<PAGE>   1
                                  United States
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                   FORM 10-QSB


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


For the quarterly period ended        SEPTEMBER 30, 2000
                               ----------------------------------------


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

                         Commission File Number 0-20791


                           AMARILLO BIOSCIENCES, INC.
-------------------------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)

            TEXAS                                          75-1974352
------------------------------                 ---------------------------------
(State or other jurisdiction of                (IRS Employer Identification No.)
incorporation or organization)

800 West Ninth, Amarillo, TX                                 79101
--------------------------------------------------------------------------------
(Address of principal executive offices)                   (Zip Code)

806-376-1741                                           FAX 806-376-9301
--------------------------------------------------------------------------------
(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 Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. Yes X . No  .
                                                                      ---    ---
As of September 30, 2000 there were 7,807,357 shares of the issuer's common
stock outstanding.








<PAGE>   2




                           AMARILLO BIOSCIENCES, INC.


                                      INDEX

<TABLE>
<CAPTION>


PART I:              FINANCIAL INFORMATION                                                                    PAGE NO.
                                                                                                              --------
<S>                 <C>                                                                                            <C>
ITEM 1.              Financial Statements

                     Consolidated Balance Sheets - December 31, 1999 and
                     September 30, 2000..........................................................                    3

                     Consolidated Statements of Operations - Three Months and
                     Nine Months Ended September 30, 1999 and 2000 and
                     Cumulative from June 25, 1984 (Inception) through
                     September 30, 2000..........................................................                    4

                     Condensed Consolidated Statements of Cash Flows - Nine
                     Months Ended September 30, 1999 and 2000 and Cumulative
                     from June 25, 1984 (Inception) through September 30, 2000...................                    5

                     Notes to Consolidated Financial Statements..................................                    6

ITEM 2.              Management's Plan of Operations.............................................                    7

PART II:             OTHER INFORMATION

ITEM 5.              Other Information...........................................................                    9

ITEM 6.              Exhibits and Reports on Form 8-K............................................                   10

Signatures           ............................................................................                   11
</TABLE>





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<PAGE>   3



                   AMARILLO BIOSCIENCES, INC. AND SUBSIDIARIES
                      (COMPANIES IN THE DEVELOPMENT STAGE)

                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>

                                                                       DECEMBER 31,     SEPTEMBER 30,
                                                                          1999              2000
                                                                     ---------------   ---------------
<S>                                                                  <C>               <C>
ASSETS                                                                                  (Unaudited)
Current assets:
  Cash and cash equivalents                                          $     1,302,343   $       655,445
  Inventory                                                                   48,639            48,639
  Other current assets                                                        32,137            45,698
                                                                     ---------------   ---------------
Total current assets                                                       1,383,119           749,782

Property and equipment, net                                                  105,799            96,394
Patents, net of accumulated amortization of $89,806 and $101,395
   at December 31, 1999 and September 30, 2000 (unaudited),
   respectively                                                               73,495            86,192
                                                                     ---------------   ---------------
Total assets                                                         $     1,562,413   $       932,368
                                                                     ===============   ===============
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)
Current liabilities:
  Accounts payable                                                   $       521,199   $       778,636
  Accrued interest                                                             3,526            63,666
  Other accrued expenses                                                      82,198            19,000
                                                                     ---------------   ---------------
Total current liabilities                                                    609,923           861,302

Notes payable to related party                                             1,000,000         2,000,000
                                                                     ---------------   ---------------
Total liabilities                                                          1,609,923         2,861,302
STOCKHOLDERS' EQUITY (DEFICIENCY):
  Preferred stock, $.01 par value:
     Authorized shares - 10,000,000
     Issued shares - none
     Common stock, $.01 par value:                                                --                --
     Authorized shares - 20,000,000
     Issued shares - 7,807,357 at September 30, 2000 and                      74,722            78,074
     7,472,157 at December 31, 1999
  Additional paid-in capital                                              17,374,570        18,361,856
  Deficit accumulated during the development stage                       (17,496,802)      (20,368,864)
                                                                     ---------------   ---------------
Total stockholders' equity (deficiency)                                      (47,510)       (1,928,934)
                                                                     ---------------   ---------------
Total liabilities and stockholders' equity (deficiency)              $     1,562,413   $       932,368
                                                                     ===============   ===============
</TABLE>

                             See accompanying notes.


                                        3

<PAGE>   4




                   AMARILLO BIOSCIENCES, INC. AND SUBSIDIARIES
                      (COMPANIES IN THE DEVELOPMENT STAGE)

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (unaudited)

<TABLE>
<CAPTION>


                                                                                                                   Cumulative
                                                                                                                      from
                                                                                                                    June 25,
                                                                                                                      1984
                                          Three months ended                      Nine months ended                (Inception)
                                             September 30,                          September 30,                    through
                                          ------------------                      ----------------                 September 30,
                                        1999               2000                1999                2000                2000
                                 ------------------  -----------------  ------------------  ------------------  ------------------
<S>                              <C>                   <C>                <C>                 <C>               <C>
Revenues:
  Contract revenues              $                -    $             -    $              -    $              -  $        9,000,000
  Interferon sales                                -                  -                   -                   -             420,974
  Interest income                            19,492             12,123              96,130              41,512           1,567,517
  Sublicense fees                                 -                  -                   -                   -             113,334
  Royalty income                                  -                  -                   -                   -              31,544
  Gain on sale of ISI stock                       -                  -                   -               5,209             113,446
  Other                                           -                125                   -               1,655             608,486
                                 ------------------  -----------------  ------------------  ------------------  ------------------
                                             19,492             12,248              96,130              48,376          11,855,301

Expenses:
  Research and
   development expenses                   1,299,344            142,684           3,536,743           2,015,895          18,100,704
  Selling, general, and
   administrative expenses                  267,807            216,497           1,007,226             844,403          13,173,195
  Interest expense                            3,637             22,685              32,807              60,140             915,266
                                 ------------------  -----------------  ------------------  ------------------  ------------------
                                          1,570,788            381,866           4,576,776           2,920,438          32,189,165
                                 ------------------  -----------------  ------------------  ------------------  ------------------

Loss before income taxes                 (1,551,296)          (369,618)         (4,480,646)         (2,872,062)        (20,333,864)
Income tax expense                                -                  -                   -                   -              35,000
                                 ------------------  -----------------  ------------------  ------------------  ------------------
Net loss                         $       (1,551,296) $        (369,618) $       (4,480,646) $       (2,872,062) $      (20,368,864)
                                 ==================  =================  ==================  ==================  ==================
Basic and diluted loss
  per share                      $           (0.24)  $          (0.05)  $           (0.74)  $           (0.37)
                                 ==================  =================  ==================  ==================
Weighted average shares
  outstanding                             6,360,326          7,807,357           6,044,961           7,684,104
                                 ==================  =================  ==================  ==================
</TABLE>




                             See accompanying notes.

                                        4

<PAGE>   5





                   AMARILLO BIOSCIENCES, INC. AND SUBSIDIARIES
                      (COMPANIES IN THE DEVELOPMENT STAGE)

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                  Nine months ended               Cumulative from
                                                                     September 30,                  June 25,1984
                                                   -------------------------------------------   (Inception) through
                                                             1999                    2000         September 30, 2000
                                                   --------------------   --------------------   --------------------

<S>                                                <C>                    <C>                    <C>
Net cash used in operating activities              $         (4,000,538)  $         (2,456,824)  $        (18,300,226)

Net cash provided by (used in) investing
 activities                                                      (6,130)                 3,126               (571,160)
Net cash provided by financing activities                     1,000,000              1,806,800             19,526,831
                                                   --------------------   --------------------   --------------------
Net increase (decrease) in cash and cash
 equivalents                                                 (3,006,668)              (646,898)               655,445
Cash and cash equivalents at beginning
 of period                                                    4,776,328              1,302,343                     --
                                                   --------------------   --------------------   --------------------
Cash and cash equivalents at end of
 period                                            $          1,769,660   $            655,445   $            655,445
                                                   ====================   ====================   ====================
Supplemental Disclosure of Cash Flow
  Information
Cash paid for income taxes                         $                 --   $                 --   $             37,084
                                                   ====================   ====================   ====================

Cash paid for interest                             $                 --   $                 --   $              6,466
                                                   ====================   ====================   ====================
</TABLE>


                             See accompanying notes.


                                        5

<PAGE>   6



                   AMARILLO BIOSCIENCES, INC. AND SUBSIDIARIES
                      (COMPANIES IN THE DEVELOPMENT STAGE)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.       Basis of Presentation. The accompanying consolidated financial
         statements, which should be read in conjunction with the consolidated
         financial statements and footnotes included in the Company's Form
         10-KSB for the year ended December 31, 1999 filed with the Securities
         and Exchange Commission, are unaudited (except for the December 31,
         1999 consolidated balance sheet which was derived from the Company's
         audited financial statements), but have been prepared in accordance
         with generally accepted accounting principles for interim financial
         information. Accordingly, they do not include all of the information
         and footnotes required by generally accepted accounting principles for
         complete financial statements. In the opinion of management, all
         adjustments (consisting only of normal recurring adjustments)
         considered necessary for a fair presentation have been included.

         Operating results for the nine months ended September 30, 2000 are not
         necessarily indicative of the results that may be expected for the full
         year ending December 31, 2000.

2.       Loss per share. Loss per share is computed based on the weighted
         average number of common shares outstanding.

         On December 29, 1999 405,932 options were granted to employees of the
         Company, including 300,000 granted to Joseph Cummins, President and
         CEO. Such options are exercisable at a price of $.875 per share, being
         the fair market value of the Company's stock on December 29, 1999, the
         date of grant. All of such options granted to employees were granted in
         consideration of the employees' agreement to relinquish salary during
         2000, on the basis of two options granted for every $1.00 of salary
         voluntarily relinquished, with the amount of such relinquished salary
         being reflected in the Option Agreement signed with each employee, such
         options to vest monthly beginning in January, 2000, and to expire
         December 29, 2004.

         In response to a request by Joseph Cummins, President and CEO, the
         Board of Directors resolved during the September 23, 2000 Board meeting
         that commencing August 31, 2000, the salary of Joseph Cummins
         (President and CEO) shall be restored in the amount of $6,250.00 per
         month; there shall be paid to the President and CEO in addition thereto
         $1,000.00 per month as a non-accountable expense allowance; and that
         the options receivable by the President and CEO pursuant to the terms
         of that certain Stock Option Agreement dated December 29, 1999, between
         the President and the Company shall be reduced, commencing August 31,
         2000, from 25,000 options per month to 12,500 options per month, with
         all other option terms, conditions and provisions to remain unchanged.

         The Company recorded compensation expense in the amount of $64,746
         during the first quarter of 2000, $64,746 during the second quarter of
         2000 and $54,346 during the third quarter of 2000 in regard to these
         options. This amount represents the difference between

                                        6

<PAGE>   7



         the exercise price and the fair market value of the stock on the date
         of the salary reduction commitment by each of the employees, amortized
         over the 12 month vesting period.

         To date, a total of 19,200 options have been exercised by employees.


ITEM 2.  MANAGEMENT'S PLAN OF OPERATIONS

Amarillo Biosciences, Inc. is a development stage company which is conducting
research and development activities focused on biologics for the treatment of
human and animal diseases. The Company has not commenced any significant product
commercialization and, until such time as it does, will not generate significant
product revenues. The Company's accumulated deficit has continued to grow, from
$17,496,802 at December 31, 1999 to $20,368,864 at September 30, 2000. Operating
losses are expected to continue for the foreseeable future and until such time
as the Company is able to attain sales levels sufficient to support its
operations.

As of September 30, 2000, the Company had current assets of $749,782, including
cash in the amount of $655,445, which management believes will permit the
Company to continue operations through the end of year 2000. The Company will
need to raise additional capital in order to implement its plan of operations.
As noted in item 5, Hunter Wise Financial Group, LLC has been retained to assist
the Company in its fund raising activities. Assuming that these activities are
successful the Company will implement the operations plan over the next 12
months which will include the expenditure of the following financial resources.

During the next 12 months the Company will continue its research and development
activities, as well as the activities necessary to develop commercial
partnerships and licenses and to initiate nutraceutical sales. The Company's
expenditure of financial resources during this period will fall principally into
five broad categories, as follows: Research and Development; Personnel;
Consulting and Professional (other than legal and accounting); Legal and
Accounting; and Public Relations, Investor Relations and Shareholder Relations.
The Company's expectations and goals with respect to these categories are
addressed separately below, by category:

RESEARCH AND DEVELOPMENT: Until it achieves commercial product sales including
sales of its nutraceutical product, the Company's business is research and
development, and this is the area where the Company's principal efforts will be
expended during the next 12 months. The Company has budgeted to $1.7 million to
be spent on research and development during the next 12 months, inclusive of
amounts to be expended on the Company's clinical trial programs in Sjogren's
syndrome; Behcet's disease; and hepatitis C.

PERSONNEL: In addition to its intellectual property, the Company's principal
assets are its personnel. To implement its plan of operations, Amarillo
Biosciences plans to increase the number of personnel during calendar year 2001.
Planned personnel additions are in the clinical group and include hiring a
full-time Chief Financial Officer. The Company has budgeted approximately $1.2
million for personnel expenses during the next 12 months, including salaries,
payroll taxes, directors' and officers' general liability insurance, group
health and liability insurance.


                                        7

<PAGE>   8



CONSULTING AND PROFESSIONAL (EXCEPT LEGAL AND ACCOUNTING): The Company has
budgeted approximately $90,000 for expenditure on professional consultants in
the next 12 months. Consulting fees are expected to be paid to certain
independent consultants, in connection with the operation of the Company. The
Company will continue to use the services of consultants to complement the
Company's small full-time staff, where such is a more efficient utilization of
the Company's resources.

LEGAL AND ACCOUNTING: Although the Company is not involved in litigation, it has
budgeted legal expenses of approximately $250,000 during the next 12 months.
Almost 20% of the Company's legal expenditures will be for preparation and
filing of patents and for maintenance of existing patents in a number of
countries. Other legal expenses will be related to compliance with laws and
regulations affecting public companies, licensing and contracting, and general
corporate matters. The Company has budgeted approximately $45,000 for accounting
charges during the next 12 months. The Company does not presently have an
in-house legal staff, nor does it intend to put such a staff in place within the
near term. The Company expects to continue Ernst & Young as its auditors.

PUBLIC RELATIONS, INVESTOR RELATIONS AND SHAREHOLDER RELATIONS: The Company has
budgeted approximately $50,000 for public relations, investor relations and
shareholder relations during the next 12 months. The Company has also budgeted
sufficient amounts to maintain its comprehensive web site (www.amarbio.com).

LIQUIDITY NEEDS: The principal budget items discussed above, along with other
miscellaneous costs and expenses, will cause the Company to expend approximately
$3.7 million during the next 12 months. As of September 30, 2000 the Company had
available cash of $655,445. The Company has sufficient cash to continue
operations only through December 31, 2000.

The Company will need to raise additional funds to continue operations during
the next 12 months. If the Company is not successful in raising additional
funds, it will need to significantly curtail clinical trial expenditures and to
reduce staff and administrative expenses and may be forced to cease operations.



                                        8

<PAGE>   9



                           PART II - OTHER INFORMATION


ITEM 5.  OTHER INFORMATION

INVESTMENT BANKER RELATIONSHIPS: On July 25, 2000 the Company and First Security
Van Kasper (FSVK) executed an agreement whereby FSVK would serve as financial
advisor to the Company relating to partner agreements including possible merger
and the sale of assets activities. This agreement was mutually terminated by the
Company and FSVK on September 26, 2000.

On September 28, 2000 the Company and Hunter Wise Financial Group, LLC executed
an agreement whereby Hunter Wise will provide advisory services to the Company
in the areas of corporate development, corporate finance and capital placement
transactions.

BOARD OF DIRECTORS: Richard A. Franco submitted his resignation from the Board
of Directors effective October 1, 2000.


                                        9

<PAGE>   10



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

         EXHIBIT 27.   Financial Data Schedule

         No reports on Form 8-K were filed during the quarter ended September
30, 2000.

                                       10

<PAGE>   11




                                   SIGNATURES





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



                                                 AMARILLO BIOSCIENCES, INC.


Date: November 10, 2000                By: /s/ JOSEPH M. CUMMINS
                                          -------------------------------------
                                            Joseph M. Cummins
                                            President, Chief Executive Officer
                                            and Chief Financial Officer




<PAGE>   12


                               INDEX TO EXHIBITS


<TABLE>
<CAPTION>

EXHIBIT
NUMBER                      DESCRIPTION
------                      -----------
<S>                         <C>
27                          Financial Data Schedule
</TABLE>