SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                 ---------------

                                   FORM 10-QSB

               QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended June 30, 2001
                           Commission File No. 1-11182


                         BIO-IMAGING TECHNOLOGIES, INC.
       ------------------------------------------------------------------
        (Exact Name of Small Business Issuer as Specified in Its Charter)


         Delaware                                           11-2872047
--------------------------------             ----------------------------------
(State or Other Jurisdiction of             (I.R.S. Employer Identification No.)
 Incorporation or Organization)


826 Newtown-Yardley Rd., Newtown, PA 18940                               18940
--------------------------------------------------------------------------------
(Address of Principal Executive Offices)                              (Zip Code)


                                 (267) 757-1360
                         ------------------------------
                           (Issuer's Telephone Number,
                              Including Area Code)


     Check  whether  the Issuer:  (1) filed all reports  required to be filed by
Section 13 or 15(d) of the  Securities  Exchange  Act of 1934 during the past 12
months (or for such shorter period that the registrant was required to file such
reports),  and (2) has been subject to such filing  requirements for the past 90
days.

                 Yes:  X                             No:
                     -----                              -----


     State the number of shares  outstanding of each of the Issuer's  classes of
common stock, as of June 30, 2001:

Class                                                Number of Shares
-----                                                ----------------

Common Stock, $.00025 par value                          8,259,212

     Transitional Small Business Disclosure Format (check one):

                 Yes:                                No:  X
                     -----                              -----


<PAGE>

                 BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
                 -----------------------------------------------

                                TABLE OF CONTENTS
                                -----------------

                                                                           Page
                                                                           ----

PART I.   FINANCIAL INFORMATION.

   Item 1.   Financial Statements........................................    1

          CONSOLIDATED BALANCE SHEETS
          as of June 30, 2001 and
          September 30, 2000 (unaudited).................................    2

          CONSOLIDATED  STATEMENTS  OF  OPERATIONS
          For the Nine Months Ended
          June 30, 2001 and 2000 (unaudited).............................    3

          CONSOLIDATED STATEMENTS OF OPERATIONS
          For the Three Months Ended June 30, 2001 and 2000
          (unaudited)....................................................   4

          CONSOLIDATED STATEMENTS OF CASH FLOWS
          For the Nine Months Ended June 30, 2001 and 2000
          (unaudited)....................................................   5

          NOTES TO CONSOLIDATED FINANCIAL
          STATEMENTS (unaudited).........................................   6

   Item 2.   Management's Discussion and Analysis of Financial
             Condition and Results of Operations.........................   9

          Results of Operations..........................................  10

          Liquidity and Capital Resources................................  14

PART II.  OTHER INFORMATION.

   Item 2.   Changes in Securities and Use of Proceeds...................  16

   Item 6.   Exhibits and Reports on Form 8-K............................  16

SIGNATURES   ............................................................  17


                                      - i -
<PAGE>

                         PART I. FINANCIAL INFORMATION.
                         ------------------------------

ITEM 1.   FINANCIAL STATEMENTS.

     Certain  information  and footnote  disclosures  required  under  generally
accepted accounting principles have been condensed or omitted from the following
consolidated  financial  statements pursuant to the rules and regulations of the
Securities and Exchange Commission, although Bio-Imaging Technologies, Inc. (the
"Company")  believes that such  financial  disclosures  are adequate so that the
information  presented is not misleading in any material respect.  The following
consolidated  financial  statements  should  be read  in  conjunction  with  the
year-end  consolidated  financial  statements and notes thereto  included in the
Company's  Annual Report on Form 10-KSB for the fiscal year ended  September 30,
2000.

     The results of operations for the interim periods  presented herein are not
necessarily indicative of the results to be expected for the entire fiscal year.





                                      -1-
<PAGE>

                 BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
                 -----------------------------------------------

                           CONSOLIDATED BALANCE SHEETS
                           ---------------------------

                                   (unaudited)
                                   -----------
<TABLE>
<CAPTION>
                                                                 June 30,        September 30,
                                                                   2001              2000
                                                               -----------       ------------

                                   ASSETS
<S>                                                            <C>               <C>
Current assets:
  Cash and cash equivalents............................        $   147,479       $   491,048
  Accounts receivable, net.............................          2,414,508         1,627,457
  Prepaid expenses and other current assets............            299,467           234,201
                                                               -----------       -----------
    Total current assets...............................          2,861,454         2,352,706

Property and equipment, net............................          1,222,850         1,292,344

Other assets ..........................................            244,557           261,762
                                                               -----------       -----------

    Total assets.......................................        $ 4,328,861       $ 3,906,812
                                                               ===========       ===========

                       LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
  Accounts payable.....................................        $   513,072       $   321,113
  Accrued expenses and other current liabilities.......            166,914           229,354
  Deferred revenue.....................................          1,598,387         1,707,681
  Current maturities of long-term debt.................            190,505           150,796
                                                               -----------       -----------
    Total current liabilities..........................          2,468,878         2,408,944
Long-term debt.........................................            141,200           164,139
                                                               -----------       -----------
    Total liabilities..................................          2,610,078         2,573,083
                                                               -----------       -----------

Stockholders' equity:
  Preferred stock - $.00025 par value; authorized
   3,000,000 shares, issued and outstanding, 0 shares
   at June 30, 2001, and  416,667 shares ($500,000
   liquidation preference) at September 30, 2000.......                 --               104
  Common stock - $.00025 par value; authorized
   18,000,000 shares, issued and outstanding
   8,259,212 shares at June 30, 2001 and 7,773,878
   shares at September 30, 2000........................              2,065             1,944
  Additional paid-in capital...........................          9,274,740         9,231,497
  Accumulated deficit..................................         (7,558,022)       (7,899,816)
                                                               -----------       -----------
    Stockholders' equity...............................          1,718,783         1,333,729
                                                               -----------       -----------

    Total liabilities and stockholders' equity.........        $ 4,328,861       $ 3,906,812
                                                               ===========       ===========
</TABLE>


                 See Notes to Consolidated Financial Statements


                                      -2-
<PAGE>

                 BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
                 -----------------------------------------------

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                      -------------------------------------
                                   (unaudited)

<TABLE>
<CAPTION>
                                                               For the Nine Months Ended
                                                                       June 30,
                                                              2001                  2000
                                                              ----                  ----

<S>                                                     <C>                  <C>
Project revenues.................................       $     6,160,341      $     4,105,911
                                                          -------------        -------------

Cost and expenses:

    Cost of revenues.............................             3,404,374            2,705,862

    General and administrative expenses..........             1,115,190              963,965

    Sales and marketing expenses.................             1,271,924            1,138,621
                                                          -------------        -------------

Total cost and expenses..........................             5,791,488            4,808,448
                                                          -------------        -------------

Income (loss) from operations....................               368,853             (702,537)

Interest expense - net...........................               (17,059)             (54,831)
                                                          --------------       --------------

Net income (loss)................................               351,794             (757,368)

Dividends on preferred stock.....................                10,000               30,000
                                                          -------------        -------------

Net income (loss) applicable to common stock.....       $       341,794      $      (787,368)
                                                          =============        =============

Basic earnings (loss) per common share...........       $          0.04      $         (0.10)
                                                          =============        =============

Weighted average number of common shares.........             8,199,376            7,773,878
                                                          =============        =============

Diluted earnings (loss) per common share.........       $          0.04      $         (0.10)
                                                          =============        =============

Weighted average number of common
  shares and dilutive common equivalent shares...             8,383,824            7,773,878
                                                          =============        =============
</TABLE>


                 See Notes to Consolidated Financial Statements


                                      -3-
<PAGE>

                 BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
                 -----------------------------------------------

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                      -------------------------------------
                                   (unaudited)

<TABLE>
<CAPTION>
                                                              For the Three Months Ended
                                                                       June 30,
                                                        ------------------------------------
                                                              2001                  2000
                                                              ----                  ----


<S>                                                     <C>                  <C>
Project revenues....................................    $     2,252,507      $     1,565,412
                                                          -------------        -------------

Cost and expenses:

    Cost of revenues................................          1,366,958            1,053,363

    General and administrative expenses.............            330,895              342,553

    Sales and marketing expenses....................            466,628              442,215
                                                          -------------        -------------

Total cost and expenses.............................          2,164,481            1,838,131
                                                          -------------        -------------

Income (loss) from operations.......................             88,026             (272,719)

Interest expense - net..............................             (8,123)             (34,475)
                                                          --------------       -------------

Net income (loss)...................................             79,903             (307,194)

Dividends on preferred stock........................                 --               10,000
                                                          -------------        -------------

Net income (loss) applicable to common stock........    $        79,903      $      (317,194)
                                                          =============        =============

Basic earnings (loss) per common share..............    $          0.01      $         (0.04)
                                                          =============        =============

Weighted average number of common shares............          8,217,234            7,773,878
                                                          =============        =============

Diluted earnings (loss) per common share............    $          0.01      $         (0.04)
                                                          =============        =============

Weighted average number of common
  shares and dilutive common equivalent shares......          8,484,572            7,773,878
                                                          =============        =============
</TABLE>


                 See Notes to Consolidated Financial Statements


                                      -4-
<PAGE>

                 BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
                 -----------------------------------------------

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                      -------------------------------------
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                              For the Nine Months Ended
                                                                                       June 30,
                                                                           ------------------------------
                                                                                 2001             2000
                                                                                 ----             ----
<S>                                                                        <C>                <C>
Cash flows from operating activities:
  Net income (loss) .................................................      $    351,794       $  (757,368)
  Adjustments to reconcile net income (loss) to net cash
    used in operating activities:
    Depreciation and amortization....................................           398,138           400,371
    Changes in operating assets and liabilities:
      Increase in accounts receivable................................          (787,051)         (971,160)
      Increase in prepaid expenses and other current assets..........           (65,266)          (79,939)
      Decrease (increase) in other assets............................            17,205           (48,122)
      Increase in accounts payable...................................           201,959           188,113
      Decrease in accrued expenses and other current
        liabilities..................................................           (62,440)          (12,723)
      (Decrease) increase in deferred revenue........................          (109,294)        1,148,070
                                                                            -----------        ----------
      Net cash used in operating activities..........................           (54,955)         (132,758)
                                                                            -----------        ----------

Cash flows from investing activities:
  Purchases of property and equipment................................          (193,828)         (296,214)
                                                                            -----------        ----------
      Net cash used in investing activities..........................          (193,828)         (296,214)
                                                                            -----------        ----------

Cash flows from financing activities:
  Payments on equipment lease obligations and notes payable..........          (118,046)         (643,699)
  Dividends paid to preferred stockholders...........................           (20,000)          (40,000)
  Proceeds from exercise of warrants and stock options                           43,260                --
  Proceeds from notes payable........................................                --           834,232
                                                                            -----------        ----------
      Net cash (used in) provided by financing activities............           (94,786)          150,533
                                                                            -----------        ----------

Net decrease in cash and cash equivalents............................          (343,569)         (278,439)

Cash and cash equivalents at beginning of period.....................           491,048           412,903
                                                                            -----------        ----------

Cash and cash equivalents at end of period...........................      $    147,479       $   134,464
                                                                            ===========        ==========

Supplemental disclosures of cash flow information:
  Cash paid during the year for interest.............................      $     24,299       $    48,377
                                                                            ===========        ==========

Supplemental Schedule of noncash investing and financing activities:
  Equipment purchased under capital lease obligations................      $    134,816       $   306,864
                                                                            ===========        ==========
</TABLE>




                 See Notes to Consolidated Financial Statements


                                      -5-
<PAGE>

                 BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
                 -----------------------------------------------

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                   (unaudited)


Note 1 - Basis of Presentation:

     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 pursuant to such rules and
regulations.   These  consolidated   financial  statements  should  be  read  in
conjunction  with  the  consolidated  financial  statements  and  notes  thereto
included  in the  Company's  Annual  Report on Form  10-KSB  for the year  ended
September 30, 2000.

     In the  opinion of the  Company's  management  the  accompanying  unaudited
consolidated financial statements contain all adjustments,  consisting solely of
those which are of a normal  recurring  nature,  necessary to present fairly its
financial position as of June 30, 2001 and the results of its operations and its
cash flows for the nine  months  ended June 30, 2001 and 2000 and the results of
its operations for the three months ended June 30, 2001 and 2000.

     Interim  results  are not  necessarily  indicative  of results for the full
fiscal year.

     Basic earnings  (loss) per common share was  calculated  based upon the net
earnings (loss) available to common stockholders divided by the weighted average
number of shares of common stock outstanding during the period. Diluted earnings
per share for the three  months  ended June 30, 2001 and nine months  ended June
30, 2001 was calculated based upon net earnings available to common stockholders
divided by the weighted  average  number of shares of common  stock  outstanding
during the period,  adjusted for dilutive  securities using the treasury method.
Diluted  loss per common share for the three months ended June 30, 2000 and nine
months ended June 30, 2000 exclude the impact of  convertible  preferred  stock,
options  (1,430,775  as of June 30,  2000) and  warrants  (66,667 as of June 30,
2000) as their inclusion would be antidilutive.


                                      -6-
<PAGE>

                 BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
                 -----------------------------------------------

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                   (unaudited)


Note 1 - Basis of Presentation: (continued)

     The  computation  of basic  earnings  (loss) per common  share and  diluted
earnings (loss) per common share were as follows:

<TABLE>
<CAPTION>
                                                   Nine Months Ended                Three Months Ended
                                                        June 30,                          June 30,
                                              ----------------------------     ----------------------------
                                                  2001             2000            2001           2000
                                              -----------      -----------     -----------     ------------

<S>                                           <C>              <C>             <C>             <C>
Net income (loss).................            $   351,794      $  (757,368)    $    79,903     $  (307,194)

Dividends on preferred stock......                (10,000)         (30,000)             --         (10,000)
                                               ----------       ----------      ----------      ----------

Net income (loss) applicable
  to common stock - basic.........            $   341,794      $  (787,368)    $    79,903     $  (317,194)
                                               ----------       ----------      ----------      ----------

Dilutive dividends on preferred
  stock...........................                 10,000               --              --              --
                                               ----------       ----------      ----------      ----------

Net income (loss) applicable
  to common stock - diluted.......            $   351,794      $  (787,368)    $    79,903     $  (317,194)
                                               ----------       ----------      ----------      ----------

Denominator:

Weighted average number of
  common shares...................              8,199,376        7,773,878       8,217,234       7,773,878
Basic earnings (loss)
  per common share................            $      0.04      $     (0.10)    $      0.01     $     (0.04)
                                               ==========       ==========      ==========      ==========

Denominator:

Weighted average number
  of common shares................              8,199,376        7,773,878       8,217,234       7,773,878
Common share equivalents of
  outstanding stock options and
  warrants........................                184,448               --         267,338              --
                                               ----------       ----------      ----------      ----------

Total shares......................              8,383,824        7,773,878       8,484,572       7,773,878
                                               ----------       ----------      ----------      ----------

Diluted earnings (loss) per
  common share....................            $      0.04      $     (0.10)     $     0.01     $     (0.04)
                                               ==========       ==========       =========      ==========
</TABLE>


                                      -7-
<PAGE>

                 BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
                 -----------------------------------------------

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                   (unaudited)


Note 2 - Stockholders' Equity:


     On January 2, 2001,  the Company  elected to convert the 416,667  shares of
its  Series A  Convertible  Preferred  Stock,  $.00025  par value per share (the
"Series A  Stock"),  held of record by  Investment  Partners  of  America,  L.P.
("IPA") into 416,667  shares of its restricted  common stock,  $.00025 par value
per  share  (the  "Common  Stock").  The  shares  of Common  Stock  issued  upon
conversion  of the Series A Stock were issued to the  designees  of IPA and have
certain  piggy-back  registration  rights. The Company has satisfied any and all
obligations  with respect to  cumulative  dividends  on the Series A Stock.  The
Company did not receive any  consideration  for the  conversion  of the Series A
Stock.  Subsequent to the conversion,  the Company has no issued and outstanding
shares of Series A Stock.

     During May and June of 2001,  the  Company  issued an  aggregate  of 66,667
shares of its  restricted  Common Stock to IPA and its  affiliate in  connection
with the  exercise  of 66,667  Class C  Warrants  (the  "Class C  Warrants")  to
purchase shares of Common Stock of the Company  previously issued to IPA on June
26, 1996.  The Class C Warrants had an exercise price equal to $.63 per share at
the time of  exercise,  and the Company  received  $42,000 as  proceeds  for the
exercise of such warrants by IPA and its affiliate.

     The Company has neither  paid nor  declared  dividends  on its Common Stock
since its  inception  and does not plan to pay  dividends on its Common Stock in
the foreseeable future.

Note 3 - Long-term Debt:

     During the nine months ended June 30, 2001,  the Company did not assign any
accounts  receivables  under the accounts  receivable  financing  agreement with
Silicon Valley Bank. At June 30, 2001,  the Company had no borrowings  under the
accounts  receivable  financing  agreement.  In July 2001, the Company  assigned
accounts receivable of approximately $212,000 to the Bank. At July 31, 2001, the
Company had a payable balance of approximately $170,000 to the Bank.

Note 4 - Recently Issued Accounting Standards:

     In December  1999,  the  Securities  and Exchange  Commission  issued Staff
Accounting  Bulletin  No. 101 ("SAB  101"),  Revenue  Recognition  in  Financial
Statements.  SAB 101 provides  guidance for revenue  recognition  under  certain
circumstances.  The  accounting  and  disclosures  prescribed by SAB 101 will be
effective  for the fourth  quarter of fiscal  year 2001.  The  Company  does not
believe  that the  application  of SAB 101 will  have a  material  impact on its
financial position or results of operations.






                                      -8-
<PAGE>

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

OVERVIEW

     Bio-Imaging  Technologies,  Inc.  ("Bio-Imaging"  or  the  "Company")  is a
pharmaceutical  contract service  organization,  providing services that support
the product development process of the pharmaceutical, biotechnology and medical
device  industries.  The Company  specializes  in  assisting  its clients in the
design and management of the  medical-imaging  component of clinical  trials for
all modalities  which consist of  computerized  tomography,  magnetic  resonance
imaging, x-rays, dual energy x-ray absorptiometry,  position emission tomography
single photon  emission  computerized  tomography  and  ultrasound.  The Company
provides  services  which include the  processing and analysis of medical images
and the  data-basing and regulatory  submission of medical images,  quantitative
data and text.  A new division of the  Company,  Bio-Imaging  ETC, is focused on
education, training and certification for medical-imaging equipment,  facilities
and staff.

     The Company's sales cycle (the period from the  presentation by the Company
to a  potential  client to the  engagement  of the  Company  by such  client) is
generally  twelve  months.  In addition,  the contracts  under which the Company
performs services typically cover a period of 12 to 36 months and the volume and
type of services  performed by the Company generally vary during the course of a
project.  No assurance  can be made that the  Company's  project  revenues  will
remain at levels  sufficient to maintain  profitability.  Project  revenues were
generated from 51 clients  encompassing 97 distinct projects for the nine months
ended June 30, 2001 as compared to 38 clients  encompassing 79 distinct projects
for the nine months ended June 30, 2000. This represents an increase of 34.2% in
clients  and  22.8% in  projects  for the nine  months  ended  June 30,  2001 as
compared   to  the  nine   months   ended   June   30,   2000.   The   Company's
contracted/committed  backlog was approximately  $18,500,000 as of June 30, 2001
as compared to  approximately  $13,500,000  as of June 30, 2000,  an increase of
37.0%.  Contracted/committed  backlog  as of July 31,  2001,  was  approximately
$18,600,000.  Contracted/committed backlog is the amount of revenue that remains
to be earned and  recognized on signed and agreed to contracts.  Such  contracts
are subject to termination by the Company's clients at any time.

     The Company  believes  that demand for its services and  technologies  will
grow  during  the  long-term  as  the  use  of  digital  technologies  for  data
acquisition  and  management  increases in the  radiology  and drug  development
communities.  The  Company  also  believes  that there is a growing  recognition
within  the  bio-pharmaceutical  industry  regarding  the use of an  independent
centralized core laboratory for analysis of medical-imaging data that is derived
from clinical trials and the rigorous  regulatory  requirements  relating to the
submission of this data. In addition,  the Food and Drug Administration  ("FDA")
is gaining  experience with electronic  submissions and is continuing to develop
guidelines  for  computerized  submission  of data,  including  medical  images.
Furthermore,  the increased use of digital  medical  images in clinical  trials,
especially for important drug classes such as anti-inflammatory,  neurologic and
oncologic



                                      -9-
<PAGE>

therapeutics and diagnostic  image agents,  generate large amounts of image data
that will require processing, analysis, data management and submission services.
Due  to  several  factors,   including,   without  limitation,  an  increase  in
competition from commercial competitors and academic research centers, there can
be no assurance  that demand for the Company's  services and  technologies  will
grow, sustain growth, or that additional  revenue generating  opportunities will
be realized by the Company.

     Certain  matters  discussed  in  this  Form  10-QSB  are   "forward-looking
statements" intended to qualify for the safe harbors from liability  established
by the Private  Securities  Litigation Reform Act of 1995. Such  forward-looking
statements may be identified by, among other things,  the use of forward-looking
terminology  such  as  "believes,"   "expects,"   "may,"  "will,"  "should,"  or
"anticipates" or the negative thereof or other variations  thereon or comparable
terminology, or by discussions of strategy that involve risks and uncertainties.
In particular,  the Company's  statements regarding the demand for the Company's
services  and  technologies,  growing  recognition  for the  use of  independent
centralized core laboratories, trends toward the outsourcing of imaging services
in clinical  trials,  realized return from the Company's  marketing  efforts and
increased use of digital  medical images in clinical trials are examples of such
forward-looking  statements.  The  forward-looking  statements include risks and
uncertainties,  including, but not limited to, the timing of revenues due to the
variability in size, scope and duration of projects, regulatory delays, clinical
study results which lead to reductions or cancellations  of projects,  and other
factors, including general economic conditions and regulatory developments,  not
within the Company's  control.  The factors  discussed herein and expressed from
time  to  time  in the  Company's  filings  with  the  Securities  and  Exchange
Commission  could  cause  actual  results  and  developments  to  be  materially
different  from  those  expressed  in  or  implied  by  such   statements.   The
forward-looking  statements  are made only as of the date of this filing and the
Company  undertakes  no  obligation  to  publicly  update  such  forward-looking
statements to reflect subsequent events or circumstances.

RESULTS OF OPERATIONS

     Nine Months Ended June 30, 2001 and 2000
     ----------------------------------------

     Project  revenues  for the nine  months  ended June 30,  2001 and 2000 were
approximately   $6,160,000  and   $4,106,000,   respectively,   an  increase  of
approximately  $2,054,000 or 50.0%.  Project  revenues for the nine months ended
June 30, 2001 and 2000 were  derived  from 51 clients  encompassing  97 distinct
projects and 38 clients  encompassing 79 distinct  projects,  respectively.  Two
clients  encompassing  seven  projects  represented  approximately  32.7% of the
Company's  project  revenues for the nine months  ended June 30,  2001.  For the
comparable period last year, two clients  encompassing six projects  represented
approximately  30.7% of the  Company's  project  revenues.  No  other  customers
accounted  for more than 10% of project  revenues for the nine months ended June
30, 2001 and 2000. The increase in project revenues is primarily a result of the
increase in the number of clients and projects for which the Company was engaged
to perform services.  This increase resulted  primarily from the increase in the
Company's sales and



                                      -10-
<PAGE>

marketing  efforts  over  the past  year.  The  Company's  scope of work in both
periods  included  medical  imaging core  laboratory  services  and  image-based
information management services.

     Cost of  revenues  for the nine  months  ended June 30,  2001 and 2000 were
comprised of professional salaries and benefits and allocated overhead.  Cost of
revenues  for the nine months  ended June 30,  2001 and 2000 were  approximately
$3,404,000 and $2,706,000,  respectively,  an increase of approximately $698,000
or 25.8%.  This  increase is  attributable  to an  increase  in staffing  levels
required for project  related  tasks for the nine months ended June 30, 2001 and
in anticipation of work to be performed on new contracts as compared to the same
period in the prior year.

     The difference  between project revenues and cost of revenues may fluctuate
as a percentage of project  revenues  based on the  utilization of staff and the
mix of services  provided by the  Company to its clients  during the  comparable
periods.  The increase in this  percentage  difference for the nine months ended
June 30, 2001 from the  comparable  period in fiscal 2000 resulted from a higher
increase in project  revenues as compared to a lower increase in project related
costs.

     General and administrative  expenses for each of the nine months ended June
30, 2001 and 2000  consisted  primarily of  professional  salaries and benefits,
depreciation and amortization, professional and consulting services, office rent
and corporate insurance.  General and administrative expenses were approximately
$1,115,000  for the nine months ended June 30, 2001 and  approximately  $964,000
for the nine months  ended June 30, 2000.  The  increase  during the nine months
ended June 30, 2001 of approximately  $151,000, or 15.7%, from the corresponding
fiscal 2000 period,  is primarily  attributable  to more  professional  services
associated with general corporate matters.

     Sales and  marketing  expenses  for each of the nine months  ended June 30,
2001 and 2000 were comprised of direct sales and marketing  costs,  professional
salaries and benefits and allocated overhead.  Sales and marketing expenses were
approximately   $1,272,000   for  the  nine  months  ended  June  30,  2001  and
approximately  $1,139,000  for the nine months ended June 30, 2000. The increase
during the nine months ended June 30, 2001 of approximately  $133,000, or 11.7%,
from the  corresponding  fiscal 2000 period,  resulted  primarily  from expenses
associated  with  increased  marketing  efforts  and  increased   attendance  at
additional conferences.

     Total cost and expenses for each of the nine months ended June 30, 2001 and
2000  consisted  primarily  of  cost of  revenues,  general  and  administrative
expenses and sales and marketing expenses.  The Company's cost and expenses were
approximately   $5,791,000   for  the  nine  months  ended  June  30,  2001  and
approximately  $4,808,000 for the nine months ended June 30, 2000. Such increase
of approximately $983,000, or 20.4%, is due primarily to an increase in staffing
levels required to support an increase in revenues along with an increase in the
Company's sales and marketing  efforts and an increase in professional  services
associated with general corporate matters.



                                      -11-
<PAGE>

     Net  interest  expense of  approximately  $17,000 for the nine months ended
June 30, 2001,  resulted  from  interest  expense  incurred in  connection  with
equipment lease obligations  offset in part by interest earned on cash balances.
Net interest expense of approximately $55,000 for the nine months ended June 30,
2000  resulted  from  interest  expense  incurred in the  assignment of accounts
receivable and interest  expense  incurred in connection  with  equipment  lease
obligations.

     The  Company's  net income  for the nine  months  ended  June 30,  2001 was
approximately $352,000, while the Company had net loss of approximately $757,000
for the nine months ended June 30, 2000.  The  Company's net income for the nine
months ended June 30, 2001 was  attributable  primarily  to  increased  revenues
associated  with an increase in the number of clients and projects for which the
Company was engaged to perform services.

     Three Months Ended June 30, 2001 and 2000
     -----------------------------------------

     Project  revenues for the quarters  ended June 30, 2001 ("Third  Quarter of
Fiscal  2001") and 2000  ("Third  Quarter of Fiscal  2000")  were  approximately
$2,253,000 and $1,565,000,  respectively,  an increase of approximately $688,000
or 44.0%. The increase in project revenues is primarily a result of the increase
in the  Company's  sales  and  marketing  efforts  over the past  year.  Project
revenues for the Third  Quarter of Fiscal 2001 and Fiscal 2000 were derived from
40 clients  encompassing  75 distinct  projects and 33 clients  encompassing  60
distinct  projects,   respectively.   Two  clients   encompassing  six  projects
represented  approximately 31.2% of the Company's project revenues for the three
months ended June 30, 2001.  For the  comparable  period last year,  two clients
encompassing  five  projects  represented  approximately  39.5% of the Company's
project  revenues.  No other  customers  accounted  for more than 10% of project
revenues  in each of the Third  Quarter  of Fiscal  2001 and  Fiscal  2000.  The
Company's scope of work in both periods included medical imaging core laboratory
services and image-based information management services.

     Cost of  revenues  for each of the Third  Quarter of Fiscal 2001 and Fiscal
2000  were  comprised  of  professional  salaries  and  benefits  and  allocated
overhead.  Cost of revenues for the Third Quarter of Fiscal 2001 and Fiscal 2000
were  approximately  $1,367,000  and  $1,053,000,  respectively,  an increase of
approximately $314,000 or 29.8%. This increase is attributable to an increase in
staffing  levels  required for project  related  tasks for the Third  Quarter of
Fiscal 2001 and in  anticipation  of work to be  performed  on new  contracts as
compared to the Third Quarter of Fiscal 2000.

     The difference  between project revenues and cost of revenues may fluctuate
as a percentage of project  revenues  based on the  utilization of staff and the
mix of services  provided by the  Company to its clients  during the  comparable
periods.  The increase in this  percentage  difference  for the Third Quarter of
Fiscal  2001  from the  Third  Quarter  of Fiscal  2000  resulted  from a higher
increase in project  revenues as compared to a lower increase in project related
costs.



                                      -12-
<PAGE>

     General and administrative expenses for each of the Third Quarter of Fiscal
2001 and Fiscal 2000 consisted primarily of professional  salaries and benefits,
depreciation and amortization, professional and consulting services, office rent
and corporate insurance.  General and administrative expenses were approximately
$331,000 for the Third Quarter of Fiscal 2001 and approximately $343,000 for the
Third Quarter of Fiscal 2000. The decrease of approximately $12,000, or 3.5%, is
primarily  attributable to less  professional  services  associated with general
corporate matters.

     Sales and  marketing  expenses for each of the Third Quarter of Fiscal 2001
and Fiscal 2000 were comprised of direct sales and marketing costs, professional
salaries and benefits and allocated overhead.  Sales and marketing expenses were
approximately  $467,000 for the Third  Quarter of Fiscal 2001 and  approximately
$442,000 for the Third Quarter of Fiscal 2000. The increase during Third Quarter
of Fiscal 2001 of  approximately  $25,000,  or 5.7%,  from the Third  Quarter of
Fiscal  2000,   resulted  primarily  from  expenses  associated  with  increased
marketing efforts and increased attendance at additional conferences.

     Total cost and  expenses  for each of the Third  Quarter of Fiscal 2001 and
Fiscal 2000 consisted primarily of cost of revenues,  general and administrative
expenses and sales and marketing expenses.  The Company's cost and expenses were
approximately  $2,164,000 in the Third Quarter of Fiscal 2001 and  approximately
$1,838,000 for the Third Quarter of Fiscal 2000. Such increase of  approximately
$326,000,  or 17.7%, is primarily due to an increase in staffing levels required
for project  related tasks and an increase in the Company's  sales and marketing
efforts offset by a decrease in  professional  services  associated with general
corporate matters.

     Net interest  expense of  approximately  $8,000 during the Third Quarter of
Fiscal 2001,  resulted from interest  expense in connection with equipment lease
obligations  offset in part by interest  earned on cash  balances.  Net interest
expense of  approximately  $34,000 for the Third Quarter of Fiscal 2000 resulted
from interest  expense  incurred in the  assignment of accounts  receivable  and
interest expense incurred in conjunction with equipment lease obligations.

     The  Company's  net  income  for the  Third  Quarter  of  Fiscal  2001  was
approximately  $80,000,  while  the  Company  had a net  loss  of  approximately
$307,000 for the Third  Quarter of 2000.  The Company's net income for the Third
Quarter  of  Fiscal  2001  was  attributable  primarily  to  increased  revenues
associated  with an increase in the number of clients and projects for which the
Company was engaged to perform services.




                                      -13-
<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

     At  June  30,  2001,   the  Company  had  cash  and  cash   equivalents  of
approximately  $147,000.  Working  capital  at June 30,  2001 was  approximately
$393,000.

     Net cash used in  operating  activities  for the nine months ended June 30,
2001 was  approximately  $55,000  and  resulted  primarily  from net  income  of
approximately  $352,000,  depreciation and amortization expense of approximately
$398,000 and an increase in accounts payable of approximately  $202,000,  offset
by an increase in accounts  receivable of approximately  $787,000 and a decrease
in deferred revenue of approximately $109,000.

     For the nine months ended June 30, 2001, the Company invested approximately
$194,000  in  capital  and  leasehold   improvements.   The  Company   currently
anticipates  that capital  expenditures for the remainder of fiscal 2001 will be
approximately  $50,000.  These expenditures represent additional upgrades in the
Company's networking,  data storage and core laboratory  capabilities along with
similar capital requirements for its European operations.

     In  December  2000,  the  Company  paid  to the  holders  of its  Series  A
Convertible Preferred Stock, $.00025 par value per share (the "Series A Stock"),
an aggregate  amount of $20,000,  which amount  represented  accrued  cumulative
dividends  for the period from July 1, 2000 through and  including  December 31,
2000.  On  January  2,  2001,  all  outstanding  shares of  Series A Stock  were
converted into shares of common stock,  $.00025 par value per share (the "Common
Stock"),  and,  therefore,  the  Company  is not  obligated  to make any  future
dividend payments on the Series A Stock.

     During the nine months ended June 30, 2001,  the Company did not assign any
accounts  receivables  under the accounts  receivable  financing  agreement with
Silicon  Valley  Bank  (the  "Bank").  At June  30,  2001,  the  Company  had $0
borrowings with the Bank. In July 2001, the Company assigned accounts receivable
of  approximately  $212,000  to the Bank.  At July 31,  2001,  the Company had a
payable balance of approximately $170,000 to the Bank.

     In August 1999,  the Company  entered into an agreement with the Bank for a
revolving line of credit of up to $500,000 collaterized by the Company's assets.
Interest  is  payable  at 1.50% over the  bank's  prime  rate of  interest.  The
agreement  requires the Company,  among other things, to maintain minimum levels
of tangible net worth and certain minimum financial ratios. In October 1999, the
Bank notified the Company that it would not make any advances under the existing
line of credit until the Company provides  sufficient  evidence  satisfactory to
the Bank of an improvement in the Company's  operating,  financial and liquidity
position.  At such  time,  the Bank may  consider  permitting  further  advances
pursuant to the loan agreement.

     During May and June of 2001,  the  Company  issued an  aggregate  of 66,667
shares of its restricted  Common Stock to Investment  Partners of America,  L.P.
("IPA") and its  affiliate  in  connection  with the  exercise of 66,667 Class C
Warrants  (the "Class C  Warrants")  to purchase



                                      -14-
<PAGE>

shares of Common Stock of the Company previously issued to IPA on June 26, 1996.
The Class C Warrants  had an exercise  price equal to $.63 per share at the time
of exercise,  and the Company  received  $42,000 as proceeds for the exercise of
such warrants by IPA and its affiliate.

     The Company  anticipates  that its cash and cash equivalents of $147,479 as
of June 30,  2001,  together  with  anticipated  cash  from  operations  and its
accounts  receivable  financing  agreement with the Bank,  will be sufficient to
fund current  working  capital needs and capital  requirements  for at least the
next twelve  months.  There can be no  assurance,  however,  that the  Company's
operating  results  will  achieve  profitability  on an annual basis in the near
future.  The  Company's  past history of operating  losses and together with the
risks associated with the Company's  ability to gain new client  contracts,  the
variability  of the timing of payments on existing  client  contracts  and other
changes in the Company's  operating assets and liabilities,  may have a material
adverse affect on the Company's future liquidity.  In connection therewith,  the
Company  may need to raise  additional  capital in the  foreseeable  future from
equity or debt sources in order to implement  its  business,  sales or marketing
plans,  take  advantage  of  unanticipated  opportunities  (such  as more  rapid
expansion,  acquisitions of  complementary  businesses or the development of new
services),  to react to  unforeseen  difficulties  (such as the  decrease in the
demand for the Company's  services or the timing of revenues due to a variety of
factors   previously   discussed)  or  to  otherwise  respond  to  unanticipated
competitive pressures.  There can be no assurance that additional financing will
be available, if at all, on terms acceptable to the Company.

     The Company's 2001 operating plans contain  assumptions  regarding  revenue
and  expenses.  The  achievement  of the operating  plan depends  heavily on the
timing of work performed by the Company on existing  projects and the ability of
the Company to gain and perform work on new projects.  Project cancellation,  or
delays in the timing of work  performed  by the Company on existing  projects or
the inability of the Company to gain and perform work on new projects could have
an adverse  impact on the Company's  ability to execute its  operating  plan and
maintain  adequate  cash  flow.  In the  event  actual  results  do not meet the
operating plan, the Company's  management  believes it could execute contingency
plans to mitigate such effects. Such plans include additional financing,  to the
extent available,  through the accounts receivable financing agreement discussed
above.  In addition,  in November 2000, the members of the Board of Directors of
the Company, in their individual capacities, committed up to an aggregate amount
totaling $100,000 in the form of a short-term loan,  through October 1, 2001, if
needed by the Company. Considering the cash on hand and based on the achievement
of the  operating  plan and  management's  actions  taken  to  date,  management
believes it has the ability to continue to generate  sufficient  cash to satisfy
its  operating  requirements  in the normal  course of business  for the next 12
months.  However,  no  assurance  can be  given  that  sufficient  cash  will be
generated from operations. The Company's cash balance was approximately $147,000
and $349,000 as of June 30, 2001 and July 31, 2001, respectively.




                                      -15-
<PAGE>

                           PART II. OTHER INFORMATION.
                           --------------------------

ITEM 2.   CHANGES IN SECURITIES AND USE OF PROCEEDS.

     During May and June of 2001,  the  Company  issued an  aggregate  of 66,667
shares of its  restricted  Common Stock to IPA and its  affiliate in  connection
with the exercise of 66,667 Class C Warrants to purchase  shares of Common Stock
of the Company  previously  issued to IPA on June 26, 1996. The Class C Warrants
had an exercise  price equal to $.63 per share at the time of exercise,  and the
Company  received  $42,000 as proceeds for the exercise of such  warrants by IPA
and its  affiliate.  The Company  believes  that the issuance of Common Stock in
connection with the exercise of the Class C Warrants held by IPA was exempt from
registration  under Section 4(2) of the Securities Act of 1933, as amended.  The
purchaser was an accredited  investor (as defined in Rule 501 promulgated by the
Securities  and Exchange  Commission  pursuant to the Securities Act of 1933, as
amended), had adequate access to information about the Company and the purchaser
acquired the securities for investment only and not with a view to distribution.

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K.

    (a)       Exhibits.

    3.1       Amended and Restated Bylaws of the Company.

    (b)       Reports on Form 8-K.

              None.




                                      -16-
<PAGE>

                                   SIGNATURES



     In accordance with the requirements of the Securities Exchange Act of 1934,
the registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

                                   BIO-IMAGING TECHNOLOGIES, INC.



DATE:   August 14, 2001            By: /s/ Mark L. Weinstein
                                      ------------------------------------------
                                      Mark L. Weinstein, President, Chief
                                      Executive Officer and Chief Financial
                                      Officer
                                      (Principal Executive Officer and Principal
                                      Financial Officer)



DATE:   August 14, 2001            By: /s/ Maria T. Kraus
                                      ------------------------------------------
                                       Maria T. Kraus, Controller
                                       (Principal Accounting Officer)