SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

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

                    For the quarter ended September 30, 1999

                                       OR

            [ ] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

               For the transition period from ________ to ________

                         COMMISSION FILE NUMBER: 2-99080

                       NATIONAL DIVERSIFIED SERVICES, INC.
             (Exact name of Registrant as specified in its charter)

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<CAPTION>
<S>                                                                                              <C>
          DELAWARE                                                                               11-2820379
(State or other jurisdiction                                                                     (I.R.S. Employer
of incorporation or organization)                                                                Identification No.)
</TABLE>

                             c/o Lester Morse P.C.
                        111 Great Neck Road, Suite #420

                           GREAT NECK, NEW YORK 11021
              (Address of principal executive offices) (Zip Code)

                         Registrant's telephone number,

                      INCLUDING AREA CODE: (516) 487-1419

                                 Not Applicable

     (Former name,  former  address and former fiscal year if changed since last
report)

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

     YES X . No ___.

     6,548,870  COMMON  SHARES,  $.001 PAR VALUE WERE ISSUED AND  OUTSTANDING AT
SEPTEMBER 30, 1999.


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                       NATIONAL DIVERSIFIED SERVICES, INC.

                                      INDEX
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<CAPTION>

                                                                                                               Page

                                                                                                             NUMBER

PART I.  FINANCIAL INFORMATION

         Item 1.           Financial Statements

                           Consolidated Balance Sheets                                                            3
<S>                                    <C> <C>
                             September 30, 1999 (Unaudited) and

                             December 31, 1998

                           Consolidated Statements of Operations                                                  4
                             Three Months and Nine Months ended September 30,

                             1999 and September 30, 1998 (Unaudited)

                           Consolidated Statements of Cash Flows                                                  5
                             Nine Months Ended September 30, 1999 and

                              September 30, 1998 (Unaudited)

                           Notes to Financial Statements (Unaudited)                                              6

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

                             Operations                                                                           7

PART II.          OTHER INFORMATION                                                                               8

SIGNATURES                                                                                                        9

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              NATIONAL DIVERSIFIED SERVICES, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS

                                     ASSETS
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<CAPTION>

                                                                          SEPTEMBER 30,      DECEMBER 31,

                                                                              1999                   1998
                                                                           (Unaudited)             (Audited)

CURRENT ASSETS:

<S>                                                                        <C>                   <C>
   Cash and cash equivalents                                               $   254,770           $   262,303
   Interest receivable                                                           1,526                   113
   OTHER CURRENT ASSETS                                                          1,656                 1,656
                                                                           -----------           -----------

                  TOTAL CURRENT ASSETS                                         257,952               264,702
                                                                           -----------           -----------

                  TOTAL                                                    $   257,952           $   264,072
                                                                           ===========           ===========


                                   LIABILITIES

CURRENT LIABILITIES:

   ACCOUNTS PAYABLE AND ACCRUED EXPENSES                                   $     5,569           $     7,517
                                                                           -----------           -----------

                  Total current liabilities                                      5,569                 7,517

ACCRUED SALARIES - OFFICER                                                      58,750                58,750
                                                                           -----------           -----------

                  TOTAL LIABILITIES                                             64,319                66,267
                                                                           -----------           -----------


                              STOCKHOLDERS' EQUITY

Common stock, $.001 par value; authorized 30,000,000

   shares, issued 6,553,870 shares                                               6,554                 6,554
ADDITIONAL PAID-IN CAPITAL                                                     705,755               705,755
                                                                           -----------           -----------
                  Total                                                        712,309               712,309

ACCUMULATED DEFICIT                                                           (518,671)             (514,499)
                                                                           -----------           -----------
                                                                               193,638               197,810
LESS:  5,000 SHARES OF TREASURY STOCK, AT COST                                       5                     5
                                                                           -----------           -----------

                  TOTAL STOCKHOLDERS' EQUITY                                   193,638               197,805
                                                                           -----------           -----------

                  TOTAL                                                    $   257,952           $   264,072
                                                                           ===========           ===========

</TABLE>

           See accompanying notes to consolidated financial statements


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              NATIONAL DIVERSIFIED SERVICES, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS

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<CAPTION>
                                   (UNAUDITED)

                                                                      NINE                        THREE
                                                                  MONTHS ENDED                MONTHS ENDED
                                                                  SEPTEMBER 30,               SEPTEMBER 30,
                                                               1999         1998            1999         1998

<S>                                                          <C>          <C>            <C>           <C>
REVENUES - interest                                          $   9,830    $   10,991     $   3,481     $  3,470


GENERAL AND ADMINISTRATIVE

   EXPENSES                                                     14,002        22,582         6,660        4,580
                                                             ---------    ----------     ---------     --------


NET LOSS                                                     $  (4,172)   $  (11,591)    $  (3,179)    $ (1,110)
                                                             =========    ==========     =========     ========


NET LOSS PER SHARE, BASED
   ON THE WEIGHTED AVERAGE

   SHARES OUTSTANDING                                        $    -   *   $     -   *    $    -   *    $   -   *
                                                             =========    ==========     =========     ========


NUMBER OF SHARES USED TO

   COMPUTE LOSS PER SHARE                                    6,548,870     6,548,870     6,548,870     6,548,870
                                                             =========     =========     =========     =========

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*Less than $.01 per share

           See accompanying notes to consolidated financial statements


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              NATIONAL DIVERSIFIED SERVICES, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)
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<CAPTION>

                                                                                                NINE
                                                                                            MONTHS ENDED
                                                                                            SEPTEMBER 30,

                                                                                        1999            1998
                                                                                    -------------  -------------

CASH FLOWS FROM OPERATING ACTIVITIES:

<S>                                                                                  <C>            <C>
   NET LOSS                                                                          $     (4,172)  $    (11,591)
                                                                                     ------------   ------------
   Adjustments to reconcile net loss to net cash
     used in operating activities:
       Changes in assets and liabilities:

         Interest receivable                                                               (1,413)          (835)
         ACCOUNTS PAYABLE AND ACCRUED EXPENSES                                             (1,948)        (1,484)
                                                                                     ------------   ------------

                  TOTAL ADJUSTMENTS                                                        (3,361)        (2,319)
                                                                                     ------------   ------------

NET CASH USED IN OPERATING ACTIVITIES                                                      (7,533)       (13,910)
                                                                                     ------------   ------------

NET CHANGE IN CASH AND CASH EQUIVALENTS                                                    (7,533)       (13,910)

CASH AND CASH EQUIVALENTS - BEGINNING                                                     262,303        275,937
                                                                                     ------------   ------------

CASH AND CASH EQUIVALENTS - ENDING                                                   $    254,770   $    262,027
                                                                                     ============   ============


SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

   CASH PAID FOR INCOME TAXES                                                        $      1,031   $        380
                                                                                     ============   ============




</TABLE>









           See accompanying notes to consolidated financial statements


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              NATIONAL DIVERSIFIED SERVICES, INC. AND SUBSIDIARIES
                                    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 1999
                                   (UNAUDITED)

NOTE 1 - BASIS OF PRESENTATION

     The  attached  summarized  financial   information  does  not  include  all
     disclosures  required  to  be  included  in a  complete  set  of  financial
     statements  prepared  in  conformity  with  generally  accepted  accounting
     principles.  Such disclosures were included with the consolidated financial
     statements  of the Company at  December  31,  1998,  included in its annual
     report on Form 10-K. Such statements should be read in conjunction with the
     data herein.

NOTE 2 - ADJUSTMENTS

     The financial  information reflects all normal recurring adjustments which,
     in the opinion of management,  are deemed necessary for a fair presentation
     of the results for the interim periods. The results for the interim periods
     are not necessarily indicative of the results to be expected for the year.

NOTE 3 - CASH EQUIVALENTS

     Cash  equivalents  are comprised of an investment in short-term  commercial
     paper with maturities of less than ninety days.

NOTE 4 - ACCRUED SALARIES - OFFICER

     Accrued salaries - officer  represents $58,750 for the period December 1986
     to November 22, 1989.



<PAGE>

           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                            AND RESULTS OF OPERATIONS

RESULTS OF OPERATIONS

         During the three months and nine months ended  September 30, 1999,  the
Company had no revenues other than interest income since the Company  terminated
its  import and sale  business  operations  in 1990.  The  Company is  presently
exploring  various  business  opportunities  that  may be  available  to it.  No
assurances  can be given that the Company  will be  successful  in  completing a
transaction to acquire an operating business.

LIQUIDITY AND CAPITAL RESOURCES

         Financing of the Company's activities has been provided from the public
sale of its securities for cash amounting to a net of approximately $600,000. At
September 30, 1999, the Company's working capital amounted to $252,383 with cash
assets of  $254,770.  Management  believes  that its cash assets are adequate to
meet the  Company's  short term and long term  liquidity  and cash  requirements
until such time, if ever, as the Company completes a transaction to establish an
operating business.

                                        7


<PAGE>
                       NATIONAL DIVERSIFIED SERVICES, INC.

                           PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS: None

ITEM 2. CHANGES IN SECURITIES: None

ITEM 3. DEFAULTS UPON SENIOR SECURITIES: None

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

                  None

ITEM 5. OTHER INFORMATION: None

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

                  (a)      Exhibits - 27 - Financial Data Schedule

                  (b) No reports on Form 8-K were filed during the quarter ended
         September 30, 1999.

                                        8


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                       NATIONAL DIVERSIFIED SERVICES, INC.

                                   SIGNATURES

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

                                             NATIONAL DIVERSIFIED SERVICES, INC.

                                                                    (Registrant)

DATED: NOVEMBER 12, 1999                        /S/MORRY RUBIN

                                                   Morry Rubin, President, Chief
                                                   Executive, Financial and
                                                   Accounting Officer

                                        9