BC FORM 51-901F



QUARTERLY REPORT



Incorporated as part of:	Schedules B & C

ISSUER DETAILS:

|Name of Issuer           | IMAGIS TECHNOLOGIES INC.                                           
|------------------------ | -------------------------------------------------------------------
|For Quarter Ended        | March 31, 2001                                                     
|Date of Report           | May 15, 2001                                                       
|Issuer Address           | 1300 - 1075 West Georgia Street
Vancouver, British Columbia
V6E 3C9
|Issuer Fax Number        | (604) 684-4601                                                     
|Issuer Telephone Number  | (604) 684-4691                                                     
|Contact Name             | Sandra Buschau                                                     
|Contact Position         | Secretary                                                          
|Contact Telephone Number | (604) 684-4691                                                     
|Contact Email Address    | sbuschau@ipm.bc.ca                                                 
|Web Site Address         | www.imagistechnologies.com                                         

CERTIFICATE



THE THREE SCHEDULES REQUIRED TO COMPLETE THIS REPORT ARE
ATTACHED AND THE DISCLOSURE CONTAINED THEREIN HAS BEEN APPROVED BY THE BOARD OF
DIRECTORS.  A COPY OF THIS REPORT WILL BE PROVIDED TO ANY SHAREHOLDER WHO
REQUESTS IT.



|Iain Drummond
Name of Director  | "Iain Drummond"Sign (typed)   | 01/05/15
Date Signed (YY/MM/DD)
|------------------------------- | ----------------------------- | -------------------------------
|                                |                               |                                
|Sandra Buschau
Name of Director | "Sandra Buschau"
Sign (typed) | 01/05/15
Date Signed (YY/MM/DD)

---

SCHEDULE B:  SUPPLEMENTARY INFORMATION



1.     Analysis of expenses:

a)     Cost of materials



|Services | 21,893 
|-------- | -------
|Supplies | 11,955 
|Total    | $33,848



(b)     Administration expenses



|Bank charges and interest, net               | 2,010   
|-------------------------------------------- | --------
|Consulting fees                              | 12,650  
|Foreign exchange                             | (19,558)
|Office and rent                              | 87,744  
|Management fees                              | 14,600  
|Salaries and benefits                        | 42,225  
|Professional fees                            | 14,275  
|Shareholder relations and regulatory
filings | 27,519  
|Travel and entertainment                     | 40,520  
|Total                                        | $221,985



2.     Related party
transactions:



|Wages and benefits for two officers               | $88,777 
|------------------------------------------------- | --------
|Management fees for two directors and one
officer | 104,377 
|Total                                             | $193,154



3.     Summary of securities
issued and options granted during the period ended March 31, 2001



a)     Summary of securities
issued during the period:



|Date
of
Issue | Type
of
Security | Type
of
Issue    | Number
or
Amount | Price | Total
Proceeds
|------------- | ---------------- | ---------------- | ---------------- | ----- | --------------
|01/24/01      | Common           | Option exercise  | 3,333            | $1.00 | $3,333        
|02/22/01      | Common           | Option exercise  | 3,000            | $1.00 | 3,000         
|03/12/01      | Common           | Bonus shares     | 29,000           | $1.45 | deemed        
|03/16/01      | Common           | Warrant exercise | 17,500           | $0.80 | 14,000        
|03/17/01      | Common           | Warrant exercise | 62,500           | $0.80 | 50,000        



b)	Options/warrants granted during the period:



|Date of
Grant | Type
of
Issue | Number | Name                 | Exercise
Price | Expiry
Date
|------------- | ------------- | ------ | -------------------- | -------------- | -----------
|03/09/01      | Option        | 15,000 | Lorraine Tsiropoulos | $1.87          | 03/10/01   

---



4.     Summary of securities as
at March 31, 2001

a)     Authorized share capital:
100,000,000 common shares without par value

b)     Number and recorded value for
shares issued and outstanding:



|Issued and outstanding
Balance, March 31, 2001 | No. of shares
13,072,298 | Amount
$6,427,961
|---------------------------------------------- | ------------------------ | -----------------

c)     Description of options,
warrants and convertible securities outstanding:

Options

|Number of common shares
issuable | Exercise Price | Date of Expiry              
|-------------------------------- | -------------- | ----------------------------
|                                 |                |                             
|230,000                          | $0.30          | July 6, 2003                
|636,498                          | $1.00          | Various to January 19, 2005 
|565,000                          | $1.50 to $2.90 | Various to December 20, 2005
|1,431,498                        |                |                             



Warrants



|Number of common shares
issuable | Exercise Price | Date of Expiry   
|-------------------------------- | -------------- | -----------------
|                                 |                |                  
|266,666                          | $1.25          | February 23, 2002
|133,334                          | $1.25          | February 23, 2003
|200,000                          | $3.50          | April 7, 2001    
|50,000                           | $4.00          | June 16, 2002    
|650,000                          |                |                  

Convertible Securities

Nil



d)     Total Number of Shares in
Escrow



270,670 shares are being held in escrow.  These shares will
be released on February 23, 2002.



5.     List of directors and
officers as of May 15, 2001:



Oliver "Buck" Revell - Chairman and a Director
Iain Drummond - President, Chief Executive Officer and a Director
Ross Wilmot - Vice President, Finance and Chief Financial Officer
Sandra Buschau - Secretary and a Director
Altaf Nazerali - Director
Robert Gordon - Director
Rory Godinho - Director
Frederick Clarke - Director
Andy Amanovich - Chief Technology Officer

---



SCHEDULE C:  MANAGEMENT DISCUSSION



DESCRIPTION OF BUSINESS



Statements in this Report, including those concerning Imagis
Technologies Inc.'s (the "Company" or "Imagis") expectations
of future sales, gross profits, sales and marketing expenses, technical services
expenses, technology development expenses, administration expenses, product
introductions and cash requirements include certain forward-looking statements
within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended
(the "Securities Act"), and Section 21E of the U.S. Securities
Exchange Act of 1934, as amended.  As such, the Company's actual results may
vary materially from expectations as a result of certain factors including, but
not limited to, variations in the level of orders which can be affected by
general economic conditions and in the markets served by the Company's
customers, international economic and political climates, difficulties or delays
in the functionality or performance of the Company's products, the Company's
timing of future product releases, the Company's failure to respond adequately
to either changes in technology or customer preferences, changes in pricing or
that of the Company's competitors, the Company's ability to manage growth, risk
of nonpayment of accounts receivable, and changes in budgeted costs.



In some cases, you can identify forward-looking statements by
the Company's use of words such as "may," "will,"
"should," "could," "expect," "plan,"
"intend," "anticipate," "believe,"
"estimate," "predict," "potential" or
"continue" or the negative or other variations of these words, or
other comparable words or phrases.



Although the Company believes the expectations reflected in
its forward-looking statements are reasonable, it cannot guarantee future
results, levels of activity, performance or achievements or other future events.
Moreover, neither it nor anyone else assumes responsibility for the accuracy and
completeness of forward-looking statements.  The Company is under no duty to
update any of our forward-looking statements after the date of this filing. You
should not place undue reliance on forward-looking statements.



In February 1999, the Company completed the acquisition of
Imagis Cascade, and in the second quarter of the year ended December 31, 1999,
the Company completed a financing that raised approximately $2.9 million before
offering costs.  The acquisition was accounted for as a reverse take-over
whereby the Company acquired, in this case Imagis Cascade, is deemed the parent
for reporting purposes and the acquirer, in this case Imagis Technologies Inc.,
is considered the target or acquired entity.  This treatment conforms with
generally accepted accounting principles in Canada, which are essentially
identical to those applicable in the United States for such transactions.



Unless otherwise indicated in this Report, all references
herein are to Canadian Dollars.



DISCUSSION OF OPERATIONS AND FINANCIAL CONDITION



Comparison of Results of Operations for the three months
ended March 31, 2001 and March 31, 2000:



Revenues:



The Company's revenues for the quarter ended March 31, 2001
were $353,836, compared to $195,135 for the quarter ended March 31, 2000, which
represents an increase of approximately 81%.  Sales of the Company's software
increased approximately 108% to $193,045 for the quarter ended March 31, 2001,
compared to $92,742 for the quarter ended March 31, 2000.  Support and service
revenues increased approximately 57% to $160,791 for the quarter ended March 31,
2001, compared to $102,393 for the quarter ended March 31, 2000.



---

Operating Costs:



The Company's operating costs increased for the quarter ended
March 31, 2001 to $1,001,724, compared to $821,044 for the quarter ended March
31, 2000, which represents an increase of approximately 22%.  Operating costs
include cost of materials and services, sales and marketing, technical services,
technology development, administration, amortization and interest.



Cost of Materials and Services:



The Company's materials and service costs in conjunction with
the support services that it provides to customers for the quarter ended March
31, 2001 were $33,848, compared to $27,025 for the quarter ended March 31, 2000,
which represents an increase of approximately 25%.  This increase reflects costs
associated with the higher support revenues earned to date.



Sales and Marketing:



The Company's sales and marketing costs for the quarter ended
March 31, 2001 were $260,422, compared to $223,894 for the quarter ended March
31, 2000, which represents an increase of approximately 16%. This increase is
attributable to higher salary costs reflecting additions to staff over the prior
year. Travel and trade show costs also rose slightly due to the increase in
staff over the prior year level.



Technical Services:



The Company's technology services costs for the quarter ended
March 31, 2001 were $175,018, compared to $149,948 for the quarter ended March
31, 2000, which represents an increase of 17%.  This increase reflects staff
additions to the technical services group. The technical services group assists
the Company's strategic partners in the installation of its products and also
provides clients with all technical support they may require under the Company's
annual support contracts, and includes costs for salaries, facilities and
travel.



Technology Development:



The Company's technology development costs for the quarter
ended March 31, 2001 were $273,643, compared to $175,218 for the quarter ended
March 31, 2000, which represents an increase of 56%.  This increase over the
prior period reflects several additions to staff that were necessary, primarily
to continue the development of ID-2000. Recently, the Company completed the
conversion of its core technology into a software development kit (SDK) format
which permits a far broader range of applications of this facial recognition
software. Staff salaries accounted for approximately 73% of the total costs of
this function with the remainder attributable to support facilities.



Administration:



The Company's administration costs for the quarter ended
March 31, 2001 were $221,985, compared to $222,755 for the quarter ended March
31, 2000. Administrative costs include staff salaries, professional fees,
facility and support costs, shareholder and regulatory costs. Costs in each
category were generally consistent with the prior year period, except for
 professional fees and travel costs which were higher in 2001. These increases,
 however, were more than offset by a foreign exchange gain of $34,993 realized
 in the quarter.



Amortization:



The Company's amortization costs for the quarter ended March
31, 2001 were $4,776, compared to $22,204 for the quarter ended March 31, 2000.
The decline in amortization costs reflects the Company's decision, following the
acquisition of Imagis Cascade, to initiate a lease-financing program for all
purchases of new equipment and, as a consequence, the Company's existing fixed
assets are almost fully depreciated at this time.

---

Interest:



The Company's interest costs for the quarter ended March 31,
2001 were $32,032, compared to no such costs for the quarter ended March 31,
2000.   The interest costs are related to the debt portion of the loan from
related party.



Net Loss for the Period:



The Company's net loss for the quarter ended March 31, 2001
was $647,888, or $0.05 per share, compared to $625,909, or $0.06 per share, for
the quarter ended March 31, 2000, which represents a decrease of approximately
4%.

SUBSEQUENT EVENTS



Subsequent to March 31, 2001:



1. The Company signed a note with a related party on April
2, 2001 for $492,890.  The note was due on May 1, 2001.  This note bore interest
at 10% per annum, compounded monthly and was repaid as due on May 1, 2001.
2. On May 2, 2001, Imagis announced, further to news
releases of February 19 and March 22, 2001, the completion of the first closing
of the private placement in the amount of 973,000 units at $1.00 per unit for
total gross proceeds of $973,000.  Each unit consists of one common share and
one non-transferable share purchase warrant, with each warrant exercisable into
an additional common share for a period of one year from closing at a price of
$1.10 per share.  Canaccord Capital Corporation acted as agent in respect of
697,000 units of the placement, and it was therefore paid $52,275 as commission
and issued 69,700 broker's warrants having the same terms as the warrants under
the placement.  Securities issued pursuant to the placement are subject to a
four-month hold period expiring on August 26, 2001.



FINANCINGS, PRINCIPAL PURPOSES AND MILESTONES

There were no financings completed during the period.

LIQUIDITY AND SOLVENCY



The Company's financial statements are prepared assuming it
will continue as a going concern.  The Company has suffered losses from
operations and it has no established source of significant revenue.
Accordingly, the Company's auditors have qualified their report on our
consolidated financial statements as at December 31, 2000 and 1999 and for the
period ended December 31, 2000 because of substantial doubts as to our ability
to continue as a going concern.



At year-end, the Company's cash position was $59,497,
however, the Company announced its intention to arrange for additional financing
for working capital purposes. Due to market weakening in the first quarter of
2001, the Company was delayed in completing the announced private placement of
approximately $1.4 million and only completed the first closing of 973,000
shares, which yielded gross proceeds to the Company of $973,000 on April 26,
2001. In the interim, the Company arranged for a line of credit of up to
$200,000 from related parties and received $95,000 from this line. As
compensation for the advancement of the funds from related parties under this
credit arrangement, the Company issued 20,000 common shares valued at the then
current market price of $1.45 per share, or $29,000. This was a non-cash cost to
the Company.  In addition, during the quarter, the Company received other
advances of $176,004 from related parties outside of this credit arrangement, an
advance on the intended private placement of $48,500 and proceeds from the
exercise of 6,333 options and 80,000 warrants which yielded $70,333.
Consequently, cash inflows from financing activities aggregated $388,167 for the
first quarter of 2001.



---

Due to the Company's operating loss in the quarter, it
experienced a net reduction in its available cash of $647,888.  This was
significantly offset, however, by a substantial reduction in the Company's
outstanding receivables of $312,254 and the receipt of additional prepayments of
annual support contract fees providing $57,306. The net impact on cash from
operations as a result of these adjustments and the reduction in the Company's
current liabilities of $173,824 was a reduction in cash of $415,344.



In summary, while the Company added cash through various
means totaling $388,167, as a result of the first quarter operating loss which
reduced its available cash after adjustments by $415,344, the Company closed the
quarter with a net reduction in its cash amounting to $28,813 and had cash on
hand of $30,684 at the end of the quarter.



As noted above, the Company completed a private placement of
973,000 units following the quarter end. Each unit was priced at $1.00 and
consisted of one (1) common share and one (1) share purchase warrant to purchase
an additional common share at an exercise price of $1.10 for a period of one (1)
year from the closing date.



Presently, the Company is slightly ahead of planned revenues,
while its costs are on budget.  The Company expects its operating costs to
remain essentially constant throughout the remainder of the year.  Based upon
management's projections at this time, the Company believes that it will be able
to sustain its operations over the near term and, the Company completes the
second and final closing with net proceeds of approximately $400,000, management
 believes that no further financing will be necessary for the remainder of the
 year to meet its internal targets for staffing and operations.



There is no assurance that the Company will be able to secure
financing or that such financing will be obtained on terms favorable to the
Company.  Failure to obtain adequate financing could result in significant
delays in development of new products and a substantial curtailment of
operations.