UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.  20549 FORM 10-Q xQUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2001 OR oTRANSITION
REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________
to _____________ Commission File Number  0-19728 GRANITE BROADCASTING
CORPORATION(exact name of registrant as specified in its charter) DELAWARE
  13-3458782(State or other jurisdiction of
  incorporation or organization)
  (I.R.S. Employer Identification No.)
 767 Third Avenue
34th Floor
New York, New York  10017 Telephone number:  (212) 826-2530 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. YesxNoo (APPLICABLE ONLY TO CORPORATE ISSUERS:) Indicate the number of shares outstanding of
each of the issuer's classes of common stock, as of the latest practicable
date. Class A Voting Common Stock, par value $.01
per share - 178,500 shares outstanding at May 11, 2001; Common Stock
(Nonvoting), par value $.01 per share  18,441,977 shares outstanding at May
11, 2001.   PART
I.  FINANCIAL INFORMATION
GRANITE BROADCASTING CORPORATION
CONSOLIDATED BALANCE SHEET

ASSETS
  March
  31,
  December
  31,2001
  2000(Unaudited)Current assets:Cash and cash equivalents (including
  $17,500,000 of restricted cash)
  $62,521,204
  $9,209,249Accounts receivable, net
  21,255,891
  28,773,620Film contract rights
  13,150,734
  17,835,745Other current assets
  30,238,243
  29,719,328Total current
  assets
  127,166,072
  85,537,942Noncurrent assets:Property and
  equipment, net
  43,180,995
  42,682,736Film contract rights
  and other noncurrent assets
  48,855,112
  23,856,896Deferred financing
  fees, net
  18,395,164
  5,027,846Intangible assets, net
  568,702,887
  574,986,006$806,300,230
  $732,091,426LIABILITIES
  AND STOCKHOLDERS' EQUITYCurrent liabilities:Accounts payable
  $1,450,661
  $3,744,779Accrued interest
  9,034,132
  2,903,984Other accrued liabilities
  4,941,421
  3,050,888Film contract rights
  22,078,397
  25,504,608Other current liabilities
  6,328,906
  5,085,295Total current
  liabilities
  43,833,517
  40,289,554Noncurrent
  liabilities:Long-term debt
  400,704,955
  311,390,914Film contract rights
  14,043,416
  16,582,412Deferred tax liability
  87,417,080
  96,624,452Other noncurrent liabilities
  25,554,949
  19,843,495Cumulative
  exchangeable preferred stock, net of offering costs
  247,198,185
  239,544,783Stockholders'
  (deficit) equity:Common Stock:  41,000,000 shares authorized consisting of      1,000,000 shares of Voting
  Common Stock, $.01 par value,      and 40,000,000 shares of Common
  Stock (Nonvoting), $.01par value;      178,500 shares of Class A Common
  Stock  and18,441,977 shares       of Common Stock (Nonvoting)
  (18,030,811shares
  at December 31, 2000)      issued and outstanding
  186,205
  182,093Additional paid in capital
  -
  2,295,136(Accumulated deficit) retained
  earnings
  (10,083,897)
  7,614,114Less:         Unearned compensation
  (2,257,180)
  (1,091,653)Less:         Treasury stock
  (297,000)
  (297,000)Less:         Notes receivable
  from officer
  -
  (886,875)Total stockholders' (deficit) equity
  (12,451,872)
  7,815,815Total liabilities and
  stockholders (deficit) equity
  $806,300,230
  $732,091,426See
accompanying notes.

GRANITE
BROADCASTING CORPORATION
CONSOLIDATED STATEMENT OF OPERATIONS

Three
  Months ended March 31,2001
  2000(Unaudited)Net revenues
  $26,848,304
  $33,339,280Station operating
  expenses
  27,957,291
  25,398,867Depreciation expense
  1,503,394
  1,377,962Amortization expense
  6,288,495
  6,882,420Corporate expense
  2,538,848
  3,074,569Non-cash compensation
  expense
  467,376
  215,550Operating loss
  (11,907,100)
  (3,610,088)Other expenses:Interest expense, net
  9,151,503
  7,311,287Non-cash interest expense
  868,589
  739,475Other
  247,313
  334,361Loss before income
  taxes and extraordinary item
  (22,174,505)
  (11,995,211)Benefit for income
  taxes
  (8,340,152)
  (3,183,920)Loss before
  extraordinary item
  (13,834,353)
  (8,811,291)Extraordinary (loss)
  gain,  net of tax
  (1,207,081)
  1,783,468Net loss
  $(15,041,434)
  $(7,027,823)Net loss attributable
  to common stockholders
  $(22,694,836)
  $(13,805,939)Per common share:Basic and diluted loss before extraordinary item
  $(1.17)
  $(0.85)Basic and diluted extraordinary (loss) gain
  (0.06)
  0.10Basic and diluted net loss
  $(1.23)
  $(0.75)Weighted average common shares outstanding
  18,403,892
  18,301,863See
accompanying notes.

GRANITE
BROADCASTING CORPORATION
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY

Three Months Ended March 31, 2001
(Unaudited)

Class
  ACommonStock
  CommonStock(Nonvoting)
  Additional
  Paid-inCapital
  Retained
  Earnings(AccumulatedDeficit)
  UnearnedCompensation
  Note
  Receivablefrom Officer
  Treasury
  stock
  TotalStockholders'
  Equity (Deficit)Balance at December
  31, 2000
  $1,785
  $180,308
  $2,295,136
  $7,614,114
  $(1,091,653)
  $(886,875)
  $(297,000)
  $7,815,815Dividend on Cumulative
  Convertible Exchangeable Preferred Stock
  
  
  (4,871,788))
  (2,656,577)
  
  
  
  (7,528,365)Accretion of offering
  costs related to Cumulative Exchangeable Preferred Stock
  
  
  (125,037)
  
  
  
  
  (125,037)Grant of stock award
  under stock plansIssuance of Common
  Stock (Nonvoting)
  
  4,112
  (4,112)Stock expense related
  to Management stock plan
  
  
  145,355
  
  282,946
  
  
  428,301Issuance of Warrants
  
  
  2,064,759
  
  
  
  
  2,064,759Discount of loans to
  officers
  
  
  
  
  (952,786)
  
  
  (952,786)Repayment of Note
  Receivable from Officer
  
  
  
  
  
  886,875
  
  886,875Net loss
  
  
  
  (15,041,434)
  
  
  
  (15,041,434)Balance at March 31,
  2001
  $1,785
  $184,420
  $  -
  $(10,083,897)
  $(2,257,180)
  $   -
  $(297,000)
  $(12,451,872)See
accompanying notes.

GRANITE
BROADCASTING CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS

Three
  Months ended March 31,2001
  2000(Unaudited)Cash flows from
  operating activities:Net loss
  $(15,041,434)
  $(7,027,823)Adjustments to reconcile net loss to
  net cash used in operating activities:Amortization of intangible assets
  6,288,495
  6,882,420Depreciation
  1,503,394
  1,377,962Non-cash compensation expense
  467,376
  215,550Non-cash interest expense
  868,589
  739,475Deferred tax benefit
  (9,207,372)
  (161,991)Extraordinary loss (gain)
  2,011,801
  (2,972,447)Change in assets and liabilities:Decrease in accounts receivable
  7,517,729
  5,555,391Increase in accounts payable
  and accrued liabilities
  5,726,563
  3,651,108(Increase) decrease in film
  contract rights and othernoncurrent assets
  (22,436,526)
  5,315,239Decrease in film contract
  rights and other liabilities
  (4,721,596)
  (3,488,946)Decrease in other noncurrent
  liabilities
  (881,902)
  (108,164)Decrease (increase) in other assets
  27,476,205
  (2,110,488)Net cash (used in) provided by
  operating activities
  (428,678)
  7,867,286Cash flows from
  investing activities:NBC
  network affiliation prepayment
  (27,778,694)
  -WB Network affiliation payment
  (630,857)
  (881,868)Insurance proceeds received
  -
  973,604Capital expenditures
  (176,336)
  (1,908,489)Other investing activities
  -
  (132,672)Net cash used in investing
  activities
  (28,585,887)
  (1,949,425)Cash flows from
  financing activities:Proceeds from long-term debt
  205,000,000
  33,000,000Repayment of bank debt
  (113,672,428)
  (7,973,604)Retirement of senior subordinated notes
  -
  (32,440,725)Payment of deferred financing fees
  (9,001,052)
  (265,865)Other financing activities, net
  -
  (3,081)Net cash provided by (used in)
  financing activities
  82,326,520
  (7,683,275)Net increase
  (decrease) in cash and cash equivalents
  53,311,955
  (1,765,414)Cash and cash
  equivalents, beginning of period
  9,209,249
  5,453,542Cash and cash
  equivalents, end of period
  $62,521,204
  $3,688,128Supplemental
  information:Cash paid for interest
  $4,622,939
  $1,710,118Income taxes paid
  54,500
  90,200Non-cash capital expenditures
  94,000
  59,000Non-cash dividend
  7,528,365
  6,653,079Fair value of warrants
  2,064,759
  -See
accompanying notes.

GRANITE
BROADCASTING CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

Note
1 -  Basis of presentation

The
accompanying unaudited consolidated financial statements include the accounts
of Granite Broadcasting Corporation and its subsidiaries (the
"Company"), have been prepared in accordance with the instructions to
Form 10-Q and do not include all of the information and footnotes required by
generally accepted accounting principles for complete financial
statements.  Operating results for the
three-month period ended March 31, 2001 are not necessarily indicative of the
results that may be expected for the year ended December 31, 2001.  For further information, refer to the
Company's consolidated financial statements and notes thereto for the year
ended December 31, 2000 which were included in the Company's Annual Report on
Form 10-K for the year ended December 31, 2000.  All significant intercompany accounts and transactions have been
eliminated.  Data at and for the year
ended December 31, 2000 are derived from the Company's audited consolidated
financial statements.  In the opinion of
management, all adjustments of a normal recurring nature, which are necessary
for a fair presentation of the results for the interim periods have been made.

Note
2 -  Long-term debt

On
March 6, 2001, the Company entered into an amended and restated $205,000,000
Senior Credit Agreement (the Credit Agreement).  The Credit Agreement consists of a $110,000,000 Tranche A term
loan and a $95,000,000 Tranche B term loan. 
The proceeds from the Credit Agreement were used (i) to repay
$114,410,000 of borrowings, of which $738,000 represented interest, under the
Companys existing senior revolving credit facility, (ii) to prepay the first
installment under the KNTV NBC affiliation agreement (See Note 3 below), (iii)
to pay certain fees and expenses associated with the Credit Agreement and (iv)
for general working capital purposes. 
The Tranche A and Tranche B term loans bear interest annually at the
greater of LIBOR plus 5.50% or 12% payable monthly.  In addition, the Tranche B term loan accrues simple deferred interest
at an annual rate of 6% which is payable when the Credit Agreement matures on
December 31, 2003. The Credit Agreement requires the Company to maintain
compliance with certain financial tests, including but not limited to, minimum
net revenue, broadcast cash flow, EBITDA and, beginning December 31, 2001, a
maximum ratio of senior debt to EBITDA. Other provisions place limitations on
payments for capital expenditures and prohibits the incurrence of additional
debt, the purchase of the Companys common stock, the repurchase of
subordinated debt and the declaration and payment of cash dividends. The
Company also granted to the Tranche B lenders a warrant to purchase 753,491
shares of Common Stock (Nonvoting), par value $.01 per share, at an exercise
price of $1.75 per share.  The warrant
is fully vested and remains exercisable until March 6, 2006.  The fair value of the warrants of $2,065,000
has been recorded as a discount to the amount outstanding under the Credit
Agreement and will be amortized as non-cash interest expense over the life of
the Credit Agreement.

Note
3  NBC Affiliation

On
May 31, 2000, the Company entered into a series of definitive agreements with
NBC for KNTV to become the NBC affiliate for the San Francisco-Oakland-San
Jose, California television market for a ten-year period commencing January 1,
2002 (the San Francisco Affiliation). 
In consideration for the San Francisco Affiliation, the Company was to
pay $362,000,000 in nine annual installments, with the initial payment in the
amount of $61,000,000 due on January 1, 2002. 
On March 6, 2001, the San Francisco Affiliation was amended to reduce
the January 1, 2002 installment to $30,500,000 and defer the remaining
$30,500,000 of the original initial payment until January 1, 2005.  The Company prepaid the January 1, 2002
installment on March 6, 2001 by paying $27,779,000, which represents the
present value of that installment discounted at 12%.  The Company will pay, excluding the prepayment, $342,480,000 in
eight annual installments. NBC has the right to terminate the San Francisco
Affiliation if it acquires an attributable interest (determined under Federal
Communications Commission rules and regulations) in another station in the San
Francisco-Oakland-San Jose market, other than KKPX-TV, upon a payment to the
Company of at least $14,500,000.

Note 4  Related Party

Between
1995 and 1998, the Company loaned an officer $2,911,000 in four separate
transactions.  On January 1, 2001, the
Company loaned this officer an additional $375,000. On
February 15, 2001, the Company agreed to consolidate the five loans
into one promissory note in the amount of $3,286,000.  The new promissory note matures on January 25, 2006 or, if
earlier, 30 days after the officers termination of employment. The new promissory
note does not bear interest but interest at an annual rate of 6.75% will be
imputed as additional compensation to the officer.  The new promissory note allows for the loan to be forgiven in
one-third increments if the Companys Common Stock (Nonvoting) trades for ten
consecutive trading days at $15.00, $20.00, and $25.00, respectively, or if the
per share consideration received by the Companys common stockholders in a
Change of Control (as defined in the Indentures governing the Companys senior
subordinated notes) equals at least $15.00, $20.00 or $25.00,
respectively.  In addition, on February
15, 2001 the Company forgave $232,000 of interest accrued during the year–ended
December 31, 2000.  The
Company took a charge against earnings for this amount in the first quarter of
2001.

In
1995, the Company loaned another officer $221,000. On
February 15, 2001, the Company agreed to cancel this note and issue a
new promissory note in the same amount. The new promissory note matures on
January 25, 2006 or, if earlier, 30 days after the officers termination of
employment. The new promissory note does not bear interest but interest at an
annual rate of 6.75% will be imputed as additional compensation to the officer.
The new promissory note allows for the loan to be forgiven in one-third
increments if the Companys Common Stock (Nonvoting) trades for ten consecutive
trading days at $15.00, $20.00, and $25.00, respectively, or if the per share
consideration received by the Companys common stockholders in a Change of
Control (as defined in the Indentures governing the Companys senior
subordinated notes) equals at least $15.00, $20.00 or $25.00,
respectively.  In addition, on February
15, 2001 the Company forgave $20,000 of interest accrued during the year–ended
December 31, 2000. The Company took a charge against earnings for
this amount in the first quarter of 2001.

MANAGEMENT'S
DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Certain
sections of this Form 10-Q contain various forward looking statements within
the meaning of Section 21E of the Securities Exchange Act of 1934, which
represent the Companys expectations or beliefs concerning future events.  The forward-looking statements include, without
limitation, the Companys ability to meet its future liquidity needs.  The Company cautions that these
forward-looking statements are further qualified by important factors that
could cause actual results to differ materially from those in the forward
looking statements.  Such factors include,
without limitation, general economic conditions, competition in the markets in
which the Companys stations are located, technological change and innovation
in the broadcasting industry and proposed legislation.  Consequently, all forward-looking statements
made herein are qualified by these cautionary statements and the cautionary
language set forth in the Companys most recent Form 10-K report and other
documents filed with the Securities and Exchange Commission.

Introduction

The
Company is a group broadcaster that operates nine network-affiliated television
stations.  The Company's revenues are
derived principally from local and national advertising and, to a lesser
extent, from network compensation for the broadcast of programming and revenues
from studio rental and commercial production activities.  The primary operating expenses involved in
owning and operating television stations are employee salaries, depreciation
and amortization, programming and advertising and promotion expenses.  Numbers referred to in the following
discussion have been rounded to the nearest thousand.  The Companys operating revenue are generally lower in the first
calendar quarter and generally higher in the fourth calendar quarter than in
the other two quarters, due in part to increases in retail advertising in the
fall months in preparation for the holiday season, and in election years due to
increased political advertising. 
Operating results for the three month period ended March 31, 2001 are
not necessarily indicative of the results that may be expected for the year
ended December 31, 2001.

Comparisons
of the Companys consolidated financial statements between the three months
ended March 31, 2001 and the same period last year have been affected by the
termination of the ABC affiliation agreement at KNTV on July 1, 2000,
significant increases in news expense at KNTV as it prepares to become the NBC
affiliate for the San Francisco-Oakland-San Jose television market on January
1, 2002 and investments in syndicated programs at the Companys WB
affiliates.  The Company anticipates
that comparisons of the Companys consolidated financial statements between the
years ended December 31, 2001 and 2000 will continue to be impacted by increases
in news and promotion expenses at KNTV and continued investment in programming
at the WB affiliates.

The
following table sets forth certain operating data for the three months ended
March 31, 2001 and 2000 (unaudited):

2001
  2000Operating loss
  $(11,907,000)
  $(3,610,000)Add:Depreciation and amortization
  7,792,000
  8,260,000Corporate expense
  2,539,000
  3,075,000Non-cash compensation
  467,000
  216,000Program amortization
  8,060,000
  5,643,000Program payments
  (6,267,000)
  (3,974,000)Broadcast cash flow
  $684,000
  $9,610,000"Broadcast
cash flow" means operating income plus depreciation, amortization,
corporate expense, non-cash compensation and program amortization, less program
payments.  The Company has included
broadcast cash flow data because such data are commonly used as a measure of
performance for broadcast companies and are also used by investors to measure a
company's ability to service debt. 
Broadcast cash flow is not, and should not be used as, an indicator or
alternative to operating income, net income or cash flow as reflected in the
consolidated financial statements, is not a measure of financial performance
under generally accepted accounting principles and should not be considered in
isolation or as a substitute for measures of performance prepared in accordance
with generally accepted accounting principles.

Three months ended March 31, 2001 and 2000

Net
revenue totaled $26,848,000; a decrease of $6,491,000 or 19 percent as compared
to $33,339,000 for the three months ended March 31, 2000.  The decrease was primarily due to a weak
advertising climate, a $3,300,000 reduction in political and internet related
advertising and lower revenue at KNTV as it operates on an interim basis as an
independent television station.

Station
operating expenses totaled $27,957,000; an increase of $2,558,000 or 10 percent
as compared to $25,399,000 for the three months ended March 31, 2000. The
increase was primarily due to an increase in news expense at KNTV, increases in
programming expense at the Companys WB affiliates and accelerated amortization
of certain syndicated programs.

Depreciation
expense increased $125,000 or 9 percent due to capital expenditures incurred
during the calendar year 2000. 
Amortization expense decreased $594,000 or 9 percent primarily due to
the elimination of amortization of the ABC affiliation at KNTV and a reduction
in the book value of the WB network affiliation agreements. Corporate expense
decreased $536,000 or 17 percent primarily due to decreased professional fees
and lower costs incurred in connection with the Companys Internet
business.  Non-cash compensation expense
increased $252,000 due to the earlier recognition of certain stock based
compensation awards and the grant of stock awards to certain executives.

Net
interest expense increased $1,841,000 or 25 percent primarily due to higher
levels of outstanding indebtedness and a higher interest rate on the Company's
new Credit Agreement (as defined below). 
Included in net interest expense for the quarter is approximately $395,000
of deferred interest on the Credit Agreement payable on December 31, 2003.

The
proceeds from the Credit Agreement were used, in part, to repay in full all
outstanding borrowings under a senior credit facility.  As a result, the Company incurred an extraordinary
loss of $2,012,000 during the three months ended March 31, 2001, representing
the write-off of unamortized deferred financing cost associated with the senior
credit facility.  During the first
quarter of 2000 the Company recognized an extraordinay gain of $2,972,000
related to the repurchase of $36,390,000 face amount of the Companys senior
subordinated notes at a discount.

Liquidity and
Capital Resources

On
March 6, 2001, the Company entered into an amended and restated $205,000,000
Senior Credit Agreement (the Credit Agreement).  The Credit Agreement consists of a $110,000,000 Tranche A term
loan and a $95,000,000 Tranche B term loan. 
The proceeds from the Credit Agreement were used (i) to repay
$114,410,000 of borrowings, of which $738,000 represented interest, under the
Companys existing senior revolving credit facility, (ii) to prepay the first
installment under the KNTV NBC affiliation agreement, (iii) to pay certain fees
and expenses associated with the Credit Agreement and (iv) for general working
capital purposes.  The Tranche A and
Tranche B term loans bear interest annually at the greater of LIBOR plus 5.50%
or 12%, which is payable monthly.  In
addition, the Tranche B term loan accrues simple deferred interest at an annual
rate of 6% which is payable when the Credit Agreement matures on December 31,
2003.  The Credit Agreement requires the
Company to maintain compliance with certain financial tests, including but not
limited to, minimum net revenue, broadcast cash flow, EBITDA and, beginning
December 31, 2001, a maximum ratio of senior debt to EBITDA. Other provisions
place limitations on payments for capital expenditures and prohibits the
incurrence of additional debt, the purchase of the Companys common stock, the
repurchase of subordinated debt and the declaration and payment of cash
dividends. The Company is in compliance with all of the financial tests
required by the Credit Agreement and expects to be in compliance in the second
quarter and beyond. Future compliance is dependent on improving operating
results which have been severely impacted by a weak advertising climate that
has affected the broadcasting industry. There can be no assurance that the
advertising climate will improve or will not decline any further. The Company also
granted to the Tranche B lenders a warrant to purchase 753,491 shares of Common
Stock (Nonvoting), par value $.01 per share, at an exercise price of $1.75 per
share.  The warrant is fully vested and
remains exercisable until March 6, 2006. 
The fair value of the warrants of $2,065,000 has been recorded as a
discount to the amount outstanding under the Credit Agreement and will be
amortized as non-cash interest expense over the life of the Credit Agreement.
As of May 9, 2001, the Company had approximately $56,969,000 of cash on hand,
of which $15,794,000 is reserved for interest payments on the Tranche B term
loan.

On
May 31, 2000, the Company entered into a series of definitive agreements with
NBC for KNTV to become the NBC affiliate for the San Francisco-Oakland-San
Jose, California television market for a ten-year period commencing January 1,
2002 (the San Francisco Affiliation). 
In consideration for the San Francisco Affiliation, the Company was to
pay $362,000,000 in nine annual installments, with the initial payment in the
amount of $61,000,000 due on January 1, 2002. 
On March 6, 2001, the San Francisco Affiliation was amended to reduce
the January 1, 2002 installment to $30,500,000 and defer the remaining $30,500,000
of the original initial payment until January 1, 2005. After giving effect to
these changes, the present value of the new payment schedule is substantially
unchanged from the original terms.  The
Company prepaid the January 1, 2002 installment on March 6, 2001 by paying
$27,779,000, which represents the present value of that installment discounted
at 12%. The next payment due NBC is on January 1, 2003 in the amount of
$37,160,000.  The Company will pay,
excluding the prepayment, $342,480,000 in eight annual installments.  NBC has the right to terminate the San
Francisco Affiliation if it acquires an attributable interest (determined under
Federal Communications Commission rules and regulations) in another station in
the San Francisco-Oakland-San Jose market, other than KKPX-TV, upon a payment
to the Company of at least $14,500,000.

The
Company has generated significant losses for federal income tax purposes during
the year ended December 31, 2000.  The
Company anticipates that it will carry back these losses to recover
approximately $19,400,000 in federal income taxes paid in 1999.  The Company expects to receive this refund
during the third quarter of 2001.

Net
cash used in operating activities were $429,000 during the three months ended
March 31, 2001, compared to cash flows provided by operating activities
$7,867,000 during the three months ended March 31, 2000.  The change from 2000 to 2001 was primarily
the result of a decrease in operating cash flow and an increase in cash
interest payments.

Net
cash used in investing activities were $28,586,000 during the three months
ended March 31, 2001, compared to $1,949,000 during the three months ended
March 31, 2000. The change from 2000 to 2001 was primarily due to the
prepayment of the first installment under the San Francisco Affiliation, offset
by lower capital expenditures.

Net
cash provided by financing activities were $82,327,000 during the three months
ended March 31, 2001 compared to cash flows used in financing activities of
$7,683,000 during the three months ended March 31, 2000. The change from 2000
to 2001 was primarily due to an increase in long-term borrowings, offset by an
increase in the amount of debt repaid and higher deferred financing fees.

The
Company expects to spend approximately $10,000,000 in 2001 and $17,000,000 in
2002 in capital expenditures, of which a total of approximately $13,500,000 is
associated with the implementation of digital technology.  The Company believes that internally
generated funds from operations, cash on hand and expected proceeds from the
income tax refund will be sufficient to satisfy the Company's cash requirements
for its existing operations for the next twelve months.

Quantitative and
Qualitative Disclosures about Market Risk

The
Company's earnings may be affected by changes in short-term interest rates as a
result of its new Senior Credit Agreement. 
Under the Credit Agreement, the Company pays interest at the greater of
LIBOR plus 5.50% or 12%, currently 12%. 
As of May 11, 2001, LIBOR was 4.1225 percent.  The Company has not entered into any agreements to hedge such
risk.  A 2% increase in the LIBOR rate
would have no impact on interest expense on an annual basis.  This analysis does not consider the effects
of the reduced level of overall economic activity that could exist in such
environment.

PART II

OTHER INFORMATION

ITEM4.            Submission
of Matters to a Vote of Security Holders

On February 15, 2001, the holders of all the Companys
Voting Common Stock, par value $.01 per share, adopted resolutions by unanimous
written consent in lieu of a special meeting approving the loan forgiveness
terms for the amended and consolidated loans between the Company and each of
Don Cornwell and Stuart Beck.ITEM
6.            Exhibits and Reports on Form
8-K

a.          Exhibits4.54(a)/  
Credit Agreement, dated as of March 6, 2001, among Granite Broadcasting
Corporation, as Borrower, the Lenders party thereto, Goldman Sachs Credit
Partners L.P., as Administrative Agent, Tranche B Collateral Agent, Sole Lead
Arranger and Sole Bookrunner, and Foothill Capital Corporation, as Tranche A
Collateral Agent.4.55(a)/  
Warrant to purchase 753,491 shares of Common Stock (Non-voting) of
Granite Broadcasting Corporation issued March 6, 2001 to Goldman Sachs &
Co.10.50(a)/  
Amended and Restated Network Affiliation Agreements, dated as of March
6, 2001, among Granite Broadcasting Corporation, the Parties set forth on
Schedule I thereto, and NBC Television Network (KNTV(TV)).10.51(a)/  
Amended and Restated Network Affiliation Agreements, dated as of March
6, 2001, among Granite Broadcasting Corporation, the Parties set forth on
Schedule I thereto, and NBC Television Network (KSEE, KBJR-TV, and WEEK-TV).(a)/   Incorporated by reference to similarly
numbered exhibit to the Companys current report on Form 8-K filed March 9,
2001.

b.          Reports on Form 8-KCurrent
Report on Form 8-K, filed on March 9, 2001, reporting that the Company entered
into an amended and restated $205,000,000 senior credit agreement (the
"Credit Agreement") with a new group of financial institutions.  Simultaneously with the closing of the
Credit Agreement, the Company amended and restated (i) the agreement pursuant
to which KNTV will become the NBC affiliate for the San Francisco-Oakland-San
Jose television market for a ten year term commencing January 1, 2002 and (ii)
the NBC Affiliation Agreement for stations KSEE, KBJR, and WEEK.SIGNATURES

Pursuant
to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of
1934, the Registrant has caused this report to be signed by an officer and the
principal accounting officer on its behalf by the undersigned thereunto duly
authorized.



GRANITE BROADCASTING
  CORPORATIONRegistrantDate May 15, 2001
  /s/    W. DON CORNWELL(W. Don Cornwell)Chief Executive
  OfficerDate May 15, 2001
  /s/    LAWRENCE I. WILLS(Lawrence I. Wills)Senior Vice President
   Chief Administrative Officer(Principal Accounting
  Officer)