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, 1997
                                   -------------

[ ]  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   X           No 
                                                        -----            -----
Number of shares of Common Stock,  $.001 par value,  outstanding  as of July 31,
1997:

                                4,316,895 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, 1997 (unaudited)                     3

           Statements of Operations for the Three Months
           Ended June 30, 1997 and 1996 (unaudited)                          4

           Statements of Cash Flows for the Three Months Ended
           June 30, 1997 and 1996 (unaudited)                                5

           Item 2.  Management's Discussion and Analysis of Financial
           Condition and Results of Operation                              6-9


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 footnote 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, 1997
                                     Assets
Current assets
    Cash and cash equivalents                                      $   240,837
    Accounts receivable
       Trade                                                            55,787
       Related parties                                                  35,674
    Inventory                                                        1,044,201
    Other current assets                                                16,753
                                                                   -----------
         Total current assets                                        1,393,252

Office equipment                                                        91,068
Accumulated depreciation                                               (44,464)
         Office equipment, net                                          46,604

Due from officer                                                        75,000
Other assets                                                            30,230
                                                                   -----------

         Total assets                                              $ 1,545,086
                                                                   ===========

                      Liabilities and Stockholders' Equity
Current liabilities
    Notes payable                                                  $         -
    Accounts payable, trade                                            549,942
    Accrued expenses                                                    46,045
    Deferred revenue from distributor                                  350,688
    Due to employees                                                    43,939
                                                                   -----------
         Total current liabilities                                     990,614

Commitments

Stockholders' equity Common stock, $.001 par value.
     Authorized 10,000,000 shares
     issued 4,368,801 shares                                             4,369
    Additional paid in capital                                       1,761,932
    Accumulated deficit                                             (1,120,079)
    Note receivable stockholder                                         (1,750)
    Treasury stock, 111,906 common shares at cost                      (90,000)
                                                                   -----------
         Total stockholders equity                                     554,472

         Total liabilities and stockholders' equity                $ 1,545,086
                                                                   ===========



                                      -3-


                             ANNIE'S HOMEGROWN, INC.
                            Statements of Operations
                                    Unaudited

                                                      Three months ended
                                                           June 30,
                                                  --------------------------
                                                     1996               1997
                                                ------------       ------------

Net sales                                       $    902,465       $  1,102,185

Cost of sales                                        545,819            699,497
                                                ------------       ------------

         Gross profit                                356,646            402,688

Operating expenses:
     Selling                                         335,803            309,342
     General and administrative                      165,273            211,635
     Slotting fees                                   146,286             40,092
     Compensation of outside directors                 6,000                  -
                                                ------------       ------------

         Total operating expenses                    653,362            561,069
                                                ------------       ------------

         Operating income (loss)                    (296,716)          (158,381)

Other income (loss)
     Interest expense and other charges              (10,369)           (13,287)
     Interest and other income                         6,048              1,909
                                                ------------       ------------

         Income (loss) before income tax            (301,037)          (169,759)

Income tax expense                                         -                250
                                                ------------       ------------

         Net income (loss)                      $   (301,037)         $(170,009)
                                                ============         ==========


Weighted average common
  shares outstanding                               4,118,961          4,256,895

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




                                      -4-



                             ANNIE'S HOMEGROWN, INC.
                            Statements of Cash Flows
                                    Unaudited
<TABLE>
<CAPTION>
                                                                             Three  months ended
                                                                                    June 30,
                                                                          --------------------------
                                                                            1996              1997
                                                                        --------------  --------------
<S>                                                                     <C>             <C>          
Cash flows from operating activities:
    Net income (loss)                                                   $   (301,037)   $   (170,009)
    Adjustments to reconcile net income (loss) to net
     cash (used in) provided by operating activities:
         Depreciation and amortization                                         3,000           4,500
         Outside directors compensation                                        6,000               -
         Changes in:
             Accounts receivable - trade                                     266,039         (19,209)
             Affiliate accounts, net                                          (4,932)          6,399
             Inventory                                                       (17,208)        118,190
             Other assets                                                     20,677          19,398
             Accounts payable - trade                                        (50,988)        (44,878)
             Accrued expenses                                                (28,866)        (41,448)
               Deferred revenue from distributor                                   -         (73,536)
             Due to employees                                                 (2,100)         (2,233)
                                                                        ------------    ------------
                  Net cash (used in) provided by
                   operating activities                                     (109,415)       (237,156)

Cash flows from investing activities:
     Purchases of equipment                                                   (  232)         (5,427)
                                                                        ------------    ------------
                  Net cash (used in) investing activities                     (  232)         (5,427)

Cash flows from financing activities:
     Repayment of notes payable                                             ( 70,907)              -
     Issuance of common stock and exercise
      of stock options, net                                                  132,760               -
                                                                        ------------    ------------
                  Net cash (used in) provided by
                   financing activities                                       61,853               -

Net (decrease) increase in cash and cash equivalents                         (47,794)       (242,583)
Cash and cash equivalents, beginning of period                                67,433         483,420
                                                                        ------------    ------------

Cash and cash equivalents, end of period                                $     19,639    $    240,837
                                                                        ============    ============

Supplemental disclosure of cash flow information
     Cash paid for interest                                             $     10,369    $     13,287
                                                                        ============    ============
     Cash paid for income taxes                                         $          -    $        250
                                                                        ============    ============

</TABLE>


                                      -5-


                             ANNIE'S HOMEGROWN, INC.

                      MANAGEMENT'S DISCUSSION AND ANALYSIS



OVERVIEW

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).  In addition, the Company introduced in AprIL 1997 two
additional  premium  macaroni and cheese dinners:  Pizza Pasta and Mild Cheddar.
The Mild Cheddar  product is being promoted in  conjunction  with the Free Willy
Keiko  Foundation  with a portion of sales going to the  foundation.  In January
1997,  the Company  introduced a new line of all natural  pasta  dinners  called
Annie's  One-Step.  The dinners  combine  different pasta shapes with five sauce
recipes which provide the  convenience of one-step,  one-pot cooking as follows:
Annie's  One-Step  Rotini with Four Cheese Sauce,  Annie's  One-Step Penne Pasta
with Alfredo Sauce,  Annie's  One-Step  Radiatore Pasta with Sundried Tomato and
Basil Sauce,  Annie's One-Step Corkscrew Pasta with Savory Herb and Garlic Sauce
and Annie's One-Step Curly Fettuccine with White Cheddar and Broccoli Sauce. 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
formula together with elbow macaroni.

In October 1996, the Company signed a master distribution agreement with Liberty
Richter, Inc. ("Liberty").  The agreement calls for Liberty to distribute all of
the Company's  products except for the private label and mail order lines in the
continental United States. The Company sells the products to Liberty who in turn
resells the  products to its two main classes of trade;  supermarket  chains and
natural and specialty food stores.  Liberty has two  warehouses,  one located in
New Jersey and the other located in California.

Liberty  distributes and sells Annie's  products within the territory  utilizing
its own  sales  force and sub  distributors  that they  maintain.  In  addition,
Liberty  provides other  services such as order  processing,  invoicing,  record
management, sales coverage, broker management,  promotion execution,  management
of sales  allowances  and food show  participation.  All promotions and slotting
presentations  as well as sub  distributors  and  brokers are subject to Annie's
approval.

Under the Liberty  Agreement,  Liberty must  distribute  all new  products  that
Annie's chooses to distribute  through  Liberty's  channels unless Liberty has a
preexisting  non compete  provision with another  vendor.  The initial  contract
expires December 31, 1997, with automatic  renewals  scheduled on a year to year
basis.

The Company's  cost of sales  consists of the cost of finished  product  shipped
from a co-packer.  The raw materials  are purchased by the Company  according to
the  specifications   provided  by  the  Company,   which  include  the  recipe,
ingredients,  graphics  and  packaging  for  the  product  and  shipped  to  the
co-packer.  The co-packer  packages the raw materials into the appropriate boxes
and cases according to orders specified by the Company. The products are shipped
directly  from the  co-packer  via  common  carrier to either of  Liberty's  two
warehouses.  The Company distributes its products through Liberty's distribution
system to either 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.  Liberty retains brokers at the
approval of the Company 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 as indicated.  Introductory  slotting fees can take the form of cash
payments and/or free product allowances.




                                      -6-


                             ANNIE'S HOMEGROWN, INC.

                MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED


The  Company's  strategy is to continue to expand its  supermarket  distribution
nationally,  to develop new and unique all natural food  products to sell to its
existing  customer base and to purchase existing all natural food brands to sell
to its existing customer base. The Company believes it will benefit from greater
trade  relations  due to Liberty's  favorable  position in the  supermarket  and
natural food trade.  Management  believes  its  consolidated  distribution  with
Liberty's other products will provide the Company greater access to key accounts
in expansion  markets as well as facilitate new product  introductions  into its
existing customers.

FORWARD LOOKING STATEMENTS

From time to time,  information provided by the Company,  statements made by its
employees  or  information  included  in its  filings  with the  Securities  and
Exchange  Commission  (including this Form 10-QSB) may contain  statements which
are not historical facts, so called "forward looking statements",  which involve
risks and  uncertainties.  Forward  looking  statements are made pursuant to the
safe harbor provisions of the Private Securities  Litigation Reform Act of 1995.
When used in this form 10-QSB, the terms "anticipates",  "expects", "estimates",
"believes"  and  other  similar  terms  as they  relate  to the  Company  or its
management  are  intended  to  identify  such  forward  looking  statements.  In
particular,  statements  made in Item 2 Management's  Discussion and Analysis of
Financial  Condition and Results of Operations  relating to the  sufficiency  of
funds  for the  Company's  working  capital  requirements  during  1997  and the
Company's  expectation  that future cash flow will  continue to be provided from
operations  may be forward  looking  statements.  The  Company's  actual  future
results  may differ  significantly  from  those  stated in any  forward  looking
statements.  Factors that may cause such differences include but are not limited
to: (i)  competitive  factors in the market place;  (ii) reliance on the Liberty
agreement; (iii) fluctuation in quarterly and annual operating results; and (iv)
dependence on key personnel,  among others.  Each of these factors,  and others,
are discussed from time to time in the Company's filings with the Securities and
Exchange Commission including the Company's annual report on Form 10-KSB for the
year ended December 31, 1996.

RESULTS OF OPERATIONS

THREE MONTHS ENDED JUNE 30, 1997 COMPARED TO THREE MONTHS ENDED JUNE 30, 1996

NET SALES.  Net sales  increased by $199,720 or 22.13% from  $902,465 in 1996 to
$1,102,185 in 1997. The net sales increase was primarily the of the introduction
of the  Pizza  Pasta  and Mild  Cheddar  products  and the  introduction  of the
One-Step dinners.

GROSS PROFIT.  As a percentage of net sales,  gross profit decreased from 39.52%
in 1996 to 36.54% in 1997.  This  decrease was primarily the result of increased
costs of raw  materials.  The Company  purchases all its raw materials  directly
from  suppliers  and has the  co-packer  produce  the  product  using  these raw
materials.

SELLING EXPENSES.  Selling expenses  decreased by $26,461 or 7.88% from $335,803
in 1996 to  $309,342 in 1997 and  decreased  as a  percentage  of net sales from
37.21% in 1996 to 28.07% in 1997. The decrease in selling expenses was primarily
a result  of a  decrease  in  distribution  costs  due to the  consolidation  of
distribution through Liberty's channels.

GENERAL  AND  ADMINISTRATIVE  EXPENSES.   General  and  administrative  expenses
increased  by $46,362 or 28.05%  from  $165,273  in 1996 to $211,635 in 1997 and
increased  as a  percentage  of net sales from 18.31% in 1996 to 19.20% in 1997.
The  increase in general and  administrative  expenses is a result of  increased
legal fees  relating to reporting  requirement  of the  Securities  and Exchange
Commission as well as an increase in printing costs and research and development
costs relating to new products.




                                      -7-


                             ANNIE'S HOMEGROWN, INC.

                MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED


SLOTTING FEES.  Slotting expenses  decreased by $106,194 or 72.59% from $146,286
in 1996 to $40,092 in 1997,  and  decreased  as a  percentage  of net sales from
16.21% in 1996 to 3.64% in 1997. The decrease was due to the Company's  decision
to slow down the expansion of 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,  $6,000 in compensation  for stock
options granted was recorded for the four outside directors of the Company.

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, 1997, the Company had a working capital surplus of
$402,638.  The increase in working capital was primarily generated by the amount
of working capital received through the Company's initial public offering.

Most of the Company's  sales are made to Liberty under  contract  terms allowing
certain rights of return on unsold  product held by Liberty.  The contract calls
for  Liberty to pay the  Company  based on terms  relating to the receipt of the
Company's  products by Liberty.  The Company  defers  recognition  of such sales
until  the  product  is sold  by  Liberty  to its two  main  classes  of  trade;
supermarket chains and natural and specialty food stores.

Net cash used in operating  activities  for the three months ended June 30, 1997
was $237,156, consisting primarily of payments for operations.

Net cash used in investing activities consisted of capital expenditures totaling
$5,427 which related  principally to the purchase of plates and dies for the new
products.

The  Company  has a $10,000  unsecured  line of credit  with a bank which  bears
interest  at the prime  rate plus  8.9%.  At June 30,  1997 the  Company  had no
outstanding borrowings under the line of credit.

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 believes
that the net proceeds from the public offering, together with the funds that may
be generated from operations, will be sufficient to fund the Company's currently
anticipated  working capital  requirement and  expenditure  requirements  for at
least the next twelve months.

In February 1997, the Financial  Accounting  Standards Board issued Statement of
Financial  Accounting Standards No. 128, Earnings per Share (FASB No. 128). FASB
No. 128 supersedes APB No. 15 and specifies the computation,  presentation,  and
disclosure  requirements  and earnings per share.  FASB No. 128 is effective for
financial  statements  for both interim and annual periods ending after December
15, 1997 and early application is not permitted.  Accordingly,  the Company will
apply FASB No. 128 for the quarter  ended  December  31, 1997 and restate  prior
period  information as required under the statement.  The Company has determined
that if the FASB No. 128 had been applied for the first quarter  ending June 30,
1997, the impact on earnings per share as currently stated would be immaterial.




                                      -8-



In  June  1997,  the  Financial  Accounting  Standards  Board  issued  Financial
Accounting  Standards  No.  130,  Reporting  Comprehensive  Income and No.  131,
Disclosure  about Segments of an Enterprise and Related  Information,  which are
effective for fiscal years  beginning  after  December 15, 1997.  The Company is
currently evaluating the effects of these new standards.

                             ANNIE'S HOMEGROWN, INC.

                           PART II - OTHER INFORMATION


 EXHIBITS LIST AND REPORTS ON FORM 8-K

(A) EXHIBITS

     Exhibit Number
     --------------
         11                      Statement Re: Computation of Per Share Earnings
         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, 1997.





                                   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: August  14, 1997                   /s/ Paul B. Nardone
      ----------------                   ---------------------------------
                                         Paul B. Nardone
                                         President


Date: August  14, 1997                   /s/ Neil Raiff
      ----------------                   ----------------------------
                                         Neil Raiff
                                         Chief Financial Officer & Treasurer






                                      -9-