U.S. Securities and Exchange Commission
                             Washington D. C., 20549

                                   Form 10-QSB

(Mark One)
( X )    QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                  ACT OF 1934
         For the quarterly period ended December 31, 2000

(   )    TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
                  EXCHANGE ACT
         For the transition period from__________ to ___________.


                         Commission file number 0-20924


                           Reconditioned Systems, Inc.
        (Exact name of small business issuer as specified in its charter)

            Arizona                                        86-0576290
(State or other  jurisdiction of
incorporation  or  organization)               (IRS Employer Identification No.)

                     444 West Fairmont, Tempe, Arizona 85282
                    (Address of principal executive offices)

                                  480-968-1772
                           (Issuer's telephone number)

       -------------------------------------------------------------------
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  Exchange  Act 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___.




State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: as of January 31, 2001, the number of
shares outstanding of the Registrant's common stock was 1,227,395.


Transitional Small Business Disclosure Format.       Yes ___ No  X .




<PAGE>

Item 1









                          PART 1 - FINANCIAL STATEMENTS



                           RECONDITIONED SYSTEMS, INC.


                         Unaudited Financial Statements

                                December 31, 2000




























                                       2
<PAGE>


                           RECONDITIONED SYSTEMS, INC.
                                 BALANCE SHEETS
                           December 31, 2000 and 1999
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                              2000          1999
                                                              ----          ----
<S>                                                     <C>           <C>
                                     ASSETS
Current Assets:
    Cash and cash equivalents                           $1,736,617      $756,455
    Accounts receivable - trade, net of
        allowance for doubtful accounts of
        approximately $26,500 and $32,000,
        respectively                                     1,455,976     2,256,085
    Inventory                                            1,217,922     1,038,446
    Prepaid expenses and other current assets              276,448       280,897
                                                           -------       -------

                    Total current assets                 4,686,963     4,331,883
                                                         ---------     ---------

Property and Equipment, net:                               264,754       270,357
                                                           -------       -------

Other Assets:
    Notes receivable - officer                              75,000        75,000
    Refundable deposits                                     12,896        13,036
    Other                                                   52,020        40,346
                                                            ------        ------

                                                           139,916       128,382
                                                           -------       -------

Total Assets                                            $5,091,633    $4,730,622
                                                        ==========    ==========

                      LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
    Accounts payable                                      $577,078      $933,478
    Customer deposits                                       89,528        33,285
    Accrued severance charges                                    0        90,000
    Accrued expenses and other current liabilities         370,405       373,705
                                                           -------       -------

                    Total current liabilities            1,037,011     1,430,468
                                                         ---------     ---------

Stockholders' Equity:
    Common stock, no par value; 20,000,000
        shares authorized                               $4,588,746    $4,587,580
    Retained earnings/(deficit)                             82,562     (925,321)
                                                            ------     ---------

                                                         4,671,308     3,662,259
    Less: treasury stock, 246,408 and 146,132
        shares respectively, at cost                     (616,686)     (362,105)
                                                         ---------     ---------

                                                         4,054,622     3,300,154
                                                         ---------     ---------

Total Liabilities and Stockholders' Equity              $5,091,633    $4,730,622
                                                        ==========    ==========
</TABLE>




                                       3
<PAGE>


                           RECONDITIONED SYSTEMS, INC.
                            STATEMENTS OF OPERATIONS
      For the Three and Nine Month Periods Ended December 31, 2000 and 1999
                                   (Unaudited)
<TABLE>
<CAPTION>

                                Three Months Ended             Nine Months Ended
                                      December 31,                  December 31,
                                    2000         1999          2000         1999
                                    ----         ----          ----         ----
<S>                           <C>          <C>          <C>           <C>

Sales                         $3,767,538   $3,066,267   $11,175,532   $7,822,153

Cost of sales                  2,922,065    2,240,967     8,747,960    5,792,229
                               ---------    ---------     ---------    ---------

Gross profit                     845,473      825,300     2,427,572    2,029,924

Selling & administrative
    expenses                     522,159      541,830     1,504,633    1,392,792
Severance charge                       0            0             0      292,984
                                       -            -             -      -------

Income from operations           323,314      283,470       922,939      344,148

Other income (expense):
    Interest income               22,383       15,115        56,808       50,361
    Other                          (269)          625         5,858          782
                                   -----          ---         -----          ---

Net income before provision
    for income taxes             345,428      299,210       985,605      395,291


Income tax expense                86,132            0       283,477            0
                                  ------            -       -------            -

Net income                      $259,296     $299,210      $702,128     $395,291
                                ========     ========      ========     ========

Basic earnings per share
    (Notes 1 and 2)                $0.21        $0.22         $0.55        $0.29
                                   =====        =====         =====        =====

Basic weighted average number
    of shares outstanding      1,227,440    1,340,765     1,282,755    1,383,478
                               =========    =========     =========    =========

Diluted earnings per common
    and common equivalent share
    (Notes 1 and 2)                $0.19        $0.21         $0.49        $0.25
                                   =====        =====         =====        =====

Diluted weighted average number
    of shares outstanding      1,362,707    1,456,567     1,418,550    1,557,870
                               =========    =========     =========    =========
</TABLE>












                                       4
<PAGE>


                           RECONDITIONED SYSTEMS, INC.
                       STATEMENTS OF STOCKHOLDERS' EQUITY
                       For the Year Ended March 31, 2000
               and the Nine Month Period Ended December 31, 2000
                                   (Unaudited)
<TABLE>
<CAPTION>

                       Common     Common      Retained
                       Stock      Stock       Earnings      Treasury
                       Shares     Amount      (Deficit)     Stock     Total
---------------------  ---------  ----------  ------------  --------- ----------
<S>                    <C>        <C>         <C>           <C>       <C>

Balance at
  March 31, 1999       1,473,816  $4,586,982  $(1,320,612)  $      -  $3,266,370

Purchase of Treasury
  Stock                (150,000)           -             -  (368,413)  (368,413)

Transfer of shares to
  ESP Plan                 3,868         594             -      9,200      9,794

Net Income                     -           -       701,046          -    701,046

                       ---------  ----------  ------------ ---------- ----------
Balance at
  March 31, 2000       1,327,684  $4,587,576    $(619,566) $(359,213) $3,608,797

Purchase of Treasury
  Stock                (101,300)           -             -  (259,962)  (259,962)

Transfer of shares to
  ESP Plan                 1,024       1,170             -      2,489      3,659

Cancelled shares            (13)

Net income                     -           -       702,128          -    702,128
                       ---------  ----------  ------------  ---------  ---------

Balance at
  December 31, 2000    1,227,395  $4,588,746       $82,562 $(616,686) $4,054,622
                       =========  ==========       ======= ========== ==========
</TABLE>






                                       5
<PAGE>


                           RECONDITIONED SYSTEMS, INC.
                            STATEMENTS OF CASH FLOWS
      For the Three and Nine Month Periods Ended December 31, 2000 and 1999
                                   (Unaudited)
<TABLE>
<CAPTION>

                                  Three Months Ended           Nine Months Ended
                                       December 31,                 December 31,
                                 2000           1999          2000          1999
                                 ----           ----          ----          ----
<S>                          <C>          <C>           <C>            <C>

Cash and cash equivalents
    provided/(used) by
    operating activities     $576,246     $(597,596)    $1,179,962       $67,855

Cash and cash equivalents
    used by investing
    activities               (34,170)       (69,714)     (107,820)     (133,702)

Cash and cash equivalents
    used by financing
    activities                  (535)       (99,805)     (256,303)     (281,023)
                                -----       --------     ---------     ---------

Increase/(decrease) in cash
    and cash equivalents      541,541      (767,115)       815,839     (346,870)

Cash and cash equivalents at
    beginning of period     1,195,076      1,523,570       920,778     1,103,325
                            ---------      ---------       -------     ---------

Cash and cash equivalents at
    end of period          $1,736,617       $756,455    $1,736,617      $756,455
                           ==========       ========    ==========      ========

</TABLE>









                                       6
<PAGE>



                           RECONDITIONED SYSTEMS, INC.
                          Notes to Financial Statements
                                   (Unaudited)
--------------------------------------------------------------------------------

                                     Note 1.
                   Summary of Significant Accounting Policies
--------------------------------------------------------------------------------

Basis of Presentation:

         The unaudited financial statements include only the accounts and
             transactions of the Company.

Interim Financial Statements:

         The unaudited interim financial statements include all adjustments
         (consisting of normal recurring accruals) which, in the opinion of
         management, are necessary. Operating results for the nine months ended
         December 31, 2000 are not necessarily indicative of the results that
         may be expected for the entire year ending March 31, 2001. These
         financial statements have been prepared in accordance with the
         instructions to Form 10-QSB and do not contain certain information
         required by generally accepted accounting principles. These statements
         should be read in conjunction with the financial statements and notes
         thereto included in the Company's Form 10-KSB for the year ended March
         31, 2000.

Earnings Per Common and Common Equivalent Share:

         Basic earnings per share include no dilution and are computed  by
         dividing income available to common stockholders by the weighted
         average number of shares outstanding for the period.

         Diluted earnings per share amounts are computed based on the weighted
         average number of shares actually outstanding plus the shares that
         would be outstanding assuming the exercise of dilutive stock options,
         all of which are considered to be common stock equivalents. The number
         of shares that would be issued from the exercise of stock options has
         been reduced by the number of shares that could have been purchased
         from the proceeds at the average market price of the Company's stock.

                                       7
<PAGE>



                           RECONDITIONED SYSTEMS, INC.
                          Notes to Financial Statements
                                   (Unaudited)
--------------------------------------------------------------------------------

                                     Note 2.
                               Earnings Per Share
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>


                               Three Months Ended              Nine Months Ended
                                     December 31,                   December 31,
                                 2000          1999           2000          1999
                                 ----          ----           ----          ----
<S>                         <C>           <C>            <C>           <C>
Basic EPS

Net income                   $259,296      $299,210       $702,128      $395,291
                             ========      ========       ========      ========

Weighted average number
    of shares outstanding   1,227,440     1,340,765      1,282,755     1,383,478

Basic earnings per share        $0.21         $0.22          $0.55         $0.29
                                =====         =====          =====         =====

Diluted EPS

Net income                   $259,296      $299,210       $702,128      $395,291
                             ========      ========       ========      ========

Weighted average number
    of shares outstanding   1,227,440     1,340,765      1,282,755     1,383,478

Effect of dilutive
    securities:
    Stock options             135,267       115,802        135,795       174,392
                              -------       -------        -------       -------

Total common shares +
    assumed conversions     1,362,707     1,456,567      1,418,550     1,557,870
                            =========     =========      =========     =========

Per Share Amount                $0.19         $0.21          $0.49         $0.25
                                =====         =====          =====         =====
</TABLE>






                                       8
<PAGE>


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

The statements contained in this report that are not historical facts may
constitute "forward-looking statements" within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended, and are subject to the safe harbors created thereby.
These forward-looking statements involve risks and uncertainties, including, but
not limited to, the risk that Reconditioned Systems, Inc. (the "Company") may
not be able to maintain its increased sales volume and the risk that the Company
may not see improved profitability. In addition, the Company's business,
operations and financial condition are subject to substantial risks that are
described in the Company's reports and statements filed from time to time with
the Securities and Exchange Commission, including the Company's Annual Report on
Form 10-KSB for the fiscal year ended March 31, 2000.

Results of Operations

SALES REVENUE
The Company reported sales revenue of approximately $3.77 million for the three
month period ended December 31, 2000 (hereinafter the "reporting quarter") as
compared to approximately $3.07 million for the quarter ended December 31, 1999
(hereinafter the "comparable quarter"), an increase of 22%. Sales revenue for
the nine month period ended December 31, 2000 (hereinafter the "reporting
period") totaled approximately $11.2 million as compared to approximately $7.8
million for the nine month period ended December 31, 1999 (hereinafter the
"comparable period"), a $3.4 million or 43% increase. Although the Company's
retail sales saw the greatest improvement, wholesale sales also improved
significantly. Retail sales accounted for 55% of the total sales for the
reporting quarter and 50% of the Company's sales for the reporting period. This
compares to 56% and 47% for the comparable quarter and period, respectively.

Retail sales totaled approximately $2.08 million during the reporting quarter
and approximately $5.56 million during the reporting period, up 21% and 52% over
the comparable quarter and comparable period, respectively. Management believes
these increases are a result of the Company's continued focus on building a
stronger retail business operating as "Total Office Interiors." This was
achieved by the addition of the Company's new sales manager in July 1999, the
expansion of new furniture and accessory product-lines, increased commitment to
improving customer service and sales support, the continued development of
qualified sales personnel and the opening of the Company's retail showroom.

Wholesale sales totaled approximately $1.69 million for the reporting quarter
and approximately $1.35 million for the comparable quarter, up 25.2%. Wholesale
sales for the reporting period totaled $5.6 million, as compared to $4.2 million
during the comparable period, an increase of 33%. These increases were primarily
due to increased industry-wide demand. Most of the office furniture industry
enjoyed record sales during the calendar year ended December 31, 2000.

GROSS MARGIN
Although the Company's sales mix remained relatively constant, the Company's
gross profit margin for the reporting quarter declined 4.48%, from 26.92% for
the comparable quarter to 22.44% for the reporting quarter. Gross margins for
the reporting period also declined relative to the comparable period, down
4.23%, from 25.95% for the comparable period to 21.72% for the reporting period.
These declines were primarily attributable to higher product costs. This trend
of higher product costs was identified during the first quarter of the current
fiscal year. The Company has focused on improving used inventory buying
procedures and has seen improvement in product costs. Gross margins have
improved from 20.76% for the quarter ended June 30, 2000, to 21.91% for the
quarter ended September 30, 2000, to 22.44% for the reporting quarter.

                                       9
<PAGE>



OPERATING EXPENSES
The Company's selling expenses decreased from 11.18% of sales in the comparable
quarter and 11.33% of sales in the comparable period to 9.18% of sales for the
reporting quarter and 8.96% of sales for the reporting period. The Company's
retail sales staff is paid commissions based upon the gross profit of their
sales. As a result, the lower gross margins earned on the Company's sales
revenues during the reporting period also resulted in lower selling expenses as
a percentage of sales for the reporting period. In addition, certain selling
expenses are fixed and are not effected by increased sales.

The Company's administrative expenses, net of severance charges accrued in the
comparable quarter, decreased from 6.49% of sales in the comparable quarter and
6.48% of sales in the comparable period to 4.68% and 4.50% of sales in the
reporting quarter and reporting period, respectively. These improvements were
primarily a result of fixed administrative expenses and increased sales
revenues.

OTHER INCOME AND EXPENSES
The Company's other income and expenses, which consists primarily of interest
income, improved from $51,143 in the comparable period to $62,666 in the
reporting period. This increase resulted from increased cash reserves in the
reporting period as compared to the comparable period.

Income Taxes
As of March 31, 2000, the Company had federal loss carryforwards of
approximately $299,000 and state loss carryforwards of approximately $99,000.
Based on annualizing the earnings for the quarters ended June 30, 2000,
September 30, 2000 and December 31, 2000, the Company's income tax expense net
of the remaining net operating loss carryforwards totals approximately $283,000.
The effective federal income tax rate for the Company is therefore higher for
the reporting period than it was for comparable period as a result of the use of
the net operating loss carryforwards. During the nine month period ended
December 31, 1999, the Company's taxable net income was fully offset by net
operating loss carryforwards. As a result, the Company incurred no income tax
expense during such period.

Financial Condition and Liquidity
As of December 31, 2000, the Company's cash and cash equivalents totaled
$1,736,617. In addition, the Company's working capital totaled  $3,649,952. The
Company has no long-term debt and $1,000,000 available on its line of credit
through M&I Thunderbird Bank.

Cash Flows from Operating Activities. Net cash provided by operating activities
totaled $1.18 million during the reporting period. This increase in cash was
generated through the Company's net income for the period and a decrease in the
Company's accounts receivables of approximately $600,000. These increases were
partially offset by increased inventory deposits and estimated income tax
payments. Management was concerned by the high accounts receivable balance and
slow collection rate as of March 31, 2000. In response to these concerns,  new
collection procedures and personnel changes were implemented. As a result of
these changes, the average days receivables improved from 62 days as of March
31, 2000 to 43 days as of December 31, 2000.

Cash Flows from Investing and Financing Activities. During the reporting period,
the Company used  approximately $108,000 for capital expenditures and
approximately $256,000 to finance the purchase of treasury stock.

Forward Looking Statements
The Company will exhaust its remaining federal and state income tax loss
carryforwards during the current fiscal year. As a result, the Company will
begin paying the full federal and state corporate tax rates beginning April 1,
2001. Assuming similar or increased taxable income levels to those reported
during the current fiscal year, that rate, would be approximately 42%.

Management is currently focusing on sustaining the Company's sales levels while
improving product costs; however there can be no assurance that the Company will
see sales growth comparable to that reported during the reporting period or that
the Company will see cost savings.

  .                                     10
<PAGE>



                           PART II - OTHER INFORMATION

Item 1.  Legal Proceedings
The  Company is not party to any pending legal proceeding other than routine
litigation incidental to the business.

Item 2.  Changes in Securities and Use of Proceeds
None.

Item 3.  Defaults Upon Senior Securities
None.

Item 4.  Submission of Matters to a Vote of Security Holders
None.

Item  5. Other Information
None.




















                                       11
<PAGE>


Item 6.  Exhibits and Reports on Form 8-K
(a)  The following exhibits are filed herewith pursuant to Regulation S-B:

No.               Description                                          Reference
---               -----------                                          ---------
3.1      Articles of Incorporation of the Registrant, as amended
           and restated                                                    3
3.2      Bylaws of Registrant, as amended and restated                     3
4.1      Form of Common Stock Certificate                                  1
4.5      Registration Rights Agreements                                    2
*4.10    Options issued to Dirk D. Anderson                                4
*4.12    Amendment to Options issued to Dirk D. Anderson                   5
*4.14    Options issued to Dirk D. Anderson                                5
*4.15    Options issued to Scott W. Ryan                                   5
*4.16    Options issued to Scott W. Ryan                                   5
10.1     Lease Agreement, dated April 12, 1990 between Boston
           Safe Deposit and Trust Company, as Lessor, and Registrant
           as Lessee                                                       1
10.33    Loan document between M&I Thunderbird Bank and the Registrant     6

         (1)     Filed with Registration Statement on Form S-18, No.33-51980-LA,
                 under the Securities Act of 1933, as declared effective on
                 December 17, 1992
         (2)     Filed with Form 10-KSB on July 13, 1995
         (3)     Filed with Form 10-KSB on July 2, 1996
         (4)     Filed with Form 10-QSB on November 14, 1996
         (5)     Filed with 10-KSB on September 26, 1997
         (6)     Filed with 10-QSB on August 11, 2000
         (*)     Indicates a compensatory plan or arrangement

(b)  Reports on Form 8-K:
No reports were filed on Form 8-K during the quarter ended December 31, 2000.



                                       12
<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, thereunto duly
authorized.


Reconditioned Systems, Inc.



                                                   /S/ DIRK D. ANDERSON
Date:    February 9, 2000                          ___________________________
                                                   Dirk D. Anderson, CEO
                                                   (Principal Financial Officer)