FORM 10-QSB

                       SECURITIES AND EXCHANGE COMMISSION

                              WASHINGTON, DC 20549


              [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                      For Quarter Ended September 30, 2000

                                       OR

              [ ] TRANSITION REPORT PURSUANT O SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                For the Transition Period from _______ to _______

                         Commission file number 33-20432

                       MAGNITUDE INFORMATION SYSTEMS, INC.
             (Exact Name of Registrant as Specified in its Charter)

                               Delaware 75-2228828
                  (State or other Jurisdiction of (IRS Employer
               Incorporation or Organization) Identification No.)

                  401 State Route 24, Chester, New Jersey 07930
               (Address of Principal Executive Office) (Zip Code)

                                 (908) 879-2722
               (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.
                                 Yes X No _____

                  The number of shares of Registrant's Common Stock, $0.0001 par
value, outstanding as of September 30, 2000, was 16,193,314 shares.

<PAGE>




              MAGNITUDE INFORMATION SYSTEMS, INC. AND SUBSIDIARIES




                                      INDEX

                                                                        Page
                                                                        Number

PART  1  -  FINANCIAL INFORMATION

Item 1   Financial Statements (unaudited)

         Consolidated Balance Sheet
          - September 30, 2000                                             3

         Consolidated Statements of Operations
          - Three and nine months ended September 30, 2000 and 1999        4

         Consolidated Statements of Cash Flows
          - Nine months ended September 30, 2000 and 1999                  5

         Notes to Consolidated Financial Statements                      6 - 11


Item 2  Management's Discussion and Analysis of Financial Condition
         and Results of Operations                                      12 - 13


PART II  -  OTHER INFORMATION                                           14 - 15


SIGNATURES                                                                 16


FINANCIAL DATA SCHEDULE                                                    17

OTHER EXHIBITS                                                             18




                                       2
<PAGE>



PART I  - Item 1
              MAGNITUDE INFORMATION SYSTEMS, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                                September 30, 2000
ASSETS
     Current Assets
<S>                                                                             <C>
     Cash  .....................................................................$    680,866
     Accounts receivable, net of allowance for
        doubtful accounts of 6,646 .............................................     461,401
     Inventories ...............................................................       8,670
     Deferred tax asset.........................................................     201,470
     Prepaid expenses ..........................................................     427,677
                                                                                -------------
        Total Current Assets ...................................................   1,780,084
     Property, plant and equipment, net of accumulated
        depreciation of $176,978 ...............................................     118,054
     Software, net of accumulated amortization of
         $378,602 ..............................................................   1,128,688
     Other assets ..............................................................      25,209
                                                                                -------------
TOTAL ASSETS ...................................................................   3,052,035
                                                                                =============
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
     Accounts payable and accrued expenses .....................................     779,414
     Deferred revenue...........................................................      27,196
     Dividends payable .........................................................      89,973
     Prepayments received ......................................................           0
     Loans and notes payable ...................................................     238,492
     Current maturities long-term debt .......................................             0
     Current maturities lease obligations ....................................         6,938
                                                                                -------------
        Total Current Liabilities ..............................................   1,142,013
     Long-term debt, less current portion ...................................        374,890
     Lease obligations, less current portion ................................         13,005
                                                                                -------------
TOTAL LIABILITIES ..............................................................   1,529,908

STOCKHOLDERS' EQUITY
     Preferred Stock, $0.001 par value, non-voting, 3,000,000 shares authorized:
     2,500 shares have been designated Cumulative Preferred Stock,
     of which 1 share is issued and outstanding ................................           0
     300,000 shares have been designated Series A Convertible Preferred Stock,
     350,000 shares have been designated Series B Convertible Preferred Stock,
     120,000 shares have been designated Series C Convertible Preferred Stock,
     500,000 shares have been designated Series D Convertible Preferred Stock,
     of which a combined total 490,448 shares are issued and outstanding                 490
     Common Stock, $0.0001 par value, 100,000,000 shares authorized,
     16,193,314 shares are issued and outstanding...............................       1,619
     Contributed capital .......................................................      81,000
     Additional paid-in capital ................................................  15,341,180
     Accumulated deficit ....................................................... (13,902,162)
                                                                                ------------
TOTAL STOCKHOLDERS' EQUITY...............................                          1,522,127

TOTAL LIABILITIES AND EQUITY ....................................               $  3,052,035
                                                                                =============
</TABLE>

                 See notes to consolidated financial statements


                                       3
<PAGE>




              MAGNITUDE INFORMATION SYSTEMS, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                       Three Months Ended                 Nine Months Ended
                                                          September 30,                      September 30,
                                                       2000              1999             2000              1999
                                                 -------------     -------------    -------------     -------------

<S>                                               <C>            <C>               <C>               <C>
Total Revenues....................................$     253,787  $       52,250    $    601,790      $    162,430

     Cost of Goods Sold ..........................       41,740          41,257         126,394           127,696
                                                  -------------    ------------     -------------    ----------------

Gross Profit .....................................      212,047          10,993         475,396            34,734

     Selling expenses ............................      441,140         210,383       1,046,219           567,217
     General & administrative expenses ...........      641,478         499,253       1,774,331         1,433,692
                                                   -------------   ------------      -------------    --------------

Operating Income (Loss) ..........................     (870,571)       (698,643)     (2,345,154)       (1,966,175)

     Miscellaneous income ........................           12          10,469          14,060            98,065
     Interest expense, net........................      (16,091)        (77,385)       (148,934)         (187,383)
     Miscellaneous expenses ......................           (0)        (49,417)         (1,149)          (69,106)
                                                   -------------   ------------     ------------      ------------
Non-Operating Income (Expense) ...................      (16,079)       (116,333)       (136,023)         (158,424)
                                                   -------------   -------------    -------------     ------------


Net Loss .........................................$    (886,650)    $  (814,976)    $(2,481,177)     $ (2,124,599)
                                                      ==========   ============      ===========     =============


Loss per Common Share ............................$       (0.06)    $     (0.09)    $     (0.17)     $      (0.26)
                                                      ==========    ===========     ============      ============
Weighted Average Number of
     Common Shares Outstanding ...................    15,745,597      8,824,380      14,599,500         8,164,100
</TABLE>




                 See notes to consolidated financial statements



                                       4
<PAGE>




              MAGNITUDE INFORMATION SYSTEMS, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

<TABLE>
<CAPTION>

                                                     Nine Months Ended September 30,
                                                          2000              1999
Cash Flows from Operating Activities
<S>                                                 <C>                <C>
     Net income (loss) ...........................  $(2,481,178)       $ (2,124,599)
     Adjustments to net income (loss)
        Depreciation and amortization ............      149,074             139,694
        Stock and debt issued for expenses........      251,667                   0
        Loss on disposition of certain assets ....        1,122               8,993
        Dividend payments.........................      (42,000)                  0
     Decreases (increases) in Assets
        Accounts receivable ......................     (401,277)             68,281
        Miscellaneous receivables.................       15,227                   0
        Inventories ..............................          215              17,827
        Prepaid expenses .........................      (38,795)           (121,527)
        Other assets .............................      (22,750)              1,852
     Increases (decreases) in Liabilities
        Prepayments received......................            0                   0
        Deferred revenue..........................       27,193
        Accounts payable and accrued expenses ....     (231,682)           (711,686)
                                                   --------------      -------------
Net Cash Provided (Used) by Operating Activities     (2,773,181)         (2,721,165)

Cash Flows from Investing Activities
     Purchases of equipment and fixtures .........      (52,182)             (2,606)
     Disposition of equipment and other assets ...        3,358              60,000
                                                   --------------       ------------
Net Cash Provided (Used) by Investing Activities        (48,824)             57,394

Cash Flows from Financing Activities
     Proceeds from notes payable .................      250,000           1,247,235
     Repayment of loans and notes ................     (484,534)           (293,200)
     Repayment of long-term debt .................           (0)            (52,000)
     Accrual of contingent liability..............            0             374,890
     Issuance of preferred stock..................    2,937,836                   0
     Issuance of common stock ........... ........      550,000           1,380,031
                                                    -----------          -----------
Net Cash Provided (Used) by Financing Activities      3,253,302           2,656,956
Net Increase (Decrease) in Cash ..................      431,297              (6,815)
Cash at Beginning of Period ......................      249,569               9,403
                                                    -----------          ----------
Cash at End of Period ............................ $    680,866     $         2,588
                                                   =================     ===========
</TABLE>




                 See notes to consolidated financial statements



                                       5
<PAGE>



              MAGNITUDE INFORMATION SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 2000

DESCRIPTION OF BUSINESS

         Magnitude  Information Systems, Inc. (the "Company" or "Magnitude") was
         incorporated as a Delaware corporation on April 19, 1988 under the name
         Fortunistics  Inc. On March 4, 1993,  the  Company  changed its name to
         Whitestone  Industries,  Inc. On July 14, 1997, the Company changed its
         name to Proformix Systems,  Inc., and on November 18, 1998, the Company
         changed its name to Magnitude Information Systems, Inc.

         The Company's  primary  product is an integrated  suite of  proprietary
         software  modules  marketed  under the name  ErgoManager(TM)  which are
         designed to help  individual  computer  users and  businesses  increase
         productivity and reduce the risk of potentially  preventable repetitive
         stress injury (RSI). These software modules can be applied individually
         or together in a comprehensive ergonomic and early intervention program
         that seeks to modify a user's  behavior by  monitoring  computer  usage
         patterns over time and warning the user when to break a dangerous trend
         in repetitive  usage of an input  device,  such as a keyboard or mouse.
         The product was developed to train people working on computers, monitor
         computer-use related activities and evaluate a user's risk exposure and
         propensity  towards injury or loss of  effectiveness in connection with
         his/her  day-to-day work.  Moreover,  the software enables a company to
         not only address the issue of health risks  involving  employees and to
         minimize resulting potential liabilities,  but delivers a powerful tool
         to increase overall productivity.

BACKGROUND

         On June 24, 1997, the Company,  extended a stock exchange offer to the
         shareholders of Proformix,  Inc., a Delaware  corporation and
         manufacturer of ergonomic keyboarding  systems.  Proformix,  Inc. in
         November  1998 changed its name to Magnitude, Inc. and is now referred
         to as  Magnitude,  Inc. At the time of this submission,  holders of
         99.1% of  Magnitude,  Inc.  common  stock have tendered their shares.
         The  business combination which took the form of a reverse acquisition
         has been accounted for as a purchase. As a result, the Company and
         Magnitude,  Inc. remain as two separate legal entities whereby
         Magnitude,  Inc. operates as a subsidiary  of Magnitude  Information
         Systems,  Inc..  The  operations  of the newly  combined  entity are
         currently  comprised  solely of the operations of Magnitude, Inc.

         On February 2, 1998, the Company  entered into an Agreement and Plan of
         Merger with Rolina  Corporation,  a privately held New Jersey  software
         developing  firm,  and on  April  30,  1998,  into  an  Asset  Purchase
         Agreement with Vanity Software  Publishing Co., a Canadian developer of
         specialized  software,  whereby the Company,  in return for payments in
         form of cash and  equity,  acquired  the  rights  to  certain  software
         products and related assets,  with such software products  subsequently
         forming the basis for the further development,  during the year, of the
         Company's proprietary ErgoManager(TM) software system.

         On November  18,  1998,  the Company  and its wholly  owned  subsidiary
         Magnitude,  Inc.  entered into an Asset Purchase  Agreement and several
         related  agreements with 1320236 Ontario Inc. ("OS"), a publicly traded
         Canadian  designer,  manufacturer  and distributor of office  furniture
         based  in  Holland  Landing,  Ontario,  Canada,  pursuant  to  which OS
         acquired  Magnitude,  Inc.'s  hardware  product  line  comprised of the
         Company's  ergonomic  keyboard platform  products and accessories,  all
         related inventory and production  tooling and warehousing  assets,  and
         all intellectual  property rights including the Proformix name, against
         a cash  consideration  and certain royalty payments on OS' sales of the
         Proformix hardware products.

                                       6

<PAGE>

              MAGNITUDE INFORMATION SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 2000

         Magnitude   Inc.'s  wholly  owned   subsidiary,   Corporate   Ergonomic
         Solutions,  Inc.  (Ergonomics)  was  incorporated  in the  State of New
         Jersey during October 1992.  Ergonomics,  which commenced operations in
         September 1997, was formed primarily to market hardware  products.  Its
         operations during the last two years have not been significant.


SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
     Principles of Consolidation
         The consolidated  financial  statements  include the accounts of
         Magnitude  Information  Systems,  Inc. and its  subsidiaries,
         Magnitude, Inc. and Corporate Ergonomic Solutions, Inc.  All
         significant intercompany balances and transactions have been
         eliminated.

     Inventories
         Inventory  consists of finished  goods which are stated at the lower of
cost (determined by the first-in, first out method) or market.

     Depreciation and Amortization
         Property,  plant and  equipment are recorded at cost.  Depreciation  on
         equipment,   furniture  and  fixtures  and  leasehold  improvements  is
         computed on the straight line method over the estimated useful lives of
         such assets between 3-10 years.  Maintenance and repairs are charged to
         operations as incurred.  Software  assets are amortized on the straight
         line method over 10 years.

     Securities Issued for Services
         The Company accounts for stock, stock options and stock warrants issued
         for services and  compensation  by employees  under the intrinsic value
         method. For non-employees, the fair market value of the Company's stock
         on the date of  stock  issuance  or  option  grant  is used.  Effective
         January 1, 1996, the Company adopted Statement of Financial  Accounting
         Standard (SFAS) No. 123, "Accounting for Stock-based Compensation". The
         statement   generally   suggests,   but  does  not  require,   employee
         stock-based  compensation  transactions  be accounted  for based on the
         fair  value of the  services  rendered  or the fair value of the equity
         instruments issued, whichever is more reliably measurable. As permitted
         by the  statement,  the  Company  has elected to continue to follow the
         requirements of Accounting Principles Board Opinion No. 25, "Accounting
         for Stock Issued to Employees' for employees  under the intrinsic value
         method. The adoption of SFAS No. 123 does not have a material impact on
         the financial statements.

     Income Taxes
         The  Company  provides  for income  taxes  based on enacted tax law and
         statutory  tax rates at which items of income and expenses are expected
         to be settled in the  Company's  income tax  return.  Certain  items of
         revenue and expense are  reported  for Federal  income tax  purposes in
         different  periods  than  for  financial  reporting  purposes,  thereby
         resulting in deferred income taxes.  Deferred taxes are also recognized
         for  operating  losses  that are  available  to offset  future  taxable
         income.  Valuation  allowances are established when necessary to reduce
         deferred tax assets to the amount expected to be realized.  The Company
         has  incurred  net  operating   losses  for   financial-reporting   and
         tax-reporting purposes.  Accordingly,  for Federal income tax purposes,
         the  benefit for income  taxes has been offset  entirely by a valuation
         allowance  against the related federal  deferred tax asset for the year
         ended  December 31,  1999.  For state  income tax  purposes,  a partial
         valuation  allowance has been offset against the related state deferred
         tax asset for the year ended December 31, 1999.

                                       7
<PAGE>



              MAGNITUDE INFORMATION SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 2000

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued

     Net Loss Per Share
         Net loss per share,  in  accordance  with the  provisions  of Financial
         Accounting Standards Board No. 128, "Earnings Per Share" is computed by
         dividing  net loss by the weighted  average  number of shares of Common
         Stock outstanding during the period.  Common Stock equivalents have not
         been   included  in  this   computation   since  the  effect  would  be
         anti-dilutive.

     Revenue Recognition
         Revenue  from  the  licensing  of  proprietary   software  products  is
         recognized  at the  time  of  licensing  provided  that  the  resulting
         receivable  is deemed  probable of  collection.  Revenue from  software
         maintenance contracts is recognized ratably as earned.

     Use of Estimates
         The  preparation of financial  statements in conformity  with generally
         accepted   principles   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 revenues and expenses
         during the  reporting  period.  Actual  results could differ from those
         estimates.

DEFERRED TAX ASSET

         During 1999, the Company had filed an  application  with the New Jersey
         Economic  Development  Authority who administers the current New Jersey
         Tax   Certification   program  pursuant  to  the  New  Jersey  Emerging
         Technology and  Biotechnology  Financial  Assistance Act to qualify for
         and be the  beneficiary of this program which will permit a participant
         to liquidate  its State NOL tax benefits  against cash  considerations.
         The Company has been  accepted  under this  program and has been issued
         tax transfer  certificates  which will, upon  liquidation,  result in a
         cash benefit in the amount stated.


PREPAID EXPENSES

         Prepaid  expenses  include a position  of  $375,000  resulting  from an
         agreement  in February  1998 with BNN  Business  News  Network  Inc., a
         nationwide  media  advertising and radio network  company,  whereby the
         Company   purchased   advertising  time  to  be  utilized  on  stations
         associated  with Business  News Network  Inc.,  usable over a period of
         three years,  since then extended,  and aggregating  $900,000 in retail
         value,  against  issuance of 150,000 new and restricted  common shares.
         The services  purchased were  capitalized at the then fair market value
         of the stock issued, for a total of $375,000.  The resulting asset will
         be amortized as utilized, over the time frame of the next two years. As
         per the  date of this  report,  no  portion  of  this  asset  has  been
         utilized.  Management  believes  that the Company will derive  economic
         benefits  commensurate with the value of this asset. If management were
         to determine that it may not be able to economically utilize the entire
         amount  during  the  time  allotted,  it  will  effect  an  accelerated
         amortization or write-down of this asset position.

                                       8


<PAGE>


              MAGNITUDE INFORMATION SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 2000

PROPERTY, PLANT AND EQUIPMENT
<TABLE>
<CAPTION>

     Property,  plant and  equipment  consist of the  following at September 30,
2000:
<S>                                                                                      <C>
              Equipment                                                                  $       179,287
              Furniture and fixtures                                                              69,976
              Leasehold improvements                                                              45,770
                                                                                           --------------

                                                                                                 295,033

              Less accumulated depreciation                                                      176,979
                                                                                           --------------

                                        Total                                            $       118,054
                                                                                           ==============

ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts  payable and accrued  expenses  consisted of the following at September
30, 2000:

              Accounts payable                                                           $       359,442

              Accrued interest                                                                    66,921

              Accrued commissions                                                                 30,176

              Accrued salaries and professional fees (payable in cash)                            59,997

              Accrued salaries and professional fees (payable in equity)                         173,711

              Miscellaneous accruals                                                              89,167
                                                                                            =============
                                    Total                                                $       779,414
                                                                                            =============
LOANS AND NOTES PAYABLE

     At September 30, 2000, Magnitude, Inc. and the Company had borrowings
     under short term loan agreements with the following terms and conditions:

         Note issued by Magnitude,  Inc.  originally  maturing December 4, 1998
         and accruing interest at                                                        $       75,000
         5% per year.  This note is overdue at September  30, 2000;  no demand
         for payment has been made through today's date.
         Note issued by Magnitude,  Inc.  originally maturing June 1996 and
         accruing interest at 12% per year.  This note is overdue at September
         30, 2000; no demand for payment has been made through today's date.                     25,000
         Discounted  present value of a non-interest bearing $70,000 settlement
         with a former investor of  Magnitude,  Inc.  to be paid in  monthly
         payments  commencing  July 1, 1997.  The  imputed interest rate used                    33,529
         to discount the note is 8% per annum. Balance of  promissory  note
         issued to a former member of the board of directors of the Company                      54,963
         carrying  interest at 12% p.a.,  maturing July 2000,  convertible  at
         the holder's  option into shares of the common stock of the Company at
         the rate of $0.50 per share.  Cash advance by an officer of the
         Company, carrying interest at the rate of 7% p.a.                                       50,000

                  Total                                                                    $    238,492
                                                                                           ==============
</TABLE>



                                       9
<PAGE>



              MAGNITUDE INFORMATION SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 2000


LONG-TERM DEBT

<TABLE>
<CAPTION>
        Pursuant to the  February 2, 1998,  Agreement  and Plan of Merger with
        Rolina  Corporation  (see "Background")  the Company had issued  155,556
<S>                                                                                               <C>
        shares (the "Shares") of its common stock to the principal of Rolina                      $      374,890
        Corporation  who  currently  serves as the  Company's  President  and
        Chief Executive Officer,  and had issued a Put Option for such Shares
        at a price of $2.41 per share in accordance with the provisions
        contained therein,  with notice for exercise eligible to be given
        at any time after  February  1, 2000,  and before  5:00 p.m.  on the
        90th day  thereafter.  This current liability was converted into a
        Company obligation  maturing March 31, 2002, and carrying interest at
        the rate of 7% per year payable  monthly.  The obligation  includes an
        option to the holder for conversion of the outstanding  principal into
        shares of the Company's common stock at the rate of $0.50 per share.


  INCOME TAXES

       At December  31, 1999,  the Company had net  operating  loss carry
       forwards  approximating which expire  between the years 2008                                $    11,300,000
       and 2013 and are subject to certain annual limitations.

  The Company's total deferred tax asset and valuation allowance at December 31,
  1999 are as follows:
            Total deferred tax asset                                                               $     4,240,000
            Less valuation allowance                                                                     4,240,000
            Net deferred tax asset                                                                 $             -
                                                                                                     ===============
</TABLE>



COMMITMENTS AND CONTINGENCIES

   Lease Agreements
     Magnitude,  Inc.  currently  leases office space which contained its former
     administrative  offices  pursuant to a lease  agreement  dated  December 9,
     1998.  Such lease  commences  December 16, 1998 and expires on December 31,
     2001 and  requires  monthly  payments of $3,700 from  December  16, 1998 to
     October  31, 1999 and $3,250 from  November 1, 1999 to December  31,  2001.
     This  space has been  sublet,  generating  $3,250  per month in  offsetting
     revenues.

     On March 15, 2000,  the Company  entered into a lease  agreement for office
     space which is utilized for the  Company's  principal  offices.  Such lease
     commenced April 15, 2000 and expires on March 31, 2005 and requires monthly
     payments of $6,500 from April 15, 2000 through  March 31,  2002;  of $6,695
     thereafter  through March 31, 2003; of $6,896 thereafter  through March 31,
     2004; and of $7,103 thereafter through March 31, 2005.



                                       10
<PAGE>




              MAGNITUDE INFORMATION SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 2000



RELATED PARTY TRANSACTIONS

      On March 31,  2000,  the Company  and its  President  and Chief  Executive
      Officer agreed to convert a current liability payable to him in the amount
      of $374,890 into a Company obligation maturing March 31, 2002, which among
      others  provides for a right to the holder to convert such obligation into
      common stock of the Company (see "Long-term debt").

      In September 2000, an officer of the Company  extended a cash advance of
      $50,000 to the Company,  accruing  interest at the rate of 7% per year.
      This advance was repaid in October 2000.


SUBSEQUENT EVENTS

      On October 11, 2000,  the board of directors of the Company  confirmed the
      promotion of John C. Duncan,  Executive Vice President, to the position of
      President  and Chief  Operating  Officer of the Company.  Steven D. Rudnik
      retains the title and position of Chief Executive  Officer and Chairman of
      the Board.

      On October 11,  2000,  the board of  directors  of the  Company  adopted a
      resolution  by which the  By-Laws of the Company are amended in Article I,
      Section 7,  Subsection  C,  through  insertion  of the sentence "A special
      meeting  of  stockholders  of the  Company  may be called by  stockholders
      holding a  majority  of the issued and  outstanding  common  shares of the
      Company".









                                       11



<PAGE>



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


Results of Operations:

         During  the  third  quarter  in 2000  Magnitude  recorded  the  largest
software contract in its history yet, a firm commitment from California's  State
Compensation Insurance Fund to install enterprise-wide the latest version of the
Company's   ErgoSentry(TM)   software.  State  Compensation  Insurance  Fund  is
California's largest provider of workers' compensation  coverage.  The order was
placed after a successful,  year-long pilot program involving 400 ErgoSentry(TM)
-equipped work places in selected State Fund offices throughout California,  and
further validated the Company's marketing strategy of lowering entry barriers by
closely cooperating with larger potential clients in introducing its proprietary
software   through  pilot   projects  at  selected   worksites.   Pilot  project
installations are designed to impart  credibility and awareness of the product's
unique  potential in the areas of  productivity  enhancement  and risk reduction
with respect to  repetitive  stress  injuries in the office  environment.  Pilot
projects  involving smaller numbers of employees also provide a potential client
with an opportunity to test the software's utility and reliability,  systems and
network  friendliness,  and staff acceptance without incurring the perceived and
sometimes   real  risk   associated   with   installing  a  new  product  on  an
enterprise-wide scale.

         Revenues for the quarter ended  September  30, 2000,  which include the
above State Fund contract increased to $253,787 compared to $52,250 for the same
period in 1999,  all such  revenues  generated  by the  Company's  wholly  owned
subsidiary  Magnitude,  Inc.  from the  licensing of the  Company's  proprietary
ErgoManager(TM)  software. The quarter also marked the passing of the $1 Million
milestone for aggregate  revenues from the licensing of the Company's  ergonomic
software.  Gross profits during the quarter amounted to $212,047 for a 83% gross
margin.  Gross  profits are  burdened  with a fixed charge for  amortization  of
software  investments.  Software  assets  underlying the Company's  products are
being amortized on a straight line over 10 years, resulting in a level charge of
approximately  $13,000 per month to  cost-of-goods-sold.  Since variable product
costs are low,  the gross  margin is  expected  to further  increase as revenues
grow. After deducting selling expenses and general and  administrative  expenses
of $1,082,618 the Company realized an operating loss of $870,571, compared to an
operating loss of $698,643 for the third quarter in 1999. Non-operating expenses
totaled $16,079  primarily in form of interest  expense.  The net result for the
quarter  was a loss of  $886,650  or  $0.06  per  share,  compared  to a loss of
$814,976 or $0.09 per share for the same period last year.

         The  quarter's  net  result was  strongly  affected  by the  continuing
expansion of marketing  and sales  operations  resulting in a sharp  increase of
selling  expenses,  which  doubled  from the level a year ago,  and, to a lesser
degree,  from  higher  general  and  administrative  expenses.  The  Company  is
undertaking  pioneering  efforts in educating  future customers and the business
community at large about the merits of a  pro-active  stance in dealing with the
growing  level  of  health  risks  and  potential  liabilities  associated  with
repetitive  stress injuries in the computer  workplace  environment.  Management
believes that these efforts are justified by the potential rewards accruing from
this  "First to  Market"  approach  which  should  lead to a strong  competitive
advantage and a sizable  market share during the years to come. The Company will
continue  to  invest  in a  comprehensive  marketing  campaign  with the goal of
accelerating  the  education of  potential  clients and  promoting  the name and
products of the Company. This process,  however, takes time and while management
is confident of the ultimate  success of its strategy it is not in a position to
predict the timing with any degree of certainty.


                                       12

<PAGE>



Liquidity and Capital Resources

         During the third  quarter,  the Company moved  aggressively  to further
improve liquidity and working capital.  New equity  investments  through private
placements with accredited investors who purchased an aggregate 138,920 Series B
and D Senior Convertible  Preferred shares (convertible into common stock at the
rate of 1 preferred  share for 10 common  shares) and the conversion of $502,500
current debt into common  equity added  $1,752,500  to working  capital,  before
deduction of related expenses which totaled $112,500. These transactions further
improved the Company's  balance sheet profile so that, at September 30, 2000 and
in  spite  of the  loss  from  operations,  stockholders'  equity  increased  to
$1,522,127,  from  $826,314 at the end of the  previous  fiscal  quarter.  These
financing  transaction  also erased the working capital deficit  manifest during
the previous  periods.  Working capital showed a positive balance of $638,071 at
the end of the quarter.

         Of the $1,250,000  raised  through new equity  investments a portion of
$750,000  was  attributable  to the  $3  Million  round  of  private  placements
commenced  in the spring of this year and  constituted  the last segment of this
financing  transaction.  The balance of $500,000 resulted from private placement
subscriptions by accredited investors under a new program designed to attract an
aggregate  total of  approximately  $2 Million  in equity  funding  through  the
remainder of this year and the first quarter in 2001.  Management  believes that
funding  expected to be generated from these capital  transactions  will provide
for sufficient  financial  resources,  to cover present and  anticipated  future
needs well into the next fiscal year.

                                       13

<PAGE>


PART  II  -  OTHER INFORMATION

Item 1   LEGAL PROCEEDINGS

The Company is not a party in any legal proceedings.


Item 2   CHANGES IN SECURITIES      -  None

c)   Issuance of unregistered securities

In addition to the issuance of unregistered  securities  previously noted in the
Company's   report  on  Form  10-QSB  for  the  quarter  ended  June  30,  2000,
incorporated  herein by reference the Company,  during the third quarter of 2000
and through October 31, 2000, issued the following unregistered securities:

(i)      109,926 shares of Common Stock  pursuant to the  conversion of $54,963
         in convertible  promissory  notes,  issued in reliance upon exemptions
         provided under Section 4(2) of the Securities Act;

(ii)     12,000 shares of Common Stock for services rendered;

(iii)    11,535 shares of Common Stock in exchange against 40,000 common shares
         of Magnitude, Inc., pursuant to the Company's stock exchange offer of
         July 1997;

(iv)     617,616 shares of Common Stock and warrants for the purchase of
         100,000 shares at a price of $1 per share, in exchange  against the
         cancellation of a $460,000 liability in form of a past-due promissory
         note and accrued interest thereon;

(v)      Warrants for the purchase of 36,000 shares of Common Stock at $1 per
         share, for services rendered;

(vi)     83,364 shares of Series B Senior Convertible Preferred Stock
         accompanied by warrants for the purchase of 416,820 shares at a price
         of $0.90 per share,  to a foreign investor pursuant to private
         placement subscriptions under Regulation S and Section 4 (2)of the
         Securities  Act, which resulted in the receipt by the Company of
         $750,276 in cash, whereby such shares,  among other things, have the
         following rights and privileges:  (i) 7% annual preferential dividend,
         payable semi-annually,  (ii)conversion  at the  holders' option into
         shares of Common Stock at a conversion rate of 10 common shares for 1
         preferred share;

(vii)    55,556  shares of Series D Senior  Convertible  Preferred  Stock
         accompanied  by warrants for the purchase of 555,560  shares at a
         price of $0.50 per share, to two investors  pursuant to private
         placement  subscriptions  under Rule 506 of Regulation D and Section
         4 (2) of the  Securities  Act, which  resulted  in the  receipt by the
         Company of $500,000 in cash, whereby such shares,  among other things,
         have the following rights and privileges:  (i) 7% annual preferential
         dividend,  payable semi-annually,  (ii)  conversion  at the  holders'
         option into shares of Common Stock at a conversion rate of 10 common
         shares for 1 preferred share.

d) On August  24,  2000,  the  Securities  and  Exchange  Commission  approved a
registration  statement on Form SB-2 for 19,467,160 common shares,  filed by the
Company on behalf of certain holders of the Company's securities.  There will be
no proceeds to the Company from the sale of any of these shares.


Item 3   DEFAULTS ON SENIOR SECURITIES    -  None
         -----------------------------


Item 4   SUBMISSION OF MATTERS TO A VOTE OF
         SECURITIES' HOLDERS  -  None



                                       14


<PAGE>




Item 5   OTHER INFORMATION      -  None


Item 6   EXHIBITS AND REPORTS ON FORM 8-K

(a)      Exhibit (3)(i) - Articles of Incorporation and Amendments thereto,
         incorporated herein by reference to Exhibits of previous filings with
         the Commission.

         Exhibit (3)(ii) - By-laws of the Company,  incorporated herein
         by reference to Exhibits of previous filings with the Commission.

         Exhibit (4) - Instruments  defining the Rights of Holders - On
         November 3,  2000,  the Company  filed an  amendment  to its
         Certificate  of  Incorporation,  designating  from its  "blank
         check"  preferred stock pool 500,000 shares as Series D Senior
         Convertible  Preferred  Stock, par value $0.001. A copy of the
         designation is attached hereto.

         Exhibit (27) - Financial Data Schedule -  attached hereto.


 (b)     Reports on Form 8-K:

         On October 11, 2000,  the Company  filed a report on Form 8-K,
         informing  about  the  signing  of  an  equity-line  financing
         agreement with Torneaux Fund Ltd.,  whereby the Company may sell up
         to between $1.2 and $4.2 Million of its common stock.




                                       15

<PAGE>




                                   SIGNATURES


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



                                    MAGNITUDE INFORMATION SYSTEMS, INC.




Date:   November 13, 2000           By: /s/  Steven D. Rudnik
                                       -----------------------
                                       Steven D. Rudnik
                                       Chairman and Chief Executive Officer








                                       16
<PAGE>



              MAGNITUDE INFORMATION SYSTEMS, INC. AND SUBSIDIARIES

                                    EXHIBIT 4

                      CERTIFICATE OF POWERS, DESIGNATIONS,
                      PREFERENCES AND RIGHTS OF THE SHARES
                            OF THE PREFERRED STOCK OF
                       MAGNITUDE INFORMATION SYSTEMS, INC.

                                To Be Designated
                   Series D Senior Convertible Preferred Stock


         Magnitude  Information  Systems,  Inc.,  a  Delaware  corporation  (the
"Corporation"), in accordance with Section 103 of the General Corporation Law of
the State of Delaware  ("DGCL"),  by its  President,  does hereby  certify  that
during  a  meeting  on  September  26,  2000,  the  Board  of  Directors  of the
Corporation duly adopted the following resolutions providing for the issuance of
a series  of  Preferred  Stock  to be  designated  Series  D Senior  Convertible
Preferred Stock, par value $.001, and to consist of 500,000 shares:

          RESOLVED,  that the Corporation is hereby  authorized to amend
          its Certificate of Incorporation  and to file a Certificate of
          Designations  of Preferred Stock to provide for 500,000 shares
          of  Series D Senior  Convertible  Preferred  Stock,  $.001 par
          value ("Series D Senior Preferred"), pursuant to the terms and
          conditions set forth in the Certificate of Designations;

          RESOLVED, that the rights,  privileges and limitations of each
          share of Series D Senior Preferred shall be as follows:

         1.   Issuance.   The series of Preferred Stock designated as Series D
Senior Preferred shall consist of 500,000 shares.

         2. Dividends.  The holders of said shares of Series D Senior  Preferred
shall be entitled to receive  cumulative  dividends thereon at the rate of seven
percent  (7%) per annum,  payable  semi-annually  when  declared by the Board of
Directors,  before any dividend  shall be declared,  set apart for, or paid upon
the Common  Stock of the  Corporation.  The  Dividend  Rate shall  accrue on the
Stated  Value (the  "Stated  Value"),  which  Stated Value shall be noted on the
certificate  issued  to the  holder,  of  each  share  of the  Series  D  Senior
Preferred.  The  dividends  on the Series D Senior  Preferred,  payable in cash,
shall be cumulative,  so that if the Corporation fails in any fiscal year to pay
such dividends on all the issued and outstanding Series D Senior Preferred, such
deficiency in the dividends  shall be fully paid, but without  interest,  before
any dividends  shall be paid on or set apart for the Cumulative  Preferred Stock
or the Common Stock.

         3.  Priority.  The  Series D Senior  Preferred  shall  with  respect to
dividend rights and  liquidation  rights rank prior to all classes and series of
Common Stock and the Cumulative Preferred Stock, and on a par with the Series A,
B and C Senior Convertible Preferred Stock.

         4.  Voting.  Except as required by the DGCL and as provided in Section
(7) below,  the  holders of said  shares of Series D Senior  Preferred  shall
 not be entitled to any voting rights.

         5.  Cancellation.  Shares of Series D Senior  Preferred which have been
issued and  reacquired in any manner,  including  shares  purchased or converted
into Common Stock, exchanged or redeemed,  shall be canceled on the books of the
Corporation and shall not be considered outstanding for any purpose.





                                       17

<PAGE>
         6.  Liquidation.  In the  event  of any  liquidation,  dissolution,  or
winding up of the affairs of the  Corporation,  whether  voluntary or otherwise,
after payment or provision for payment of the debts and other liabilities of the
Corporation,  the holders of the Series D Senior  Preferred shall be entitled to
receive, out of the remaining net assets of the Corporation,  an amount equal to
the Stated  Value of each share of Series D Senior  Preferred  held of record by
such  holder,  payable  in cash or in  shares  of  stock,  securities  or  other
consideration, the value of which stock, securities or other consideration shall
be fixed by the Board of Directors,  plus the amount of all dividends in arrears
on each such share up to the date  fixed for  distribution,  provided,  however,
that such remaining net assets are sufficient to cover all the before  mentioned
payments  and  also  like  payments  to  holders  of  Series  A, B and C  Senior
Preferred,  before any distribution shall be made to the holders of Common Stock
or Cumulative  Preferred  Stock of the  Corporation.  In case such remaining net
assets are  insufficient to cover all such payments to holders of Series A, B, C
and D Senior Preferred,  the holders of these series shall receive payments on a
pro rata basis.

         7.  Cumulative  Dividends.  During  such  time as  there  exist  unpaid
cumulative  dividends due on the Series D Senior Preferred,  no reclassification
of the shares of the Corporation or capital reorganization of the Corporation in
any manner  provided by law shall be valid  unless (a) the holders of a majority
of all the Series D Senior Preferred approve,  and (b) provision is made for the
payment of the aggregate unpaid cumulative dividends then in arrears.

         8.   Redemption.

         (i) The Corporation  shall have the right to redeem pro rata any or all
of its Series D Senior  Preferred  issued and  outstanding at any time, with the
Board of Directors of the Corporation in its sole  discretion  deciding how many
shares to redeem, provided,  however, that any such shares called for redemption
have been issued and outstanding for a minimum of three (3) years at the time of
notice of  redemption  to the holders of such  shares,  by paying to the holders
thereof  the Stated  Value for each share of Series D Senior  Preferred  held by
such holder plus a "call premium" of 10% of the Stated Value,  together with the
amount of any accrued and unpaid  dividends as may have  accumulated  thereon at
the time of redemption (the "Redemption Price").

         (ii) At least 10 days but not more than 30 days prior to the date fixed
by the Board of Directors of the Corporation for the redemption of any shares of
the Series D Senior Preferred pursuant to subsection (i) above, a written notice
shall be  mailed  to the  holder  of  record  of such  shares of Series D Senior
Preferred to be redeemed,  at the address of such holder as shown on the records
of the Corporation,  notifying such holder of the election of the Corporation to
redeem such shares,  stating the date fixed for redemption thereof  (hereinafter
referred to as the "Redemption Date"), and calling upon such holder to surrender
to the Corporation on the Redemption Date at the place designated in such notice
such holder's  certificate or certificates  representing the number of shares of
Series D Senior  Preferred  specified in such notice of redemption.  On or after
the Redemption  Date,  each holder of shares of Series D Senior  Preferred to be
redeemed shall present and surrender such holder's  certificate or  certificates
for such shares to the  Corporation  at the place  designated in such notice and
thereupon the  Redemption  Price of such shares shall be paid to or to the order
of the person  whose name appears on such  certificate  or  certificates  as the
owner thereof and each surrendered certificate shall be canceled. From and after
the Redemption  Date (unless default shall be made by the Corporation in payment
if the Redemption  Price),  all dividends on the Series D Senior Preferred shall
cease to accrue and all rights of the  holders  thereof as  stockholders  of the
Corporation,  except the right to receive the Redemption  Price thereof upon the
surrender of certificates representing the same, without interest thereon, shall
cease and terminate and such shares shall not thereafter be transferred  (except
with the consent of the  Corporation)  on the books of the  Corporation and such
shares shall not be deemed to be outstanding for any purpose whatsoever.

         (iii) The holder of any shares of Series D Senior Preferred notified by
the  Corporation  of the redemption of such shares  pursuant to subsection  (ii)
above  shall have the right to  exercise  his option to convert  such  shares of
Series D Senior  Preferred  into  Common  Stock of the  Corporation  pursuant to
Section (9) below,  by notifying  the  Corporation  in writing or via  facsimile
prior to the Redemption Date of his election to convert,  in the form prescribed
therefore.  The  Corporation,  after  receipt of such notice  shall  remove such
shares from the shares to be redeemed.

                                       18

<PAGE>


         9.  Conversion.  Each  share  of  Series D  Senior  Preferred  shall be
convertible  at any time prior to the Redemption  Date, at the holder's  option,
into shares of Common Stock of the  Corporation  on the basis of ten (10) shares
of  Common  Stock for 1 share of Series D Senior  Preferred.  The  holder of any
shares of Series D Senior  Preferred  who elects to convert  his or her Series D
Senior Preferred into Common Stock of the Corporation  shall  surrender,  at the
principal office of the Corporation or at such other office or agency maintained
by  the   Corporation   for  that  purpose,   the  certificate  or  certificates
representing the shares of Series D Senior  Preferred to be converted,  together
with a written  affidavit  informing the  Corporation  of his or her election to
convert  such  shares,  whereby the date of receipt by the  Corporation  of such
certificates and affidavit shall  constitute the "Conversion  Date". As promptly
as  practicable,  and in any event within ten business  days after  surrender of
such  certificates,  the  Corporation  shall  deliver  or cause to be  delivered
certificates   representing  the  number  of  validly  issued,  fully  paid  and
non-assessable shares of Common Stock of the Corporation to which such holder of
Series D Senior Preferred so converted shall be entitled.  Such conversion shall
be deemed to have been made at the close of business on the Conversion  Date, so
that the rights of the holders of the Series D Senior Preferred shall thereafter
cease  except  for the  right to  receive  Common  Stock of the  Corporation  in
accordance  herewith,  and such converting  holder of Series D Senior  Preferred
shall be treated  for all  purposes as having  become the record  holder of such
Common Stock of the Corporation at such time.

         10.  Anti-Dilution.  In the event that,  prior to the conversion of the
Series D Senior  Preferred  Stock by the holder thereof into Common Stock of the
Corporation,  there shall occur any change in the  outstanding  shares of Common
Stock of the  Corporation by reason of the  declaration of stock  dividends,  or
through a re-capitalization resulting from stock splits or combinations, without
the receipt by the  Corporation of fair  consideration  therefore in the form of
cash,  services  or  property,  the  conversion  ratio  of the  Series  D Senior
Preferred Stock into Common Stock of the Corporation provided for in Section (9)
above shall be adjusted such that any holder of Series D Senior  Preferred Stock
converting  such  stock  into  Common  Stock  subsequent  to such  change in the
outstanding  shares of Common  Stock of the  Corporation  shall be  entitled  to
receive,  upon such  conversion,  a number  of  shares  of  Common  Stock of the
Corporation  representing  the same  percentage of common shares  outstanding as
represented  by the shares  that he would have  received  had he  converted  his
Series D Senior  Preferred  Stock to Common  Stock  prior to such  change in the
outstanding shares of Common Stock of the Corporation.

         IN WITNESS WHEREOF,  we, the undersigned,  have executed and subscribed
this certificate on September 26, 2000





                                         /s/ Steven D. Rudnik
                                         ----------------------------
                                          Steven D. Rudnik, President


ATTEST:


/s/  Joerg H. Klaube
---------------------------
Joerg H. Klaube, Secretary



                                       19
<PAGE>