,000,
in the three months ended April 30,  2002,  when  compared to the same period in
the prior year. Research and development expense decreased $728,000,  or 19%, to
$3,046,000  in the three  months  ended April 30,  2002.  These  decreases  were
primarily  due  to  the  shifting  of  priorities  between  various  development
projects, slower than anticipated TIME 1 clinical trial patient enrollment,  and
the  reimbursement of costs from the National  Institutes of Health (NIH) grant.
The Company  believes that research and development  expense for AngioJet System
applications  will  increase  for the  remainder  of fiscal  2002 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 distal protection device.

     In  October  1999,   the  Company   received  full  FDA  approval  for  its
Investigational Device Exemption (IDE) application for the TIME 1 clinical trial
of the AngioJet  System in the  treatment of acute  ischemic  stroke.  The first
patient was enrolled in May 2000. After the first five patients had been treated
in the  TIME 1  clinical  trial  for  ischemic  stroke,  a  planned  review  was
conducted.  This review  concluded that the AngioJet NV150  neurocatheter  could
access the middle  cerebral artery where most ischemic  strokes occur,  and that
the  device  can  effectively  remove a clot from  this  territory.  The  review
suggested changes to the protocol covering a variety of areas, including patient
selection,  exclusion  criteria,  and specifications for physician  technique in
deploying and moving the device in the cerebral vasculature. Physician reviewers
also suggested changes to the device,  to improve the trackability,  flexibility
and  efficacy  profile.  In May 2001,  the FDA  approved the re-start of patient
enrollment in the TIME 1 clinical trial. TIME 1 clinical trial will enroll up to
30 patients at up to eight centers in the U.S. to determine safety of the device
for this  indication.  Nine  patients  have  been  enrolled  to date  under  the
re-opened trial. The next planned review clinical results will take place when a
total of 10 patients have been enrolled under the re-opened trial.

Interest Income

     Interest  income  decreased  $51,000 to $56,000 in the three  months  ended
April 30,  2002,  and  decreased  $208,000 to $191,000 in the nine months  ended
April 30, 2002 compared to the same periods in the prior year.  These  decreases
are due to the declining  market  interest rates.  The Company expects  interest
income on a quarterly basis to increase  slightly during the remainder of fiscal
2002 as cash is generated from operations.

<PAGE>

Liquidity and Capital Resources

     The Company's cash and cash equivalents totaled approximately $16.8 million
at April 30, 2002 versus $9.5 million at July 31, 2001.

     The $7,306,000 net increase in cash and cash equivalents in the most recent
nine-month  period  was  primarily  due to the net cash  provided  by  operating
activities  of  $5,275,000.  Net  cash  provided  by  operating  activities  was
primarily due to the net income of $4,251,000, depreciation of $1,585,000, stock
compensation  expense of $176,000 and an increase in accrued  expenses and other
current  liabilities  of  $1,198,000.   This  net  cash  provided  by  operating
activities  was  partially  offset  by  an  increase  in  trade  receivables  of
$1,096,000,  an increase in inventory of $581,000, a decrease in other assets of
$98,000 and a decrease in accounts payable of $143,000.  The increase in accrued
liabilities was due to the timing of the payments of accrued liabilities and the
increase in accrued corporate incentives. Trade receivables increased due to the
increase in revenue for the three month period ending April 30, 2002 as compared
to revenue for the last three months of fiscal 2001.  Inventory increased due to
the increase in demand for the AngioJet System. The increase in other assets was
due to the increase in prepaid  insurance.  The decrease in accounts payable was
due to the timing of the payment of accounts  payables.  Cash used in  investing
activities of $661,000 was for the purchase of property and equipment.  Net cash
provided by financing  activities was  $2,692,000,  which resulted from the cash
received  in  connection  with the  exercise of stock  options  and  warrants of
$2,719,000, offset by the repayment of debt of $27,000.

     The Company expects that fiscal 2002 product sales of the AngioJet  System,
primarily  in the  United  States,  will  be in  the  middle  of the  previously
estimated  range of $39 million to $44 million.  Gross margin for fiscal 2002 is
expected to be in the high sixties to low seventies as a  percent-of-sales.  The
Company  expects  selling,  general and  administrative  expenses to increase in
fiscal 2002 due to anticipated growth in product sales. Research and development
expenditures  are expected to increase  during the fourth quarter of fiscal 2002
versus the third  quarter of fiscal  2002.  For the full fiscal  2002 year,  the
research and  development  expenditures  are expected to be less than the fiscal
2001 level as the  Company  completes  development  of  projects  and invests in
development  of  new  AngioJet  System  thrombectomy  applications  and  related
products.  The Company expects its diluted  earnings per share for the full year
to be in the previously estimated range of $0.31-$0.34 per diluted share for the
full year.  Possis Medical expects its business to be cash flow positive for the
balance of the fiscal year,  and the Company  anticipates  no additional  equity
financing to support  these growths  plans.  The trends to support the Company's
expected  positive cash flow for the remainder for fiscal 2002 are the continued
growth of the  Company's  product  sales  and the  continued  management  of the
Company's  expenses.  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 April  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.

     The Company does not have any debt or off balance sheet liabilities.

<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     Form            Date Filed                 Description


     3.1       10-K         Fiscal year ended      Articles of incorporation as
                            July 31, 1994          amended and restated to date.

     3.2       10-K         Fiscal Year ended      Bylaws as amended and
                            July 31, 1999          restated to date.




     (b) Reports on Form 8-K

     Possis Medical,  Inc. filed no reports on Form 8-K during the quarter ended
April 30, 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: June 13, 2002   BY:  /s/  Robert G. Dutcher
                         ROBERT G. DUTCHER
                         Chairman, President and Chief Executive Officer



DATE: June 13, 2002   BY:  /s/ Eapen Chacko
                          EAPEN CHACKO
                          Vice President of Finance and Chief Financial Officer