<PAGE> 1
                    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, 2002

[ ]     Transition Report Under Section 13 or 15(d) of the Securities Exchange
Act of 1934

        For the Transition Period from _____________ to ____________

                    Commission File Number   0-25873
                                             -------

                       POWERBALL INTERNATIONAL, INC.
               ----------------------------------------------
               (Name of Small Business Issuer in its charter)

          Utah                                             84-1431425
-------------------------------                    --------------------------
(State or other jurisdiction of                    (I.R.S. Employer I.D. No.)
 incorporation or organization)

                2095 West 2200 South, West Valley City, Utah 84119
              -----------------------------------------------------
              (Address of principal executive offices and Zip Code)

                                 (801) 974-9120
              ----------------------------------------------------
              (Registrant's telephone number, including area code)


     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 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.

(1)  Yes X    No     (2)  Yes X     No
        ---     ---          ---      ---

     Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.

Common Stock, Par Value $0.001                          4,369,750
--------------------------------                ----------------------------
       Title of Class                           Number of Shares Outstanding
                                                as of June 30, 2002
<PAGE>
<PAGE> 2
                         PART I FINANCIAL INFORMATION

                        ITEM 1.  FINANCIAL STATEMENTS

                   POWERBALL INTERNATIONAL, INC. AND SUBSIDIARY


                            FINANCIAL STATEMENTS
                                (UNAUDITED)


     The financial statements included herein have been prepared by the
Company, without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission.  Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed or omitted.
However, in the opinion of management, all adjustments (which include only
normal recurring accruals) necessary to present fairly the financial position
and results of operations for the periods presented have been made.  These
financial statements should be read in conjunction with the accompanying
notes, and with the historical financial information of the Company.


<PAGE>
<PAGE> 3

POWERBALL INTERNATIONAL, INC. AND SUBSIDIARY
(Development Stage Companies)
CONSOLIDATED BALANCE SHEETS

                                                    June 30,     December 31,
                                                      2002           2001
                                                  ------------   ------------
          ASSETS                                   (Unaudited)

CURRENT ASSETS
 Cash in bank                                    $     399,078 $      552,583
                                                  ------------   ------------
   Total Current Assets                                399,078        552,583
                                                  ------------   ------------
PROPERTY AND EQUIPMENT
 Equipment                                               7,770          7,770
 Leasehold improvements                                 23,923         23,923
                                                  ------------   ------------
                                                        31,693         31,693
 Less accumulated depreciation                         (22,520)       (20,758)
                                                  ------------   ------------
                                                         9,173         10,935
                                                  ------------   ------------
OTHER ASSETS
 Assets held for resale - net of valuation
  allowance                                              4,000          4,000
 Patents and assigned technology, net of
  amortization of $7,683 and $6,337                     19,248         20,595
                                                  ------------   ------------
   Total Other Assets                                   23,248         24,595
                                                  ------------   ------------
TOTAL ASSETS                                     $     431,499  $     588,113
                                                  ------------   ------------
LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
 Accounts payable                                $      48,461  $      24,408
 Accrued and deferred liabilities                        1,195          2,395
                                                  ------------   ------------
   Total Current Liabilities                            49,656         26,803
                                                  ------------   ------------

STOCKHOLDERS' EQUITY
 Common stock; $.001 par value, 25,000,000 shares
  authorized, 4,369,750, and 4,127,250 shares
  issued and outstanding respectively                    4,370          4,127
 Capital in excess of par value                      2,810,412      2,568,155
 Subscription receivable                               (75,000)      (187,500)
 Earnings (deficit) accumulated during the
  development stage                                 (2,357,939)    (1,823,472)
                                                  ------------   ------------
   Total Stockholders' Equity                          381,843        561,310
                                                  ------------   ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY       $     431,499  $     588,113
                                                  ------------   ------------

The accompanying notes are an integral part of these consolidated financial
statements.

<PAGE>
<PAGE> 4

POWERBALL INTERNATIONAL, INC. AND SUBSIDIARY
(Development Stage Companies)

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
<TABLE>
<CAPTION>
                                              For the       For the       For the       For the     (Deficit)
                                             3 months      3 months      6 months      6 months    Accumulated
                                               Ended         Ended         Ended         Ended      During the
                                              June 30,      June 30,      June 30,      June 30,    Development
                                               2002           2001          2002          2001        Stage
                                            -----------   -----------   -----------   -----------   -----------
<S>                                      <C>           <C>           <C>           <C>           <C>
REVENUE                                    $          -  $          -  $          -  $          -  $          -
                                            -----------   -----------   -----------   -----------   -----------
EXPENSES
 Equity in loss from limited
  liability company                                   -             -             -             -       446,549
 General and administrative                      19,175         5,176        27,099        25,123       214,911
 Professional fees                              115,110         2,120       248,436        13,897       682,268
 Depreciation and amortization expense            1,554         1,204         3,108         2,408        25,422
 Research and development                       121,084       122,296       259,882       245,667       987,300
                                            -----------   -----------   -----------   -----------   -----------
                                                256,923       130,796       538,525       287,095     2,356,450
                                            -----------   -----------   -----------   -----------   -----------
OPERATING LOSS                                 (256,923)     (130,796)     (538,525)     (287,095)   (2,356,450)

OTHER INCOME AND EXPENSE
 Interest income                                  2,053           581         4,058         2,762        16,631
 Asset writedown                                      -             -             -             -        (3,497)
 Limited sales of tanks, net of direct
  production costs of $1,046                          -             -             -             -        13,003
                                            -----------   -----------   -----------   -----------   -----------
INCOME (LOSS) BEFORE INCOME TAXES              (254,870)     (130,215)     (534,467)     (284,333)   (2,330,313)
 Minimum State franchise tax                          -           100             -           100           400
                                            -----------   -----------   -----------   -----------   -----------
NET INCOME (LOSS) BEFORE CUMULATIVE
EFFECT OF ACCOUNTING CHANGE                    (254,870)     (130,315)     (534,467)     (284,433)   (2,330,713)

Cumulative effect of accounting change for
organization costs                                    -             -             -             -       (27,226)
                                            -----------   -----------   -----------   -----------   -----------
NET INCOME (LOSS)                          $   (254,870) $   (130,315) $   (534,467) $   (284,433) $ (2,357,939)
                                            ===========   ===========   ===========   ===========   ===========
EARNINGS (LOSS) PER SHARE BEFORE
ACCOUNTING CHANGE                          $      (0.06) $      (0.04) $      (0.13) $      (0.09) $      (1.20)
                                            ===========   ===========   ===========   ===========   ===========
CUMULATIVE EFFECT OF ACCOUNTING CHANGE     $      (0.00) $      (0.00) $      (0.00) $      (0.00) $      (0.01)
                                            ===========   ===========   ===========   ===========   ===========
EARNINGS (LOSS) PER SHARE                  $      (0.06) $      (0.04) $      (0.13) $      (0.09) $      (1.22)
                                            ===========   ===========   ===========   ===========   ===========
WEIGHTED AVERAGE NUMBER OF COMMON SHARES      4,280,299     3,300,250     4,205,924     3,306,369     1,940,136
                                            ===========   ===========   ===========   ===========   ===========
</TABLE>






The accompanying notes are an integral part of these consolidated financial
statements.

<PAGE>
<PAGE> 5

POWERBALL INTERNATIONAL, INC. AND SUBSIDIARY
(Development Stage Companies)

 CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

                                        For the       For the    Cumulative
                                       6 Months      6 Months    During the
                                       June 30,      June 30,    Development
                                         2002          2001         Stage
                                     -----------   -----------   -----------
CASH FLOWS FROM OPERATING ACTIVITIES
 Net (loss)                         $   (534,467) $   (284,433) $ (2,357,939)
 Adjustments to reconcile net (loss)
  to net cash provided by operating
  activities:
  Cumulative change in accounting
   principle                                   -             -        27,226
  Stock issued for services              225,000             -       505,500
  Expense stockholder loan                     -             -         6,294
  Decrease in investment in limited
   liability company                           -             -       446,548
  Depreciation and amortization            3,108         2,408        28,969
 Changes in assets and liabilities:
  Increase in supplies                         -             -           972
  Increase in organization costs               -             -       (28,465)
  Increase in accounts payable            24,054        14,214        26,494
  Increase in accrued expenses            (1,200)      (10,373)        1,006
                                     -----------   -----------   -----------
   Net cash (used) by operating
    activities                          (283,505)     (278,184)   (1,343,395)
                                     -----------   -----------   -----------
CASH FLOWS FROM INVESTING ACTIVITIES
 Acquisition of joint venture partner
  - net of cash                                -             -        17,016
 Related party loans                           -             -      (509,000)
 Investment in limited liability company       -             -      (250,000)
 Purchase of equipment and leasehold
  improvements                                 -        (7,497)      (13,067)
 Additional patent costs                       -       (13,629)       (7,416)
                                     -----------   -----------   -----------
   Net cash provided (used) by
    investing activities                       -       (21,126)     (762,467)
                                     -----------   -----------   -----------
CASH FLOWS FROM FINANCING ACTIVITIES
 Sale of common stock                    130,000        60,000     2,556,000
 Direct costs of stock sale                    -             -       (51,060)
                                     -----------   -----------   -----------
   Net Cash Provided By Financing
    Activities                           130,000        60,000     2,504,940
                                     -----------   -----------   -----------
NET INCREASE (DECREASE) IN CASH         (153,505)     (239,310)      399,078

CASH - BEGINNING OF PERIOD               552,583       298,069             -
                                     -----------   -----------   -----------
CASH - END OF PERIOD                $    399,078  $     58,759  $    399,078
                                     ===========   ===========   ===========



The accompanying notes are an integral part of these consolidated financial
statements.

<PAGE>
<PAGE> 6

POWERBALL INTERNATIONAL, INC. AND SUBSIDIARY
(Development Stage Companies)

 CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)(Continued)

                                        For the       For the    Cumulative
                                       6 Months      6 Months    During the
                                       June 30,      June 30,    Development
                                         2002          2001         Stage
                                     -----------   -----------   -----------
SUPPLEMENTAL INFORMATION

Interest paid during the period     $          -  $          -  $          -
                                     ===========   ===========   ===========
Income taxes paid during the period $          -  $        100  $          -
                                     ===========   ===========   ===========
Stock issued to pay royalties and
 expenses of related entity         $          -  $          -  $     97,000
                                     ===========   ===========   ===========
Stock issued to pay finders fee     $          -  $      5,000  $    251,794
                                     ===========   ===========   ===========
Stock issued to acquire Powerball
 Industries, Inc.                   $          -  $          -  $   (370,658)
                                     ===========   ===========   ===========





















The accompanying notes are an integral part of these consolidated financial
statements.

<PAGE>
<PAGE> 7
POWERBALL INTERNATIONAL, INC. AND SUBSIDIARY
 (Development Stage Companies)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTE   1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization  -  The Company was incorporated on July 9, 1997 under the laws
of the State of Utah. At the present time, the Company and its subsidiary are
in the development stage. The Company was formed for the purpose of raising
capital to invest in a joint venture which acquired a license to certain
technology relating to the production of hydrogen, to generate hydrogen for
sale, and to market hydrogen generating equipment and products. During the
beginning of the second quarter ended June 30, 2000, the Company acquired the
remaining 50% interest in Powerball Technologies, LLC, for 1,500,000 shares of
the Company's common which was issued to the other joint interest member. At
that time, Powerball Technologies, LLC became a wholly owned subsidiary of the
Company.  The Company, through its  wholly owned subsidiary and prior to the
year 2000 its joint venture, is involved in research and development efforts
of commercializing the technology.

Consolidation policy  -  Prior to the acquisition , the Company accounted for
its investment in the Limited Liability company using the equity method of
accounting. The acquisition has been accounted for using the purchase method
of accounting.   The consolidated balance sheet, statement of operation, and
statement of cash flows at June 30, 2002 and December 31, 2001, include the
accounts of Powerball International, Inc. (Company) and its wholly-owned
operating subsidiary, Powerball Technologies, Inc.  Intercompany transactions
and balances have been eliminated in consolidation.

Amortization of Organization Costs  -  The Company was amortizing its
organization costs over a  sixty (60) month period using the straight-line
method.  In 1998, the Accounting Standards Executive Committee (AcSEC) of the
American Institute of Certified Public Accountants issued Statement of
Position (SOP) 98-5. "Reporting on the Costs of Start-up Activities."  The SOP
requires costs of start-up activities and organization costs to be expensed as
incurred.  During 1999, the Company adopted the SOP and recognized a charge
for the cumulative effect of accounting change of $27,226.

Intangible Asset - At the time of the acquisition, the patent technology held
by the joint venture was assigned to the Company and was recorded at the
historical cost as recorded on the books of the Subsidiary. This cost plus
additional costs related to the technology obtained is being amortized over
ten years on a straight-line basis.

Income Taxes  -  The Company provides for income taxes based on the liability
method, which required recognition of deferred tax assets and liabilities
based on differences between financial reporting and tax bases of assets and
liabilities measured using enacted tax rates and laws that are expected to be
in effect when the differences are expected to reverse.

Use of Estimates - The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported amounts
of revenue and expenses during the reporting period. Actual results could
differ from those estimates.

<PAGE>
<PAGE> 8
POWERBALL INTERNATIONAL, INC. AND SUBSIDIARY
 (Development Stage Companies)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTE   1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Cash and Cash Equivalents  -  For purposes of the statement of cash flows, the
Company considers all investment instruments purchased with a maturity of
three months or less to be cash equivalents.  The Company had no noncash
financing activities for the six months ended June 30, 2002 and the year ended
December 31, 2001.

Net Income (Loss) Per Common Share - Basic earnings (loss) per common share
(EPS) is calculated by  dividing net income (loss) for the period by the
weighted average number of the Company's common shares outstanding and, if
applicable, EPS is computed by dividing net income by diluted common
equivalent shares from stock options and warrants, as calculated using the
treasury stock method.

Fully diluted earnings per common share reflect the calculation of the number
of common equivalent shares based on the stock price at the end of the period.
Fully diluted per common share amounts are not reported because the Company
has had losses for every period since inception and thus a diluted earnings
per share computation would be antidilutive for June 30, 2002 and December 31,
2001.  Per Financial Accounting Statement No. 128 if there is a loss from
continuing operations, diluted EPS is the same as basic EPS.

Issuance of Shares for Services and Other Expenses  -  Valuation of shares
issued for royalties, services and expenses of the Company and in behalf of
its joint venture partner, prior to its acquisition,  were based on the fair
market value of the above items at the time of issuance

Research and Development Costs  -  Research and Development costs to both
future and present products are charged to operations as incurred

NOTE   2  -  RECEIVABLE - RELATED PARTY

Prior to the business combination, the Company had a receivable from a related
party that was an unsecured non-interest bearing loan, which had no repayment
terms.   The Company now accounts for the related party loan as an
intercompany transfer and is eliminated in consolidation.  The receivable was
due from Powerball Technologies, LLC ( A Development Stage Company).
Powerball International, Inc. was a 50% owner of Powerball Technologies, LLC,
until the second quarter 2000 merger.

NOTE  3  -  BUSINESS COMBINATION

The Company in the second quarter ended June 30, 2000 completed its plan of
merger with Powerball Technologies, Inc. (PIC) in a business combination
accounted for as a purchase.  The Company acquired the net assets of PIC for
1,500,000 shares of the Company's common stock.  PIC's only business activity
was its joint interest investment in Powerball Technologies, LLC.   The merger
caused Powerball Technologies, LLC (Tech) to become a wholly-owned subsidiary
of the Company.  The results of operations of Tech is included in the
financial statements since the first day of the quarter ended June 30, 2000.
The merger was recorded at historical cost values and thus there is no
amortization of the cost of the merger over the fair value of the net assets
of PIC.

<PAGE>
<PAGE> 9
POWERBALL INTERNATIONAL, INC. AND SUBSIDIARY
 (Development Stage Companies)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTE   4  -  INVESTMENT IN LIMITED LIABILITY COMPANY

The Company and Powerball Industries, Inc. formed a limited liability company
called Powerball Technologies, LLC (LLC) to license the Technology; to further
develop the Technology; to build a sodium hydride pellet recycling plant; to
manufacture tanks in which hydrogen is generated; to demonstrate the
commercial viability of the Technology; and to commercialize the Technology.
Powerball Industries, Inc. assigned the Technology License to the LLC for a
50% ownership interest in the LLC. The Company invested $250,000 in the LLC
for a 50% ownership interest.  The LLC is a development Stage Company.
Through the quarter ended March 31, 2000, equity in the loss of the LLC was
recognized in the Company's financial statements.

NOTE   5  -  STOCK OFFERINGS AND COMMON STOCK TRANSACTIONS

On January 22, 2001, the Company completed a subscription agreement for a
private placement of 150,000 units at $4.00 per unit, each unit consisting of
1 unit of common stock and 1 warrant to purchase 1 share of stock at an
exercise price of $6.00, exercisable for two years from the date of issuance.
The total subscription price was $600,000 and was paid by the issuance of a
promissory note for the same amount.  The note was to be paid in monthly
installments of $50,000, $50,000, $50,000, $100,000, $150,000 and $200,000 at
the end each month starting with February 2001.   The note was unsecured,
carried no interest and was subject to prepayment.  The shares under the
subscription would be held in escrow until the note was satisfied.   As of
March 31, 2001 the subscription receivable had a balance of $550,000.  In
connection with the private placement, the Company was to pay a finder's fee
to an individual consisting of 15,000 shares of restricted common stock and a
warrant to purchase up to 15,000 shares of common stock on the same terms as
the above private placement warrants.  This fee was treated as a direct cost
of the private placement.  In June 2001, the Company cancelled the
subscription agreement for nonpayment in the amount of $550,000.  A total of
13,750 shares were issued under agreement for payments prior to the
cancellation, 1,250 of the shares issued represented the finder's fee.  The
recipient of the finders fee became a Officer of the Company.  Direct costs of
this private placement were $5,000.

During October and November of 2001, the Company completed two separate
private placements of its common stock.  Under the October private placement,
it sold 356,000 shares of common stock at $1.00 per share for $356,000.  Under
the November private placement, it sold 161,000 shares of common stock at
$2.50 for $402,500.  Direct costs associated with these private placements was
$6,512.

During February, October and November of 2001, 110,000 warrants were exercised
at a $1,00 per share for a total amount of $110,000.  Of this amount, $10,000
was received in the year 2000 and was treated as a deferred liability for that
year.  Consideration for 20,000 of the above warrants exercised was provided
by services rendered to the Company by an officer and stockholder.

<PAGE>
<PAGE> 10
POWERBALL INTERNATIONAL, INC. AND SUBSIDIARY
 (Development Stage Companies)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTE   5  -  STOCK OFFERINGS AND COMMON STOCK TRANSACTIONS (Continued)

During October 2001, an officer and director of the Company was issued 100,000
shares of common stock valued at $150,000.  During December 2001, another
officer of the Company was issued 10,000 shares of common stock valued at
$33,000.  During October 2001, a vendor was issued 100,000 shares of common
stock for services to be rendered per an agreement between the vendor and the
Company.  The shares issued were valued at $190,000.

From January to June 2002, warrants for 130,000 shares of common stock were
exercised at $1.00 per share were exercised for a total amount received of
$130,000.

On March 26, 2002, the Board of Directors credited Robert Ipson, CEO, for
services rendered to the Company, with $50,000 toward the exercise of his
outstanding $1.00 options for purchase of the Company's common stock.  The
Board also credited Phillip McStotts, Board member and consultant to the
Company, with $12,500 toward the exercise of his outstanding $1.00 warrants
for purchase of the Company's common stock.  These shares were subsequently
issued on April 1, 2002.

On June 6, 2002, the Board of Directors credited Robert Ipson, CEO, for
services rendered to the Company, with $50,000 toward the exercise of his
outstanding $1.00 warrants for purchase of the Company's common stock.

On June 26, 2002, the Board of Directors agreed to modify William Freise's
employment agreement dated May 30, 2001, and approve the issuance of an option
for the purchase of 75,000 shares of its restricted common stock in lieu of
the issuance of 10,000 shares and 65,000 warrants called for in his employment
agreement.  The options will be issued at an exercise price of $2.45,
exercisable for a period of three years pursuant to the Company's 2000 Stock
Option and Award Plan.

NOTE   6 -  INCOME TAXES

Due to losses at December 31, 2001 and 2000, the Company had no income tax
liability and thus no provision for taxes was recorded.  The Company had a
deferred tax benefit of $4,330 derived from the amortizing of organization
costs for tax reporting and expensing of organization costs for financial
reporting purposes.  At December 31, 2001, the Company has a net operating
loss carryforward of approximately $1,910,736 which will expire between the
years 2012 and 2021.  A Valuation allowance of $649,650 has been established
for those tax credits which are not expected to be realized.  The change in
the valuation allowances for 2001 was $318,069.

The Subsidiary which is a Limited Liability Company is not a tax paying entity
for Federal or State income tax purposes and, thus, no income tax expense has
been recorded. Instead, its earnings and losses since the merger are included
in the Parent's income tax return.


<PAGE>
<PAGE> 11

          ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                     CONDITION AND RESULTS OF OPERATIONS

Cautionary Statement Regarding Forward-looking Statements
---------------------------------------------------------
This report may contain "forward-looking" statements.  Examples of forward-
looking statements include, but are not limited to: (a) projections of
revenues, capital expenditures, growth, prospects, dividends, capital
structure and other financial matters; (b) statements of plans and objectives
of our management or Board of Directors; (c) statements of our future economic
performance; (d) statements of assumptions underlying other statements and
statements about us and our business relating to the future; and (e) any
statements using the words "anticipate," "expect," "may," "project," "intend"
or similar expressions.

General
-------
We have completed the construction of our pilot sodium plant in Salt Lake
City, Utah.  The pilot plant has successfully produced small quantities of
elemental sodium.  Operational procedures have been developed that produce
consistent and repeatable sodium production yields.  We have retained the
services of a professional chemical and mechanical engineering firm to scale
up the methodologies in the pilot plant to achieve results that management
hopes will yield commercially useful hourly sodium production quantities. We
anticipate receiving the final report and drawings from the engineering firm
in the 3rd quarter 2002.

We are currently in discussions and working out specifics for a number of
demonstration projects for our Hydrogen On Demand generators.  Powerball has
agreed to produce a version of its patented hydrogen generation system for use
as an emergency backup fuel supply for a hydrogen powered mining vehicle, code
named ZEUS. The zero emission utility solution (ZEUS) mining vehicle project
is under the direction of the Spokane Research Laboratory (SRL) of the
National Institute of Occupational Safety and Health (NIOSH). NIOSH has
tentatively scheduled this project to begin in the 4th quarter 2002. We are
also engaged in discussions with a fuel cell manufacturer regarding a project
aimed at powering cellular telephone repeater tower electronics in Africa.

We have signed a letter of intent with FMC to explore a joint venture
arrangement for a potential sodium metal production plant to be constructed at
an FMC site in Green River, Wyoming. No definitive agreement has been reached
and no timetable has been established for an agreement or a potential
construction schedule. We anticipate being able to make additional
announcements of partnerships before the end of the fiscal year.

Results of Operations
---------------------
Three and Six Months Ended June 30, 2002 compared with June 30, 2001
--------------------------------------------------------------------
Revenues.  We expect that our initial revenues will be generated primarily by
the production of sodium.  Additional revenues may be derived from the
licensing of the Technology and/or manufacturing and sale of hydrogen
generation systems. We had no revenues for the three and six months ended June
30, 2002 and 2001, respectively, and have had no revenues since July 9, 1997
("Inception").


<PAGE>
<PAGE> 12

Operating Expenses.  For the three and six months ended June 30, 2002, we had
total operating expenses of $256,923 and $538,525, respectively, compared to
$130,796 and $287,095 for the three months and six months ended June 30, 2001.
The increase in operating expenses is attributable primarily to an increase in
professional fees of $234,539 and an increase in research and development
costs of $14,215.  The increase in professional fees is due primarily to the
compensation paid to two officers in the form of credit towards the exercise
of outstanding options and warrants, plus the amortized payment of fees to a
third party investor research firm.

In the six month period ended June 30, 2002, Robert Ipson, our C.E.O.,
received a credit of $50,000 towards the exercise of his existing options to
purchase our common stock at $1.00 per share, and an additional credit of
$50,000 towards the exercise of his existing warrants to purchase our common
stock at $1.00 per share.  Phillip McStotts, our secretary and treasurer,
received a credit of $12,500 towards the exercise of his existing warrants to
purchase our common stock at $1.00 per share.  Total expense recorded as
professional fees for these two officers for the six months ended June 30,
2002 was $112,500.  There was no comparable expense for the prior year period.

In October 2001, we entered into an investor research contract with
TheInvestorOnline, a third party vendor, for services to be performed over a
one year period.  Upon signing the contract, we paid $35,000 cash and issued
100,000 shares of our restricted common stock valued at $1.90 per share for
total consideration of $225,000.  This expense is being amortized over the one
year period in which the services are to be performed.  There was no
comparable expense for the prior year period.

In the next twelve months, we expect that operating costs will increase mainly
due to additional fees for third party design and/or engineering consultants
involved scaling up the pilot plant sodium process.  We do not anticipate
incurring additional fees for officers' services.

Other Income.  Other income for the three and six month period ended June 30,
2002 consisted of $2,053 and $4,058 of interest income, respectively, compared
to $581 and $2,762 of interest income, respectively, for the three and six
months ended June 30, 2001.

We experienced a net loss of $254,870 and $534,467, respectively, for the
three and six months ended June 30, 2002 compared to a net loss of $130,315
and $284,433, respectively, for the three and six months ended June 30, 2001.
Our net loss since inception has been $2,357,939. The net loss per share for
the three and six months ended June 30, 2002 was $0.06 and $0.13, based on the
weighted average number of shares outstanding of 4,280,299 and 4,205,924
shares, respectively compared to a net loss per share for the three and six
months ended June 30, 2001 of $0.04, and $0.09, based on the weighted average
number of shares outstanding of 3,300,250 and 3,306,369 shares, respectively.
The net loss per share since inception has been $1.22, based on the weighted
average number of shares outstanding of 1,940,136.

Liquidity and Capital Resources
-------------------------------
At June 30, 2002, we had current assets of $399,078 and current liabilities of
$49,656 for working capital of $349,422.  At June 30, 2002, we had  property
and equipment of $9,173, net of depreciation, other assets held for resale,
net of valuation allowance, of $4,000, and patents and license agreements, net
of amortization, of $19,248.


<PAGE>
<PAGE> 13

Our cash used in operations for the six months ended June 30, 2002 was
$283,505, compared to $278,184 for the same period the prior year.  Since
inception, our operations have been funded primarily by cash received from
capital contributions and the issuance of common stock for cash.

We did not engage in investing activities for the six months ended June 30,
2002.  Investment activities used $7,497 for the purchase of equipment and
leasehold improvements, and $13,629 for additional patent costs during the
prior year period.

Cash flows from financing activities during the six months ended June 30, 2002
totaled $130,000, all from the issuance of common stock through the exercise
of previously outstanding warrants.

Our working capital has come mainly through the sale of our securities.
Proceeds generated from the sale of our securities have funded our operations,
including continued research and development activities.  At June 30, 2002, we
believe we have sufficient funds for operations through the remainder of the
fiscal year.

In August 2001, we initiated a private placement of our restricted common
stock to certain existing shareholders.  The original private placement was
intended to raise a maximum of $200,000 through the sale of 80,000 shares at a
price of $2.50 per share.  However, prior to the fulfillment of the private
placement, due to market conditions and the need for additional capital, in
October 2001, our Board of Directors amended the private placement, to permit
the sale of up to 400,000 shares at a price of $1.00 per share.  We sold a
total of 356,000 shares for aggregate proceeds of $356,000.

In November, we initiated a private placement of our restricted common stock
at a price of $2.50 per share.  We issued a total of 161,000 shares for
aggregate proceeds of $402,500.

We anticipate that within the next year additional funds may be needed to
allow us to enter into other markets for hydrogen technology.  There can be no
assurance that any additional required funding will be available to us.

We expect that during the next year our primary expenditures will be for
further research and development aimed at commercialization of sodium and
powerball production, and expenses and professional and related fees
associated with our ongoing reporting obligations.  We believe we have
sufficient working capital to meet our ongoing operating expenses through the
end of the fiscal year.


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<PAGE> 14
                          PART II - OTHER INFORMATION

                          ITEM 1.  LEGAL PROCEEDINGS
     None.

                        ITEM 2.  CHANGES IN SECURITIES
     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.

               ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a)     Exhibits.
        ---------
     None.


(b)     Reports on Form 8-K.
        --------------------
     None.



                                  SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
Company has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.

                                     POWERBALL INTERNATIONAL, INC.


Dated: August 6, 2002                By/S/Robert K. Ipson, Chairman and
                                     Chief Financial Officer