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 March 31, 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 March 31,
1996:

                                4,100,476 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 March 31, 1996 (unaudited)                      3

          Statements of Operations for the Three Months Ended
          March 31, 1996 and 1995 (unaudited)                                 4

          Statements of Cash Flows for the Three Months Ended
          March 31, 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



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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

                                                           March 31, 1996
                                                           --------------
                                     Assets
Current assets
    Cash and cash equivalents                                  $  67,433
    Accounts receivable
       Trade                                                     354,375
       Related parties                                            27,376
    Inventory                                                    233,076
    Other current assets                                          25,481
                                                               ---------
         Total current assets                                    707,741

Office equipment                                                  58,513
Accumulated depreciation                                         (27,291)
                                                               ---------
         Office equipment, net                                    31,222

Due from officer                                                  75,000
Other assets                                                      20,166
                                                               ---------

         Total assets                                          $ 834,129
                                                               =========

                 Liabilities and Stockholders' Equity (Deficit)
Current liabilities
    Notes payable                                              $ 135,070
    Accounts payable, trade                                      502,746
    Accrued expenses                                             170,375
    Due to employees                                              49,714
                                                               ---------
         Total current liabilities                               857,905

Commitments

Stockholders' equity (deficit)
 Common stock, $.001 par value
     Authorized 10,000,000 shares
     issued 4,212,382 shares                                       4,212
    Additional paid in capital                                   912,108
    Accumulated deficit                                         (842,346)
    Note receivable stockholder                                   (1,750)
    Deferred compensation                                         (6,000)
    Treasury stock, 111,906 common shares at cost                (90,000)
                                                               ---------
         Total stockholders equity (deficit)                     (23,776)

         Total liabilities and stockholders' equity            $ 834,129
                                                               =========
                                      -3-


                             ANNIE'S HOMEGROWN, INC.
                            Statements of Operations
                                    Unaudited

                                                    Three months ended     
                                                         March 31,
                                                         ---------
                                               
                                                    1995           1996 
                                                    ----           ---- 
                                               
Net sales                                       $ 1,224,820    $ 1,408,483
                                               
Cost of sales                                       710,861        888,505
                                                -----------    -----------
                                               
         Gross profit                               513,959        519,978
                                               
Operating expenses:                            
     Selling                                        373,142        405,350
     General and administrative                     119,334        187,058
     Slotting fees                                  109,980         57,727
     Compensation of outside directors                 --            9,000
                                                -----------    -----------
                                               
         Total operating expenses                   602,456        659,135
                                                -----------    -----------
                                               
         Operating income (loss)                    (88,497)      (139,157)
                                               
Other income (loss)                            
     Interest expense and other charges             (11,425)       (10,789)
     Interest and other income                        9,718            521
                                                -----------    -----------
                                               
         Income (loss) before income tax            (90,204)      (149,425)
                                               
Income tax expense                                    1,962          2,050
                                                -----------    -----------
                                               
         Net income (loss)                      $   (92,166)   $  (151,475)
                                                ===========    ===========
                                               
                                               
Weighted average common                        
  shares outstanding                              3,949,980      4,090,700
                                               
Net income (loss) per share                            (.02)          (.04)
                                               
                                               
                                      -4-
                                               
                                          


                             ANNIE'S HOMEGROWN, INC.
                            Statements of Cash Flows
                                    Unaudited

<TABLE>
<CAPTION>

                                                                            Three months ended
                                                                                  March 31,   
                                                                        -----------------------------
                                                                          1995                   1996 
                                                                       ---------              ---------
<S>                                                                    <C>                    <C>       
Cash flows from operating activities:
    Net income (loss)                                                  $ (92,166)             $(151,475)
    Adjustments to reconcile net income (loss) to net
     cash (used in) provided by operating activities:
         Depreciation and amortization                                     2,000                  3,000
         Outside directors compensation                                     --                    9,000
         Changes in:
             Accounts receivable - trade                                 (66,724)              (149,682)
             Affiliate accounts, net                                     190,349                 (6,623)
             Inventory                                                    53,709                172,688
             Other assets                                                (16,773)               (25,994)
             Accounts payable - trade                                    (33,576)               (88,913)
             Accrued expenses                                            107,483                 (9,205)
               Due to employees                                           (3,135)                   --       
                                                                       ---------               --------
                  Net cash (used in) provided by
                   operating activities                                  141,167               (247,204)

Cash flows from investing activities:
     Purchases of office equipment                                        (4,125)                (1,891)
                                                                       ---------              ---------
                  Net cash (used in) investing activities                 (4,125)                (1,891)

Cash flows from financing activities:
     Repayment of notes payable                                         (118,906)                  --
     Net proceeds from notes payable                                        --                   95,441
     Issuance of common stock and exercise
      of stock options, net                                                  280                185,624
                                                                       ---------              ---------
                  Net cash (used in) provided by
                   financing activities                                 (118,626)               281,065

Net (decrease) increase in cash and cash equivalents                      18,416                 31,970
Cash and cash equivalents, beginning of period                             2,442                 35,463
                                                                       ---------              ---------

Cash and cash equivalents, end of period                               $  20,858              $  67,433
                                                                       =========              =========

Supplemental disclosure of cash flow information
     Cash paid for interest                                            $  11,425              $  10,789
                                                                       =========              =========
     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


THREE MONTHS ENDED MARCH 31, 1996 COMPARED TO THREE MONTHS ENDED MARCH 31, 1995

NET SALES.  Net sales increased by $183,663 or 15.00% from $1,224,820 in 1995 to
$1,408,483 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 41.96%
in 1995 to 36.92% in 1996.  This decrease was primarily a result from two areas:
(I) a higher  production  cost as raw  materials  increased  in  price  and (ii)
shipping  more private label house brand which has a lower gross profit than the
Company's regular products.

                                      -6-




                             ANNIE'S HOMEGROWN, INC.

                MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED


SELLING EXPENSES.  Selling expenses  increased by $32,208 or 8.63% from $373,142
in 1995 to  $405,350 in 1996 and  decreased  as a  percentage  of net sales from
30.47% in 1995 to 28.78% in 1996.  The  increase  in costs in  selling  expenses
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 $67,724 or 56.75%  from  $119,334  in 1995 to $187,058 in 1996 and
increased as a percentage of net sales from 9.74% in 1995 to 13.28% 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 decreased by $52,253 or 47.51% from $109,980 in
1995 to $57,727 in 1996,  and  decreased as a percentage of net sales from 8.98%
in 1995 to 4.10% in 1996. The decrease was due to the Company's decision,  based
on the  initial  public  offering,  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,  $8,000 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.


                                      -7-





                             ANNIE'S HOMEGROWN, INC.

                MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED



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 March 31, 1996, the Company had a working capital deficit of
$150,164. The decrease in 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.  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 March 31, 1996 the Company had $127,570 in  outstanding
borrowings under the lines 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'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.


SUBSEQUENT EVENTS

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).

On July 31,  1996,  the  Company  closed its initial  public  offering of Common
Stock.  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  three  months  of  fiscal  1996  amounting  to  approximately
$151,000, which included slotting fees of approximately $57,000.


                                      -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 March 31, 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-