SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    Form 10-Q


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


For the Quarter Ended May 31, 2002            Commission File Number:  000-17249



                               AURA SYSTEMS, INC.
             (Exact name of Registrant as specified in its charter)

         Delaware                                         95-4106894
   (State or other jurisdiction             (I.R.S. Employer Identification No.)
of incorporation or organization)


                               2335 Alaska Avenue
                          El Segundo, California 90245
                    (Address of principal executive offices)


Registrant's telephone number, including area code:           (310) 643-5300

Former name, former address and former fiscal year, if changed since
last report:  None


     Indicate  by check mark  whether the  Registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
Registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days:
YES       X             NO
   --------------         --------------

         Indicate  the  number of  shares  outstanding  of each of the  issuer's
classes of common stock, as of the latest practicable date.

    Class                                          Outstanding at July 9, 2002
   -------                                         ---------------------------
Common stock, par value                                408,782,576 Shares
   $.005 per share



<PAGE>

<TABLE>
<CAPTION>
                       AURA SYSTEMS, INC. AND SUBSIDIARIES

                                      INDEX



                                                                                                    Page No.
<S>            <C>                                                                                  <C>
PART I.       FINANCIAL INFORMATION

         ITEM 1.      Financial Statements

                      Statement Regarding Financial Information                                        1

                      Condensed Consolidated Balance Sheets as of
                      May 31, 2002 (unaudited) and February 28, 2002                                   2

                      Condensed Consolidated Statements of Operations for the Three
                      Months Ended May 31, 2002 (unaudited) and 2001 (unaudited)                       3

                      Condensed Consolidated Statements of Cash Flows for the Three
                      Months Ended May 31, 2002 (unaudited) and 2001 (unaudited)                       4

                      Notes to Condensed Consolidated Financial Statements
                                                                                                       5

         ITEM 2.      Management's Discussion and Analysis of Financial Condition and
                      Results of Operations                                                            7


PART II.  OTHER INFORMATION

         ITEM 1.      Legal Proceedings                                                                10

         ITEM 2.      Changes in securities                                                            10

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


SIGNATURES                                                                                             11


</TABLE>


<PAGE>




                       AURA SYSTEMS, INC. AND SUBSIDIARIES

                           QUARTER ENDED MAY 31, 2002




PART I.  FINANCIAL INFORMATION

The  financial  statements  included  herein have been prepared by Aura Systems,
Inc.  ("Aura"  or the  "Company"),  without  audit,  pursuant  to the  rules and
regulations  of  the  Securities  and  Exchange   Commission  (the  "SEC").   As
contemplated  by the SEC under Rule 10-01 of  Regulation  S-X, the  accompanying
financial  statements  and  footnotes  have been  condensed and therefore do not
contain all disclosures required by accounting  principles generally accepted in
the United  States.  However,  the Company  believes  that the  disclosures  are
adequate to make the  information  presented  not  misleading.  These  financial
statements should be read in conjunction with the financial statements and notes
thereto included in the Company's Form 10-K for the year ended February 28, 2002
as filed with the SEC (file number 000-17249).


<PAGE>

<TABLE>
<CAPTION>

                       AURA SYSTEMS, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS


                                                                                 May 31,
                                                                                  2002                   February 28,
                                                                               (Unaudited)                   2002
Assets

<S>                                                                            <C>                        <C>

Current assets
     Cash and equivalents                                                    $       1,099,471          $      1,143,396
     Receivables, net                                                                   91,668                    67,491
     Inventories, net                                                                4,856,286                 5,006,424
     Notes receivable                                                                  172,191                   168,792
     Other current assets                                                              522,170                   228,758
                                                                             -----------------         -----------------
       Total current assets                                                          6,741,786                 6,614,861

Property and equipment, at cost                                                     16,309,956                16,309,956
Less accumulated depreciation and amortization                                      (6,125,975)               (5,935,475)
                                                                             ------------------        ------------------

     Net property and equipment                                                     10,183,981                10,374,481

     Non-current inventories                                                         4,500,000                 4,500,000
     Long term investments                                                           1,000,000                 1,700,000
     Long term receivables                                                           2,303,003                 2,347,346
     Patents and trademarks, net                                                     2,984,851                 3,061,932
     Other assets                                                                      157,005                   163,370
                                                                             -----------------         -----------------
       Total                                                                 $      27,870,626         $      28,761,990
                                                                             =================         =================

Liabilities and Stockholders' Equity

Current liabilities:
     Accounts payable                                                        $       2,410,860         $       3,032,134
     Notes payable                                                                   3,324,034                 3,913,623
     Accrued expenses                                                                2,321,633                 2,181,657
                                                                             -----------------         -----------------
       Total current liabilities                                                     8,056,526                 9,127,414

Notes payable and other liabilities                                                  6,891,031                 6,981,843

COMMITMENTS AND CONTINGENCIES
Stockholders' equity

   Common stock par value $.005 per share and additional paid
   in capital.  Issued and outstanding 408,782,576 shares at May
   31, 2002 and 387,690,068 shares at February 28, 2002.                           304,560,994               300,332,457

   Accumulated deficit                                                            (291,637,925)             (287,679,724)
                                                                             ------------------         -----------------

       Total stockholders' equity                                                   12,923,069                12,652,733
                                                                             -----------------          ----------------
       Total                                                                 $      27,870,626         $      28,761,990
                                                                             =================         =================

     See accompanying notes to condensed consolidated financial statements.


</TABLE>

<PAGE>


<TABLE>
<CAPTION>

                       AURA SYSTEMS, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                  FOR THREE MONTHS ENDED MAY 31, 2002 AND 2001
                                   (Unaudited)


                                                                                   2002                        2001

<S>                                                                           <C>                        <C>
Net Revenues                                                                  $      183,739             $    2,874,569

     Cost of goods                                                                    80,985                  1,440,623
                                                                              --------------             --------------

Gross Profit                                                                         102,753                  1,433,946

Operating Expenses

     Engineering expenses                                                          1,096,770                  2,301,285
     Selling, general and administrative                                           2,160,475                  2,254,461
     Research and development                                                        136,048                    271,806
                                                                             ---------------             --------------

     Total expenses                                                                3,393,292                  4,827,552
                                                                              --------------             --------------

Loss from operations                                                             (3,290,539)                (3,393,606)

Other (income) and expense

     (Gain) on sale of assets                                                             --                   (399,189)
     (Gain) on settlement with Deutsche Financial Services                                --                 (1,150,000)
     Other (income) expense                                                          585,429                   (144,252)
     Interest expense, net                                                            82,234                    405,533
                                                                              --------------              --------------

Net loss                                                                      $   (3,958,201)            $   (2,105,698)
                                                                              ===============            ===============

Net loss per common share-basic                                               $         (.01)            $         (.01)
                                                                              ===============             ==============

Weighted average shares used
  to compute net loss per share                                                  398,236,320                300,710,598
                                                                              ===============             ==============
</TABLE>



     See accompanying notes to condensed consolidated financial statements.


<PAGE>

<TABLE>
<CAPTION>

                       AURA SYSTEMS, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                FOR THE THREE MONTHS ENDED MAY 31, 2002 AND 2001
                                   (Unaudited)


                                                                           2002                       2001

<S>                                                                  <C>                       <C>
Net cash used in operations                                          $     (3,969,869)         $     (4,174,294)
                                                                     -----------------         -----------------

Cash flows from investing activities:
      Proceeds from sale of assets                                                 --                   399,189
      Payments from notes receivable                                           40,944                    37,807
     Purchase of property and equipment                                            --                  (107,434)
                                                                     ----------------          -----------------

     Net cash provided by investing activities                                 40,944                   329,562

Cash flows from financing activities:

     Repayment on line of credit                                                   --                (1,300,000)
     Proceeds from exercise of warrants                                            --                    27,000
     Repayment of debt                                                       (250,000)                 (629,966)
     Net proceeds from issuance of common stock                             4,135,000                 5,697,900
                                                                     ----------------          ----------------

     Net cash provided by financing activities                              3,885,000                 3,794,934
                                                                      ---------------          ----------------

Net increase (decrease) in cash and equivalents                               (43,925)                  (49,798)
Cash and equivalents at beginning of period                                 1,143,396                 1,265,912
                                                                     ----------------          ----------------

Cash and equivalents at end of period                                $      1,099,471          $      1,216,114
                                                                     ================          ================

Supplemental  disclosures of cash flow  information
Cash paid during the period for:
              Interest                                               $         43,167          $        447,291
              Income Tax                                             $              0          $              0

</TABLE>


The  unaudited  supplemental  disclosure  of non-cash  investing  and  financing
activities:

In the quarter  ended May 31, 2002 there were  292,508  shares of the  Company's
common stock issued in satisfaction  of $92,140 in  liabilities.  In the quarter
ended May 31, 2001,  $4,330,994 of liabilities  were satisfied with the issuance
of 10,851,381 shares of the Company's common stock.




     See accompanying notes to condensed consolidated financial statements.


<PAGE>


                       AURA SYSTEMS, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  May 31, 2002
                                   (Unaudited)

1)       Basis of Presentation

         The condensed consolidated financial statements include the accounts of
Aura Systems,  Inc.  ("the  Company" or "Aura") and  subsidiaries.  All material
inter-company balances and inter-company transactions have been eliminated.

         In the opinion of  management,  the  accompanying  unaudited  condensed
consolidated  financial  statements  contain all adjustments (which include only
normal recurring adjustments) and reclassifications for comparability  necessary
to present fairly the financial  position of Aura Systems,  Inc. at May 31, 2002
and the results of its  operations and cash flows for the three months ended May
31, 2002 and 2001.

         The  preparation of financial  statements in conformity with accounting
principles  generally accepted in the United States requires  management to make
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities  and disclosure of contingent  assets and liabilities as of the date
of the financial  statements  and the reported  amounts of revenues and expenses
during the reported period. Actual results could differ from those estimates.

2)       Going Concern

         The Company has received a report from its  independent  auditors  that
includes an explanatory paragraph describing the uncertainty as to the Company's
ability to continue as a going concern.  These condensed  consolidated financial
statements  contemplate  the  ability to continue as such and do not include any
adjustments that might result from this uncertainty.

3)       Capital

         In the quarter ended May 31, 2002, common stock  outstanding  increased
by a total of  21,092,508  shares as  follows:  20,800,000  shares were sold for
gross  proceeds  of  $4,160,000  and  292,508  shares  were  issued  to  satisfy
liabilities of $92,140.

4)       Inventories
<TABLE>
<CAPTION>

         Inventories, stated at the lower of cost (first in, first out) or market, consist of the following:


                                                                              May 31,              February 28,
                                                                                2002                   2002
                                                                        ------------------       -----------------
        <S>                                                               <C>                      <C>
         Raw materials                                                    $     3,971,566          $    4,043,697
         Finished goods                                                         7,179,275               7,258,138
         Reserve for potential product obsolescence                            (1,795,411)             (1,795,411)
                                                                          ----------------         --------------
                                                                          $     9,355,430          $    9,506,424
                                                                          ===============          ==============
</TABLE>


          Inventories  consist  primarily of components and completed  units for
     the Company's AuraGen(R) product.

5)       Asset Impairment

          Subsequent  to the quarter  ended May 31,  2002 Aura  became  aware of
     financial difficulties relative to one of its investments.  Aura recognized
     a $700,000  impairment  charge as the Company  concluded there was an other
     than temporary  decline in the value of the investment.  It is now recorded
     at its estimated fair market value of approximately $500,000.

6)       Significant Customers

          In the quarter ended May 31, 2002, the Company sold AuraGen(R) related
     products  to  four  significant  customers  for a  total  of  approximately
     $106,000 or 55% of net revenues. None of the above customers are related to
     or affiliated with the Company.

7)       Contingencies

          The Company is not presently engaged in any material  litigation.  See
     the  Company's  Form  10-K,  Item 3 Legal  Proceedings  for the year  ended
     February  28,  2002 as filed  with the SEC (file  number  000-17249)  for a
     further  discussion of the legal  activities.  In the case of a judgment or
     settlement,   appropriate  provisions  have  been  made  in  the  financial
     statements.  The following  are  summaries of changes in litigation  issues
     since February 28, 2002:

         Securities and Exchange Commission Settlement
          On June 11,  2002  the  Securities  and  Exchange  Commission  filed a
     settled  civil  enforcement  action in U.S.  District  Court in the Central
     District  of  California  against  Aura,  a former  subsidiary,  and former
     officers of both  companies.  The SEC settled action alleged  violations of
     the  anti-fraud  and books and records  provisions of the  securities  laws
     during Aura's 1997 and 1998 fiscal years (See Litigation Release No. 17557,
     SEC vs. Aura Systems,  Inc. et. al., USDC No. 02-4555 NM (MANx)). No person
     who is now an  employee,  officer or director of Aura Systems is alleged to
     have engaged in any  wrongdoing.  The settlement was without any penalty or
     fine imposed on Aura and will not require that Aura restate its financials.
     It did not include any admission of wrongdoing.  As part of the settlement,
     the court  papers  included a consent and  undertaking  and final  judgment
     reflecting  the  Company's   agreement  to  be  enjoined  from   committing
     securities  violations of the anti-fraud and books and records  provisions,
     thus ending the matter.  The Audit  Committee  of the Board will  conduct a
     full review of the Company's accounting controls and procedures.

         Other Legal Actions

          The Company is also engaged in other legal actions.  In the opinion of
     management  the  ultimate  resolution  of  these  matters  will  not have a
     material adverse effect on financial  conditions,  results of operations or
     cash flow.

8)       Subsequent Event

          In July  2002 the  Company  received  $500,000  from  two  significant
     shareholders in the form of a convertible note. The note is due in 180 days
     and carries an interest rate of 8% due at maturity.  Upon equity funding of
     at least $2 million prior to the note's maturity, the principal and accrued
     interest are convertible into common stock at $.11 per share or the average
     equity sale rate, whichever is less.


<PAGE>



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


         Overview

         This report may contain forward-looking statements, which involve risks
and  uncertainties.  The Company's actual results may differ materially from the
results  discussed in such  statements.  Certain factors could also cause actual
results  to differ  materially  from  those  discussed  in such  forward-looking
statements,  including  factors  discussed  in the  Company's  Form 10-K for the
period ended February 28, 2002, and factors discussed in this report.

         Results of Operations

     Net revenues for the quarter ended May 31, 2002  decreased to $183,739 from
$2,874,569 in the prior year quarter.  This  represents a decrease of $2,690,830
from the prior year comparable  quarter.  Revenues are lower because the Company
did not ship any significant  quantities to its  distributors as was done in the
prior year.  In addition,  revenue of $1.3 million was  recognized  in the prior
year first quarter relative to shipments made to CRS Emergency, which were later
returned.

     Cost of goods  decreased to $80,985 in the quarter  ended May 31, 2002 from
$1,440,623 in the quarter ended May 31, 2001, due to the decrease in sales noted
above. Cost of goods sold includes only the direct material costs incurred.

     Gross  margins  increased  to 56% from 50% in the prior  year  quarter as a
result of a combination of price increases and cost reductions for the Company's
products.  Margins  can vary  quarter to  quarter  as a result of  product  mix,
options and  accessories  purchased  and system  sales as opposed to  individual
component sales.

     Engineering  expenses  decreased by $1,204,515 to $1,096,770 in the quarter
ended May 31,  2002  from  $2,301,285  in the prior  year  fiscal  quarter.  The
decrease  was  primarily  due to the  elimination  of the tooling  depreciation.
Depreciation  and  amortization  for the  quarter  ended  May 31,  2001  totaled
$1,477,199  compared to $273,828 for the quarter  ended May 31, 2002.  In fiscal
2001,  the Company  reclassified  certain costs that had been  characterized  as
overhead  costs  and  included  in cost of goods.  These  items  were  primarily
engineering  and facility  related and have now been  classified as  engineering
expenses in the operating  expense  category.  This was done to more  accurately
reflect  the  actual  cost of the  product  sold  and  provide  a  gross  profit
presentation based on the sale of the product itself.

     Selling,  general and administrative  (SG&A) expenses decreased slightly to
$2,160,475  in the  quarter  ended May 31, 2002 from  $2,254,461  in the quarter
ended  May 31,  2001.  The SG&A  expenses  were  lower  due  primarily  to lower
litigation  expenses  incurred.  A majority of the lawsuits which existed in the
prior year have been settled or dismissed, thus requiring less in legal fees. In
addition,  sales and  marketing  costs were lower in the current  year  quarter.
Sales and marketing costs are expected to increase in the future. The lower SG&A
costs were  partially  offset by  consulting  expenses  incurred  for the former
management of the Company.

     Research and  development  expense  decreased  from $271,806 in the quarter
ended May 31, 2001 to $136,048 in the quarter  ended May 31, 2002.  In the prior
year the Company had expanded its efforts in  developing  variations of the 5 kW
AuraGen(R),  such as the 8.5 kW, 10 kW, 12.5 kW, and the inverter option. In the
current year, much of that initial  activity is complete,  and the headcount for
the R&D staff has been reduced.

     The Company recorded a gain of $399,189 on the sale of assets and a gain of
$1.2 million on the settlement with Deutsche  Financial  Services in the quarter
ended May 31, 2001 while there were no asset sales or other similar gains in the
quarter ended May 31, 2002.

     Other  income and  expense  for the  quarter  ended May 31,  2001  consists
primarily of  settlement of accounts  payable.  Other income and expense for the
quarter ended May 31, 2002 consists  primarily of the recognition of an impaired
investment,  reimbursement  of prior period legal expenses and sub-lease  rental
income.  In the  quarter  ended May 31, 2002 Aura  became  aware of  significant
financial  difficulties  relative to Algo  Technology,  Inc.  Aura  recognized a
$700,000  impairment  charge as the  Company  concluded  there is an other  than
temporary decline in the value of Algo Technologies,  Inc. The investment is now
recorded as its estimated fair market value of approximately $500,000.

     Net interest  expense for the quarter  ended May 31, 2002,  decreased  from
$405,533 to $82,234 in the current year quarter due to the continuing  reduction
in the debt level of the  Company.  Current  interest  income was  approximately
$52,000 primarily from the long-term note receivable.

     The Company  has  received  correspondence  from  Daewoo  Electronics  Co.,
Limited ("Daewoo") relative to its Technology License Agreement in the form of a
request  to  grant  transfer  of  the  License  to  a  major  public  industrial
corporation  in the Republic of South Korea.  The Technology  License  Agreement
between Aura and Daewoo provides for Aura's consent to any transfer and contains
rights to Aura in any sublicense.  The Company has had  preliminary  discussions
with Daewoo that could  possibly  affect  materially  the  Company's  results of
operations in subsequent reports.  However, no assurances can be given as to the
outcome of the  discussions or whether they will lead to  consummating a consent
or sublicense. The Company has previously reported that it had retained interest
in the Company's other proprietary technology besides the AuraGen, including its
Actuated  Mirror Array ("AMA"),  but that Daewoo had been in a financial  crisis
and negotiating about the future of the AMA technology.

         Financial Position, Liquidity and Capital Resources

         At May 31, 2002,  the Company had cash of  $1,099,471  as compared to a
cash level of  $1,143,396  at February  28,  2002.  Inventories  at May 31, 2002
decreased by $150,138 from February 28, 2002.

         Cash flows used in operations  decreased by $204,425 as compared to the
fiscal quarter ended May 31, 2001. The Company's  working capital was a negative
$1,314,740 at May 31, 2002,  as compared to a negative  $2,512,553 at the fiscal
year ended  February 28, 2002.  The Company  continues to focus on improving the
financial  position through cost control measures and by decreasing the long and
short-term  debt owed by Aura.  Aura  continues  to  implement  actions  for the
purpose of monetizing  non-operating assets in order to utilize the cash to fund
the operating, sales and marketing activities.

         In the fiscal  quarter ended May 31, 2002,  the Company  received gross
proceeds  of  $4,160,000  from the sale of  20,800,000  shares of the  Company's
common stock. The Company also satisfied  liabilities of  approximately  $92,140
through the issuance of 292,508 shares of common stock.

         In July  2002  the  Company  received  $500,000  from  two  significant
shareholders in the form of a convertible  note. The note is due in 180 days and
carries an interest rate of 8% due at maturity.  Upon equity funding of at least
$2 million prior to maturity,  the notes and accrued interest are convertible at
$.11 per share or the average equity sale rate, whichever is less.

         The cash flow generated  from the Company's  operations to date has not
been  sufficient  to fund its working  capital  needs,  and the Company does not
expect that operating  cash flow will be sufficient to fund its working  capital
needs in fiscal 2003.  In the past,  in order to maintain  liquidity the Company
has relied upon external sources of financing,  principally equity financing and
private  and bank  indebtedness.  The  Company  expects  to fund  any  operating
shortfall  in the  current  fiscal  year  from  cash on  hand  and  third  party
financings in order to continue its  operations.  Currently,  the Company has no
commitments from third parties to provide additional financing.  The Company has
no assurances  that third party funding will be available at the times or in the
amounts  required.   If  future  financing   involves  the  issuance  of  equity
securities, existing stockholders may suffer dilution in net tangible book value
per share.  The  limited  availability  of funds  could have a material  adverse
effect on the Company's  financial  statements,  results of  operations  and the
ability to continue or expand operations.

         For additional information regarding the Company's financial condition,
see the Company's  Form 10K, Item 7 -  Management's  Discussion  and Analysis of
Financial  Condition and Results of Operations  for the year ended  February 28,
2002 as filed with the SEC (file number 000-17249).

         Forward Looking Statements

         The Company wishes to caution readers that important  factors,  in some
cases,  have  affected,  and in the future could affect,  the  Company's  actual
results and could cause the Company's actual consolidated results for the second
quarter of Fiscal 2003, and beyond, to differ materially from those expressed in
any forward-looking statements made by, or on behalf of the Company.

         Such factors  include,  but are not limited to, the following risks and
contingencies:  changed business  conditions in the automotive  industry and the
overall  economy;   increased   marketing  and  manufacturing   competition  and
accompanying price pressures; inefficiencies,  delays and increased depreciation
costs in connection with the start of production in new plants and expansions.

         Relating  to the  above  are  potential  difficulties  or delays in the
development,  production,  testing and marketing of products, including, but not
limited to, a failure to ship new products and  technologies  when  anticipated.
There might exist a difficulty in obtaining raw materials,  supplies,  power and
natural  resources and any other items needed for the  production of Company and
other products,  creating capacity  constraints,  limiting the amounts of orders
for certain  products and thereby  causing  effects on the Company's  ability to
ship its  products.  Manufacturing  economies  may fail to develop when planned,
products  may be  defective  and/or  customers  may fail to  accept  them in the
consumer marketplace.

         In addition to the above,  risks and  contingencies may exist as to the
amount and rate of growth in the Company's  selling,  general and administrative
expenses,  and the impact of unusual items resulting from the Company's  ongoing
evaluation  of its business  strategies,  asset  valuations  and  organizational
structures.  Furthermore,  any  financing or other  financial  incentives by the
Company  under or  related to major  infrastructure  contracts  could  result in
increased  bad debt or other  expenses or  fluctuation  of profit  margins  from
period to period.  The focus by some of the  Company's  businesses  on any large
system order could entail fluctuating results from quarter to quarter.

         The effects of, and changes in,  trade,  monetary and fiscal  policies,
laws and  regulations,  other  activities of  governments,  agencies and similar
organizations,  and social and economic  conditions,  such as trade restrictions
impose  yet other  constraints  on any  Company  statements.  The cost and other
effects of legal and administrative  cases and proceedings impose another factor
which may or may not have an impact.



PART II - OTHER INFORMATION


Item 1:    Legal Proceedings

          For information regarding pending legal proceedings, see Note 7 to the
Company's  condensed   consolidated  financial  statements  appearing  elsewhere
herein.


Item 2:   Changes in Securities

          During the first  quarter of Fiscal  2003,  the  Company  conducted  a
private  offering to a group of  accredited  investors and two Directors for the
sale  of  20,800,000  shares  of  common  stock  for  total  gross  proceeds  of
approximately $4.16 million.

          During the first  quarter  of Fiscal  2003,  292,508  shares of common
stock were issued to a creditor for approximately $92,140 of liabilities.

          All  of the  foregoing  transactions  were  exempt  from  registration
pursuant to Section 4(2) of the Securities Act of 1933 as these offerings were a
private placement to a limited number of accredited investors.


Item 6:   Exhibits and Reports on Form 8-K

a)       Exhibits:
                  None
          b)    Reports on Form 8-K:
                  None



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                                   SIGNATURES




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







                                                   AURA SYSTEMS, INC.
                                      -----------------------------------------
                                                     (Registrant)






Date:         July 15, 2002             By:   /s/Steven M. Burdick
       ------------------------              -----------------------------
                                                 Steven M. Burdick
                                               Senior Vice President
                                              Chief Financial Officer
                                     (Principal Financial and Accounting Officer
                                            and Duly Authorized Officer)