                   SECURITIES AND EXCHANGE COMMISSION
                         WASHINGTON, D.C. 20549
                            _________________
                                Form 10-K
                            _________________
(Mark One)
    X     ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
             SECURITIES EXCHANGE ACT OF 1934 (FEE REQUIRED)
                For the fiscal year ended March 31, 2002
                                   OR
          TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
          THE SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
     For the transition period from _______________ to _____________

                     commission file number 0-11720

                               Air T, Inc.
         (Exact name of registrant as specified in its charter)


         Delaware                                   52-1206400
(State or other jurisdiction of
 incorporation or organization)   (I.R.S. Employer Identification No.)

         3524 Airport Road
      Maiden, North Carolina                             28650
(Address of principal executive offices)               (Zip Code)

                             (704) 377-2109
           (Registrant's telephone number, including area code)


    SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:  NONE
       SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
                      Common Stock, par value  $.25 per share
                            (Title of Class)
                           __________________
     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 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 by check mark if disclosure of delinquent filers pursuant
to  Item 405 of Regulation S-K is not contained herein, and will not  be
contained, to the best of registrant's knowledge, in definitive proxy or
information  statements incorporated by reference in Part  III  of  this
Form 10-K or any amendment to this Form 10-K.  [X]

     The aggregate market value of voting stock held by non-affiliates
of the registrant as of June 5, 2002, computed by reference to the
average of the closing bid and asked prices for such stock on such date,
was $2,723,997.  As of the same date, 2,724,320 shares of Common Stock
were outstanding.


                                 PART I

Item 1.   Business.

     Air T, Inc., incorporated under the laws of the State of Delaware
in 1980 (the "Company"), operates in three industry segments, providing
overnight air cargo services to the air express delivery industry
through its wholly owned subsidiaries, Mountain Air Cargo, Inc. ("MAC")
and CSA Air, Inc. ("CSA"), aviation related parts brokerage and overhaul
services through its wholly owned subsidiary, Mountain Aircraft
Services, LLC ("MAS"), and aviation ground support equipment products
through its wholly owned subsidiary, Global Ground Support, LLC
("Global").  For the fiscal year ended March 31, 2002 the Company's air
cargo services through MAC and CSA accounted for approximately 41.2% of
the Company's consolidated revenues, aircraft deice and other ground
support equipment products through Global accounted for 42.8% of
consolidated revenues and aviation related parts brokerage and overhaul
services through MAS accounted for 16.0% of consolidated revenues.  The
Company's air cargo services are provided exclusively to one customer --
Federal Express Corporation ("Federal Express").  Revenues from
contracts with Federal Express accounted for approximately 41.2% of the
Company's consolidated revenues for the year ended March 31, 2002.
Certain financial data with respect to the Company's overnight air
cargo, aviation services and ground support equipment segments are set
forth in Note 15 of Notes to Consolidated Financial Statements included
under Part II, Item 8 of this report.  Such data are incorporated herein
by reference.

     The principal place of business of the Company and MAC is Maiden,
North Carolina; the principal places of business of CSA, MAS and Global
are, respectively: Iron Mountain, Michigan; Kinston, North Carolina; and
Olathe, Kansas.

Diversification and Acquisition.

     In October 1993, the Company organized MAS to diversify its
customer base and business mix.  MAS provides aircraft maintenance,
parts and other aviation related services to the commercial and military
aviation industries.  MAS is organized as a limited liability company
100% owned by Air T.

     In  August 1997, the Company organized Global to acquire the  Simon
Deicer  Division of Terex Aviation Ground Equipment, and the acquisition
was  completed  that  month.  Global is located in  Olathe,  Kansas  and
manufactures, sells and services aircraft ground support equipment  sold
to  domestic and international passenger and cargo airlines, as well  as
to  airports.   During  the fiscal year ended  March  31,  2000,  Global
diversified  its product line to include additional models  of  aircraft
deicers  and scissor-lift ground support equipment.  Global is organized
as a limited liability company 100% owned by Air T.

     The organization of MAS and Global reflects the Company's strategy
to diversify its operations within the aviation industry to reduce its
dependence on the air cargo service segment.

Overnight Air Cargo Services.

     MAC and CSA provide small package overnight air freight delivery
services on a contract basis throughout the eastern half of the United
States and Canada, and in Puerto Rico and the U.S. Virgin Islands.  MAC
and CSA's revenues are derived principally pursuant to "dry-lease"
service contracts.  Under the dry-lease service contracts, the customer
leases its aircraft to MAC (or CSA) for a nominal amount and pays an
administrative fee to MAC (or CSA).  Under these arrangements, all
direct costs related to the operation of the aircraft (including fuel,
maintenance, landing fees and pilot costs) are passed through to the
customer.  For the most recent fiscal year, operations under dry-lease
service contracts accounted for 98.0% of MAC and CSA's revenues (41.2%
of the Company's consolidated revenues).

     For the fiscal year ended March 31, 2002, MAC and CSA provided air
delivery service exclusively to Federal Express.  As of March 31, 2002,
MAC and CSA operated an aggregate of 95 aircraft under agreements with
Federal Express.  Separate agreements cover the three types of aircraft
operated by MAC and CSA for Federal Express -- Cessna Caravan, Fokker F-
27 and Short Brothers SD3-30.  Cessna Caravan and Fokker F-27 aircraft
are dry-leased from Federal Express, and Short Brothers SD3-30 aircraft
are owned by the Company and operated under "wet-lease" arrangements
with Federal Express which provide for a fixed fee per flight regardless
of the amount of cargo carried.  Pursuant to such agreements, Federal
Express determines the schedule of routes to be flown by MAC and CSA.


     Agreements with Federal Express are renewable annually and may be
terminated by Federal Express any time upon 15 to 30 days' notice.  The
Company believes that the short term and other provisions of its
agreements with Federal Express are standard within the air freight
contract delivery service industry.  Loss of Federal Express as a
customer would have a material adverse effect on MAC, CSA and the
Company.

     MAC and CSA operate under separate aviation certifications.  MAC is
certified to operate under Part 121, Part 135 and Part 145 of the
regulations of the Federal Aviation Administration (the "FAA").  These
certifications permit MAC to operate and maintain aircraft that can
carry up to 18,000 pounds of cargo and provide maintenance services to
third party operators.  CSA is certified to operate under Part 135 of
the FAA regulations.  This certification permits CSA to operate aircraft
with a maximum cargo capacity of 7,500 pounds.

     MAC and CSA, together, operated or held for sale the following
aircraft as of March 31, 2002:

                                               Form of    Number of
      Type of Aircraft          Model Year    Ownership   Aircraft

Cessna Caravan, 208A and 208B
(single turbo prop)             1985-1996     dry lease      73

Fokker F-27 (twin turbo prop)   1968-1981     dry lease      20

Short Brothers SD3-30
(twin turbo prop)                  1981        owned          2

Total                                                        95

     Of the 95 aircraft fleet, 93 aircraft (the Cessna Caravan and
Fokker F-27 aircraft) are owned by Federal Express.  Under the dry-lease
service contracts, certain maintenance expense, including cost of parts
inventory, and maintenance performed by personnel not employed by the
Company, is passed directly to the customer, and the expense of daily,
routine maintenance and aircraft service checks is charged to the
customer on an hourly basis.  Accordingly, the Company does not
anticipate maintenance expense, such as engine overhauls, to be material
to the Company's operating results.

     All FAA Part 135 aircraft, including Cessna Caravan models 208A and
208B,  and Short Brothers SD3-30 aircraft are maintained on FAA approved
inspection  programs.  The inspection intervals range from  100  to  200
hours.   The  engines  are  produced by Pratt &  Whitney,  and  overhaul
periods  are  based  on  FAA approved schedules.  The  current  overhaul
period  on  the  Cessna  aircraft is 7,500 hours.   The  Short  Brothers
manufactured  aircraft  are maintained on an "on condition"  maintenance
program  (i.e., maintenance is performed when performance deviates  from
certain specifications) with engine inspections at each phase inspection
and in-shop maintenance at predetermined intervals.

      The  Fokker  F-27 aircraft are maintained under  a  FAA  Part  121
maintenance program.  The program consists of A, B, C, D and  I  service
checks.  The engine overhaul period is 6,700 hours.

      In  May  2000,  MAC  completed its FAA certification  to  commence
operation  of  a  Part  145 maintenance facility at  its  Kinston,  N.C.
location.   MAC's  future  plans include the ability  to  perform  heavy
maintenance for regional/trunk FAA Part 121 certified carriers.

     The Company operates in highly competitive markets and competes
with approximately 50 other contract cargo carriers in the United
States.  MAC and CSA's contracts are renewed on an annual basis.
Accurate industry data is not available to indicate the Company's
position within its marketplace (in large measure because most of the
Company's competitors are privately held), but management believes that
MAC and CSA, combined, constitute one of the largest contract carriers
of the type described immediately above.

     The Company's air cargo operations are not materially seasonal.


Aircraft Deice and Other Equipment Products.

     Global manufactures, sells, services and supports aircraft devices
on a worldwide basis.  During the fiscal year ended March 31, 2000,
Global diversified its product line to include additional models of
aircraft deicers and scissor-lift ground support equipment.  Global's
primary customers are passenger and cargo airlines, the U.S. Air Force,
as well as airports located in the United States and in international
markets.  Global's operations are located in Olathe, Kansas.

     In the manufacture of its ground service equipment, Global
assembles components acquired from third party suppliers.  Components
are readily available from a number of different suppliers.  The primary
components are the chassis (which is similar to the chassis of a medium
to heavy truck) and heating equipment.

     Global manufactures five basic models of mobile deicing equipment
ranging from 700 to 3,200 gallon capacity models in addition to fixed
pedestal mounted deicers.  Each model can be customized as requested by
the customer, including the addition of twin engine deicing systems,
fire suppressant equipment, modifications for open or enclosed cab
design, a recently patented forced-air deicing nozzle to substantially
reduce glycol usage, and color and style of the exterior finish.  Global
also manufactures three models of scissor-lift equipment, for catering,
cabin service and maintenance service of aircraft.  Global competes
primarily on the basis of reliability of its products, prompt delivery
and price.  The market for aviation ground service equipment is highly
competitive.

      Global's  mobile deicing equipment business has historically  been
highly  seasonal, with the bulk of deicing equipment being purchased  by
customers in the late summer and fall in preparation for winter  months.
Historically,  the  bulk of Global's revenues have occurred  during  the
second  and third fiscal quarters, and comparatively little revenue  has
occurred  during the first and fourth fiscal quarters.  The Company  has
reduced Global's seasonal fluctuation in revenues by the introduction of
a  line of non-deicer related ground support equipment, the January 2000
commencement of a long-term contract to provide deicing equipment to the
U.S.  Air Force and the award of a $7.1 million pedestal-mounted  deicer
contract with the Philadelphia International Airport.

     Revenue from Global's contract with the U.S. Air Force accounted
for approximately 13.9% of the Company's consolidated revenue for the
year ended March 31, 2002.

Aviation Related Parts Brokerage and Overhaul Services.

     MAS provides aircraft maintenance and parts and other aviation
related services to the commercial and military aviation industries.
MAS's principal offices and primary overhaul facilities are located at
the Global TransPark in Kinston, North Carolina and Miami, Florida.

     Services offered by MAS include engine overhaul management,
aircraft maintenance and component repair.  Services are provided under
standard purchase contracts.

     In addition, MAS sells aircraft parts, of which approximately 1% of
the amount sold in the fiscal year ended March 31, 2002 were used in
connection with maintenance performed by MAS.  Sales of parts by MAS do
not include any parts purchased for maintenance of aircraft operated by
MAC or CSA.

      MAS's  inventory  of  parts held for sale was  approximately  $4.8
million  at  March 31, 2002 and included parts for use in  primarily  15
types of commercial and military aircraft, all of which are generally in
current   use.    MAS   maintains  its  own   inventory   controls   and
documentation,  sets stocking levels and determines the  conditions  for
surplus parts disposal.

     MAS's customers include the commercial air cargo and passenger
aviation industries and manufacturers of commercial and military
aircraft and contract maintenance companies serving the commercial and
military aviation industry.  MAS also provides parts or services under
contracts directly with the U.S. government.  For the fiscal year ended
March 31, 2002, MAS provided services or parts to over 75 customers,
with five customers accounting for approximately 95% of MAS's revenues
for the year.

     MAS's operations are not materially seasonal.


Backlog.

     The Company's backlog consists of "firm" orders supported by
customer purchase orders with fixed delivery dates for the deicing
equipment sold by Global and for parts and equipment sold by MAS.  At
March 31, 2002, the Company's backlog of orders was $3.0 million, of
which $2.7 million was attributable to Global and approximately $.3
million was attributable to MAS, all of which the Company expects to be
filled in the current fiscal year.

Governmental Regulation.

     Under the Federal Aviation Act of 1958, as amended, the FAA has
safety jurisdiction over flight operations generally, including flight
equipment, flight and ground personnel training, examination and
certification, certain ground facilities, flight equipment maintenance
programs and procedures, examination and certification of mechanics,
flight routes, air traffic control and communications and other matters.
The FAA also has power to suspend or revoke for cause the certificates
it issues and to institute proceedings for imposition and collection of
fines for violation of federal aviation regulations.  The Company has
secured appropriate operating certificates and airworthiness
certificates for all aircraft operated by it.

     The FAA periodically conducts routine reviews of MAC and CSA's
operating procedures and flight and maintenance records.

     The Airline Deregulation Act of 1978 created a new class of
domestic certificated all-cargo carriers.  Pursuant to such certificate,
aircraft of specified size may be operated within the United States,
without restriction on routes.

     The Company has been subject to FAA regulation since the
commencement of its business activities.  The FAA is concerned with
safety and the regulation of flight operations generally, including
equipment used, ground facilities, maintenance, communications and other
matters.  The FAA can suspend or revoke the authority of air carriers or
their licensed personnel for failure to comply with its regulations and
can ground aircraft if questions arise concerning airworthiness.  The
Company, through its subsidiaries, holds all operating airworthiness and
other FAA certificates that are currently required for the conduct of
its business, although these certificates may be suspended or revoked
for cause.

     The FAA has authority under the Noise Control Act of 1972, as
amended, to monitor and regulate aircraft engine noise.  The aircraft
operated by the Company are in compliance with all such regulations
promulgated by the FAA.  Moreover, because the Company does not operate
jet aircraft, noncompliance is not likely.  Such aircraft also comply
with standards for aircraft exhaust emissions promulgated by the
Environmental Protection Agency pursuant to the Clean Air Act of 1970,
as amended.

     Because of the extensive use of radio and other communication
facilities in its aircraft operations, the Company is subject to the
Federal Communications Act of 1934, as amended.

Maintenance and Insurance.

     The Company, through its subsidiaries, maintains its aircraft under
the appropriate FAA standards and regulations.

      The  Company  has  secured public liability  and  property  damage
insurance  in  excess of minimum amounts required by the  United  States
Department  of  Transportation.  The Company has also obtained  all-risk
hull insurance on Company-owned aircraft.

     The Company maintains cargo liability insurance, workers'
compensation insurance and fire and extended coverage insurance, for
leased as well as owned facilities and equipment.

Employees.

     At May 24, 2002, the Company and its subsidiaries had 379 full-time
and full-time-equivalent employees, of which 10 are employed by the
Company, 257 are employed by MAC, 52 are employed by CSA, 21 are
employed by MAS and 39 are employed by Global.  None of the Company's
employees are represented by a union.  The Company believes its
relations with its employees are good.


Item 2.   Properties.

     The Company leases the Little Mountain Airport in Maiden, North
Carolina from a corporation whose stock is owned in part by J. Hugh
Bingham, William H. Simpson and John J. Gioffre, officers and directors
of the Company, and the estate of David Clark, of which, Walter Clark,
the Company's chairman and Chief Executive Officer, is a co-executor and
beneficiary, and Allison Clark, a director, is a beneficiary.  The
facility consists of approximately 65 acres with one 3,000 foot paved
runway, approximately 20,000 square feet of hangar space and
approximately 10,300 square feet of office space.  The operations of the
Company and MAC are headquartered at this facility.  The lease for this
facility extends through May 31, 2006, and the monthly lease payment  is
$9,155.

     The Company also leases approximately 800 square feet of office
space and approximately 6,000 square feet of hangar space at the Ford
Airport in Iron Mountain, Michigan.  CSA's operations are headquartered
at these facilities.  These facilities are leased, from a third party,
under an annually renewable agreement with a monthly rental payment, as
of March 31, 2002, of approximately $1,698.

     On November 16, 1995, the Company entered into a twenty-one and a
half year premises and facilities lease with Global TransPark
Foundation, Inc. to lease approximately 53,000 square feet of a 66,000
square foot aircraft hangar shop and office facility at the North
Carolina Global TransPark in Kinston, North Carolina.  On August 10,
1996, MAS's component repair services and part of MAC's aircraft
maintenance operations were relocated to this facility.  Rent under this
lease increases over time as follows:  the first 18 months, no rent; the
next 5-year period, $2.25 per square foot; the next 5-year period, $3.50
per square foot; the next 5-year period, $4.50 per square foot; and the
final 5-year period, $5.90 per square foot.  This lease is cancelable
under certain conditions at the Company's option. The Company currently
considers the lease to be non-cancelable for seven years and has
calculated rent expense on a straight-line basis over this portion of
the lease term.  The Company began operations at this facility in August
1996.

     MAS operates an engine overhaul management facility in Miami,
Florida, leasing, from a third party, approximately 4,700 square feet of
shop space.  The lease expired on March 31, 2002 and MAS relocated to a
smaller facility in April 2002 and signed a lease expiring February 2003
at a monthly rental payment of $1,523.  MAS also operates a 145 repair
shop facility in Kinston, North Carolina.  The lease expired on March
31, 2002 and MAS relocated to a smaller facility under a month to month
lease in May 2002, with a monthly rental payment of $1,225.

     Global leases a 112,500 square foot production facility in Olathe,
Kansas.  The facility is leased, from a third party, under a five-year
lease agreement which expires in August 2006.  The monthly rental
payment, as of March 31, 2002, was $29,341, and the monthly rental will
increase to $29,809 over the life of the lease.

     As of March 31, 2002, the Company leased hangar space from third
parties at 35 other locations for aircraft storage.  Such hangar space
is leased, from third parties, at prevailing market terms.

     The table of aircraft presented in Item 1 lists the aircraft
operated by the Company's subsidiaries and the form of ownership.

Item 3.   Legal Proceedings.

     Global and one of its employees are defendants in a lawsuit filed
in March 2002 in the United States District Court for the District of
Columbia, Catalyst & Chemical Services et al v. Terex, et al.  In this
action, the plaintiffs allege that they provided to Global and the
employee certain trade secrets regarding aircraft de/anti-icing systems
that were then disclosed by Global and the employee to third parties.
The plaintiffs allege misappropriation of trade secrets, breach of
contract and violation of the federal Racketeer Influenced and Corrupt
Organization Act and seek monetary damages.  An answer in this action is
not yet due and has not yet been filed.  The Company does not believe
that the action has any merit and intends to defend the lawsuit
vigorously.

      The  Company  is  currently  aware of  certain  employee,  product
liability  and environmental matters, some of which involve  pending  or
threatened  lawsuits.  If  adversely decided,  management  believes  the
results  of  these  pending  or threatened lawsuits  would  not  have  a
material adverse effect on the Company.



Item 4.   Submission of Matters to a Vote of Security Holders.

     No matter was submitted to a vote of security holders during the
fourth quarter of the fiscal year covered by this report.


                                 PART II

Item 5.   Registrant's Common Equity and Related Stockholder Matters.

     The Company's common stock is publicly traded in the over-the-
counter market under the NASDAQ symbol "AIRT."

     As of June 5, 2002 the number of holders of record of the Company's
Common Stock was approximately 362.  Over-the-counter market quotations
reflect inter-dealer prices, without retail mark-up, mark-down or
commissions and may not necessarily represent actual transactions.  The
range of high and low bid quotations per share for the Company's common
stock from April 2000 through March 2002 is as follows:

                                          Common Stock
           Quarter Ended                   High    Low

           June 30, 2000                   3.875  3.000
           September 30, 2000              3.750  2.750
           December 31, 2000               4.000  2.250
           March 31, 2001                  4.438  3.000

           June 30, 2001                   4.480  2.810
           September 30, 2001              4.150  2.290
           December 31, 2001               6.490  2.500
           March 31, 2002                  6.310  2.700

     The  Company's  Board of Directors has adopted a policy  to  pay  a
regularly  scheduled annual cash dividend in the first quarter  of  each
fiscal  year.  The $0.12 per share cash dividend, declared  on  May  22,
2002, will be paid on June 20, 2002 to stockholders of record on June 5,
2002.


Item 6.   Selected Financial Data


(In thousands except per share data)

                                       Year Ended March 31,

                           2002       2001      2000       1999      1998

Operating revenues     $  70,958  $  70,246  $  58,846  $  52,120  $  51,001

Net earnings           $   1,278  $   1,289  $     362  $     523  $   1,706

Net earnings per share-
Basic                  $    0.47  $    0.47  $    0.13  $    0.19  $    0.64

Net earnings per share-
Diluted                $    0.46  $    0.46  $    0.13  $    0.19  $    0.61

Total assets           $  22,903  $  28,533  $  23,936  $  20,852  $  18,289

Long-term obligations,
including
current portion        $   4,158  $   5,969  $   1,486  $   1,364  $   1,144

Stockholders' equity   $  11,100  $  10,170  $   9,383  $   9,636  $   9,712

Average common shares
outstanding-Basic          2,717      2,733      2,758      2,698      2,660

Average common shares
outstanding-Diluted        2,789      2,781      2,837      2,794      2,788

Dividend declared per
common share
(1)                    $    0.15  $    0.10  $    0.08  $    0.14  $    0.10

Dividend paid per common
share
(1)                    $    0.15  $    0.10  $    0.08  $    0.14  $    0.10
__________________________
___

(1)  On May 22, 2002, the Company declared a cash dividend of
  $0.12 per common share payable
  on June 20, 2002 to stockholders of record on June 5, 2002.

















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

Overview

     The Company's two most significant components of revenue, which
accounted for 42.8% and 41.2% of revenue in fiscal 2002 were generated,
respectively, through its ground support equipment subsidiary, Global
Ground Support, LLC (Global), and its air cargo subsidiaries, Mountain
Air Cargo, Inc. (MAC) and CSA Air, Inc. (CSA).

     Global manufactures, services and supports aircraft deicers and
ground support equipment on a worldwide basis. Global's revenue
contributed approximately $30,345,000 and $31,406,000 to the Company's
revenues in fiscal 2002 and 2001, respectively.  The small decrease in
revenues in 2002 was primarily due to decreased commercial equipment
orders being virtually offset by a large scale airport deicer contract,
which commenced in February 2001.

     MAC and CSA are short-haul express air freight carriers.  MAC and
CSA's revenue contributed approximately $29,264,000 and $30,262,000 to
the Company's revenues in fiscal 2002 and 2001, respectively.  Under the
terms of the dry-lease service agreements, which currently cover
approximately 98% of the revenue aircraft operated, the Company passes
through to its customer certain cost components of its operations
without markup.  The cost of fuel, flight crews, landing fees, outside
maintenance, parts and certain other direct operating costs are included
in operating expenses and billed to the customer as cargo and
maintenance revenue, at cost.

     Separate agreements cover the three types of aircraft operated by
MAC and CSA-Cessna Caravan, Fokker F-27, and Short Brothers SD3-30.
Cessna Caravan and Fokker F-27 aircraft (a total of 93 aircraft at March
31, 2002) are owned by and dry-leased from a major air express company
(Customer), and Short Brothers SD3-30 aircraft (two aircraft at March
31, 2002) are owned by the Company and operated periodically under wet-
lease arrangements with the Customer.  Pursuant to such agreements, the
Customer determines the type of aircraft and schedule of routes to be
flown by MAC and CSA, with all other operational decisions made by the
Company.

     Agreements are renewable annually and may be terminated by the
Customer at any time upon 15 to 30 days' notice.  The Company believes
that the short term and other provisions of its agreements with the
Customer are standard within the air freight contract delivery service
industry.  The Company is not contractually precluded from providing
such services to other firms, and has done so in the past. Loss of its
contracts with the Customer would have a material adverse effect on the
Company.

     Mountain Aircraft Services, LLC's (MAS) aircraft component parts
brokerage and repair services contributed approximately $11,349,000 and
$8,578,000 to the Company's revenues in fiscal 2002 and 2001,
respectively, and are included in Aircraft Services and Other in the
accompanying consolidated statement of earnings.

     The Company's four subsidiaries operate in three business segments.
Each business segment has separate management teams and infrastructures
that offer different products and services.  The subsidiaries have been
combined into the following reportable segments: air cargo, aviation
ground equipment and aviation services in the accompanying consolidated
financial statements.

     The following table summarizes the changes and trends in the
Company's expenses as a percentage of revenue:

                                      Fiscal Year Ended March 31,
                                      2002         2001         2000

Operating revenue (in thousands)  $  70,958    $  70,246    $  58,846

Expense as a percentage of revenue:
   Flight operations                  20.32%       21.30%       23.31%
   Maintenance and brokerage          29.33        24.06        35.11
   Ground equipment                   33.19        37.43        25.58
   General and administrative         12.88        12.44        12.78
   Depreciation and amortization       0.94         1.18         1.57

Total costs and expenses              96.65%       96.41%       98.35%




Critical Accounting Policies and Estimates

     The preparation of the Company's financial statements in conformity
with accounting principles generally accepted in the U.S. requires the
use of estimates and assumptions to determine certain assets,
liabilities, revenues and expenses.  Management bases these estimates
and assumptions upon the best information available at the time of the
estimates or assumptions.  The Company's estimates and assumptions could
change materially as conditions within and beyond our control change.
Accordingly, actual results could differ materially from estimates.  The
most significant estimates made by management include allowance for
doubtful accounts receivable, reserves for excess and obsolete
inventories, deferred tax asset valuation,  retirement benefit
obligations, valuation of revenue recognized under the percentage of
completion method and valuation of long-lived assets.  Following is a
discussion of critical accounting policies and related management estimates
and assumptions necessary in determining the value of related assets or
liabilities.  A full description of all significant accounting policies is
included in Note 1 to our Consolidated Financial Statements included
elsewhere in this Report.

     Allowance for Doubtful Accounts.  An allowance for doubtful
accounts receivable is established based on management's estimates of
the collectability of accounts receivable.  The required allowance is
determined using information such as customer credit history, industry
information, credit reports and customer financial condition.  The
estimates can be affected by changes in the aviation industry, customer
credit issues or general economic conditions.

     Inventories.  The Company's parts inventories are valued at the
lower of cost or market.  Provisions for excess and obsolete inventories
are based on assessment of slow-moving and obsolete inventories.
Historical part usage and estimated future demand provide the basis for
estimates.  Estimates are subject to volatility and can be affected by
reduced equipment utilization, the retirement of aircraft or ground
equipment and changes in the aviation industry.

     Deferred Taxes.  Deferred tax assets net of valuation allowance,
if any, reflect the likelihood of the recoverability of these assets.
Company judgement of the recoverability of these assets is based
primarily on estimates of current and expected future earnings and tax
planning.

     Retirement Benefits Obligation.  The Company determines the value
of retirement benefits assets and liabilities on an actuarial basis.
Values are affected by our outside actuary's estimates of the expected
return on plan assets, insurance policies and the discount rates used.
Actual changes in the fair market value of plan assets, differences
between the actual return and the expected return on plan assets and
changes in the discount rate used will affect the amount of pension gain
or loss recognized.

     Revenue Recognition.  Cargo revenue is recognized upon completion
of contract terms and maintenance revenue is recognized when the service
has been performed.  Revenue from product sales is recognized when
contract terms are completed and title has passed to customers.
Revenues from overhaul contracts on customer owned parts and long term
fixed price manufacturing projects are recognized on the percentage-of-
completion method.  Revenues for contracts under percentage of
completion are measured by the percentage of cost incurred to date, to
estimated total cost for each contract or workorder.

     Valuation of Long-Lived Assets.  The Company adopted Financial
Accounting Standards Board Statement of Financial Accounting Standards
(SFAS) No. 144, "Accounting for Impairment or Disposal of Long-Lived
Assets" on April 1, 2002.  If required, the Company will record
impairment charges on long-lived assets used in operations when events
and circumstances indicate the assets may be impaired and the
undiscounted cash flows estimated to be generated by those assets are
less than their carrying amount.  In the event it is determined that the
carrying values of long-lived assets are in excess of estimated gross
future cash flows for those assets, the Company then will write-down the
value of the assets to a level commensurate with their fair value using a
discounted cash flow approach.


Seasonality

      Global's business has historically been highly seasonal.   Due  to
the  nature  of  its  product line, the bulk of  Global's  revenues  and
earnings  have  typically occurred during the second  and  third  fiscal
quarters in anticipation of the winter season, and comparatively  little
has  occurred during the first and fourth fiscal quarters.  The  Company
has  continued  its efforts, started in fiscal 1999, to reduce  Global's
seasonal fluctuation in revenues and earnings by broadening its  product
line  to  increase revenues and earnings in the first and fourth  fiscal
quarters. In June 1999,  Global was  awarded  a  four-year contract to
supply deicing equipment  to  the United  States Air Force (USAF) for a
total amount of approximately  $25 million,  and  in January 2001 Global
received a $7.1 million  pedestal-mounted  deicer  contract with the
Philadelphia  International  Airport, expected  to  be  completed in the
first quarter of  fiscal  2003.   The Company anticipates that revenue
from the USAF contract will continue to contribute  to management's plan
to reduce Global's seasonal fluctuation in  revenues.  The  Company
believes that this seasonal  trend  was  not reflected in Global's current
third quarter results due to the September 11,  2001  terrorist  attacks
and weakening  aviation  market  discussed below.   The  remainder  of the
Company's business  is  not  materially seasonal.

Results of Operations

     Fiscal 2002 vs. 2001

     Consolidated revenue increased $712,000 (1.0%) to $70,958,000 for
the fiscal year ended March 31, 2002 compared to the prior fiscal year.
The increase in 2002 revenue primarily resulted from increases in
revenue from MAS of $2,685,000 (31.0%) to $11,349,000 partially offset
by decreases in Global revenue of $1,061,000 (3.4%) to $30,345,000 and a
$912,000 (3.0%) decrease in air cargo revenue to $29,264,000.

     Operating expenses increased $854,000 (1.3%) to $68,582,000 for
fiscal 2002 compared to fiscal 2001.  The net increase in operating
expenses consisted of the following changes: cost of flight operations
decreased $547,000 (3.7%) as a result of decreases in fuel, landing
fees, and costs associated with pilot travel partially offset by
increases in pilot and flight personnel costs; maintenance and brokerage
expenses increased $3,906,000 (23.1%) primarily as a result of cost
associated with the sale of an aircraft engine, partially offset by
lower outside maintenance and parts costs at MAC; ground equipment costs
decreased $2,748,000 (10.5%), as a result of decreased sales at Global;
depreciation and amortization decreased $160,000 (19.3%) as a result of
certain assets becoming fully depreciated, or written off during fiscal
2002; the general and administrative expense increase of $402,000 (4.6%)
is primarily the result of  increases in general wages and benefits,
insurance cost and staff expense.

     On a segment basis, the most significant impacts on the Company's
operating results comparing the fiscal year ended March 31, 2002 to the
prior period resulted from changes in the ground equipment operation at
Global and the aircraft services operation at MAS.  In the fiscal year
ended March 31, 2002, Global had operating income of $3,335,000 compared
to prior period income of $2,049,000 and MAS had an operating loss of
$905,000 compared to a $274,000 profit in the prior year.  Several
factors contributed to the changes in Global's and MAS's operating
results. Global's current fiscal year operating income increased
compared to its prior fiscal year primarily due to commencement of a
large scale airport contract and higher sales volume on its U.S. Air
Force contract offsetting declines in commercial equipment orders.
MAS's current fiscal year revenue increased 31.4% compared to its prior
fiscal year revenue, primarily due to a large engine sale offsetting
declines in service revenue.  The net decrease, exclusive of the engine
sale, in MAS revenue, and operating income, was primarily due to
decreased brokerage sales and parts overhaul revenue.  Operating income
for the Company's overnight air cargo operations was $2,216,000 in the
fiscal year ended March 31, 2002, a decrease of 10.5% from $2,476,000 in
the prior fiscal year revenue.  The decrease resulted from decreased
levels of aircraft maintenance.

     Non-operating expense decreased a net $305,000 due to decreased
current year interest expense related to decreased borrowing on the
Company's line of credit.

     Provision for income taxes increased $175,000 (26.6%) due to
changes in the effective tax rate.  The provision for income taxes for
the fiscal years ended March 31, 2002, 2001 and 2000 were different from
the Federal statutory rates due to state tax provisions and a reduction
in the Company's excise tax accrual due to a favorable tax ruling.

     Although fiscal 2002's revenues and net earnings closely match fiscal
2001, the effect of the September 11th terrorist attacks and a softening
aviation market during fiscal 2002 substantially affected Air T's operations
during the second half of the current year. Air T's operating subsidiaries
experienced significant decreases in current fourth quarter revenues and
earnings compared to the prior year's fourth quarter.  Additional accruals
contributed to the Company's current period fourth quarter loss of $38,000.

     Fiscal 2001 vs. 2000

     Consolidated revenue increased $11,400,000 (19.4%) to $70,246,000
for the fiscal year ended March 31, 2001 compared to the prior fiscal
year.  The increase in 2001 revenue primarily resulted from increases in
revenue from Global of $14,397,000 (84.6%) to $31,406,000 partially
offset by decreases in MAS revenue of $591,000 (6.4%) to $8,578,000 and
a $2,405,000 (7.4%) decrease in air cargo revenue to $30,262,000.



     Operating expenses increased $9,857,000 (17.0%) to $67,729,000 for
fiscal 2001 compared to fiscal 2000.  The net increase in operating
expenses consisted of the following changes: cost of flight operations
increased $1,248,000 (9.1%) as a result of increases in fuel, landing
fees, pilot and flight personnel and costs associated with pilot travel;
maintenance and brokerage expenses decreased $3,755,000 (18.2%)
primarily as a result of decreases associated with cost of parts stock
purchases and labor related to the decreased revenue of MAS's repair
facility and by lower outside maintenance costs at MAC; ground equipment
costs increased $11,244,000 (74.7%), as a result of increased sales at
Global; depreciation and amortization decreased $96,000 (10.4%) as a
result of certain assets becoming fully depreciated, or written off
during fiscal 2001; the general and administrative expense increase of
$1,217,000 (16.2%) is primarily the result of  increases in general
wages and benefits, professional fees and staff expense.

      On  a segment basis, the most significant impacts on the Company's
operating results comparing the fiscal year ended March 31, 2001 to  the
prior  period  resulted  from  changes in  parent  company  revenue  and
expense,  the  ground  equipment operation at Global  and  the  aircraft
services  operation  at  MAS.   Current year  corporate  operating  loss
increased  $420,000 due to increased general and administrative  expense
over the prior year and decreased investment income.  In the fiscal year
ended  March  31,  2001, Global had an operating  income  of  $2,049,000
compared to a prior period loss of $591,000, MAS had operating income of
$274,000  compared  to  $650,000 in the  prior  year.   Several  factors
contributed  to  the  changes in Global's and MAS's  operating  results.
Global's  current fiscal year revenue increased 84.6%  compared  to  its
prior  fiscal  year primarily due to commencement of the USAF  contract.
MAS's  current fiscal year revenue decreased 6.4% compared to its  prior
fiscal year revenue.  The decrease in MAS revenue, and operating income,
was  primarily  due  to  decreased brokerage sales  and  parts  overhaul
revenue.   Operating  income  for  the  Company's  overnight  air  cargo
operations  was $2,476,000 in the fiscal year ended March  31,  2001,  a
decrease of 7.6% from $2,680,000 in the prior fiscal year revenue.   The
MAC decrease resulted from decreased levels of aircraft maintenance.

     Non-operating expense increased a net $225,000 due to increased
current year interest expense related to higher levels of borrowing on
the Company's line of credit to fund the expanded operations of Global
and MAS and a decrease in investment income.

     Provision for income taxes increased $390,000 (146.9%) due to
increased taxable income.  The provision for income taxes for the fiscal
years ended March 31, 2001, 2000 and 1999 were different from the
Federal statutory rates due to state tax provisions and a reduction in
the Company's excise tax accrual due to a favorable tax ruling.

Liquidity and Capital Resources

     As of March 31, 2002 the Company's working capital amounted to
$11,221,000, a decrease of $1,028,000 compared to March 31, 2001.  The
net decrease primarily resulted from decreases in accounts receivable
and inventory and an increase in accrued expenses, partially offset by
decreased accounts payable and increased deferred tax assets.

     On May 23, 2001 the Company expanded its bank financing line to a
$10,000,000 credit facility.  Under the terms of the agreement, a
$7,000,000 secured long-term revolving credit line which expires on
August 31, 2003 replaced the Company's $8,500,000 unsecured short-term
revolving credit line.  The remaining $3,000,000 of the credit facility
is a five-year term loan which matures on May 31, 2006; with quarterly
payments of $150,000, plus accrued interest.

     The credit facility contains customary events of default and
restrictive covenants that, among other matters, require the Company to
maintain certain financial ratios.  As of March 31, 2002, the Company
was in compliance with all of the restrictive covenants.  The amount of
credit available to the Company under the agreement at any given time is
determined by an availability calculation, based on the eligible
borrowing base, as defined in the credit agreement, which includes the
Company's outstanding receivables, inventories and equipment, with
certain exclusions.  The credit facility is secured by substantially all
of the Company's assets.

     Amounts advanced under the credit facility bear interest at the 30-
day "LIBOR" rate plus 137 basis points.  The LIBOR rate at March 31,
2002 was 1.85%. At March 31, 2002 and 2001, the amounts outstanding
against the credit facility were $3,860,000 and $5,763,000, respectively.
At March 31, 2002, $5,690,000 was available under the entire credit facility.

     The Company has classified $3,260,000 of its outstanding balance on
the credit facility as of March 31, 2002 as long-term to reflect the terms
included under the agreement signed on May 31, 2001.  The Company
entered into two swap agreements on May 31, 2001 to fix the interest
rate on the $3,000,000 term portion and $2,000,000 of the revolving
portion of the credit facility at respective interest rates of 6.97% and
6.50%.


     The following table of material debt and lease commitments at March
31, 2002 summarizes the effect these obligations are expected to have on
the Company's cash flow in the future periods.

                                 Related Cash Outflows
  Contractual
   Obligations    Total       2003      2004        2005       2006      2007


Long-term bank
  debt         $3,860,000 $  600,000 $1,910,000 $  600,000 $  600,000 $ 150,000
Operating
  leases        2,827,000    638,000    622,000    629,000    637,000   301,000
Capital leases    149,000     51,000     46,000     39,000     13,000      -
  Total        $6,836,000 $1,289,000 $2,578,000 $1,268,000 $1,250,000 $ 451,000



     The respective years ended March 31, 2002, 2001 and 2000 resulted
in the following changes in cash flow: operating activities provided
$2,890,000 and $262,000, respectively in 2002 and 2000 and used
$1,129,000 in 2001.  Investing activities used $657,000, $227,000, and
$172,000, respectively, in 2002, 2001 and 2000 and financing activities
used $2,300,000 and $209,000, respectively, in 2002 and 2000 and
provided $1,310,000 in 2001.  Net cash decreased $66,000, $47,000 and
$119,000, respectively, in 2002, 2001 and 2000.

     Cash provided by operating activities was $4,020,000 more for the
year ended March 31, 2002, compared to 2001 principally due to decreases
in accounts receivable and inventory, partially offset by decreases in
accounts payable.  Cash used in investing activities for the year ended
March 31, 2002 was approximately $430,000 more than 2001, principally
due to a sale of marketable securities in 2001.  Cash used in financing
activities was $3,609,000 more in 2002 compared to 2001 principally due
to changes relating to borrowings under the line of credit.

     During the fiscal year ended March 31, 2002 the Company repurchased
13,500 shares of its common stock at a total cost of $42,785.  Pursuant
to its previously announced stock repurchase program, $147,134 remains
available for repurchase of common stock.

       There  are  currently  no  commitments  for  significant  capital
expenditures.  The  Company's Board of Directors,  on  August  7,  1997,
adopted  the policy to pay an annual cash dividend in the first  quarter
of  each  fiscal year, in an amount to be determined by the board.   The
Company paid a $0.15 per share cash dividend in June 2001 and declared a
$0.12  per share cash dividend on May 22, 2002, to be paid on  June  20,
2002 to shareholders of record dated June 5, 2002.

Deferred Retirement Obligation

     The Company's former Chairman and Chief Executive Officer passed
away on April 18, 1997. The death benefits are payable in the amount of
$75,000 per year for 10 years.

Impact of Inflation

      The Company believes the impact of inflation and changing prices
on its revenues and net earnings will not have a material effect on its
manufacturing operations because increased costs due to inflation could
be passed on to its customers, or on its air cargo business since the
major cost components of its operations, consisting principally of fuel,
crew and certain maintenance costs are reimbursed, without markup, under
current contract terms.


Recent Accounting Pronouncements

     The Financial Accounting Standards Board has approved SFAS No. 143,
"Accounting for Asset Retirement Obligations" and No. 144, "Accounting
for the Impairment or Disposal of Long-lived Assets".  SFAS No. 143
addresses financial accounting and reporting for obligations associated
with the retirement of tangible long-lived assets and the associated
asset retirement costs.  It requires that the fair value of a liability
for an asset retirement obligation be recognized in the period in which
it is incurred if a reasonable estimate of fair value can be made.  The
associated asset retirement costs are capitalized as part of the
carrying amount of the long-lived asset.  SFAS No. 143 is effective for
fiscal years beginning after June 15, 2002.  SFAS No. 144 supersedes
SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets and
for Long-Lived Assets to be Disposed of" and amends, Accounting
Principles Bulletin (APB) No. 30.  Along with establishing a single
accounting model, based on the framework established in SFAS No. 121,
for long-lived assets to be disposed of by sale, this standard retains
the basic provisions of APB No. 30 for the presentation of discontinued
operations in the income statement but broadens that presentation to
include a component of an entity.  SFAS No. 144 is effective for fiscal
years beginning after December 15, 2001. The Company does not expect the
adoption of SFAS No. 143 or 144 to have a material effect on our financial
position and results of operations.

Derivative Financial Instruments

     On April 1, 2001, the Company adopted Statement of Financial
Accounting Standard No. 133, "Accounting for Derivative Instruments and
Hedging Activities", as amended. SFAS 133 establishes accounting and
reporting standards for derivative instruments, including certain
derivative instruments embedded in other contracts, and for hedging
activities.  It requires that entities recognize all derivatives as
either assets or liabilities in the statement of financial position and
measure those instruments at fair value.

     The Company is exposed to market risk, such as changes in interest
rates.  To manage the volatility relating to interest rate risk, we may
enter into interest rate hedging arrangements from time to time.  The
Company does not utilize derivative financial instruments for trading or
speculative purposes.

     During the first quarter of fiscal 2002, the Company entered into
two interest rate swaps with a notional amount of $3 million, and $2
million respectively.  These agreements were entered into as cash flow
hedges to fix the interest rates on the $3 million term portion and $2
million of the revolving portion of the credit facility at interest
rates of 6.97% and 6.50%, respectively; the maturity dates of the swaps
vested the respective maturity dates of the underlying debt instruments.
The fair value of these swaps had decreased by $119,000 at March 31,
2002.  Because the swaps are considered completely effective the change
in fair market value of the swaps are recorded in other comprehensive
loss and long-term debt on the balance sheet.



Item 7A.  Quantitative and Qualitative Disclosures About Market Risk.

     The Company does not hold or issue derivative financial instruments
for  trading  purposes.  On May 31, 2001 the Company entered  into  swap
agreements to fix the interest rates on the $3 million term portion  and
$2 million of the revolving portion of its credit facility at respective
interest  rates  of  6.97%  and 6.50% to  reduce  its  exposure  to  the
fluctuations  of LIBOR-based variable interest rates.   The  Company  is
exposed to changes in interest rates on certain portions of its line  of
credit,  which  bears interest based on the 30-day LIBOR rate  plus  137
basis  points.   If  the LIBOR interest rate had been increased  by  one
percentage  point, based on the year-end balance of the line of  credit,
annual interest expense would have increased by approximately $39,000.



Item 8.   Financial Statements and Supplementary Data.




INDEPENDENT AUDITORS' REPORT



Board of Directors and Stockholders
Air T, Inc.
Denver, North Carolina

We have audited the accompanying consolidating balance sheets of
Air T, Inc. and subsidiaries (the "Company") as of March 31, 2002
and 2001, and the related consolidated statements of earnings,
stockholders' equity, and cash flows for each of the three years
in the period ended March 31, 2002.  These financial statements
are the responsibility of the Company's management.  Our
responsibility is to express an opinion on these financial
statements based on our audits.

We conducted our audits in accordance with auditing standards
generally accepted in the United States of America.  Those
standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are
free of material misstatement.  An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in
the financial statements.  An audit also includes assessing the
accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation.  We believe that our audits provide a reasonable
basis for our opinion.

In our opinion, such financial statements present fairly, in all
material respects, the financial position of the Company as of
March 31, 2002 and 2001, and the results of its operations and
its cash flows for each of the three years in the period ended
March 31, 2002 in conformity with accounting principles
generally accepted in the United States of America.






/s/Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Charlotte, North Carolina
May 31, 2002















                      AIR T, INC. AND SUBSIDIARIES
                   CONSOLIDATED STATEMENTS OF EARNINGS


                                          Year Ended March 31,

                                   2002          2001           2000

Operating Revenues (Note 10):
 Cargo                        $ 19,861,747   $ 20,258,595   $ 18,823,692
 Maintenance                     9,366,524      9,917,749     13,712,681
 Ground equipment               30,344,889     31,405,711     17,009,311
 Aircraft services and other    11,384,943      8,663,818      9,300,454

                                70,958,103     70,245,873     58,846,138

Operating Expenses:
 Flight operations              14,418,205     14,965,001     13,717,147
 Maintenance and brokering      20,810,379     16,903,938     20,658,917
 Ground equipment               23,547,474     26,295,686     15,052,477
 General and administrative      9,139,897      8,738,131      7,521,446
 Depreciation and amortization     666,389        826,018        921,791

                                68,582,343     67,728,774     57,871,778

 Operating Income                2,375,759      2,517,099        974,360


Non-operating Expense (Income):
 Interest                          491,387        745,077        638,138
 Deferred retirement
  expense (Note 12)                 88,078         24,996         24,996
 Investment income                (115,562)      (114,467)      (183,227)
 Increase in cash surrender
 value of life insurance          (164,000)       (95,457)      (133,378)
 Other                             (33,142)        12,075            256

                                   266,761        572,224        346,785

Earnings Before Income Taxes     2,108,998      1,944,875        627,575

Income Taxes (Note 11)             830,499        655,950        265,718

Net Earnings                  $  1,278,499   $  1,288,925   $    361,857


Net Earnings Per Share (Note 13):
  Basic                       $       0.47   $       0.47   $       0.13
  Diluted                     $       0.46   $       0.46   $       0.13

Weighted Average Shares Outstanding:
  Basic                          2,716,823      2,733,428      2,757,549
  Diluted                        2,788,700      2,780,732      2,837,398

See notes to consolidated financial statements.



                      AIR T, INC. AND SUBSIDIARIES
                       CONSOLIDATED BALANCE SHEETS



                                              March 31,

                                          2002          2001
ASSETS (Note 6)

Current Assets:
  Cash and cash equivalents         $     31,770    $     97,799
  Marketable securities (Note 2)         982,028         875,836
  Accounts receivable, less
   allowance for doubtful accounts
   of $455,805 in 2002 and
   $163,862 in 2001                    5,875,754      11,089,528
  Costs and estimated earnings in
   excess of billings on uncompleted
   contracts (Note 4)                     14,320         194,067
  Inventories, net (Note 3)            9,907,430      10,783,686
  Deferred tax asset (Note 11)           727,665         444,764
  Prepaid expenses and other             188,245         203,765
   Total Current Assets               17,727,212      23,689,445


Property and Equipment (Note 1):
  Furniture, fixtures and
   improvements                        7,210,133       6,500,938
  Flight equipment and
   rotables inventory                  1,329,153       1,153,301
                                       8,539,286       7,654,239
  Less accumulated depreciation       (5,020,238)     (4,400,067)
  Property and equipment, net          3,519,048       3,254,172

Deferred Tax Asset (Note 11)             568,186         567,282
Intangible Pension Asset (Note 12)       290,862         361,631
Other Assets                             797,454         660,682

  Total Assets                      $ 22,902,762    $ 28,533,212





See notes to consolidated financial statements.






                      AIR T, INC. AND SUBSIDIARIES
                       CONSOLIDATED BALANCE SHEETS



                                                 March 31,

                                            2002            2001

LIABILITIES AND STOCKHOLDERS'EQUITY

Current Liabilities:
  Accounts payable                  $     3,543,568   $   8,879,628
  Accrued expenses (Note 5)               1,915,605       1,573,468
  Income taxes payable (Note 11)            355,195         287,846
  Current portion of long-term
    obligations (Notes 6 & 7)               691,812         699,719

   Total Current Liabilities              6,506,180      11,440,661

Capital Lease Obligations  (less
  current portion) (Note 7)                  87,718         105,007
Long-term Debt (less current
  portion) (Note 6)                       3,378,934       5,163,829
Deferred Retirement Obligations
(less current portion) (Note 12)          1,830,205       1,653,400

Stockholders' Equity (Note 9):
  Preferred stock, $1 par value,
   authorized 50,000 shares, none
   issued                                      -               -
  Common stock, par value $.25;
   authorized 4,000,000 shares;
   2,724,320 and 2,705,153 shares
   issued and outstanding
   in 2002 and 2001,respectively            681,080         676,288
   Additional paid in capital             6,858,898       6,828,640
   Retained earnings                      4,079,621       3,206,642
   Accumulated other comprehensive loss    (519,874)       (541,255)
     Total Stockholders'Equity           11,099,725      10,170,315

     Total Liabilities and
      Stockholders' Equity             $ 22,902,762   $  28,533,212







See notes to consolidated financial statements.



                      AIR T, INC. AND SUBSIDIARIES
                  CONSOLIDATED STATEMENTS OF CASH FLOWS

                                               Year Ended March 31,
                                          2002         2001         2000
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net earnings                         $ 1,278,499  $ 1,288,925  $  361,857
 Adjustments to reconcile net
  earnings to net cash provided by
  (used in) operating activities:
 Increase in accounts receivable
  and inventory reserves                  616,049      172,844      93,478
 Depreciation and amortization            666,389      826,018     921,791
 Deferred tax provision                  (283,805)    (252,395)   (101,046)
 Net periodic pension cost                253,609      240,385     219,456
 Changes in assets and liabilities
  which provided (used)cash:
   Accounts receivable                  4,921,831   (3,133,354)   (987,870)
   Inventories                            291,324   (1,834,225) (2,873,729)
   Prepaid expenses and other              58,495      (49,547)   (461,826)
   Accounts payable                    (5,336,060)   1,361,988   3,249,750
   Accrued expenses                       356,793      432,626    (629,703)
   Income taxes payable                    67,349     (182,401)    470,247
  Total adjustments                     1,611,974   (2,418,061)    (99,452)
 Net cash provided by (used in)
  operating activities                  2,890,473   (1,129,136)    262,405

CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of
  property and equipment                   50,000       30,581        -
Capital expenditures                     (720,428)    (720,545)   (647,084)
Purchase of marketable securities            -            -       (100,000)
Sale and maturity of
  marketable securities                    13,496      462,617     575,143
Net cash used in investing
  activities                             (656,932)    (227,347)   (171,941)

CASH FLOWS FROM FINANCING ACTIVITIES:
Net (repayments) borrowings on
  line of credit                       (1,479,100)   1,740,910      89,402
Repayment of term loan                   (450,000)        -           -
Payment of cash dividend                 (405,520)    (274,858)   (220,278)
Repurchase of common stock                (42,785)    (186,783)    (78,437)
Proceeds from exercise of stock
  options                                  77,835       30,500        -
Net cash (used in) provided by
  financing activities                 (2,299,570)   1,309,769    (209,313)

NET DECREASE IN CASH AND  CASH
  EQUIVALENTS                             (66,029)     (46,714)   (118,849)
CASH AND CASH EQUIVALENTS AT
BEGINNING OF YEAR                          97,799      144,513     263,362

CASH AND CASH EQUIVALENTS AT END
OF YEAR                               $    31,770  $    97,799  $  144,513


SUPPLEMENTAL SCHEDULE OF NON-CASH
  FINANCING ACTIVITIES:
Capital leases entered into
  during fiscal year                  $    24,581  $   138,181  $   30,236

SUPPLEMENTAL DISCLOSURES OF CASH
  FLOW INFORMATION:
  Cash paid during the period for:
     Interest                         $   609,912  $   722,885  $  608,938
     Income taxes paid/(refunds
       received)                        1,039,595    1,091,684    (596,993)

See notes to consolidated financial statements.



                      AIR T, INC. AND SUBSIDIARIES
             CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY


                Common Stock (Note 9) Addit-            Accumulated
                                      ional                 Other      Total
                                     Paid-In   Retained Comprehensive  Stock-
                 Shares    Amount    Capital   Earnings    Income     holder's
                                                            (Loss)     Equity
Balance,March
 31, 1999     2,764,653 $  690,491 $7,049,157 $2,050,995 $ (154,745) $9,635,898
Comprehensive Income:
  Net earnings                                   361,857
  Other Comprehensive
  Loss:
   Unrealized loss
   on available-for-
   sale securities                                         (315,438)
  Excess of additional
   pension liability over
   unrecognized prior
   service cost                                            (127,721)
Total Comprehensive
  Loss                                                                 (81,302)
Repurchase and retirement
  Of common
  stock         (24,300)    (6,075)   (72,362)      -          -       (78,437)
Cash dividend
($.08 per share)   -           -          -     (220,278)      -      (220,278)

Balance, March
31,2000       2,740,353    684,416  6,976,795  2,192,574   (597,904) 9,255,881
Comprehensive Income:
  Net earnings                                 1,288,925
  Other Comprehensive
   Income:
  Unrealized gain
   on available-for-
   sale securities                                           74,980
  Excess of additional
   pension liability over
   unrecognized prior
   service cost                                             (18,331)
Total Comprehensive
  Income                                                             1,345,574
Repurchase and retirement
  of common
  stock         (61,200)   (14,628)  (172,155)      -          -      (186,783)
Exercise of stock
options          26,000      6,500     24,000                           30,500
Cash dividend
($.10 per share)   -          -          -      (274,858)      -      (274,858)

Balance, March
31, 2001      2,705,153    676,288  6,828,640  3,206,642   (541,255) 10,170,315
Comprehensive Income:
  Net earnings                                 1,278,499
  Other Comprehensive
   Income:
  Unrealized gain
   on available-for-
   sale securities                                          119,690
  Excess of additional
   pension liability
   over unrecognized
   prior service cost                                        20,691
  Change in fair
  value of derivatives                                     (119,000)
Total Comprehensive
  Income                                                              1,299,880
Repurchase and retirement
  of common
  stock         (13,500)    (3,375)   (39,410)      -          -       (42,785)
Exercise of stock
options          32,667      8,167     69,668                           77,835
Cash dividend
($.15 per share)   -          -          -      (405,520)             (405,520)

Balance, March
 31,2002      2,724,320 $  681,080 $6,858,898 $4,079,621 $ (519,874)$11,099,725

See notes to consolidated financial statements.


                      AIR T, INC. AND SUBSIDIARIES
               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
               YEARS ENDED MARCH 31, 2002, 2001, AND 2000

1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

          Principal Business Activities - Air T, Inc. (Company), through its
     operating subsidiaries, is an air cargo carrier specializing in the
     overnight delivery of small package air freight, a provider of
     aircraft parts, engine overhaul management and component repair
     services and a manufacturer of aircraft ground service equipment.

     Principles of Consolidation - The consolidated financial statements
     include the accounts of the Company and its wholly-owned
     subsidiaries, Mountain Air Cargo, Inc., CSA Air, Inc., Mountain
     Aircraft Services, LLC and Global Ground Support, LLC (Global).
     All significant intercompany transactions and balances have been
     eliminated.

     Concentration of Credit Risk - The Company's potential exposure to
     concentrations of credit risk consists of trade accounts
     receivable.  Accounts receivable are normally due within 30 days
     and the Company performs periodic credit evaluations of its
     customers' financial condition.

     Substantially all of the Company's customers are concentrated in
     the aviation industry and revenue can be materially affected by
     current economic conditions and the price of certain supplies such
     as fuel, the cost of which is passed through to the customer.  The
     Company has customer concentrations in two areas of operations, air
     cargo which provides service to one major customer and ground
     support equipment which provides equipment and services to
     approximately 90 customers, one of which is considered a major
     customer.  The loss of a major customer would have a material
     impact on the Company's results of operations.

     Cash Equivalents  - Cash equivalents consist of liquid investments
     with maturities of three months or less when purchased.

     Marketable Securities - Marketable securities consists primarily of
     investments in mutual funds and REITs.  The Company has classified
     marketable securities as available-for-sale and they are carried at
     fair value. Unrealized gains and losses on such securities are
     excluded from earnings and reported as a component of accumulated
     comprehensive loss until realized.  Realized gains and losses on
     marketable securities are determined by calculating the difference
     between the basis of each specifically identified marketable
     security sold and its sales price.

     Inventories  - Inventories of the manufacturing subsidiary are
     carried at the lower of cost (first in, first out) or market.
     Aviation parts and supplies inventories are carried at the lower of
     average cost or market.  Consistent with industry practice, the
     Company includes aircraft parts and supplies in current assets,
     although a certain portion of these inventories may not be used
     within one year.

     Property and Equipment - Property and equipment is stated at cost
     or, in the case of equipment under capital leases, the present
     value of future lease payments.  Rotables inventory represents
     aircraft parts which are repairable, capitalized and depreciated
     over their estimated useful lives.  Depreciation and amortization
     are provided on a straight-line basis over the asset's service life
     or related lease term, as follows:

      Flight equipment and intellectual property          7 years
      Other equipment and furniture                  3 to 7 years

     Revenue Recognition  - Cargo revenue is recognized upon completion
     of contract terms and maintenance revenue is recognized when the
     service has been performed.  Revenue from product sales is
     recognized when contract terms are completed and title has passed
     to customers.  Revenues from overhaul contracts on customer owned
     parts and long term fixed price construction projects are
     recognized on the percentage-of-completion method, in accordance
     with AICPA Statement of Position No. 81-1, "Accounting for
     Performance of Construction Type and Certain Production Type
     Contracts".  Revenues for contracts under percentage of completion
     are measured by the percentage of cost incurred to date to
     estimated total cost for each contract or workorder. Contract costs
     include all direct material and labor costs and overhead costs
     related to contract performance.  Unanticipated changes in job
     performance, job conditions and estimated profitability may result
     in revisions to costs and income, and are recognized in the period
     in which the revisions are determined or future periods.  Such contracts
     generally have no customer retainage provisions.  Except for a
     construction contract at Global, which is billed on a progress billing
     basis, the Company generally bills its customer at the time of
     completion of the contract or workorder.


          Operating Expenses Reimbursed by Customer - The Company, under the
     terms of its air cargo dry-lease service contracts, passes through
     to its major customer certain cost components of its operations
     without markup.  The cost of flight crews, fuel, landing fees,
     outside maintenance and certain other direct operating costs are
     included in operating expenses and billed to the customer, at cost,
     as cargo and maintenance revenue.

          Stock Based Compensation  - The Company measures employee stock
     compensation plans using the intrinsic method with pro-forma
     disclosure of net earnings and earnings per share determined as if
     the fair value based method had been applied in measuring
     compensation cost.

     Income Taxes - Income taxes are provided for temporary differences
     between the tax and financial accounting bases of assets and
     liabilities using the asset and liability method.  Deferred income
     taxes are recognized for the tax consequence of such temporary
     differences at the enacted tax rate expected to be in effect when
     the differences reverse.

     Accounting Estimates - The preparation of consolidated financial
     statements in conformity with accounting principles generally accepted
     in the United States of America requires management to make estimates
     and assumptions that affect the amounts reported.  Actual results could
     differ from those estimates.  Significant estimates include the
     allowance for doubtful account, inventory reserve, intangible pension
     asset, deferred retirement obligations and revenue recognized under the
     percentage of completion method.

     Derivative Financial Instruments - In June 1998, the Financial
     Accounting Standards Board ("FASB") issued Statement of Financial
     Accounting Standard No. 133, ("SFAS 133") "Accounting for
     Derivative Instruments and Hedging Activities", which requires all
     derivative instruments to be recognized on the balance sheet at
     their fair value.  Changes in the fair value of derivatives are to
     be recorded each period either in other comprehensive income or in
     current earnings depending on the use of the derivative and whether
     it qualifies for hedge accounting.  SFAS No. 133 was effective for
     the Company beginning on April 1, 2001. The adoption of SFAS No.
     133 did not significantly impact the Company's financial
     statements.

     Recent Accounting Pronouncements -

     The Financial Accounting Standards Board has approved SFAS No. 143,
     "Accounting for Asset Retirement Obligations" and No. 144,
     "Accounting for the Impairment or Disposal of Long-lived Assets".
     SFAS No. 143 addresses financial accounting and reporting for
     obligations associated with the retirement of tangible long-lived
     assets and the associated asset retirement costs.  It requires that
     the fair value of a liability for an asset retirement obligation be
     recognized in the period in which it is incurred if a reasonable
     estimate of fair value can be made.  The associated asset
     retirement costs are capitalized as part of the carrying amount of
     the long-lived asset.  SFAS No. 143 is effective for fiscal years
     beginning after June 15, 2002.  SFAS No. 144 supersedes SFAS No.
     121 and amends, "Accounting for the Impairment of Long-Lived Assets
     and for Long-Lived Assets to be Disposed of" and Accounting
     Principles Bulletin (APB No. 30).  Along with establishing a single
     accounting model, based on the framework established in SFAS No.
     121, for long-lived assets to be disposed of by sale, this standard
     retains the basic provisions of APB No. 30 for the presentation of
     discontinued operations in the income statement but broadens that
     presentation to include a component of an entity.  SFAS No. 144 is
     effective for fiscal years beginning after December 15, 2001. The
     Company does not expect the adoption of SFAS No. 143 or 144 to have
     a material effect on our financial position and results of
     operations.

     Reclassifications - Certain reclassifications have been made to
     2001 and 2000 amounts to conform to the current year presentation.

2.   MARKETABLE SECURITIES

     At March 31, 2002 and 2001, marketable securities consist of the
     following investment types:

                                             2002       2001
     Real estate investment trusts       $  242,200  $   98,000
     Mutual funds                           739,828     764,336
     Certificate of deposit                    -         13,500

     Total                               $  982,028  $  875,836

     The Company recorded a realized gain of approximately $40,000 in
     2001 and a realized loss of approximately $26,000 in 2000 in the
     accompanying consolidated statements of earnings due to the sale of
     securities.

3.   INVENTORIES

     Inventories consist of the following:
                                                          March 31,
                                                      2002         2001
        Aircraft parts and supplies               $ 5,373,398  $ 5,571,721
        Aircraft equipment manufacturing:
          Raw materials                             2,777,175    2,819,329
          Work in process                             914,730    1,131,565
          Finished goods                            1,432,332    1,527,170
          Total inventory                          10,497,635   11,049,785
          Reserves                                   (590,205)    (266,099)

         Total, net of reserves                    $9,907,430  $10,783,686


4.   UNCOMPLETED CONTRACTS

     Overhaul contracts in process accounted for under the percentage of
     completion method at March 31, 2002 and 2001 are summarized as
     follows:


                                                         2002         2001
           Costs incurred on uncompleted contracts   $  6,337      $ 53,953
           Estimated earnings                           7,983       140,114
           Subtotal                                    14,320       194,067
           Less billings to date                         -             -
           Costs and estimated earnings in excess of
           billings on uncompleted contracts         $ 14,320      $194,067

5.   ACCRUED EXPENSES

     Accrued expenses consist of the following:
                                                          March 31,
                                                    2002            2001

          Salaries, wages and related items    $   613,671     $   661,600
          Profit sharing                           556,363         403,466
          Health insurance                         305,834           -
          Other                                    439,737         508,402

                                               $ 1,915,605     $ 1,573,468

6.   FINANCING ARRANGEMENTS

     On May 23, 2001 the Company expanded its bank financing line to a
     $10,000,000 credit facility.  Under the terms of the agreement, a
     $7,000,000 secured long-term revolving credit line, which expires
     on August 31, 2003, replaced the Company's $8,500,000 unsecured
     short-term revolving credit line.  The remaining $3,000,000 of the
     credit facility is a five-year term loan which matures on May 31,
     2006; with quarterly payments of $150,000, plus accrued interest.

            Long-term debt maturities are as follows:

                 2003                         $   600,000
                 2004                           1,910,000
                 2005                             600,000
                 2006                             600,000
                 2007                             150,000

                 Total                        $ 3,860,000


     Both the revolving credit line and the term loan contain customary
     events of default and restrictive covenants that, among other
     matters, require the Company to maintain certain financial ratios.
     As of March 31, 2002, the Company was in compliance with all of the
     restrictive covenants.  The amount of credit available to the
     Company under the agreement at any given time is determined by an
     availability calculation, based on the eligible borrowing base, as
     defined in the credit agreement which includes the Company's
     outstanding receivables, inventories and equipment, with certain
     exclusions.  The credit facility is secured by substantially all of
     the Company's assets.

     Amounts advanced under the credit facility bear interest at the 30-
     day "LIBOR" rate plus 137 basis points.  The LIBOR rate at March
     31, 2002 was 1.85%. At March 31, 2002 and 2001, the amounts
     outstanding against the credit facility were $3,860,000 and $5,764,000,
     respectively.  At March 31, 2002, $5,690,000 was available under
     the entire credit facility.

     The Company has classified $3,260,000 of its outstanding bank debt
     as long-term as of March 31, 2002 to reflect the terms included
     under the agreement signed on May 31, 2001.  The Company entered
     into two swap agreements on May 31, 2001 to fix the interest rate
     on the $3,000,000 term portion and $2,000,000 of the revolving
     portion of the credit facility at respective interest rates of
     6.97% and 6.50%.  See Footnote 8.

7.   LEASE COMMITMENTS

     The Company has operating lease commitments for office equipment
     and its office and maintenance facilities as well as capital leases
     for certain office and other equipment.  The Company leases its
     corporate offices from a company controlled by Company officers for
     $9,155 per month under a five-year lease which expires in May 2006.

     In August 1996, the Company relocated certain portions of its
     maintenance operations to a new maintenance facility located at the
     Global TransPark in Kinston, N. C.  Under the terms of the long-
     term facility lease, after an 18 month grace period (from date of
     occupancy), rent will escalate from $2.25 per square foot to $5.90
     per square foot, per year, over the 21.5 year life of the lease.
     However, based on the occurrence of certain events the lease may be
     canceled by the Company.  The Company currently considers the lease
     to be non-cancelable for seven years and has calculated rent
     expense on a straight-line basis over this portion of the lease
     term.

     In August 1997 Global, located in Olathe, Kansas, leased
     approximately 57,000 square feet of manufacturing space for $17,030
     per month, under a two-year operating lease originally set to
     expire in  September 1999.  In September 1998, the lease was
     expanded to 112,500 square feet of manufacturing and office space
     for $35,903 per month expiring August 2001.  In April 2001 the
     lease was renewed through August 2006; monthly rental will increase
     from $28,967 to $30,842 over the life of the lease.

     At March 31, 2002, future minimum annual lease payments under
     capital and non-cancellable operating leases with initial or
     remaining terms of more than one year are as follows:

                                         Capital      Operating
                                          Leases        Leases
     2003                              $    50,590   $   637,901
     2004                                   46,388       622,340
     2005                                   38,703       629,474
     2006                                   13,115       636,608
     2007                                     -          300,227

     Total minimum lease payments      $   148,796   $ 2,826,549
     Less amount representing interest      20,028

     Present value of lease payments       128,768
     Less current maturities                41,050

     Long-term maturities              $    87,718

     Rent expense for operating leases totaled approximately $759,000,
     $819,000, and $728,000 for 2002, 2001 and 2000, respectively.  Rent
     expense to related parties was $109,860 for 2002 and $96,900 for
     2001 and 2000, respectively.

8.   DERIVATIVE FINANCIAL INSTRUMENTS

     On April 1, 2001, the Company adopted Statement of Financial
     Accounting Standard No. 133, "Accounting for Derivative Instruments
     and Hedging Activities", as amended. SFAS 133 establishes
     accounting and reporting standards for derivative instruments,
     including certain derivative instruments embedded in other
     contracts, and for hedging activities.  It requires that entities
     recognize all derivatives as either assets or liabilities in the
     statement of financial position and measure those instruments at
     fair value.

     The Company is exposed to market risk, such as changes in interest
     rates.  To manage the volatility relating to interest rate risk, we
     may enter into interest rate hedging arrangements from time to
     time.  The Company does not utilize derivative financial
     instruments for trading or speculative purposes.

     During the first quarter of fiscal 2002, the Company entered into
     two interest rate swaps with a notional amount of $3 million, and
     $2 million respectively.  These agreements were entered into as
     cash flow hedges to fix the interest rates on the $3 million term
     portion and $2 million of the revolving portion of the credit
     facility at interest rates of 6.97% and 6.50%, respectively; the
     maturity dates of the swaps match the respective maturity dates of
     the underlying debt instruments.  The fair value of these swaps had
     decreased by $119,000 at March 31, 2002.  Because the swaps are
     considered completely effective the change in fair market value of
     the swaps are recorded in other comprehensive loss and long-term
     debt on the balance sheet.

9.   STOCKHOLDERS' EQUITY

     The Company may issue up to 50,000 shares of preferred stock, in
     one or more series, on such terms and with such rights, preferences
     and limitations as determined by the Board of Directors.  No
     preferred shares have been issued as of March 31, 2002.

     The Company has granted options to purchase up to a total of
     285,200 shares of common stock to certain Company employees and
     outside directors at prices ranging from $2.75 to $6.38 per share.
     As of March 31, 2002, 79,800 shares remain available for future
     issuance.  All options were granted at exercise prices which
     approximated the fair market value of the common stock on the date
     of grant.  Options granted in fiscal 1999 and 2000 vest over one to
     three year periods and must be exercised within one to ten years of
     the vesting date.

     The following table summarizes information about stock options at
     March 31, 2002:

                        Options Outstanding                Options Exercisable
                                   Weighted
                                    Average     Weighted               Weighted
  Option                           Remaining     Average                Average
  Grant    Exercise    Options    Contractual   Exercise   Options     Exercise
  Date       Price   Outstanding  Life (years)    Price   Exerciable      Price

 3/19/99   $  2.75      132,533         1.0      $  2.75     132,533     $ 2.75
 1/28/00      3.19       89,000         2.3         3.19      79,000       3.19
 8/13/98      6.38        5,000         6.4         6.38       5,000       6.38

        $2.75 to $6.38  226,533         1.6      $  3.00     216,533     $ 2.99


          Option information is summarized as follows:

                                                      Weighted
                                                       Average
                                      Shares   Exercise Price Per Share
     Outstanding March 31, 1999       196,200            2.57
          Granted                      89,000            3.19
     Outstanding March 31, 2000       285,200            2.77
          Exercised                   (26,000)           1.17
     Outstanding March 31, 2001       259,200            2.93
          Exercised                   (32,667)           2.75
     Outstanding March 31, 2002       226,533            3.00



     The fair value of options granted in 2000 and 1999, is estimated on
     the date of grant using the Black-Scholes option-pricing model with
     the  assumptions listed below.  No options were granted in 2002  or
     2001.

                                                       2000      1999
      Weighted average fair value  per option      $   1.62  $   1.15
      Assumptions used:
       Weighted average expected volatility            65.1%     61.0%
       Weighted average expected dividend yield         2.4%      2.2%
       Weighted average risk-free interest rate        6.59%     5.70%
       Weighted average expected life, in years         4.6       3.0

     The Company measures stock-based compensation using the intrinsic
     value method in accordance with APB Opinion No. 25.  Had
     compensation cost for the Company's stock-based compensation awards
     been determined at the grant dates based on the fair market value
     method described in FASB Statement No. 123, "Accounting for Stock-
     Based Compensation" the Company's pro forma net income would have
     been $1,232,623, or $0.44 per diluted share, $1,240,350, or $0.45
     per diluted share, and  $279,927, or $0.10 per diluted share,
     respectively, for 2002, 2001 and 2000.

     The Company has announced its intention to repurchase up to
     $3,400,000 of the Company's common stock under a share repurchase
     program.  At March 31, 2002 the Company had repurchased a total of
     789,780 shares at a total cost of $3,257,622 and may expend up to
     an additional $142,378 under this program.

10.  REVENUES FROM MAJOR CUSTOMER

     Approximately 41.2%, 43.1% and 55.5% of the Company's revenues were
     derived from services performed for a major air express company in
     2002, 2001 and 2000, respectively.  In addition, approximately
     22.9% and 13.9% of the Company's revenues for 2002 and 2001
     respectively, were generated from Global's US Air Force contract.

11.  INCOME TAXES

     The provision for income taxes consists of:

                                           Year Ended March 31,

                                         2002        2001        2000
     Current:
     Federal                        $   911,000  $  730,000  $  300,000
     State                              203,000     178,000      67,000
        Total current                 1,114,000     908,000     367,000
     Deferred:
     Federal                           (214,000)   (207,000)    (83,000)
     State                              (70,000)    (45,000)    (18,000)
        Total deferred                 (284,000)   (252,000)   (101,000)


     Total                          $   830,000  $  656,000  $  266,000

          The consolidated income tax provision was different from the amount
     computed using the statutory Federal income tax rate for the
     following reasons:

                                                  2002       2001         2000

Income tax provision at U.S. Statutory rate  $  716,000  $  661,000  $  213,000
State income taxes                               99,000      94,000      32,000
Meal and entertainment disallowance              25,000      21,000      17,000
Other, net                                      (10,000)     17,000       4,000
Reduction in valuation allowance                   -       (137,000)       -

Income tax provision                         $  830,000  $  656,000  $  266,000

     The tax effect of temporary differences that gave rise to the
     Company's deferred tax assets at March 31, 2002 and 2001 are as
     follows:
                                                2002          2001
     Book accruals over tax, net:
       Warranty reserve                     $   47,742    $   80,123
       Accounts receivable reserve             177,008        66,210
       Inventory reserve                       227,937       102,767
       Accrued insurance                        (7,103)       25,561
       Accrued vacation                         86,879        79,467
       Deferred compensation                   565,097       519,111
       Other                                   198,277        96,117
     Fixed assets                                   14        42,690
     Total                                 $ 1,295,851   $ 1,012,046


     The deferred tax asset is classified in the accompanying 2001 and
     2000 consolidated balance sheets according to the classification of
     the related asset and liability.


12.  EMPLOYEE BENEFITS

     The Company has a 401K defined contribution plan (AirT 401(K)
     Retirement Plan).  All employees of the Company are eligible to
     participate in the plan.  The Company's contribution to the 401(K)
     plan for the years ended March 31, 2002, 2001 and 2000 was
     $228,000, $229,000, and $229,000, respectively.

     The Company, in each of the past three years, has paid a
     discretionary profit sharing bonus in which all employees have
     participated.  The Company's expense for the years ended March 31,
     2002, 2001, and 2000 was $562,000, $400,000 and $126,000, respectively.

     Effective January 1, 1996 the Company entered into supplemental
     retirement agreements with certain key executives of the Company,
     to provide for a monthly benefit upon retirement.  The following
     table sets forth the funded status of the plan at March 31, 2002
     and 2001.


                                                                March 31,
                                                            2002       2001

 Vested benefit obligation and
   accumulated benefit obligation                     $ 1,555,827  $ 1,392,100
 Projected benefit obligation                           1,555,827    1,395,178
 Plan assets at fair value                                   -            -

 Projected benefit obligation greater than plan assets  1,555,827    1,395,178
 Unrecognized prior service cost                         (290,862)    (361,631)
 Unrecognized actuarial loss                             (125,361)    (147,552)
 Adjustment required to recognize minimum liability       416,223      506,105

 Accrued pension cost recognized in the
  consolidated balance sheet                          $ 1,555,827  $ 1,392,100


     In accordance with the provisions of Statement of Financial
     Accounting Standards No. 87, "Employers' Accounting for Pensions,"
     the Company has recorded an additional minimum liability
     representing the excess of the accumulated benefit obligation over
     the fair value of plan assets and accrued pension liability for its
     pension plan.  The additional liability has been offset by an
     intangible asset to the extent of prior service cost.  The portion
     of unrecognized prior service cost in excess of additional
     liability in fiscal 2002 totaled $20,691 and is reported as a
     component of accumulated other comprehensive loss.

     The projected benefit obligation was determined using an assumed
     discount rate of 7% and an assumed rate of return on assets of 7%.
     The liability relating to these benefits has been included in
     deferred retirement obligation in the accompanying financial
     statements.

     Net periodic pension expense for fiscal 2002 and 2001 included the
     following:

                                          2002       2001        2000

     Future service cost            $   62,944  $   58,826   $  53,106
     Interest cost                      97,665      87,425      77,987
     Amortization                       93,000      94,134      88,363

     Net periodic pension cost      $  253,609  $  240,385   $ 219,456


     A rollforward of the projected benefit obligation (PBO) is as follows:

       PBO March 31, 2001            $  1,395,178
         Actuarial loss                        40
         Future service cost               62,944
         Interest cost                     97,665
       PBO March 31, 2002            $  1,555,827


     The Company's former Chairman and CEO passed away on April 18,
     1997.  Under the terms of his supplemental retirement agreement,
     approximately $498,000 in present value of death benefits is
     required to be paid to fulfill death benefit payments over the next
     10 years.  As of March 31, 2002 accruals related to the unpaid
     present value of the benefit amounted to approximately $324,000 (of
     which approximately $274,000 is included under deferred retirement
     obligations in the accompanying balance sheet).  The net periodic
     pension costs are included in general and administrative expenses
     in the accompanying consolidated statements of earnings.

13.  NET EARNINGS PER COMMON SHARE

     Basic earnings per share has been calculated by dividing net
     earnings by the weighted average number of common shares
     outstanding during each period.  For purposes of calculating
     diluted earnings per share, shares issuable under employee stock
     options were considered potential common shares and were included
     in the weighted average common shares.

     The computation of basic and diluted earnings per common share is
     as follows:


                                           Year Ended March 31,
                                       2002        2001         2000

     Net earnings                  $ 1,278,499  $ 1,288,925   $  361,857

     Weighted average common shares:
     Shares outstanding - basic      2,716,823    2,733,428    2,757,549
     Dilutive stock options             71,877       47,304       79,849
     Shares outstanding - diluted    2,788,700    2,780,732    2,837,398

     Net earnings per common share:
     Basic                         $      0.47  $     0.47   $      0.13
     Diluted                       $      0.46  $     0.46   $      0.13




14.  QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
     (in thousands except per share data)

                                      FIRST     SECOND     THIRD      FOURTH
                                     QUARTER    QUARTER    QUARTER    QUARTER
     2002
     Operating Revenues             $ 17,573  $  25,273  $  15,769  $  12,343
     Operating Income (Loss)             701      1,331        382        (38)
     Earnings Before Income Taxes        571      1,230        278         30
     Net Earnings                        343        746        156         34

     Net Earnings Per Share-Basic   $   0.13  $    0.27  $    0.06  $     0.01
     Net Earnings Per Share-Diluted     0.12       0.27       0.06        0.01

     2001
     Operating Revenues             $ 14,412  $  15,110  $  20,583  $   20,141
     Operating  Income                   406        458      1,051         602
     Earnings  Before Income Taxes       280        282        822         561
     Net Earnings                        165        167        498         459

     Net Earnings Per Share-Basic   $   0.06  $    0.06  $    0.18  $     0.17
     Net Earnings Per Share-Diluted     0.06       0.06       0.18        0.16


15.  SEGMENT INFORMATION

     The Company's four subsidiaries operate in three business segments.
     Each business segment has separate management teams and
     infrastructures that offer different products and services.  The
     subsidiaries have been combined into the following reportable
     segments: overnight air cargo, ground equipment, and aviation
     services.

     The accounting policies for all reportable segments are the same as
     those described in Footnote 1 of Notes to Consolidated Financial
     Statements.  The Company evaluates the performance of its operating
     segments based on operating income.

     Segment data is summarized as follows:

                                         Year Ended March 31,

                                 2002           2001            2000
     Operating Revenues
       Overnight Air Cargo   $ 29,264,031   $ 30,262,362   $ 32,667,694
       Ground Equipment        30,344,889     31,405,711     17,009,311
       Aviation Services       11,349,183      8,577,800      9,169,133
       Corporate                     -              -              -
       Total                 $ 70,958,103   $ 70,245,873   $ 58,846,138


     Operating Income (Loss)
       Overnight Air Cargo   $  2,215,901   $  2,475,522   $  2,679,793
       Ground Equipment         3,335,477      2,048,843       (591,440)
       Aviation Services         (904,911)       274,337        650,033
       Corporate (1)           (2,270,708)    (2,281,603)    (1,764,026)
       Total                 $  2,375,759   $  2,517,099   $    974,360


     Identifiable Assets
       Overnight Air Cargo   $  3,852,042   $  4,957,327   $  5,168,813
       Ground Equipment        10,051,691     13,531,515     10,284,886
       Aviation Services        6,142,237      8,862,645      6,111,755
       Corporate                2,856,792      1,181,725      2,370,993
       Total                 $ 22,902,762   $ 28,533,212   $ 23,936,447


     Capital Expenditures, net
       Overnight Air Cargo   $    107,264   $    371,505   $    353,409
       Ground Equipment           271,672         77,288         58,483
       Aviation Services           38,308        229,650        132,238
       Corporate                  303,184         42,102        108,497
       Total                 $    720,428   $    720,545   $    652,627


     Depreciation and Amortization
       Overnight Air Cargo   $    228,051   $    261,122   $    322,479
       Ground Equipment           197,708        271,496        283,664
       Aviation Services          149,437        146,683        161,781
       Corporate                   91,193        146,717        153,867
       Total                 $    666,389   $    826,018   $    921,791


     (1) Excludes income from inter-segment transactions.

16.  COMMITMENTS AND CONTINGENCIES

     Global and one of its employees are defendants in a lawsuit filed
     in March 2002 in the United States District Court for the District
     of Columbia, Catalyst & Chemical Services et al v. Terex, et al.
     In this action, the plaintiffs allege that they provided to Global
     and the employee certain trade secrets regarding aircraft de/anti-
     icing systems that were then disclosed by Global and the employee
     to third parties.  The plaintiffs allege misappropriation of trade
     secrets, breach of contract and violation of the federal Racketeer
     Influenced and Corrupt Organization Act and seek monetary damages.
     An answer in this action is not yet due and has not yet been filed.
     The Company does not believe that the action has any merit and
     intends to defend the lawsuit vigorously.

     The  Company  is currently aware of certain employee,  intellectual
     property  and environmental matters, some of which involve  pending
     or  threatened lawsuits. If adversely decided, management  believes
     the  results of these pending or threatened lawsuits would not have
     a material adverse effect on the Company.



Item 9.   Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure.

     The Company had no disagreements on accounting or financial
disclosure matters with its independent certified public accountants to
report under this Item 9.


                                PART III

Item 10.  Directors and Executive Officers of the Registrant.

     J. Hugh Bingham, age 56, has served as President and Chief
Operating Officer of the Company since April 1997, as Senior Vice
President of the Company from June 1990 until April 1997, as Executive
Vice President from June 1983 to June 1990, and as a director since
March 1987.  Mr. Bingham also serves as Chief Executive Officer and a
director of MAC, as Chief Executive Officer of MAS and as an Executive
Vice President and director of CSA.

     Walter Clark, age 45, has served as Chairman of the Board of
Directors of the Company and Chief Executive Officer since April 1997.
Mr. Clark also serves as a director of MAC and CSA.  Mr. Clark was
elected a director of the Company in April 1996.  Mr. Clark was self-
employed in the real estate development business from 1985 until April
1997.

     John J. Gioffre, age 58, has served as Vice President-Finance and
Chief Financial Officer of the Company since April 1984 and as
Secretary/Treasurer of the Company since June 1983.  He has served as a
director of the Company since March 1987.  Mr. Gioffre also serves as
Vice-President, Secretary/Treasurer and a director of MAC and CSA and as
Vice President-Finance, Treasurer and Secretary of MAS.

     J. Leonard Martin, age 65, was elected a director in August 1994
and joined the Company as a Vice President in April 1997.  From June
1995 until April 1997, Mr. Martin was an independent aviation
consultant.  From April 1994 to June 1995, Mr. Martin served as Chief
Operating Officer of Musgrave Machine & Tool, Inc., a machining company.
From January 1989 to April 1994, Mr. Martin served as a consultant to
the North Carolina Air Cargo Authority in connection with the
establishment of the Global TransPark air cargo facility in Kinston,
North Carolina.  From 1955 through 1988 Mr. Martin was employed by
Piedmont Airlines, a commercial passenger airline, in various
capacities, ultimately serving as Senior Vice President-Passenger
Services.

     William H. Simpson, age 54, has served as Executive Vice President
of the Company since June 1990, as Vice President from June 1983 to June
1990, and as a director of the Company since June 20, 1985.  Mr. Simpson
is also the President and a director of MAC, the Chief Executive Officer
and a director of CSA and Executive Vice President of MAS.

     Menda J. Street, age 50, has served as Vice President of MAC since
1984, and in various other capacities at MAC since 1979.

     Claude S. Abernethy, Jr., age 75, was elected as director of the
Company in June 1990.  For the past five years, Mr. Abernethy has served
as a Senior Vice President of Wachovia Securities, a securities
brokerage and investment banking firm, and its predecessor.  Mr.
Abernethy is also a director of Carolina Mills, Inc. and Wellco
Enterprises.

     Sam Chesnutt, age 65, was elected a director of the Company in
August 1994.  Mr. Chesnutt serves as President of Sam Chesnutt and
Associates, an agribusiness consulting firm.  From November 1988 to
December 1994, Mr. Chesnutt served as Executive Vice President of
AgriGeneral Company, L.P., an agribusiness firm.

     Allison T. Clark, age 46, has served as a director of the Company
since May 1997.  Mr. Clark has been self-employed in the real estate
development business since 1987.

     Herman A. Moore, age 72, was elected a director of the Company on
June 22, 1998.  Mr. Moore is the president of Herman A. Moore & Assoc.,
Inc., a real estate development company.

     George C. Prill, age 79, has served as a director of the Company
since June 1982, as Chief Executive Officer and Chairman of the Board of
Directors from August 1982 until June 1983, and as President from August
1982 until spring 1984.  Mr. Prill has served as an Editorial Director
for General Publications, Inc., a publisher of magazines devoted to the
air transportation industry, from November 1992 until 2001 and was
retired from 1990 until that time.  From 1979 to 1990, Mr. Prill served
as President of George C. Prill & Associates, Inc., of Charlottesville,
Virginia, which performed consulting services for the aerospace and
airline industry.  Mr. Prill has served as President of Lockheed
International Company, as Assistant Administrator of the FAA, as a
Senior Vice President of the National Aeronautic Association and
Chairman of the Aerospace Industry Trade Advisory Committee.

     The officers of the Company and its subsidiaries each serve at the
pleasure of the Board of Directors.  Allison Clark and Walter Clark are
brothers.

     Each director receives a director's fee of $500 per month and an
attendance fee of $500 is paid to outside directors for each meeting of
the board of directors or a committee thereof.  Pursuant to the
Company's 1998 Omnibus Securities Award Plan (the "Plan") each director
who is not an employee of the Company received an option to purchase
1,000 shares of Common Stock at an exercise price of $6.375 per share
(the closing bid price per share on the date of stockholder approval of
the Plan.)  The Plan provides for a similar option award to any director
first elected to the board after the date the stockholders approved the
Plan.  Such options expire ten years after the date they were granted.

     To the Company's knowledge, based solely on review of the copies of
reports under Section 16(a) of the Securities Exchange Act of 1934 that
have been furnished to the Company and written representations that no
other reports were required, during the fiscal year ended March 31, 2002
all executive officers, directors and greater than ten-percent
beneficial owners have complied with all applicable Section 16(a) filing
requirements.

Item 11.  Executive Compensation.

     The following table sets forth a summary of the compensation paid
during each of the three most recent fiscal years to the Company's Chief
Executive Officer and to the four other executive officers on March 31,
2002 with total compensation of $100,000 or more.

SUMMARY COMPENSATION TABLE

                                                             Long-term
                                                           Compensation
Name and Principal                                             Awards
    Position                                                 Securities
                                  Annual Compensation        Underlying
                       Year   Salary ($)(1)    Bonus ($)     Options (#)
Walter Clark           2002     111,522         52,140           -
Chief Executive        2001     125,732         46,900           -
Officer                2000     126,035         15,080         50,000

J. Hugh Bingham        2002     193,304         52,564           -
President              2001     193,004         46,900           -
                       2000     196,032         15,080           -

John J. Gioffre        2002     122,058         39,880           -
Vice President         2001     121,788         35,175           -
                       2000     121,948         11,311           -

J. Leonard Martin      2002     122,659         59,900           -
Vice President         2001     122,673         24,880           -
                       2000     122,205          6,880           -

William H. Simpson     2002     195,364         52,140           -
Executive Vice         2001     194,803         46,900           -
President              2000     195,169         15,080          9,000

__________________________________________
(1)  Includes perquisites in aggregate amount no greater than 10% of the
  officer's base salary plus bonus.


     The following table sets forth, for each of the executive officers
listed in the Summary Compensation Table who exercised options to
purchase shares of Common Stock during the most recent fiscal year, the
number of shares purchased and the value realized upon exercise, which
is determined based on the aggregate fair market value of the shares at
the time of the exercise minus the aggregate exercise price.  The table
also sets forth the number of shares of Common Stock underlying
unexercised options at March 31, 2002 held by each of the executive
officers listed in the Summary Compensation Table.  The table also
includes the value of such options at March 31, 2002 based upon the
closing bid price of the Company's Common Stock in the over-the-counter
market on that date ($3.50 per share) and the exercise price of the
options.


           AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
                      FISCAL YEAR-END OPTION VALUES

                                         Number of              Value of
                                         Securities            Unexercised
                  Shares                 Underlying            In-the-Money
                Acquired     Value       Unexercised              Options
                   On      Realized   Options at FY-End(#)     at FY-End ($)
    Name        Exercise#     ($)    Exercis-  Unexercis-  Exercis-  Unexercis-
                                       able       able        able      able
Walter Clark        -         -      50,000       -        15,500       -

J. Hugh Bingham     -         -       9,000       -         6,750       -

John J. Gioffre     -         -       9,000       -         6,750       -

J. Leonard Martin  6,000     4,800    3,000       -         2,250       -

William H. Simpson 8,000    20,400    9,000       -         2,790       -


EMPLOYMENT AGREEMENTS

Effective January 1, 1996, the Company and each of its subsidiaries
entered into employment agreements with J. Hugh Bingham, John J. Gioffre
and William H. Simpson, each of substantially similar form.  Each of
such employment agreements provides for an annual base salary ($130,000,
$103,443 and $165,537 for Messrs. Bingham, Gioffre and Simpson,
respectively) which may be increased upon annual review by the
Compensation Committee of the Company's Board of Directors.  In
addition, each such agreement provides for the payment of annual
incentive bonus compensation equal to a percentage (2.0%, 1.5% and 2.0%
for Messrs. Bingham, Gioffre and Simpson, respectively) of the Company's
consolidated earnings before income taxes and extraordinary items as
reported by the Company in its Annual Report on Form 10-K.  Payment of
such bonus is to be made within 15 days after the Company files its
Annual Report on Form 10-K with the Securities and Exchange Commission.

The initial term of each such employment agreement expired on March 31,
1999, and the term is automatically extended for additional one-year
terms unless either such executive officer or the Company's Board of
Directors gives notice to terminate automatic extensions which must be
given by December 1 of each year (commencing with December 1, 1996).

Each such agreement provides that upon the executive officer's
retirement, he shall be entitled to receive an annual benefit equal to
$75,000 ($60,000 for Mr. Gioffre), reduced by three percent for each
full year that the termination of his employment  precedes the date he
reaches age 65.  The retirement benefits under such agreements may be
paid at the executive officer's election in the form of a single life
annuity or a joint and survivor annuity or a life annuity with a ten-
year period certain.  In addition, such executive officer may elect to
receive the entire retirement benefit in a lump sum payment equal to the
present value of the benefit based on standard insurance annuity
mortality tables and an interest rate equal to the 90-day average of the
yield on ten-year U.S. Treasury Notes.

Retirement benefits shall be paid commencing on such executive officer's
65th birthday, provided that such executive officer may elect to receive
benefits on the later of his 62nd birthday, in which case benefits will
be reduced as described above, or the date on which his employment
terminates, provided that notice of his termination of employment is
given at least one year prior to the termination of employment.  Any
retirement benefits due under the employment agreement shall be offset
by any other retirement benefits that such executive officer receives
under any plan maintained by the Company.  In the event such executive
officer becomes totally disabled prior to retirement, he will be
entitled to receive retirement benefits calculated as described above.

In the event of such executive officer's death before retirement, the
agreement provides that the Company shall be required to pay an annual
death benefit to such officer's estate equal to the single life annuity
benefit such executive officer would have received if he had terminated
employment on the later of his 65th birthday or the date of his death,
payable over ten years; provided that such amount would be reduced by
five percent for each year such executive officer's death occurs prior
to age 65, but in no event more than 50 percent.

Each of the employment agreements provides that if the Company
terminates such executive officer's employment other than for "cause"
(as defined in the agreement), such executive officer be entitled to
receive a lump sum cash payment equal to the amount of base salary
payable for the remaining term of the agreement (at the then current
rate) plus one-half of the maximum incentive bonus compensation that
would be payable if such executive officer continued employment through
the date of the expiration of the agreement (assuming for such purposes
that the amount of incentive bonus compensation would be the same in
each of the years remaining under the agreement as was paid for the most
recent year prior to termination of employment).  Each of the agreements
further provides that if any payment on termination of employment would
not be deductible by the Company under Section 280G(b)(2) of the
Internal Revenue Code, the amount of such payment would be reduced to
the largest amount that would be fully deductible by the Company.

Item 12.  Security Ownership of Certain Beneficial Owners and Management
and Related Stockholder Matters.

                        CERTAIN BENEFICIAL OWNERS

     The following table sets forth information regarding the beneficial
ownership of shares of Common Stock (determined in accordance with Rule
13d-3 of the Securities and Exchange Commission) of the Company as of
June 1, 2002 by each person that beneficially owns five percent or more
of the shares of Common Stock.  Each person named in the table has sole
voting and investment power with respect to all shares of Common Stock
shown as  beneficially owned, except as otherwise set forth in the notes
to the table.

         SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS

                                                  Amount of
                                                  Beneficial
 Title of         Name and Address of             Ownership     Percent
  Class            Beneficial Owner              as of June 1,     Of
                                                    2002          Class
Common      Walter Clark and Caroline Clark,     1,342,416(1)     48.7%
Stock, par  Executors(1)
value $.25  P.O. Box 488
per share   Denver, North Carolina 28650

            William H. Simpson                     270,580(2)      9.9%
            P.O. Box 488
            Denver, North Carolina 28650


_____________________________

(1)  Includes 1,279,272 shares controlled by such individuals as the
     executors of the estate of David Clark, 10,922 shares owned by
     Walter Clark, 50,000 shares purchasable by Walter Clark under
     options awarded by the Company and 2,222 shares owned by Caroline
     Clark.

(2)  Includes 1,200 shares held jointly with J. Hugh Bingham and 9,000
     shares under options granted by the Company.

     The following table sets forth information regarding the beneficial
ownership of shares of Common Stock of the Company by each director of
the Company and by all directors and executive officers of the Company
as a group as of June 1, 2002.  Each person named in the table has sole
voting and investment power with respect to all shares of Common Stock
shown as beneficially owned, except as otherwise set forth in the notes
to the table.



     SECURITY OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS

                                             Shares and Percent of Common
                                             Stock Beneficially Owned as
                                                   of June 1, 2002
Name                  Position with Company    No. of Shares     Percent

J. Hugh Bingham          President, Chief       128,080(1)(2)      4.7%
                         Operating Officer,
                         Director

Walter Clark             Chairman of the      1,340,194(3)        48.3%
                         Board of Directors
                         and Chief Executive
                         Officer

John J. Gioffre          Vice President-         66,580(4)         2.4%
                         Finance, Chief
                         Financial Officer,
                         Secretary and
                         Treasurer, Director

J. Leonard Martin        Vice President,          3,100(5)           *
                         Director

William H.Simpson        Executive Vice         270,580(1)(6)      9.9%
                         President, Director

Claude S. Abernethy, Jr. Director                44,011(7)(8)      1.6%

Sam Chesnutt             Director                12,100(7)           *

Allison T. Clark         Director                 3,222(7)           *

Herman A. Moore          Director                 1,000(7)           *

George C. Prill          Director                46,966(7)         1.7%

All directors            N/A                  1,930,833(9)        68.5%
and executive
officers as a
group (11
persons)
__________________________________________

*    Less than one percent.
(1)  Includes 1,200 shares jointly held by Messrs. Simpson and Bingham.
(2)  Includes 9,000 shares under options granted by the Company to Mr.
     Bingham.
(3)  Includes 1,279,272 shares held by the estate of David Clark, of
     which Mr. Walter Clark is a co-executor and 50,000 shares under
     options granted by the Company to Mr. Walter Clark.
(4)  Includes 9,000 shares under options granted by the Company to
     Mr. Gioffre.
(5)  Such 100 shares are held by Mr. Martin's spouse of which shares Mr.
     Martin disclaims beneficial ownership and 3,000 shares under
     options granted by the Company to Mr. Martin.
(6)  Includes 9,000 shares under options granted by the Company to Mr.
     Simpson.
(7)  Includes 1,000 shares under options granted by the Company.
(8)  Includes 20,400 shares held by the Estate of Raenelle B. Abernethy,
     of which Mr. Abernethy is the executor.
(9)  Includes an aggregate of 94,000 shares of Common Stock members of
     such group have the right to acquire within 60 days.


This table summarizes share and exercise price information about our
equity compensation plans as of March 31, 2002.

                EQUITY COMPENSATION PLAN INFORMATION

                         Number of                               Number of
                       securities to         Weighted-          securities
                         be issued            average            remaining
                       upon exercise       exercise price      available for
                       of outstanding      of outstanding     future issuance
                      options, warrants   options, warrants     under equity
Plan Category             and rights         and rights       compensation plan


Equity compensation
 plans approved by
 security holders           226,533             $3.00              79,800
Equity compensation
 plans not approved by
 security holders            None                N/A                N/A


Item 13.  Certain Relationships and Related Transactions.

The  Company leases its corporate and operating facilities at the Little
Mountain,   North   Carolina  airport  from  Little   Mountain   Airport
Associates,  Inc. ("Airport Associates"), a corporation whose  stock  is
owned  by  J.  Hugh Bingham, William H. Simpson, John  J.  Gioffre,  the
estate  of  David  Clark and three unaffiliated third  parties.   Walter
Clark  and Allison Clark are beneficiaries of the estate of David Clark,
and  Walter Clark is also a co-executor of the estate.  On May 31, 2001,
the Company renewed its lease for this facility, scheduled to expire  on
that  date, for an additional five-year term, and adjusted the  rent  to
account  for  increases in the consumer price index.  Upon the  renewal,
the  monthly  rental payment was increased from $8,073 to  $9,155.   The
Company  paid aggregate rental payments of $96,876 to Airport Associates
pursuant to such lease during the fiscal year ended March 31, 2002.  The
Company  believes that the terms of such lease are no less favorable  to
the Company than would be available from an independent third party.


PART IV

Item 14.  Exhibits, Financial Statement Schedules, and Reports on Form 8-K

The following documents are filed as part of this report:

1.   Financial Statements

The following financial statements are incorporated herein by reference
in Item 8 of Part II of this report:

     (i)  Independent Auditors' Report.
     (ii) Consolidated Balance Sheets as of March 31, 2002 and 2001.
     (iii)Consolidated Statements of Earnings for each of the three
          years in the period ended March 31, 2002.
     (iv) Consolidated Statements of Stockholders' Equity for each of the
          three years in the period ended March 31, 2002.
     (v)  Consolidated Statements of Cash Flows for each of the three years
          in the period ended March 31, 2002.
     (vi) Notes to Consolidated Financial Statements.

2.   Financial Statement Schedules

     No schedules are required to be submitted.

3.   Exhibits

     No.  Description

3.1   Restated Certificate of Incorporation, incorporated by reference to
      Exhibit 3.1 of the Company's Quarterly Report on Form 10-Q for the
      period ended September 30, 2001

3.2   By-laws of the Company, as amended, incorporated by reference to
      Exhibit 3.2 of the Company's Annual Report on Form 10-K for the fiscal
      year ended March 31, 1996

4.1   Specimen Common Stock Certificate, incorporated by reference to
      Exhibit 4.1 of the Company's Annual Report on Form 10-K for the fiscal
      year ended March 31, 1994

10.1  Aircraft Dry Lease and Service Agreement dated February 2, 1994
      between Mountain Air Cargo, Inc. and Federal Express Corporation,
      incorporated by reference to Exhibit 10.13 to Amendment No. 1 on Form 10-
      Q/A to the Company's Quarterly Report on Form 10-Q for the quarterly
      period ended December 31, 1993

10.2  Loan Agreement among Bank of America, N.A. the Company and its
      subsidiaries, dated May 23, 2001, incorporated by reference to
      Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the
      period ended June 30, 2001.

10.3  Aircraft Wet Lease Agreement dated April 1, 1994 between Mountain
      Air Cargo, Inc. and Federal Express Corporation, incorporated by
      reference to Exhibit 10.4 of Amendment No. 1 on Form 10-Q/Q to the
      Company's Quarterly Report on Form 10-Q for the period ended
      September 30, 1994

10.4  Adoption Agreement regarding the Company's Master 401(k) Plan and
      Trust, incorporated by reference to Exhibit 10.7 to the Company's Annual
      Report on Form 10-K for the fiscal year ended March 31, 1993*

10.5  Amendment No. 1 to Omnibus Securities Award Plan incorporated by
      reference to Exhibit 10.14 of the Company's Annual Report on Form 10-K
      for the year ended March 31, 2000*.

10.6  Premises and Facilities Lease dated November 16, 1995 between
      Global TransPark Foundation, Inc. and Mountain Air Cargo, Inc.,
      incorporated by reference to Exhibit 10.5 to Amendment No. 1 on Form 10-
      Q/A to the Company's Quarterly Report on Form 10-Q for the period ended
      December 31, 1995

10.7  Employment Agreement dated January 1, 1996 between the Company,
      Mountain Air Cargo Inc. and Mountain Aircraft Services, LLC and William
      H. Simpson, incorporated by reference to Exhibit 10.8 to the Company's
      Annual Report Form 10-K for the fiscal year ended March 31, 1996*

10.8  Employment Agreement dated January 1, 1996 between the Company,
      Mountain Air Cargo Inc. and Mountain Aircraft Services, LLC and John J.
      Gioffre, incorporated by reference to Exhibit 10.9 to the Company's
      Annual Report Form 10-K for the fiscal year ended March 31, 1996*

10.9  Employment Agreement dated January 1, 1996 between Company,
      Mountain Air Cargo Inc. and Mountain Aircraft Services, LLC and J. Hugh
      Bingham, incorporated by reference to Exhibit 10.10 to the Company's
      Annual Report Form 10k for the fiscal year end March 31, 1996.*

10.10 Employment Agreement dated September 30, 1997 between Mountain
      Aircraft Services, LLC and J. Leonard Martin, incorporated by reference
      to Exhibit 10.10 to the Company's Quarterly Report Form 10-Q for the
      quarter ended December 31, 1997.*

10.11 Omnibus Securities Award Plan, incorporated by reference to
      Exhibit 10.11 to the Company's Quarterly Report Form 10-Q for the
      quarter ended June 30, 1998.*

10.12 Commercial and Industrial Lease Agreement dated August 25,
      1998 between William F. Bieber and Global Ground Support, LLC,
      incorporated by reference to Exhibit 10.12 of the Company's Quarterly
      Report on 10Q for the period ended September 30, 1998.

10.13 Amendment, dated February 1, 1999, to Aircraft Dry Lease and
      Service Agreement dated February 2, 1994 between Mountain Air Cargo,
      Inc. and Federal Express Corporation, incorporated by reference to
      Exhibit 10.13 of the Company's Quarterly Report on 10Q for the period
      ended December 31, 1998.

10.14 ISDA Schedule to Master Agreement between Bank of America,
      N.A. and the Company dated May 23, 2001, incorporated by reference to
      Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q for the
      period ended June 30, 2001

21.1  List of subsidiaries of the Company, incorporated by reference to
      Exhibit 21.1 to the Company's Quarterly Report on Form 10-Q for the
      period ended September 30, 1997

23.1  Consent of Deloitte & Touche LLP
     __________________

     *  Management compensatory plan or arrangement required to be filed
as an exhibit to this report.

b.   Reports on Form 8-K.

     No Current Reports on Form 8-K were filed in the last quarter of
the fiscal year ended March 31, 2002.

SIGNATURES

      Pursuant  to  the  requirements of Section  13  or  15(d)  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.

          AIR T, INC.

By:        /s/ Walter Clark
          Walter Clark, Chief Executive Officer
          (Principal Executive Officer)


Date:  June 11, 2002


By:        /s/ John J. Gioffre
          John J. Gioffre, Chief Financial Officer
          (Principal Financial and Accounting Officer)


Date:  June 11, 2002


     Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on
behalf of the registrant and in the capacities and on the dates
indicated.


By:        /s/ Claude S. Abernethy
          Claude S. Abernethy, Jr., Director


Date:  June 11, 2002



By:        /s/  J. Hugh Bingham
          J. Hugh Bingham, Director


Date:  June 11, 2002



By:        /s/  Allison T. Clark
          Allison T. Clark, Director


Date:  June 11, 2002



By:        /s/  Walter Clark
          Walter Clark, Director


Date:  June 11, 2002




By:        /s/  Sam Chesnutt
          Sam Chesnutt, Director


Date:  June 11, 2002



By:        /s/  John J. Gioffre
          John J. Gioffre, Director


Date:  June 11, 2002



By:        /s/  J. Leonard Martin
          J. Leonard Martin, Director


Date:  June 11, 2002



By:        /s/  Herman A. Moore
          Herman A. Moore, Director


Date:  June 11, 2002



By:        /s/ George C. Prill
          George C. Prill, Director


Date:  June 11, 2002



By:        /s/  William Simpson
          William Simpson, Director


Date:  June 11, 2002











                              EXHIBIT INDEX



Exhibit Number        Document


   23.1               Consent of Deloitte & Touche LLP


