FORM 10-QSB


                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C.  20549


(Mark One)

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

     For the quarterly period ended March 31, 2001

                                       OR

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


                        Commission file number 33-19598-D


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

              Nevada                             84-0992908
              ------                             ----------
 (State or other jurisdiction of               (I.R.S. Employer
  incorporation or organization)              Identification No.)

                       370 Seventeenth Street, Suite 3580
                             Denver, Colorado 80202
                    (Address of principal executive offices)

                    Issuer's telephone number: (303) 592-1010


     Indicate by check mark whether the issuer (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
                                               -----     -----


     As of May 7, 2001 there were 55,677,398 shares of the registrant's sole
class of common stock outstanding.


     Transitional Small Business Disclosure Format  Yes       No   X
                                                        -----    -----








<PAGE>




                  NANOPIERCE TECHNOLOGIES, INC. AND SUBSIDIARY
                                      INDEX


PART I - FINANCIAL INFORMATION

Item 1 - Financial Statements


                                                                      PAGE
                                                                      ----

     Independent Accountants' Report                                   F-2

     Condensed Consolidated Balance Sheet
          March 31, 2001                                               F-3

     Condensed Consolidated Statements of Operations -
          Three and nine months ended March 31, 2001 and 2000          F-4

     Condensed Consolidated Statements of Comprehensive
          Loss - Three and nine months ended
          March 31, 2001 and 2000                                      F-5

     Condensed Consolidated Statement of Stockholders'
          Equity (Deficit) - Nine months ended March 31, 2001          F-6

     Condensed Consolidated Statements of Cash Flows -
          Nine months ended March 31, 2001 and 2000                    F-7

     Notes to Condensed Consolidated Financial Statements              F-9


Item 2.  Management's Discussion and Analysis                            1


PART II - OTHER INFORMATION

Item 1.   Legal Proceedings                                              3

Item 2.   Changes in Securities                                          4

Item 6.   Exhibits and Reports on Form 8-K                               4


     SIGNATURES                                                          5


     LIST OF EXHIBITS                                                    6











                                        F-1

<PAGE>




                         INDEPENDENT ACCOUNTANTS' REPORT
                         -------------------------------



Board of Directors
Nanopierce Technologies, Inc.

We have reviewed the accompanying condensed consolidated balance sheet of
Nanopierce Technologies, Inc. and subsidiary as of March 31, 2001, the related
condensed consolidated statements of operations and comprehensive loss for the
three-month and nine-month periods ended March 31, 2001 and 2000, changes in
stockholders' equity (deficit) for the nine-month period ended March 31, 2001,
and cash flows for the nine-month periods ended March 31, 2001 and 2000.  These
condensed consolidated financial statements are the responsibility of the
Company's management.

We conducted our reviews in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data and making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the expression of an opinion regarding the financial statements taken as a
whole. Accordingly, we do not express such an opinion.

Based on our reviews, we are not aware of any material modifications that should
be made to the accompanying consolidated financial statements for them to be in
conformity with generally accepted accounting principles.


GELFOND HOCHSTADT PANGBURN, P.C.




Denver, Colorado
May 10, 2001






















                                        F-2

<PAGE>

                  NANOPIERCE TECHNOLOGIES, INC. AND SUBSIDIARY
                      Condensed Consolidated Balance Sheet
                                 March 31, 2001
                                   (Unaudited)
<TABLE>
<CAPTION>
                                 ASSETS
<S>                                                          <C>
Current assets:
  Cash and cash equivalents                                  $  4,391,352
  Accounts receivable                                              37,090
  Prepaid expenses                                                 98,016
                                                               ----------
    Total current assets                                        4,526,458
                                                               ----------
Property and equipment:
  Machinery                                                       172,546
  Office equipment and furniture                                  149,300
                                                               ----------
                                                                  321,846
  Less accumulated depreciation                               (    53,422)
                                                               ----------
                                                                  268,424
                                                               ----------
Other assets:
  Notes receivable                                                570,000
  Marketable securities                                               710
  Deposits and other                                               18,200
  Intellectual property rights, net of accumulated
    amortization of $309,315                                      690,685
  Patent applications                                              60,303
                                                               ----------
                                                                1,339,898
                                                               ----------
                                                             $  6,134,780
                                                               ==========
                         LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable                                           $     39,584
  Accrued liabilities                                              19,100
                                                               ----------
    Total liabilities - all current                                58,684
                                                               ----------
Commitments and contingencies
Stockholders' equity:
  Preferred stock, $0.0001 par value; 5,000,000
    shares authorized:
    Series A; no shares issued and outstanding
    Series B; maximum of 75,000 shares issuable; no
      shares issued and outstanding
    Series C; maximum of 700,000 shares issuable; no
      shares issued and outstanding
  Common stock, $0.0001 par value; 100,000,000 shares
    authorized; 52,552,398 shares issued and outstanding            5,255
  Additional paid-in capital                                   17,351,016
  Accumulated other comprehensive income                           14,173
  Accumulated deficit                                         (11,294,348)
                                                               ----------
               Total stockholders' equity                       6,076,096
                                                               ----------
                                                             $  6,134,780
                                                               ==========
<FN>
          See notes to the condensed consolidated financial statements.
</TABLE>
                                       F-3
<PAGE>


                  NANOPIERCE TECHNOLOGIES, INC. AND SUBSIDIARY
                 Condensed Consolidated Statements of Operations
               Three and Nine Months Ended March 31, 2001 and 2000
                                   (Unaudited)

<TABLE>
<CAPTION>

                                           Three Months Ended          Nine Months Ended
                                                March 31                    March 31
                                           ------------------          ------------------
                                           2001          2000          2001          2000
                                           ----          ----          ----          ----
<S>                                    <C>           <C>           <C>           <C>
Revenues                               $   14,848           -          94,277           -
                                         --------     ---------     ---------     ---------

Research and development expense           79,743           -         167,407           -
General and administrative expense        732,366       928,729     2,051,581     2,015,604
                                         --------     ---------     ---------     ---------

                                          812,109       928,729     2,218,988     2,015,604
                                         --------     ---------     ---------     ---------

Loss from operations                    ( 797,261)   (  928,729)   (2,124,711)   (2,015,604)
                                         --------     ---------     ---------     ---------

Other income (expenses):
 Interest income                           54,320         7,230       142,930         7,662
 Interest expense:
   Related party                        (     -  )   (    1,396)   (    2,087)   (    8,882)
   Other                                (     -  )   (  842,443)   (   30,449)   (  851,073)
                                         --------     ---------     ---------     ---------
                                           54,320    (  836,609)      110,394    (  852,293)
                                         --------     ---------     ---------     ---------

Loss before extraordinary item          ( 742,941)   (1,765,338)   (2,014,317)   (2,867,897)

Extraordinary loss on
 extinguishment of debt                 (     -  )   (      -  )   (  551,811)   (      -  )
                                         --------     ---------     ---------     ---------

Net loss                               $( 742,941)   (1,765,338)   (2,566,128)   (2,867,897)
                                         ========     =========     =========     =========

Net loss per share, basic
 and diluted:
   Loss from continuing
    operations                         $(     .01)   (      .05)   (      .05)   (      .09)
   Extraordinary loss                   (     .00)   (      .00)   (      .01)   (      .00)
                                         --------     ---------     ---------     ---------
     Net loss                          $(     .01)   (      .05)   (      .06)   (      .09)
                                         ========     =========     =========     =========

Weighted average number
 of common shares
 outstanding                           50,932,506    34,217,425    44,473,600    32,030,727
                                       ==========    ==========    ==========    ==========
<FN>
          See notes to the condensed consolidated financial statements
</TABLE>

                                       F-4

<PAGE>


                  NANOPIERCE TECHNOLOGIES, INC. AND SUBSIDIARY
             Condensed Consolidated Statements of Comprehensive Loss
               Three and Nine Months Ended March 31, 2001 and 2000
                                   (Unaudited)

<TABLE>
<CAPTION>

                                    Three Months Ended          Nine Months Ended
                                         March 31                    March 31
                                    ------------------          ------------------
                                    2001          2000          2001          2000
                                    ----          ----          ----          ----
<S>                             <C>           <C>           <C>           <C>

Net loss                        $( 742,941)   (1,765,338)   (2,566,128)   (2,867,897)

Change in unrealized
   gain on securities                   47         5,208    (    1,231)        6,154

Changes in foreign currency
   translation adjustments       (  15,580)   (   16,713)       15,937    (   16,713)
                                  --------     ---------     ---------     ---------

Comprehensive loss              $( 758,474)   (1,776,843)   (2,551,422)   (2,878,456)
                                  ========     =========     =========     =========

<FN>

          See notes to the condensed consolidated financial statements.

</TABLE>





























                                       F-5

<PAGE>



                  NANOPIERCE TECHNOLOGIES, INC. AND SUBSIDIARY
       Condensed Consolidated Statement of Stockholders' Equity (Deficit)
                        Nine Months Ended March 31, 2001
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                          Common stock          Additional
                                                       Shares       Amount    paid-in capital
                                                       ------       ------    ---------------
<S>                                                  <C>            <C>         <C>
Balances, July 1, 2000                               35,113,674     $ 3,511      8,673,504
Common stock issued for services                         36,000           4         82,112
Common stock and warrant issued for
  convertible debt and accrued interest               1,194,616         120      1,548,359
Common stock issued in connection
  with financing agreement:
  6,675,588 shares for $7,500,000 cash,
  9,532,520 shares upon cashless exercise
  of warrants, net of $507,989 of offering costs     16,208,108       1,620      6,990,391
Option issued for services                                  -           -           56,650
Net loss                                                    -           -              -
Other comprehensive income:
    Change in unrealized gain on securities                 -           -              -
    Foreign currency translation adjustments                -           -              -
                                                     ----------      ------     ----------
Balances, March 31, 2001                             52,552,398     $ 5,255     17,351,016
                                                     ==========      ======     ==========



                                                Accumulated other                        Total
                                                  comprehensive     Accumulated      stockholders'
                                                   income(loss)       deficit       equity(deficit)
                                                   ------------       -------       ---------------
<S>                                                  <C>           <C>                <C>
Balances, July 1, 2000                               (   533)      ( 8,728,220)       (   51,738)
Common stock issued for services                         -                 -              82,116
Common stock and warrant issued for
  convertible debt and accrued interest                  -                 -           1,548,479
Common stock issued in connection
  with financing agreement:
  6,675,588 shares for $7,500,000 cash,
  9,532,520 shares upon cashless exercise
  of warrants, net of $507,989 of offering costs         -                 -           6,992,011
Option issued for services                               -                 -              56,650
Net loss                                                 -         ( 2,566,128)       (2,566,128)
Other comprehensive income:
    Change in unrealized gain on securities          ( 1,231)              -          (    1,231)
    Foreign currency translation adjustments          15,937               -              15,937
                                                      ------        ----------         ---------
Balances, March 31, 2001                              14,173       (11,294,348)        6,076,096
                                                      ======        ==========         =========

<FN>

          See notes to the condensed consolidated financial statements.

</TABLE>



                                       F-6

<PAGE>


                  NANOPIERCE TECHNOLOGIES, INC. AND SUBSIDIARY
                 Condensed Consolidated Statements of Cash Flows
                    Nine Months Ended March 31, 2001 and 2000
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                      2001            2000
                                                                      ----            ----
<S>                                                              <C>              <C>
Cash flows from operating activities:
  Net loss                                                       $(2,566,128)     (2,867,897)
                                                                   ---------       ---------
  Adjustments to reconcile net loss to net cash used in
    operating activities:
      Amortization expense                                            75,000          75,000
      Depreciation expense                                            57,327           6,606
      Amortization of discount on debentures                           5,257             -
      Amortization of discount on note receivable and
        amortization of beneficial conversion feature                    -           698,622
      Expenses incurred in exchange for common
        stock, warrants and options                                  138,766         800,000
      Extraordinary loss in redemption of
        convertible debentures                                       551,811             -
    Changes in operating assets and liabilities:
      Increase in accounts receivable                             (   32,720)            -
      (Increase) decrease in prepaid expenses                     (   53,567)            428
      (Increase) decrease in deposits and other assets                 7,223      (   54,629)
      Decrease in accounts payable and accrued liabilities        (   61,715)     (    6,660)
      Decrease in deferred revenue                                (   16,822)            -
                                                                   ---------       ---------
  Total adjustments                                                  670,560       1,519,367
                                                                   ---------       ---------
Net cash used in operating activities                             (1,895,568)     (1,348,530)
                                                                   ---------       ---------
Cash flows from investing activities:
  Increase in notes receivable                                    (  570,000)     (   44,100)
  Increase in patent applications                                 (   60,303)            -
  Purchase of property and equipment                              (  158,124)     (   67,101)
  Payments received on notes receivable                                  -            54,100
                                                                   ---------       ---------
Net cash used in investing activities                             (  788,427)     (   57,101)
                                                                   ---------       ---------
Cash flows from financing activities:
  Proceeds from notes payable:
    Related party                                                        -             9,787
    Other                                                                -           285,749
  Proceeds from issuance of common stock                           6,992,011         332,750
  Proceeds from issuance of convertible
    debentures and warrants                                              -         4,000,000
  Proceeds from exercise of stock options and warrants                   -            49,920
  Redemption of convertible debentures                            (2,312,500)            -
  Payments on note payable                                        (   66,837)     (   83,513)
                                                                   ---------       ---------
Net cash provided by financing activities                          4,612,674       4,594,693
                                                                   ---------       ---------
Effect of exchange rate changes on cash and cash equivalents      (    3,620)     (   16,713)
                                                                   ---------       ---------
Net increase in cash and cash equivalents                          1,925,059       3,172,349
Cash and cash equivalents, beginning                               2,466,293             641
                                                                   ---------       ---------
Cash and cash equivalents, ending                                $ 4,391,352       3,172,990
                                                                   =========       =========
</TABLE>
                                   (Continued)
                                       F-7
<PAGE>


                  NANOPIERCE TECHNOLOGIES, INC. AND SUBSIDIARY
                 Condensed Consolidated Statements of Cash Flows
                    Nine Months Ended March 31, 2001 and 2000
                                   (Unaudited)
                                   (Continued)

<TABLE>
<CAPTION>

                                                                      2001            2000
                                                                      ----            ----
<S>                                                              <C>              <C>

Supplemental disclosure of cash flow information:
  Cash paid for interest                                         $    70,348           3,553
                                                                   =========       =========

Supplemental schedule of non-cash investing and financing activities:
  Conversion of debentures and accrued
    interest to common stock and warrant                         $ 1,548,479         298,067
                                                                   =========       =========
  Conversion of note payable, accrued interest and
    accounts payable to officers, to common stock                $       -           152,802
                                                                   =========       =========

<FN>

          See notes to the condensed consolidated financial statements.

</TABLE>































                                       F-8

<PAGE>



                          NANOPIERCE TECHNOLOGIES, INC.
              Notes to Condensed Consolidated Financial Statements
                    Nine Months Ended March 31, 2001 and 2000
                                   (Unaudited)


1.   Business, Organization and Summary of Significant Accounting Policies:


     Presentation of Interim Information:

     The accompanying condensed consolidated financial statements include the
     accounts of Nanopierce Technologies, Inc., a Nevada corporation (the
     Company), and its wholly owned foreign subsidiary, Nanopierce Card
     Technologies GmbH, Hohenbrunn (NCT), a German subsidiary, which was
     incorporated on January 19, 2000.  All significant intercompany accounts
     and transactions have been eliminated in consolidation.  NCT activities
     through March 31, 2001 consist primarily of administrative and research and
     development activities.

     In the opinion of the management of the Company, the accompanying unaudited
     condensed consolidated financial statements include all material
     adjustments, including all normal recurring adjustments, considered
     necessary to present fairly the financial position and operating results
     for the periods presented.  The financial statements and notes are
     presented as permitted by Form 10-QSB, and do not contain certain
     information included in the Company's last Annual Report on Form 10-KSB for
     the fiscal year ended June 30, 2000.  It is management's opinion that, when
     the interim statements are read in conjunction with the June 30, 2000
     Annual Report on Form 10-KSB, the disclosures are adequate to make the
     information presented not misleading.  Interim results are not necessarily
     indicative of results for a full year or any future period.

     The accompanying consolidated financial statements have been prepared on a
     going concern basis, which contemplates the realization of assets and the
     settlement of liabilities and commitments in the normal course of business.
     For the period ended March 31, 2001, the Company reported a net loss of
     $2,566,128 and an accumulated deficit of $11,294,348.  The Company has not
     recognized any significant revenues from its PI technology and expects to
     incur continued cash outflows.  The Company has also experienced difficulty
     and uncertainty in meeting its liquidity needs in prior periods.  These
     factors raise substantial doubt about the Company's ability to continue as
     a going concern.  The financial statements do not include any adjustments
     relating to the recoverability and classification of assets or the amounts
     and classification of liabilities that might be necessary should the
     Company be unable to continue as a going concern.

     To address its current cash flow concerns, in October, 2000 the Company
     entered into an agreement for equity financing, and the Company received
     $7,500,000 in cash (Note 4).  The Company believes that with the $7,500,000
     received in the October 2000 financing, adequate funding is available to
     support operations for the next twelve months.  The Company also believes
     that sales of its products and technology license rights may provide
     additional funds to meet the Company's capital requirements.

     Currently, the Company does not have a revolving loan agreement with any
     financial institution, nor can the Company provide any assurance that it
     will be able to enter into any such agreement in the future, or be able to
     raise funds through a further issuance of debt or equity in the Company.


                                       F-9

<PAGE>


                          NANOPIERCE TECHNOLOGIES, INC.
              Notes to Condensed Consolidated Financial Statements
                    Nine Months Ended March 31, 2001 and 2000
                                   (Unaudited)

     Business:

     The Company is engaged in the design, development and licensing of products
     using its intellectual property, the PI Technology.  The PI Technology
     consists of patents, pending patent applications, patent applications in
     preparation, trade secrets, trade names, and trademarks.  The PI Technology
     improves electrical, thermal and mechanical characteristics of electronic
     products.  The Company has designated and is commercializing its PI
     Technology as the Nanopierce Connection System (NCS) and markets the PI
     Technology to companies in various industries for a wide range of
     applications.

     Product and Process Technology:

     Costs related to the PI Technology (intellectual property) are being
     amortized to expense using the straight-line method over 10 years.

     Costs incurred to establish patents are capitalized and will be amortized
     when the patent is granted over the shorter of the estimated useful life of
     the technology or the patent term.

     Property and Equipment:

     Property and equipment are stated at cost.  Depreciation expense is
     provided by use of the accelerated and straight-line methods over the
     estimated useful lives of the assets, generally 3 to 10 years for
     machinery, office equipment and furniture.

     Business Risk:

     The Company is subject to risks and uncertainties common to
     technology-based companies, including rapid technological change,
     dependence on principle products and third party technology, new product
     introductions and other activities of competitors, dependence on key
     personnel, and limited operating history.

     International Operations:

     The Company's subsidiary (NCT) operations are located in Germany.  NCT
     transactions are conducted in currencies other than the U.S. dollar (the
     currency into which NCT's historical financial statements have been
     translated) primarily the Euro.  As a result, the Company is exposed to
     adverse movements in foreign currency exchange rates.  In addition, the
     Company is subject to risks including adverse developments in the foreign
     political and economic environment, trade barriers, managing foreign
     operations and potentially adverse tax consequences.  There can be no
     assurance that any of these factors will not have a material adverse effect
     on the Company's financial condition or results of operations in the
     future.

     Use of Estimates in the Financial Statements:

     The preparation of financial statements in conformity with generally
     accepted accounting principles requires management to make estimates and
     assumptions that affect the reported amounts of assets and liabilities and
     disclosure of contingent assets and liabilities at the date of the
     financial statements and the reported amounts of revenues and expenses
     during the reporting periods.  Actual results could differ from those
     estimates.
                                       F-10
<PAGE>


                          NANOPIERCE TECHNOLOGIES, INC.
              Notes to Condensed Consolidated Financial Statements
                    Nine Months Ended March 31, 2001 and 2000
                                   (Unaudited)

     Revenue Recognition:

     Revenues from the sale of services, products or product licenses are
     generally recorded at the time of delivery to the customer and when no
     significant obligations remain related to implementation.  Revenues are
     deferred if significant future obligations are to be fulfilled or if
     collection is not probable.

     Research and Development:

     Research and development costs are expensed as incurred.

     Foreign Currency Translation:

     The financial statements of the Company's foreign subsidiary are measured
     using the local currency (the Euro) as the functional currency.  Assets and
     liabilities of the subsidiary are translated at exchange rates as of the
     balance sheet date.  Revenues and expenses are translated at average rates
     of exchange in effect during the period.  The resulting cumulative
     translation adjustments have been recorded as a component of comprehensive
     income (loss), included as a separate item in shareholders' equity.

     Foreign Currency Transactions:

     Gains and losses from foreign currency transactions are included in net
     income (loss).  Foreign currency transaction gains and losses were not
     significant during the periods ended March 31, 2001 and 2000.

     Loss Per Share:

     Statement of Financial Accounting Standards (SFAS) No. 128, Earnings per
     Share, requires dual presentation of basic and diluted earnings or loss per
     share (EPS) with a reconciliation of the numerator and denominator of the
     basic EPS computation to the numerator and denominator of the diluted EPS
     computation.  Basic EPS excludes dilution.  Diluted EPS reflects the
     potential dilution that could occur if securities or other contracts to
     issue common stock were exercised or converted into common stock or
     resulted in the issuance of common stock that then shared in the earnings
     of the entity.

     Loss per share of common stock is computed based on the average number of
     common shares outstanding during the period.  Stock options, warrants, and
     convertible preferred stock are not considered in the calculation, as the
     impact of the potential common shares (8,727,661 shares at March 31, 2001
     (Note 6) and 18,034,713 shares at March 31, 2000) would be to decrease loss
     per share.  Therefore, diluted loss per share is equivalent to basic loss
     per share.  The potential common shares at March 31, 2001 do not include
     any additional shares that may be contingently due under the financing
     agreement described in Note 4 since any such contingent shares would be
     antidilutive.

     Reclassification:

     Certain amounts reported in the 2000 financial statements have been
     reclassified to conform with the 2001 presentation.

                                      F-11

<PAGE>



                          NANOPIERCE TECHNOLOGIES, INC.
              Notes to Condensed Consolidated Financial Statements
                    Nine Months Ended March 31, 2001 and 2000
                                   (Unaudited)

2.   Notes Receivable:

     During the three months ended March 31, 2001 the Company loaned $500,000 to
     an unrelated third party - Global Capital Partners Inc. ("Global").  The
     note bears interest at 12%, is secured by 750,000 shares of Nanopierce
     Technologies, Inc. stock and is due on May 14, 2001.  As additional
     consideration, Global also agreed to issue 25,000 shares of Global's
     restricted common stock to the Company.  Due to the lack of marketability
     no value was placed on the 25,000 shares.

     During the three months ended March 31, 2001 the Company loaned $70,000 to
     Intercell Corporation, an affiliate of the Company.  The loan is unsecured,
     bears interest at 5.75% per annum, and is due on demand.

3.   Note Payable - Related Party:

     In October 2000 the Company paid a note payable of $66,837 plus accrued
     interest of $10,455 to a related party.

4.   Common Stock, Stock Options, Warrants and Convertible Debentures:

     Financing agreement:

     In October 2000, the Company entered into a $15,000,000 equity financing
     agreement with a third party.  Under the first installment of the
     agreement, the Company received $7,500,000 cash, net of $507,989 in
     offering costs, in exchange for 4,531,613 shares of the Company's common
     stock (approximately $1.66 per share, before offering costs), a warrant
     ("the Initial Warrant") to purchase an additional 453,161 shares of the
     Company's common stock, and a separate warrant to purchase shares of the
     Company's common stock ("the Vesting Warrant").  The $1.66 per share amount
     was based upon 80% of the average market price of the Company's common
     stock prior to the closing, as defined in the agreement.  The Initial
     Warrant is exercisable immediately through October 2005 at an exercise
     price of $2.586 per share.  Under the Vesting Warrant, on defined dates,
     the warrant shall vest with respect to a defined number of shares that are
     exercisable at $0.001 per share immediately and through October 2005.  The
     defined dates are the 65th, 130th, and 195th trading days following the
     closing of the $7,500,000 transaction.  The defined number of shares is
     equal to one-third of the initial shares (4,531,613) multiplied by an
     amount equal to the initial purchase price multiplied by an initial
     percentage (the initial percentage is equal to 115%, 125% and 140% from the
     65th, 130th, and 190th days, respectively, from the initial closing date),
     less the reset price, which is equal to the average market value of the
     Company's common stock at those dates.  This amount is then divided by the
     reset price and equals the number of shares issuable under the Vesting
     Warrant.  For the 65th trading day, 2,143,975 shares were issued in March,
     2001 for the first one-third installment under the vesting warrant.  On the
     130th trading day, the companies and individuals that provided the equity
     financing have stated that 7,418,895 shares are due for the second
     one-third installment under the vesting warrant.  As described in Note 6,
     the Company does not intend to issue the shares and on April 27, 2001 the
     Company filed suit against the companies and individuals that provided the
     equity financing (Note 6).  As a result of the suit filed by the Company,
     management does not believe that the second installment of the equity
     financing will be completed.

                                      F-12

<PAGE>


                          NANOPIERCE TECHNOLOGIES, INC.
              Notes to Condensed Consolidated Financial Statements
                    Nine Months Ended March 31, 2001 and 2000
                                   (Unaudited)


     In order to close the financing, the third party investor required the
     Company to cause the holders of an existing option to purchase up to
     10,000,000 shares of the Company's common stock, to immediately exercise
     the options and also required the Company to cause the option holders to
     agree to restrictions on the sale and use of the 10,000,000 shares for a
     defined time period.  The option holders agreed to these terms in exchange
     for a reduction in the exercise price to purchase 10,000,000 shares of
     common stock from $.51 to $.25 per share.  The warrants were exercised by
     applying a $1,350,000 commission due to the option holders on the
     $15,000,000 financing and in part through a cash-less exercise.  A net
     9,532,520 shares of common stock were issued for the warrants in October
     2000.

     Convertible debentures:

     During the nine months ended March 31, 2001, the Company issued 1,194,616
     shares of common stock in exchange for $1,431,633 of convertible debentures
     and $48,296 of accrued interest on the convertible debentures.  The
     remaining $1,850,000 of convertible debentures (having a carrying value of
     $1,829,239, net of unamortized discount) and accrued interest of $59,878
     were redeemed, at a 25% premium, for cash of $2,372,378, and in exchange
     for an additional warrant to purchase up to 50,000 shares of the Company's
     common stock at an exercise price of $2.17 per share (the market value of
     the Company's common stock at the date of grant).  The warrant was valued
     at $68,550 using the Black-Scholes pricing model.  The value of the warrant
     and premium on redemption of the convertible debentures resulted in a loss
     on extinguishment of debt of $551,811 (accounted for as an extraordinary
     loss in accordance with SFAS No. 4).  Under the debenture agreement, the
     debentures were convertible at the lessor of $2.915 or 80% of the average
     of the three lowest daily closing bid prices of the Company's common stock
     during the 30 trading days immediately preceding the date on which the
     holder elected to convert the debentures.  During the nine months ended
     March 31, 2001, the conversion rate for those transactions was
     approximately $1.24 per share.

     Other:

     During the nine months ended March 31, 2001, the Company issued 36,000
     shares of common stock to third parties in exchange for services valued at
     $82,116, based on the quoted market price of the Company's common stock on
     the date the services were performed.  In addition, the Company granted
     stock options to purchase 1,970,000 shares of common stock at exercise
     prices of $1.625 to $2.375 per share to employees and directors of the
     Company.  The options exercise prices were based upon the quoted market
     prices of the Company's common stock on the dates of grant.  The stock
     options expire in the year 2010.  Subsequent to March 31, 2001, the Company
     issued 3,125,000 shares of common stock, to be held in escrow as a retainer
     for services to be performed.

     In September, 2000 the Company issued a stock option to purchase 50,000
     shares of common stock at $3.00 per share for services received from a
     third party.  The stock option expires on December 31, 2002.  The option
     was valued at $56,650 using the Black-Scholes pricing model, and that
     expense was charged to general and administrative expense.

                                      F-13

<PAGE>



                          NANOPIERCE TECHNOLOGIES, INC.
              Notes to Condensed Consolidated Financial Statements
                    Nine Months Ended March 31, 2001 and 2000
                                   (Unaudited)


5.   License Agreements:

     The Company has license agreements with third parties, which allow the
     third parties to utilize defined aspects of the intellectual property
     rights in return for royalty fees.  All but two license agreements are
     idle.  Royalties and maintenance payments from the two license agreements
     have been held in an escrow account, outside of the Company's control,
     pending the resolution of certain legal issues.  On November 30, 1999, the
     Company obtained a Court Order of Declaratory Judgment that it has
     incontestable and exclusive ownership of all patents, patent applications,
     licenses, trade names, trademarks, trade secrets and other intellectual
     properties relating to the PI Technology.  As part of the Court Order, the
     original inventor of the technology is to receive all accrued and future
     royalty payments from the licenses which were outstanding as of
     September 3, 1996.  The Company also granted to the original inventor of
     the technology a two-year, royalty bearing, non-exclusive license to use
     the PI Technology for certain specified applications.  The Company has not
     recorded any receivables or revenues associated with the accrued royalty
     payments on licenses which were outstanding as of September 3, 1996.  The
     original inventor filed a Motion of Appeal on March 29, 2000 regarding the
     Declaratory Judgment.  In January 2001, the Colorado Court of Appeals
     ordered that the case be remanded to the district court for the limited
     purpose of determining whether the original inventor has waived his right
     to appeal, or whether the appeal has become moot, by reason of appellant's
     having accepted benefits under the order and judgment that are the subject
     of the appeal.  On April 23, 2001 the District Court Judge signed an order
     that the original inventor has waived his right to appeal.  The Company
     believes that the resolution of this litigation will not have a material
     adverse impact on either results of operations, financial position, or cash
     flows.

6.   Financing Agreement Suit:

     On April 27, 2001 the Company filed an action in the United States District
     Court in and for the District of Colorado, against Harvest Court, LLC,
     Southridge Capital Investments, LLC, Daniel Pickett, Patricia Singer and
     Thompson Kernaghan, of Toronto (Canada)(collectively, the "Defendants").

     The suit alleges among other things, that the Defendants have violated
     Sections 10 and 20 of the Securities and Exchange Act of 1934 (the "Act"),
     violations of anti-fraud and controlling persons of the Colorado Securities
     Act, aiding and abetting violations of the Colorado Securities Act, common
     law fraud and civil conspiracy and seek Declaratory Judgment against the
     Defendants.

     The Company is seeking various forms of relief from the Defendants,
     including an accounting, a declaratory judgment, actual damages of at least
     $190,000,000 due to the decline in the market value of the Company's common
     stock caused by the actions of the Defendants and exemplary and treble
     damages.

     On May 7, 2001, Harvest Court, LLC filed suit against the Company in the
     Supreme Court of the State of New York, County of New York.  The suit
     alleges that the Company has breached the October 20, 2000 Purchase
     Agreement, by not issuing 7,418,895 free trading shares of the Company's
     common stock in connection with the reset provisions of the Purchase
     Agreement.
                                      F-14
<PAGE>


                          NANOPIERCE TECHNOLOGIES, INC.
              Notes to Condensed Consolidated Financial Statements
                    Nine Months Ended March 31, 2001 and 2000
                                   (Unaudited)


     Harvest Court is seeking the delivery of the 7,418,895 free trading shares
     of the Company's common stock and other unspecified damages.


7.   Foreign and Domestic Operations:

     Operating results and long-lived assets as of and for the periods ended
     March 31, 2001 and 2000, by geographic area, are presented in the table
     below.  There were no significant amounts of transfers between geographic
     areas.

<TABLE>
<CAPTION>

                                          Three Months Ended    Nine Months Ended
                                               March 31              March 31
                                          ------------------    -----------------
                                           2001       2000       2001       2000
                                           ----       ----       ----       ----

<S>                                      <C>          <C>        <C>        <C>

          Revenues:
            United States                $    -          -          -          -
            Germany                        14,848        -       94,277        -
                                           ------     ------     ------     ------

            Total                        $ 14,848        -       94,277        -
                                           ======     ======     ======     ======


          Long-lived assets at
            March 31, 2001:
              United States                           $ 1,001,200
              Germany                                      18,212
                                                        ---------

              Total                                   $ 1,019,412
                                                        =========

</TABLE>














                                      F-15

<PAGE>



Item 2 - Management's Discussion and Analysis


     The statements contained in this Form 10-QSB, if not historical, are
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995, and involve risks and uncertainties that could
cause actual results to differ materially from the results, financial or
otherwise, or other expectations described in such forward-looking statements.
Any forward-looking statement or statements speak only as of the date on which
such statements were made, and the Company undertakes no obligation to update
any forward-looking statement to reflect events or circumstances after the date
on which such statements are made or reflect the occurrence of unanticipated
events.  Therefore, forward-looking statements should not be relied upon as
prediction of actual future results.

     The independent auditors' report on the Company's financial statements as
of June 30, 2000, and for each of the years in the two-year period then ended
includes a "going concern" explanatory paragraph, that describes substantial
doubt about the Company's ability to continue as a going concern.  Management's
plans in regard to the factors prompting the explanatory paragraph are discussed
below and also in Note 2 of the audited financial statements contained in the
Company's Annual Report on Form 10-KSB for the fiscal year ended June 30, 2000.


Results of operations

     The Company recognized revenues of $14,848 for the three months ended March
31, 2001, and $94,277 for the nine months ended March 31, 2001.  The revenues
were from work on various contracts to provide consulting services and software
development assistance to third parties by the Company's German subsidiary,
Nanocard Technologies, GmbH ("Nanocard").  During the three months and nine
months ended March 31, 2000 the Company had no revenues.

     Research and development expense was $79,743 for the three months ended
March 31, 2001 and $167,407 for the nine months ended March 31, 2001.  The
Company had no research and development expense in the three and nine months
ended March 31, 2000.

     General and administrative expenses increased to $2,051,581 for the nine
months ended March 31, 2001, from $2,015,604 for the nine months ended March 31,
2000, and decreased to $732,366 for the three months ended March 31, 2001 from
$928,729 for the three months ended March 31, 2000.  This increase for the nine
months ended March 31, 2001 can be attributed to among other things, the
increased operations of both the facility in Colorado Springs and the facility
in Germany and the hiring of additional employees to support operations.  The
increase in expenses can further be attributed to an increase in legal fees due
to the increase in the number of Securities and Exchange Commission filings.
The increases are offset by a reduction of financing costs.  The decrease for
the three months ended March 31, 2001 can be attributed primarily to a decrease
in financing costs of approximately $458,000 offset by the increase in the cost
of operations of the Company's facilities in Colorado and Germany.

     Interest income increased due to the increase in the amount of cash
invested in interest bearing accounts.

     Interest expense decreased as a result of the redemption and conversion of
the convertible debentures.

     The Company recorded an extraordinary loss of $551,811 during the nine
months ended March 31, 2001 as a result of the Company's redemption of its
convertible debt.

                                        1

<PAGE>


     The Company incurred a net loss of $2,566,128 for the nine months ended
March 31, 2001 compared to a net loss of $2,867,897 for the nine months ended
March 31, 2000.  The decrease in the net loss is primarily due to the decrease
in interest expense described above offset by the extraordinary loss of $551,811
described above and the increase in research and development expense.


Liquidity and financial condition

     The Company's current operations are not generating positive cash flows.
In order to meet operating needs the Company, in October 2000 completed the
first installment of a $15 million dollar equity financing.  The Company
received the first installment of $7,500,000 and in return issued 4,531,613 of
its common shares to the investor and granted certain options to the investor.
As a result of a suit filed by the Company in April, 2001, management does not
believe that the second installment of this equity financing will be completed.

     During October 2000, the Company redeemed for cash the remaining $1,850,000
outstanding convertible debentures of the $4 million financing completed in
January 2000.  In addition to the outstanding principal the Company also paid
$59,878 in interest, a premium of $462,500 and issue a warrant to purchase up to
50,000 shares of the Company's common stock at a exercise price of $2.17 per
share.  In addition, the Company paid in full the outstanding note payable and
accrued interest of $77,292 payable to a related party.

     During the three months ended March 31, 2001 the Company loaned $500,000 to
an unrelated third party - Global Capital Partners Inc. ("Global").  The note
bears interest at 12%, is secured by 750,000 shares of Nanopierce Technologies,
Inc. stock and is due on May 14, 2001.  As additional consideration, Global also
agreed to issue 25,000 shares of Global's restricted common stock to the
Company.  Due to the lack of marketability no value was placed on the 25,000
shares.

     During the three months ended March 31, 2001 the Company loaned $70,000 to
Intercell Corporation, an affiliate of the Company.  The loan is unsecured,
bears interest at 5.75% per annum, and is due on demand.

     The Company, in the spring of 1999, signed various agreements with
companies both overseas and in the states.  The agreements are to apply the
Company's NCS (Nanopierce Connection System) technology to various products,
mainly in the smart card/smart label industry.  Management is pursuing the
development of further similar agreements both nationally and internationally
with companies not only in the smart card/smart label industry, but other
industries, as well.  Further, the Company is working to advance the agreements
already in place.

     The Company is continuing to look for additional financing through
marketing of its NCS though the pursuit of licensing, joint ventures,
co-manufacturing or other similar arrangements with industry partners.  The
failure to secure such a relationship will result in the Company requiring
substantial additional capital and resources to bring its NCS to market.  To the
extent the Company's operations are not sufficient to fund the Company's capital
requirements, the Company may enter into a revolving loan agreement with
financial institutions or attempt to raise capital through the sale of
additional capital stock or through the issuance of debt.  At the present time
the Company does not have a revolving loan agreement with any financial
institution nor can the Company provide any assurance that it will be able to
enter into any such agreement in the future or be able to raise funds through
the further issuance of debt or equity in the Company.  The Company continues to
evaluate additional merger and acquisition opportunities.

                                        2

<PAGE>



Recently issued accounting pronouncement:

     In June 1998, the Financial Accounting Standard Board (FASB) issued SFAS
No. 133, Accounting for Derivative Instruments and Hedging Activities.  This
statement, as amended, is effective for fiscal years beginning after June 15,
2000.  Currently, the Company does not have any derivative financial instruments
and does not participate in hedging activities; therefore, SFAS No. 133 will not
impact the Company's financial statements.

     In December 1999, the staff of the Securities and Exchange Commission
issued Staff Accounting Bulletin ("SAB") No. 101, Revenue Recognition in
Financial Statements.  SAB No. 101, as amended by SSAB No. 101A and SAB
No. 101B, is effective no later than the fourth fiscal quarter of fiscal years
beginning after December 15, 1999.  SAB No. 101 provides the staff's views in
applying generally accepted accounting principles to selected revenue
recognition issues.  Currently, the Company believes that it complies with the
accounting and disclosure described in SAB No. 101; therefore, management
believes that SAB No. 101 will not impact the Company's financial statements.


                           PART II - OTHER INFORMATION


Item 1 - Legal Proceedings


     The Company and Louis DiFrancesco, the inventor of the PI Technology, were
involved in litigation relating to the Company's ownership of its intellectual
property and the rights as to whom should receive royalty payments from
licenses, which were outstanding as of September 3, 1996.  On November 30, 1999,
the Company obtained a Court Order of Declaratory Judgment that it has
incontestable and exclusive ownership of all patents, patent applications,
licenses, trade names, trademarks, trade secrets and other intellectual
properties relating to the PI Technology.  As part of the Court Order, Mr.
DiFrancesco is to receive all accrued and future royalty payments from the
licenses, which were outstanding as of September 3, 1996.  The Company also
granted to Mr. DiFrancesco a two-year royalty bearing, non-exclusive license to
use the PI Technology for certain specified applications.  Mr. DiFrancesco filed
an Appeal on March 28, 2000 with the Colorado Court of Appeals regarding the
Declaratory Judgment.  The Colorado Court of Appeals ordered that the case is
remanded to the district court for the limited purpose of determining whether
Mr. DiFrancesco has waived his right to appeal, or whether the appeal has become
moot, by reason of appellant's having accepted benefits under the order and
judgment that are the subject of the appeal.  On April 23, 2001 the District
Judge signed an order that Mr. DiFrancesco has waived his right to appeal.

     On April 27, 2001 the Company filed an action in the United States District
Court in and for the District of Colorado, against Harvest Court, LLC,
Southridge Capital Investments, LLC, Daniel Pickett, Patricia Singer and
Thompson Kernaghan, of Toronto (Canada)(collectively, the "Defendants").  The
suit alleges among other things, that the Defendants have violated Sections 10
and 20 of the Securities and Exchange Act of 1934 (the "Act"), violations of
anti-fraud and controlling persons of the Colorado Securities Act, aiding and
abetting violations of the Colorado Securities Act, common law fraud and civil
conspiracy and seek Declaratory Judgment against the Defendants.  The Company is
seeking various forms of relief from the Defendants, including an accounting, a
declaratory judgment, actual damages of at least $190,000,000 due to the decline
in the market value of the Company's common stock caused by the actions of the
Defendants and exemplary and treble damages.


                                        3

<PAGE>



     On May 7, 2001, Harvest Court, LLC filed suit against the Company in the
Supreme Court of the State of New York, County of New York.  The suit alleges
that the Company has breached the October 20, 2001 Purchase Agreement, by not
issuing 7,418,895 free trading shares of the Company's common stock in
connection with the reset provisions of the Purchase Agreement.  Harvest Court
is seeking the delivery of the 7,418,895 free trading shares of the Company's
common stock and other unspecified damages.


Item 2 - Changes in Securities


     None


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


     (a)  Exhibits:

     Exhibit 11  Computation of Net Loss Per Share

     (b)  Reports:

      None




































                                        4

<PAGE>



                                   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.


                                      NANOPIERCE TECHNOLOGIES, INC.
                                      (Registrant)


May 14, 2001                         /s/  Paul H. Metzinger
                                     ----------------------------------
                                     Paul H. Metzinger, President & CEO


May 14, 2001                         /s/  Kristi J. Kampmann
                                     -------------------------------------------
                                     Kristi J. Kampmann, Chief Financial Officer










































                                        5

<PAGE>



                                LIST OF EXHIBITS


Exhibit 11   Computation of Net Loss Per Share













































                                        6