UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                   FORM 10-QSB

[X]  Quarterly report under Section 13 or 15(d) of the Securities Exchange Act
     of 1934 For the quarter ended June 30, 1996
                                   -------------

[    ] Transition  report under Section 13 or 15(d) of the  Securities  Exchange
     Act of 1934 For the transition period from ____________ to ____________

                       Commission file number: 33-93982-LA

                             ANNIE'S HOMEGROWN, INC.
--------------------------------------------------------------------------------
       (Exact name of Small Business Issuer as specified in its charter)

             DELAWARE                                         06-1258214
--------------------------------------                    ----------------------
     (State or other jurisdiction of                        (I.R.S. Employer
      incorporation or organization)                        Identification No.)

180 SECOND STREET, SUITE 202, CHELSEA, MA                         02150
--------------------------------------------------------------------------------
 (Address of principal executive offices)                       (Zip Code)

                                  617-889-2822
--------------------------------------------------------------------------------
                (Issuer's telephone number, including area code)

                                      NONE
--------------------------------------------------------------------------------
              (Former name, former address and former fiscal year,
                          if changed since last report)

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 during the past 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            No  X 
   ----           ----
Number of shares of Common Stock,  $.001 par value,  outstanding  as of June 30,
1996:

                                4,127,281 shares

Transitional Small Business Disclosure Format (check one): Yes    No  X  
                                                              ----   ----




                             ANNIE'S HOMEGROWN, INC.

                                      Index


                                                                        Page No.
                                                                        --------

Part I.    Financial Information

           Item 1. Financial Statements
           Balance Sheet as of June 30, 1996 (unaudited)                      3

           Statements of Operations for the Three Months and
           Six Months Ended June 30, 1996 and 1995 (unaudited)                4

           Statements of Cash Flows for the Six Months Ended
           June 30, 1996 and 1995 (unaudited)                                 5

           Item 2.  Management's Discussion and Analysis of Financial
           Condition and Results of Operation                               6-8


Part II    Other Information

           Item 6. Exhibits and Reports on Form 8-K                           9
           Signatures                                                         9



------------------------------------------------------------------------------

Statement of Fair Presentation

The  financial  information  included  herein is  unaudited.  In  addition,  the
financial  information does not include all disclosures required under generally
accepted accounting  principles because certain note information included in the
Company's  annual report to shareholders  has been omitted and such  information
should be read in conjunction with the prior year's annual report.  However, the
financial  information reflects all adjustments  (consisting of normal recurring
adjustments)  which are,  in the  opinion  of  management,  necessary  to a fair
statement  of  results  for the  interim  periods.  The  Company  considers  the
disclosures adequate to make the information presented not misleading.

                                      -2-


                             ANNIE'S HOMEGROWN, INC.
                                  Balance Sheet
                                    Unaudited

                                                                   June 30, 1996
                                                                   -------------
                                     Assets
Current assets
    Cash and cash equivalents                                       $    19,639
    Accounts receivable
       Trade                                                             88,336
       Related parties                                                   32,308
    Inventory                                                           250,284
    Other current assets                                                    500
                                                                     ----------
         Total current assets                                           391,067

Office equipment                                                         58,745
Accumulated depreciation                                                (30,291)
                                                                    -----------
         Office equipment, net                                           28,454

Due from officer                                                         75,000
Other assets                                                             24,470
                                                                    -----------

         Total assets                                               $   518,991
                                                                    ===========

                  Liabilities and Stockholders' Equity (Deficit)
Current liabilities
    Notes payable                                                   $    64,163
    Accounts payable, trade                                             451,758
    Accrued expenses                                                    141,512
    Due to employees                                                     47,614
                                                                    -----------
         Total current liabilities                                      705,047

Commitments

Stockholders' equity (deficit)
 Common stock, $.001 par value 
     Authorized 10,000,000 shares
     issued 4,239,187 shares                                              4,239
    Additional paid in capital                                        1,044,841
    Accumulated deficit                                              (1,143,386)
    Note receivable stockholder                                          (1,750)
    Treasury stock, 111,906 common shares at cost                       (90,000)
                                                                    -----------
         Total stockholders equity (deficit)                           (186,056)

         Total liabilities and stockholders' equity                 $   518,991
                                                                     ===========

                                      -3-



                             ANNIE'S HOMEGROWN, INC.
                            Statements of Operations
                                    Unaudited

<TABLE>
<CAPTION>

                                               Three months ended               Six months ended
                                                    June 30,                        June 30,        
                                            ------------------------      ---------------------------
                                                1995          1996           1995             1996   
                                          --------------  ----------      -----------      ----------

<S>                                        <C>            <C>            <C>            <C>        
Net sales                                  $   965,492    $   902,465    $ 2,190,312    $ 2,310,948

Cost of sales                                  573,606        545,819      1,280,942      1,434,323
                                           -----------    -----------    -----------    -----------

         Gross profit                          391,886        356,646        909,370        876,625

Operating expenses:
     Selling                                   263,048        335,803        569,715        737,138
     General and administrative                165,814        165,273        343,172        354,831
     Slotting fees                              42,872        146,286        165,171        204,013
     Compensation of outside directors            --            6,000           --           15,000
                                           -----------    -----------    -----------    -----------

         Total operating expenses              471,734        653,362      1,078,058      1,310,982
                                           -----------    -----------    -----------    -----------

         Operating income (loss)               (79,848)      (296,716)      (168,688)      (434,357)

Other income (loss)
     Interest expense and other charges           (757)       (10,369)       (13,523)       (21,158)
     Interest and other income                   8,310          6,048         19,370          5,053
                                           -----------    -----------    -----------    -----------


         Income (loss) before income tax       (72,295)      (301,037)      (162,841)      (450,462)

Income tax expense                                --             --            1,962          2,050
                                           -----------    -----------    -----------    -----------
                                                                                              

         Net income (loss)                 $   (72,295)   $  (301,037)   $  (164,803)   $  (452,512)
                                           ===========    ===========    ===========    ===========


Weighted average common
  shares outstanding                         3,957,297      4,118,961      3,950,536      4,104,831

Net income (loss) per share                       (.02)          (.07)          (.04)          (.11)

</TABLE>


                                      -4-



                             ANNIE'S HOMEGROWN, INC.
                            Statements of Cash Flows
                                    Unaudited
<TABLE>
<CAPTION>


                                                              Six months ended
                                                                  June 30, 
                                                            -----------------------
                                                               1995         1996 
                                                           -----------  ------------
<S>                                                         <C>          <C>       
Cash flows from operating activities:
    Net income (loss)                                       $(164,803)   $(452,512)
    Adjustments to reconcile net income (loss) to net
     cash (used in) provided by operating activities:
         Depreciation and amortization                          4,100        6,000
         Outside directors compensation                          --         15,000
         Changes in:
             Accounts receivable - trade                       58,009      116,357
             Affiliate accounts, net                          273,918      (11,555)
             Inventory                                        116,093      155,480
             Other assets                                       1,626       (5,317)
             Accounts payable - trade                         (29,092)    (139,901)
             Accrued expenses                                  68,929      (38,071)
               Due to employees                                (3,771)      (2,100)
                                                            ---------    ---------
                  Net cash (used in) provided by
                   operating activities                       325,009     (356,619)

Cash flows from investing activities:
     Purchases of office equipment                             (7,614)      (2,123)
                                                            ---------    ---------
                  Net cash (used in) investing activities      (7,614)      (2,123)

Cash flows from financing activities:
     Repayment of notes payable                              (210,658)        --
     Net proceeds from notes payable                             --         24,534
     Issuance of common stock and exercise
      of stock options, net                                   (68,865)     318,384
                                                            ---------    ---------
                  Net cash (used in) provided by
                   financing activities                      (279,523)     342,918

Net (decrease) increase in cash and cash equivalents           37,872      (15,824)
Cash and cash equivalents, beginning of period                  2,442       35,463
                                                            ---------    ---------

Cash and cash equivalents, end of period                    $  40,314    $  19,639
                                                            =========    =========

Supplemental disclosure of cash flow information
     Cash paid for interest                                 $  13,523    $  21,158
                                                            =========    =========
     Cash paid for income taxes                             $   1,962    $   2,050
                                                            =========    =========
</TABLE>


                                      -5-



                             ANNIE'S HOMEGROWN, INC.

                      MANAGEMENT'S DISCUSSION AND ANALYSIS


OVERVIEW

The Company's net sales are generated by sales to  supermarkets  and natural and
specialty food stores. Net sales are net of product returns and allowances.  The
Company  sells most of its product to its customers on a credit basis with 2% 10
day,  net 15 day terms.  The Company has  developed  four  premium  macaroni and
cheese dinners: Annie's Shells and Cheddar, Annie's Alfredo, Annie's Whole Wheat
Shells and  Cheddar,  and Annie's  Mild  Mexican(TM)  . The Company  also has an
agreement with a specialty retailer to provide a private label house brand using
the Company's  premium all natural white cheddar cheese  formulae  together with
elbow macaroni.

The Company's cost of sales consists of purchasing cheese from a cheese supplier
as  well  as  finished  product  from  pasta  manufacturers.  The  products  are
manufactured  according to the  specifications  provided by the  Company,  which
include the recipe,  ingredients,  graphics and packaging  for the product.  The
Company  products are shipped  directly from the manufacturer via common carrier
to either of two public warehouses located in Massachusetts and California.  The
Company  generally  distributes its products by either shipping  directly to the
supermarket chains' central warehouses or to a wholesale grocery distributor.

Selling expenses include the costs of product marketing, sales commissions, cost
of product distribution and account management.  The Company retains brokers who
present the  Company's  products to  supermarket  chains and  distributors.  The
brokers  work on a commission  basis,  generally  5% of net cash  received.  The
Company  negotiates,  through  the  broker,  the cost of  acquiring  shelf space
(introductory  slotting)  as  well  as the  continuing  support  needed  for the
product.  Introductory  slotting fees can take the form of cash payments  and/or
free product allowances.

The Company's strategy is to continue to expand its supermarket and natural food
distribution  nationally  as well as to develop new and unique all natural  food
products for sale to its existing customer base.



RESULTS OF OPERATIONS


SIX MONTHS ENDED JUNE 30, 1996 COMPARED TO SIX MONTHS ENDED JUNE 30, 1995

NET SALES.  Net sales  increased by $120,636 or 5.51% from $2,190,312 in 1995 to
$2,310,948 in 1996.  The net sales increase was primarily a result of our growth
in the slotting of new accounts in 1996 and 1995.  The Company  believes that it
has penetrated all major supermarket chains in the New England states, and sells
in several major supermarket chains in New York and California.  The Company has
expanded its supermarket  business into the  Mid-Atlantic  states as well as the
Rocky Mountain region.  The Company believes it has penetrated many of the major
natural  food  market  stores  across the  country.  Additionally,  the  Company
continues to produce for a specialty retailer their private label brand macaroni
and cheese dinner using the Company's white cheddar cheese formula.

GROSS PROFIT.  As a percentage of net sales,  gross profit decreased from 41.52%
in 1995 to  37.93%  in 1996.  This  decrease  was  primarily  a result of higher
production costs as raw materials increased in price.


                                      -6-



                             ANNIE'S HOMEGROWN, INC.

                MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED


SELLING EXPENSES. Selling expenses increased by $167,423 or 29.39% from $569,715
in 1995 to  $737,138 in 1996 and  increased  as a  percentage  of net sales from
26.01%  in 1995 to  31.90%  in 1996.  The  increase  in  selling  expenses  as a
percentage  of net sales  primarily  reflected  an increase in spending in three
primary  areas:  (i) the hiring of additional  personnel to sell and support the
Company's  products and customer  base,  (ii) increase in freight costs due to a
customer  base  expanding   further  away  from  the  Company's   warehouses  in
Massachusetts and California,  (iii) marketing costs, including price reductions
and trade  show  appearances,  associated  with the  continued  roll-out  of the
Company's products in 1996.

GENERAL  AND  ADMINISTRATIVE  EXPENSES.   General  and  administrative  expenses
increased  by $38,842 or 23.52%  from  $343,172  in 1995 to $354,831 in 1996 and
decreased  as a  percentage  of net sales from 15.67% in 1995 to 15.35% in 1996.
The increase in costs relates to hiring more personnel to handle the increase in
volume as well as the initial public offering.

SLOTTING FEES. Slotting expenses increased by $38,842 or 23.52% from $165,171 in
1995 to $204,013 in 1996,  and increased as a percentage of net sales from 7.54%
in 1995 to 8.83% in 1996.  The  increase  was due to the  Company's  decision to
proceed with the expansion by purchasing  additional  shelf space which requires
paying  introductory  slotting  fees  for the  acquisition  of  shelf  space  at
supermarkets.  These  slotting  fees are required by most  supermarkets  and are
expensed at the time of product introduction.

COMPENSATION OF OUTSIDE  DIRECTORS.  In 1996,  $15,000 in compensation for stock
options granted was recorded for the four outside  directors of the Company.  In
1995,  the Company had $45,000 paid to the four outside  directors in the fourth
quarter.  No  compensation  was paid to its directors who also were employees of
the Company.


THREE MONTHS ENDED JUNE 30, 1996 COMPARED TO THREE MONTHS ENDED JUNE 30, 1995

NET SALES.  Net sales  decreased  by $63,027 or 6.53% from  $965,492  in 1995 to
$902,465 in 1996.  The net sales  decrease was  primarily a result of doing less
sales in its  private  label  house  brand.  The  Company  believes  that it has
penetrated all major supermarket  chains in the New England states, and sells in
several major  supermarket  chains in New York and  California.  The Company has
expanded its supermarket  business into the  Mid-Atlantic  states as well as the
Rocky Mountain  region.  The Company believes it has penetrated all of the major
natural food market stores across the country.

GROSS PROFIT.  As a percentage of net sales,  gross profit decreased from 40.59%
in 1995 to  39.52%  in 1996.  This  decrease  was  primarily  a result of higher
production costs as raw materials increased in price.

SELLING EXPENSES.  Selling expenses increased by $72,755 or 27.66% from $263,048
in 1995 to  $335,803 in 1996 and  increased  as a  percentage  of net sales from
27.24%  in 1995 to  37.21%  in 1996.  The  increase  in  selling  expenses  as a
percentage of net sales primarily reflected an increase in spending in marketing
costs, including advertising and price reductions.

                                      -7-




                             ANNIE'S HOMEGROWN, INC.

                MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED


GENERAL  AND  ADMINISTRATIVE  EXPENSES.   General  and  administrative  expenses
decreased  by $541 or .33%  from  $165,814  in  1995  to  $165,273  in 1996  and
increased  as a  percentage  of net sales from 17.17% in 1995 to 18.31% in 1996.
The percentage  increase was due primarily to personnel handling less volumes of
work as sales decreased.

SLOTTING FEES.  Slotting expenses  increased by $103,414 or 241.22% from $42,872
in 1995 to $146,286 in 1996,  and  increased as a  percentage  of net sales from
4.44% in 1995 to 16.21% in 1996. The increase was due to the Company's  decision
to proceed  with the  expansion  by  purchasing  additional  shelf  space  which
requires paying introductory slotting fees for the acquisition of shelf space at
supermarkets.  These  slotting  fees are required by most  supermarkets  and are
expensed at the time of product introduction.


LIQUIDITY AND CAPITAL RESOURCES

The Company has  financed  its  operations  to date  through the initial  public
offering  of  Common  Stock,   private  sale  of  equity  and  convertible  debt
securities,  a line of credit from a financial  institution  and cash  generated
from operations.  At June 30, 1996, the Company had a working capital deficit of
$313,980.  The working capital deficit was primarily  generated by the Company's
decision to proceed with the  expansion  by  purchasing  additional  shelf space
which requires  paying  introductory  slotting fees for the acquisition of shelf
space at supermarkets.

The Company has a revolving  line of credit with a financial  institution in the
amount of $150,000 which bears interest at the prevailing prime rate plus 3%. In
addition,  each borrowing  incurs a service fee which varies from 0.5% to 8% (up
to 90 days)  depending on the number of days the borrowing is  outstanding.  The
line of credit is secured by the Company's accounts receivable and inventory and
guaranteed by an officer and certain directors of the Company. In June 1996, the
Company  renegotiated  its line of credit with the  financial  institution.  The
Company increased its line of credit from $150,000 to $300,000. In addition, the
service  fees  charged  were  reduced from 0.5% to 8% (up to 90 days) to 0.4% to
6.4% (up to 90 days).  The Company also has a $10,000  unsecured  line of credit
with a bank which bears  interest at the prime rate plus 8.9%.  At June  30,1996
the Company had $56,663 in outstanding borrowings under the lines of credit.

On July 31, 1996, the Company closed its offering. In total, 256,490 shares were
sold resulting in gross proceeds of approximately $1,500,000.  Expenses from the
inception of the offering totaled approximately  $325,000.  Some of the proceeds
were used to fund  operating  losses  during the first six months of fiscal 1996
amounting  to   approximately   $450,000,   which  included   slotting  fees  of
approximately  $204,000.  The Company  expects  profitable  operations  over the
balance of 1996.

The Company's primary capital needs are for expansion into national  supermarket
distribution  and to develop new  products.  The  Company  intends to expand its
supermarket  distribution  throughout the United States by acquiring shelf space
or new "slots" (one product in one store equals one slot). The Company's planned
expenditures  for slotting  fees for the balance of 1996 are to be funded with a
portion of the net proceeds of the initial public offering. The Company believes
that the net proceeds  from the public  offering,  together  with the  Company's
increased line of credit and funds that may be generated from  operations,  will
be  sufficient  to fund the  Company's  currently  anticipated  working  capital
requirement and expenditure for at least the next twelve months.

                                      -8-




                             ANNIE'S HOMEGROWN, INC.

                           PART II - OTHER INFORMATION


 EXHIBITS LIST AND REPORTS ON FORM 8-K

(A) EXHIBITS

     Exhibit Number
     --------------
         27.1                                        Financial Data Schedule

(B) REPORTS ON FORM 8-K

No reports on Form 8-K were filed by the  Company  during the  Company's  fiscal
quarter ended June 30, 1996.





                                   SIGNATURES

In accordance with the requirements of the Securities  Exchange Act of 1934, the
registrant  caused  this  report to be signed on its behalf by the  undersigned,
thereunto duly authorized.



                                                       ANNIE'S HOMEGROWN, INC.


Date: December 16, 1996                  /s/ Paul B. Nardone 
      -----------------                      ---------------------------------
                                             Paul B. Nardone
                                             President


Date: December 16, 1996                 /s/  Neil Raiff  
      -----------------                      ----------------------------
                                             Neil Raiff
                                             Chief Financial Officer & Treasurer


                                      -9-