SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

             [X] Quarterly report pursuant to Section 13 or 15(d) of
                       the Securities Exchange Act of 1934

                For the quarterly period ended September 30, 2000

       [ ] Transition report under Section 13 or 15(d) of the Exchange Act

                         Commission file number 0-21934

                              DIGITAL PRIVACY, INC.
        (Exact name of small business issuer as specified in its charter)

                                    Delaware
                         (State or other jurisdiction of
                         incorporation or organization)

                                   52-1680936
                        (IRS Employer Identification No.)

            1433 Utica Avenue South, Suite 290, Minneapolis, MN 55416
                    (Address of Principal Executive Offices)

                                 (763) 544-2200
                           (Issuer's Telephone Number)

           4820 Minnetonka Blvd., Suite 410, St. Louis Park, MN 55416
                                (Former Address)

Check whether the  registrant  filed all  documents  and reports  required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the  distribution  of
securities under a planned confirmed by a court.
Yes [X]  No [  ]

As of November 10, 2000, the Registrant had 3,971,113 shares of its Common Stock
outstanding.

Transitional Small Business Disclosure Format:    Yes  [  ]   No [X]

<PAGE>

Item 1.  Financial Information


                              Digital Privacy, Inc.
                            Condensed Balance Sheets

                                              September 30,     December 31,
                   ASSETS                          2000             1999
                                              ------------      ------------
                                               (unaudited)

CURRENT ASSETS
       Cash                                      $ 41,352         $ 84,493
       Accounts Receivable                         40,491                -
       Inventory                                   51,940           14,765
       Other                                        5,254            4,753
                                                    -----            -----
          TOTAL CURRENT ASSETS                    139,037          104,011

PROPERTY AND EQUIPMENT                             61,413           48,584

OTHER ASSETS
       Patents and trademarks                     399,727          387,821
       License fee escrow                          49,981           49,996
                                              ------------      ------------
                                                  449,708          437,817
                                              ------------      ------------
                                                $ 650,158        $ 590,412
                                              ============      ============
                                              ============      ============

   LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES
       Notes payable to vendor                   $ 10,000         $ 10,000
       Accounts payable                           110,172           56,326
       Accrued expenses                            53,337           29,688
                                                   ------           ------
          TOTAL CURRENT LIABILITIES               173,509           96,014

NOTES PAYABLE OTHER                                50,000                -
NOTES PAYABLE TO DIRECTOR                         600,000          600,000
                                              ------------      ------------
                                                  650,000          600,000

STOCKHOLDERS' EQUITY (DEFICIT)
       Preferred stock:
       Series A, 8% cumulative convertible - $.01
       par value, $10 stated and liquidation value
       (authorized - 40,000 shares; issued and
        outstanding - 30,000 and 15,000 shares)   300,000          150,000
          Undesignated - $.01 par value (authorized -
             4,960,000 shares; no shares issued and
             outstanding)                               -                -
       Common stock - $.01 par value (authorized -
          95,000,000 shares; issued and outstanding -
          3,971,113 and 3,620,113 shares)          39,711           36,201
       Additional paid-in capital                 720,439           80,449
       Warrants                                     4,905            4,877
       Accumulated deficit                     (1,238,406)        (377,129)
                                              ------------      ------------
                                                 (173,351)        (105,602)
                                              ------------      ------------
                                                $ 650,158        $ 590,412
                                              ============      ============
                                              ============      ============

       See notes to condensed financial statements.

<PAGE>

                              Digital Privacy, Inc.
                       Condensed Statements of Operations
                                   (unaudited)

<TABLE>
<S>                                               <C>                                 <C>

                                                  Three months ended September 30,    Nine months ended September 30,
                                                       2000            1999                  2000             1999
                                                       ----            ----                  ----             ----

REVENUES                                           $ 22,588           $ 717              $ 97,676             $928

COST OF GOODS SOLD                                    1,146             198                 2,504              284
                                                      -----             ---                 -----              ---

GROSS PROFIT                                         21,442             519                95,172              644

OPERATING EXPENSES                                  272,429         176,084               910,494          839,000
                                                    -------         -------               -------          -------

OPERATING LOSS                                     (250,987)       (175,565)             (815,322)        (838,356)

INTEREST EXPENSE                                    (15,376)         (7,475)              (45,955)         (15,827)
                                                    -------          ------               -------          -------

LOSS BEFORE REORGANIZATION ITEMS AND
  EXTRAORDINARY GAIN                               (266,363)       (183,040)             (861,277)        (854,183)

REORGANIZATION ITEMS                                      -         661,238                     -          661,238
                                                    -------         -------               -------          -------

INCOME (LOSS) BEFORE EXTRAORDINARY GAIN            (266,363)        478,198              (861,277)        (192,945)

EXTRAORDINARY GAIN                                        -       1,838,259                     -        1,838,259
                                                    -------       ---------               -------        ---------

NET INCOME (LOSS)                                  (266,363)      2,316,457              (861,277)       1,645,314

PREFERRED STOCK DIVIDEND ACCRUED                      6,005               -                16,696                -
                                                      -----       ---------                ------        ---------

NET INCOME (LOSS) APPLICABLE TO COMMON
  STOCKHOLDERS                                   $ (272,368)    $ 2,316,457            $ (877,973)     $ 1,645,314
                                                 =============  ============          ============   =============

NET INCOME (LOSS) PER SHARE OF COMMON STOCK-
  BASIC AND DILUTED                                 $ (0.07)                              $ (0.23)
                                                 =============                        ============

WEIGHTED AVERAGE NUMBER OF COMMON
  SHARES OUTSTANDING                              3,958,363                             3,864,321
                                                 =============                        ============

</TABLE>

See notes to condensed financial statements.

<PAGE>
                           Digital Privacy, Inc.
                    Condensed Statements of Cash Flows
                               (unaudited)



<TABLE>
<S>                                                                              <C>                      <C>

                                                                                 Nine months ended September 30,
                                                                                     2000                  1999
                                                                                     ----                  ----
OPERATING ACTIVITIES
      Net income (loss)                                                           $ (861,277)          $ 1,645,314
      Adjustments to reconcile net income (loss)
      to net cash used by operating activities:
             Extraordinary gain on discharge of prepetition liabilities                    -            (1,838,259)
             Depreciation                                                             21,835                21,604
             Amortization of debt issuance costs                                           -               326,371
             Loss on disposal of property and equipment                                    -                 9,292
             Changes in operating assets and liabilities:
               Accounts receivable                                                   (40,491)                    -
               Inventory                                                             (37,175)               (3,864)
               Other assets                                                             (486)               34,031
               Accounts payable and accrued liabilities                               87,523              (360,794)
                                                                                      ------              --------
                  Net cash used by operating activities                             (830,071)             (166,305)
                                                                                    --------              --------
INVESTING ACTIVITIES
      Purchases of property and equipment                                            (34,664)                    -
      Patent and trademark costs                                                     (11,906)              (12,558)
                                                                                     -------               -------
                  Net cash used by investing activities                              (46,570)              (12,558)
                                                                                     -------               -------
FINANCING ACTIVITIES
      Proceeds from notes payable                                                     50,000               175,000
      Proceeds from issuance of stock and option exercises                           783,500                     -
                                                                                     -------
                  Net cash provided by financing activities                          833,500               175,000
                                                                                     -------               -------
NET DECREASE IN CASH                                                                 (43,141)               (3,863)

CASH

      Beginning of period                                                             84,493                 4,233
                                                                                      ------                 -----
      End of period                                                                 $ 41,352                 $ 370
                                                                                      ======                 =====

</TABLE>

See notes to condensed financial statements.

<PAGE>
                              DIGITAL PRIVACY, INC

                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                               September 30, 2000

                                   (unaudited)

1.       Basis of Presentation:
     The  interim  financial  statements  are  unaudited,  but in the opinion of
     management  reflect all  adjustments  necessary for a fair  presentation of
     results of such periods.  All such  adjustments  are of a normal  recurring
     nature.   The  results  of  operations  for  any  interim  period  are  not
     necessarily indicative of results for a full fiscal year.

     The  condensed  balance  sheet as of December 31, 1999, is derived from the
     audited financial  statements but does not include all disclosures required
     by generally  accepted  accounting  principals.  The notes accompanying the
     financial  statements in the Company's Annual Report on form 10-KSB for the
     year ended December 31, 1999,  include  accounting  policies and additional
     information  pertinent to an  understanding  of both the December 31, 1999,
     condensed  balance  sheet  and  the  interim  financial   statements.   The
     information  has not  changed  substantially  except  as a result of normal
     transactions  in the nine months ended September 30, 2000, and as discussed
     in the following notes.

2.       Earnings (Loss) Per Share:
     Earnings  (loss) per share was not  calculated for the three and nine month
     period  ended  September  30,  1999,  as it is  not  meaningful  due to the
     Company's adoption of fresh start reporting upon its emergence from Chapter
     11 bankruptcy on September 9, 1999.

3.       Stock Transactions:
     During the nine months ended  September 30, 2000, the Company issued 15,000
     shares of Series A preferred  stock for $150,000,  issued 351,000 shares of
     common  stock for  $633,500  and issued  5,000  shares of common  stock and
     warrants in satisfaction of $10,028 of accounts payable.

<PAGE>

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

              The following  discussion  should be read in conjunction  with the
financial  statements  and  related  notes  which  are  included  under  Item 1.
Statements  made  below  which  are not  historical  facts  are  forward-looking
statements.   Forward-looking   statements   involve   a  number  of  risks  and
uncertainties  including,  but not limited to, general economic conditions,  our
ability  to  complete  development  and then  market our  products,  competitive
factors and other risk factors as stated in other of our public filings with the
Securities and Exchange Commission.

Overview

              We were initially formed in December 1990 and filed for bankruptcy
under  Chapter  11  of  the  U.S.  Bankruptcy  Code  on  January  6,  1999.  Our
Reorganization  Plan was confirmed by the U.S. Bankruptcy Court for the District
of Minnesota on September 8, 1999.

              We began commercial  activity in the first quarter of 2000 and are
now in a  position  to offer a diverse  range of  products  designed  around the
concept of providing  useful products and services in an attractive,  convenient
format to people in their everyday environments.

              From   December  7,  1990  through   December   1998,   we  raised
approximately  $5,000,000  through  equity  and  debt  financings  from  private
investors. As a development stage enterprise, we incurred losses in excess of $8
million.

              Our ability to continue in business is dependent on our ability to
raise additional capital and, ultimately,  to generate sufficient cash flow from
operations to support our cost  structure.  The following are primary  obstacles
which we feel  contributed to our inability to generate cash flow  sufficient to
meet  scheduled  payments  and  sustain  further  operations  and forced us into
bankruptcy:

             1.     We experienced  significant  delays,  some  unforseeable and
                    uncontrollable,   in  the  design  and  development  of  our
                    products;

             2.     We  experienced  delays in bringing  our  products to market
                    because of the slow  adaptation and development of the smart
                    card and security market place in the United States, and the
                    lack of established distribution channels;

             3.     Our  inability  to  deliver  to the  government  market  our
                    hardware  based  product and the  significant  time delay in
                    developing new software products; and

             4.     We expended a  considerable  amount of time and resources in
                    preparing for further financing and growth. It was necessary
                    to  engage  an  independent  auditor  to  review  and  audit
                    historical  financials  and  operational  procedures  and to
                    retain consultants to provide marketing research and prepare
                    a comprehensive business plan. We also retained the services
                    of   corporate   counsel   to  prepare   private   placement
                    memorandum,   review  our  past  sales  of  securities   for
                    compliance  with  applicable  securities laws and applicable
                    contractual  shareholder  obligations,  assist  in  reducing
                    potential  liability  resulting from past transactions,  and
                    advise on the  revaluation  and related  issues  involved in
                    recapitalization efforts.

              We recognized  only very nominal  revenues in 1998.  Revenues were

<PAGE>

generated primarily on integration services and the sale of our developer's tool
kit product. 1998 was the first year we realized sales.

              Inadequate cash flow and lack of capital resources continued to be
the most serious  concerns  facing our management  coming into 1999. At December
31, 1998,  we had a  significant  negative net worth.  Having taken steps to cut
expenses  and  extend  the  payment  schedule  on  long-term  payables,  we then
developed a proposal  for a  restructuring  of our debts that would  involve the
conversion of secured and certain unsecured debt into common stock.  Ultimately,
we concluded that a non-bankruptcy restructuring was unlikely to be completed in
a timely  manner.  We therefore  decided to file a Chapter 11  bankruptcy as the
best method for restructuring our obligations.

              Following the  bankruptcy  proceedings  we added to our management
structure  and board of  directors.  Current  management  is  familiar  with our
history and  recognizes  the problems  that plagued us prior to the  bankruptcy.
Accordingly, we are now focused on two aspects: (i) raising sufficient financing
to  support  us until  positive  cash flow from  sales  are  generated  and (ii)
generating sales.

Liquidity

              During  the  quarter  we  raised  $56,000  from the sale of 28,000
shares  common  stock at a price of $2.00 per share in a private  placement  and
$500 from the exercise of employee stock options. Subsequent to the close of the
quarter  we raised  an  additional  $75,000.  As of  November  3,  2000,  we had
approximately $51,000 in cash which we believe will be sufficient until December
2000. We are currently commencing a new round of private financing which we hope
will raise  $500,000  through the sale of convertible  debentures.  We currently
project requiring approximately an additional $1,500,000 to allow us to grow the
business.  In the event we are  unsuccessful in raising such funds, we will have
to seek alternative sources of funding.  While we are currently looking to raise
a lesser amount of funds for short term working  capital,  we currently  have no
plans how to raise such additional funds.

              There  can be no  assurance  that we will  be  able to  raise  any
additional proceeds from private offerings of our securities or otherwise obtain
the substantial  additional capital necessary to permit us to attract and retain
a  sufficient  number of  subscribers  or that any  assumptions  relating to our
business  plan  will  prove to be  accurate.  While we hope to raise  additional
financing,  we have no current  arrangements  with  respect  to, or sources  of,
additional  financing  and there can be no  assurance  that any such  financing,
particularly the significant  amounts of financing that would be required,  will
be available to us on commercially reasonable terms, or at all. Any inability to
obtain  additional  financing could have a material  adverse  effect,  including
possibly requiring us to significantly curtail or cease operations.

Third Quarter Activities

              We continued to actively  market our computer  security  products.
During the quarter, our family of Privacy products consisting of PrivacyWeb(TM),
Privacy.AccessTM  and  Privacy.FileTM  completed final stage Beta testing and we
began  actively  marketing  them.  The  development   efforts  relating  to  our
e-commerce  security  products  are  currently  on hold as we are  meeting  with
potential joint venture partners to produce a multi-purpose SmartCard(TM).

              We incurred a loss during the quarter of $266,363 from  operations
and had revenues of $22,588.  We expect to have some meaningful  revenues during
the fourth quarter.

<PAGE>

              The Company is  concentrating  its efforts on the security aspects
of its products. As a result, in the beginning of the quarter its Vice President
of Sales  resigned.  The Company filled the opening by hiring as consultants two
salesmen that are specialists in security  technology  products.  We are hopeful
that these efforts will be successful in increasing  sales.  In the event we can
increase  sales,  this will  relieve  the burden of  financing  and allow  other
members of management  to devote their  efforts to growing the business  through
internal  growth.  In this regard we also established and filled the position of
Vice President-Government Relations and Business Development.

              Once we attain a level of liquidity, we will also look to grow our
business through acquisitions. We currently have no acquisition plans and do not
believe that any such type of transaction is likely in the near future.

Year 2000 Disclosure

              We are Year 2000  compliant and we do not  anticipate any internal
problems.  In the event any internal  problems should arise, we have many expert
computer  technicians  on our  payroll  and we  believe  that we will be able to
satisfactorily  address any such  problems.  However,  we are  dependent  on the
integrity of the Internet  being  maintained to increase its use as a commercial
marketplace,  thereby  increasing  demand for our products.  Given the currently
available  information  it does not appear to be likely that the  Internet  will
suffer major failure and, accordingly,  we do not believe that our potential for
profitability  or  operations  will be  materially  affected  by the  Year  2000
problem.

<PAGE>

                                     PART II
                                OTHER INFORMATION

Item 1.  Legal Proceedings.

         None.

Item 2.  Changes in Securities.

                  We sold an  aggregate  of 28,000  restricted  shares of common
stock at a price of $2.00  per  share to two  investors.  The  shares  were sold
pursuant to the exemption from registration contained in Regulation D, Rule 506.

                  We also issued  10,000  shares to a former  director  upon the
exercise of stock options.

Item 3.  Defaults Upon Senior Securities.

         None.

Item 4.  Submission of Matters to Vote of Security Holders.

         None.

Item 5.  Other Information.

         None.

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

         (a)      A financial data schedule is filed herewith as an exhibit.

         (b)      None.



<PAGE>

                                   SIGNATURES



         In accordance with the requirements of the Exchange Act, the Registrant
caused this Report to be signed on its behalf by the  undersigned  thereto  duly
authorized.


Date: November 14, 2000

                                                DIGITAL PRIVACY, INC.



                                                By: /s/Howard Miller
                                                   -----------------------------
                                                    Howard Miller
                                                    Chief Executive Officer