SECURITIES AND EXCHANGE COMMISSION
                          WASHINGTON, D.C.  20549
                    __________________________________

                                FORM 10-Q

(Mark One)

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

For the quarterly period ended September 30, 2002

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

For the transition period from _________ to _________.

                        Commission file number 1-8729


                             UNISYS CORPORATION
            (Exact name of registrant as specified in its charter)

               Delaware                            38-0387840
       (State or other jurisdiction             (I.R.S. Employer
       of incorporation or organization)        Identification No.)

               Unisys Way
        Blue Bell, Pennsylvania                          19424
       (Address of principal executive offices)        (Zip Code)

Registrant's telephone number, including area code:  (215) 986-4011


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

     Number of shares of Common Stock outstanding as of September 30, 2002:  
324,475,589.



<PAGE> 2

Part I - FINANCIAL INFORMATION

Item 1.  Financial Statements.

<TABLE>

                             UNISYS CORPORATION
                         CONSOLIDATED BALANCE SHEET
                                 (Millions)
<CAPTION>   
                                          
                                         September 30,    
                                            2002       December 31,
                                         (Unaudited)       2001
                                         -----------   ------------
<S>                                       <C>            <C>
Assets
------
Current assets
Cash and cash equivalents                 $  166.2       $  325.9
Accounts and notes receivable, net           901.7        1,093.7
Inventories
   Parts and finished equipment              172.8          201.6
   Work in process and materials              84.7          144.2
Deferred income taxes                        345.1          342.6
Other current assets                          85.8           96.1
                                          --------       --------
Total                                      1,756.3        2,204.1
                                          --------       --------

Properties                                 1,478.3        1,460.4
Less-Accumulated depreciation                891.6          910.8
                                          --------       --------
Properties, net                              586.7          549.6
                                          --------       --------
Investments at equity                        176.9          212.3
Marketable software, net                     302.8          287.9
Prepaid pension cost                       1,375.8        1,221.0
Deferred income taxes                        747.8          747.8
Goodwill                                     158.5          159.0
Other long-term assets                       375.7          387.4
                                          --------       --------
Total                                     $5,480.5       $5,769.1
                                          ========       ========
Liabilities and stockholders' equity
------------------------------------
Current liabilities
Notes payable                             $  112.6       $   78.9

Current maturities of long-term debt           1.9            2.2
Accounts payable                             455.8          694.9
Other accrued liabilities                  1,159.3        1,302.9
Income taxes payable                         241.6          234.6
                                          --------       --------
Total                                      1,971.2        2,313.5
                                          --------       --------
Long-term debt                               748.9          745.0
Other long-term liabilities                  548.8          597.9

Stockholders' equity
Common stock, shares issued: 2002, 326.4;
   2001,322.5                                  3.3            3.2
Accumulated deficit                       (  762.6)      (  896.5)
Other capital                              3,750.7        3,712.8
Accumulated other comprehensive loss      (  779.8)      (  706.8)
                                          --------       --------
Stockholders' equity                       2,211.6        2,112.7
                                          --------       --------
Total                                     $5,480.5       $5,769.1
                                          ========       ========
</TABLE>

See notes to consolidated financial statements.







<PAGE> 3

<TABLE>

                              UNISYS CORPORATION
                CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
                     (Millions, except per share data)

<CAPTION>
 
                                        Three Months           Nine Months
                                     Ended September 30     Ended September 30
                                     ------------------     ------------------
                                       2002      2001         2002      2001
                                     --------  --------     --------  --------
<S>                                  <C>       <C>          <C>       <C>
Revenue                              $1,332.3  $1,376.0     $4,054.6  $4,461.2
                                     --------  --------     --------  --------
Costs and expenses
  Cost of revenue                       929.3     996.1      2,857.8   3,256.3
  Selling, general and
    administrative                      241.3     262.7        732.2     784.4 
  Research and development expenses      65.5      73.4        192.6     224.6 
                                     --------  --------     --------  --------
                                      1,236.1   1,332.2      3,782.6   4,265.3  
                                     --------  --------     --------  --------
Operating income                         96.2      43.8        272.0     195.9  

Interest expense                         17.6      16.5         53.2      50.0  
Other income (expense), net               9.5       3.9      (  18.9)     32.6  
                                     --------  --------     --------  --------
Income before income taxes               88.1      31.2        199.9     178.5  
Provision for income taxes               29.1      10.3         66.0      59.0  
                                     --------  --------     --------  --------
Income before extraordinary item         59.0      20.9        133.9     119.5  
Extraordinary item                                                     (  17.2) 
                                     --------  --------     --------  --------
Net income                           $   59.0  $   20.9     $  133.9  $  102.3  
                                     ========  ========     ========  ========

Earnings per share
  Basic                              
    Before extraordinary item        $    .18  $    .07     $    .41  $    .37 
    Extraordinary item                                                    (.05)
                                     --------  --------     --------  --------
     Total                           $    .18  $    .07     $    .41  $    .32
                                     ========  ========     ========  ========

  Diluted
    Before extraordinary item        $    .18  $    .07     $    .41  $    .37
    Extraordinary item                                                    (.05)
                                     --------  --------     --------  --------
     Total                           $    .18  $    .07     $    .41  $    .32
                                     ========  ========     ========  ======== 


</TABLE>



See notes to consolidated financial statements.



                                                









<PAGE> 4

<TABLE>

                           UNISYS CORPORATION
               CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
                                (Millions)
<CAPTION>
                                                    Nine Months Ended
                                                       September 30
                                                    ------------------
                                                      2002       2001
                                                   --------    --------
<S>                                                <C>         <C>
Cash flows from operating activities 
Income before extraordinary item                   $  133.9    $  119.5
Add (deduct) items to reconcile income before
   extraordinary item to net cash provided by 
   (used for) operating activities:           
Extraordinary item                                              (  17.2)
Depreciation                                          111.7       100.6        
Amortization:   
   Marketable software                                 90.1        88.3
   Deferred outsourcing contract costs                 14.1         9.5
   Goodwill                                                        12.5         
(Increase) in deferred income taxes, net            (   2.5)   (    3.5) 
Decrease in receivables, net                          208.0       161.0
Decrease in inventories                                88.2        27.0       
(Decrease) in accounts payable and
   other accrued liabilities                        ( 375.8)   (  522.5)    
Increase (decrease) in income taxes payable             7.0    (   21.0)       
Increase(decrease) in other liabilities             (  33.3)      202.7     
(Increase) in other assets                          ( 178.8)   (  225.8)     
Other                                                   7.4         4.2        
                                                   --------     -------
Net cash provided by (used for) operating
 activities                                            70.0     (  64.7)      
                                                   --------     -------
Cash flows from investing activities
   Proceeds from investments                        2,360.1     1,976.6       
   Purchases of investments                        (2,384.0)   (1,967.5)     
   Investment in marketable software               (  105.0)   (  100.0)    
   Capital additions of properties                 (  151.8)   (  134.8)     
   Purchases of businesses                         (    4.8)   (    2.2)     
                                                   --------     -------
Net cash used for investing activities             (  285.5)   (  227.9)    
                                                   --------     -------
Cash flows from financing activities
   Net proceeds from short-term borrowings             33.8        68.9        
   Proceeds from employee stock plans                  21.9        26.2
   Payments of long-term debt                      (    1.6)   (  354.3)     
   Proceeds from issuance of long-term debt                       389.9 
                                                   --------     -------
Net cash provided by financing activities              54.1       130.7            
                                                   --------     -------
Effect of exchange rate changes on
   cash and cash equivalents                            1.7         3.6           
                                                   --------     -------

Decrease in cash and cash equivalents               ( 159.7)   (  158.3)          
Cash and cash equivalents, beginning of period        325.9       378.0      
                                                   --------    --------
Cash and cash equivalents, end of period           $  166.2    $  219.7     
                                                   ========    ========
</TABLE>


See notes to consolidated financial statements.








<PAGE> 5

UNISYS CORPORATION 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

In the opinion of management, the financial information furnished
herein reflects all adjustments necessary for a fair presentation of
the financial position, results of operations and cash flows for the
interim periods specified.  These adjustments consist only of normal
recurring accruals.  Because of seasonal and other factors, results
for interim periods are not necessarily indicative of the results to
be expected for the full year.

a. The following table shows how earnings per share were computed for the
   three and nine months ended September 30, 2002 and 2001 (dollars in millions,
   shares in thousands):

                                  Three Months Ended       Nine Months Ended   
                                     September 30            September 30
                                  ------------------      ------------------ 
                                    2002       2001         2002      2001
                                  -------    -------      -------    -------
    Basic Earnings Per Share

    Income before 
      extraordinary item          $  59.0    $  20.9      $ 133.9    $ 119.5
    Extraordinary item                                                ( 17.2)
                                  -------    -------      -------    -------
    Net income                    $  59.0    $  20.9      $ 133.9    $ 102.3
                                  =======    =======      =======    =======
    
    Weighted average shares       324,075    318,761      322,792    317,576
                                  =======    =======      =======    =======
    Basic earnings per share
      Before extraordinary 
        item                      $   .18    $   .07      $   .41    $   .37
      Extraordinary item                                                (.05)
                                  -------    -------      -------    -------
        Total                     $   .18    $   .07      $   .41    $   .32
                                  =======    =======      =======    =======

    Diluted Earnings Per Share

    Income before 
      extraordinary item          $  59.0    $  20.9      $ 133.9    $ 119.5
    Extraordinary item                                                ( 17.2)
                                  -------    -------      -------    -------
    Net income                    $  59.0    $  20.9      $ 133.9    $ 102.3
                                  =======    =======      =======    =======

    Weighted average shares       324,075    318,761      322,792    317,576 
    Plus incremental shares 
      from assumed exercise
      of employee stock plans         594      1,394        1,287      1,951
                                  -------    -------      -------    -------
    Adjusted weighted average
      shares                      324,669    320,155      324,079    319,527
                                  =======    =======      =======    =======

    Diluted earnings per share
      Before extraordinary 
        item                      $   .18    $   .07      $   .41    $   .37
      Extraordinary item                                                (.05)
                                  -------    -------      -------    -------
        Total                     $   .18    $   .07      $   .41    $   .32
                                  =======    =======      =======    =======

At September 30, 2002, 36.6 million shares related to employee stock plans 
were not included in the computation of diluted earnings per share because 
the option prices are above the average market price of the company's common 
stock.

b. Effective January 1, 2002, the company adopted Statement of Financial
   Accounting Standards ("SFAS") No. 142 "Goodwill and Other Intangible Assets."
   SFAS No. 142 no longer permits the amortization of goodwill and indefinite-


<PAGE> 6

   lived intangible assets.  Instead, these assets must be reviewed annually for
   impairment in accordance with this statement.  SFAS 142 requires the company 
   to perform a transitional impairment test of its goodwill as of January 1, 
   2002, as well as perform impairment tests on an annual basis and whenever 
   events or circumstances occur indicating that the goodwill may be impaired.  
   The company performed the transitional impairment test of goodwill as of 
   January 1, 2002, which indicated that the company's goodwill was not 
   impaired.

   During the nine months ended September 30, 2002, there was an increase in
   goodwill of $3.0 million related to an immaterial acquisition.  All other 
   changes were attributable to foreign currency translation adjustments.
   Goodwill as of September 30, 2002 was allocated by segment as follows:
   Technology - $117.2 million; Services - $41.3 million.

   The company's net income and earnings per share for the three and nine months
   ended September 30, 2002 and 2001, adjusted to exclude goodwill amortization,
   was as follows (in millions of dollars, except per share amounts):
                                      

                                  Three Months Ended       Nine Months Ended   
                                     September 30            September 30
                                  ------------------      ------------------ 
                                    2002       2001         2002       2001
                                   ------     ------       ------     ------
                                             
   Reported income before
     extraordinary item            $ 59.0     $ 20.9       $133.9     $119.5
   Add back goodwill
     amortization, net of tax                    3.3                    10.6
                                   ------     ------       ------     ------
   Adjusted income before
     extraordinary item            $ 59.0     $ 24.2       $133.9     $130.1
                                   ======     ======       ======     ======

   Reported net income             $ 59.0     $ 20.9       $133.9     $102.3
   Add back goodwill
     amortization, net of tax                    3.3                    10.6
                                   ------     ------       ------     ------
   Adjusted net income             $ 59.0     $ 24.2       $133.9     $112.9
                                   ======     ======       ======     ======

   Earnings per share before
     extraordinary item
     Basic and diluted earnings
       per share as reported       $  .18     $  .07       $  .41     $  .37
     Goodwill amortization                       .01                     .03
                                   ------     ------       ------     ------
     Basic and diluted earnings
       per share as adjusted       $  .18     $  .08       $  .41     $  .40
                                   ======     ======       ======     ======

   Earnings per share
     Basic and diluted earnings
       per share as reported       $  .18     $  .07       $  .41     $  .32
     Goodwill amortization                       .01                     .03
                                   ------     ------       ------     ------
     Basic and diluted earnings
       per share as adjusted       $  .18     $  .08       $  .41     $  .35
                                   ======     ======       ======     ======















<PAGE> 7

The company's net income and earnings per share for the three years ended 
December 31, 2001 adjusted to exclude goodwill amortization was as follows (in 
millions of dollars, except per share amounts):

                                                           Years Ended
                                                           December 31,
                                                  ----------------------------
                                                  2001         2000       1999
                                                  ----         ----       ----

Reported income (loss) available to common        
  stockholders before extraordinary items        $(49.9)     $244.8     $486.1
Add back goodwill amortization, net of tax         14.1        20.1       20.9
                                                 ------      ------     ------
Adjusted income (loss) available to common
  stockholders before extraordinary items        $(35.8)     $264.9     $507.0
                                                 ======      ======     ======

Reported income (loss) on common shares          $(67.1)     $225.0     $474.0 
Add back goodwill amortization, net of tax         14.1        20.1       20.9
                                                 ------      ------     ------
Adjusted income (loss) on common shares          $(53.0)     $245.1     $494.9
                                                 ======      ======     ======

Earnings (loss) per share before extraordinary
  items
    Basic
     As reported                                 $ (.16)     $  .78     $ 1.69
     Goodwill amortization                          .04         .06        .07
                                                 ------      ------     ------
      As adjusted                                $ (.12)     $  .84     $ 1.76
                                                 ======      ======     ======
    Diluted
     As reported                                 $ (.16)     $  .77     $ 1.63
     Goodwill amortization                          .04         .06        .07
                                                 ------      ------     ------
      As adjusted                                $ (.12)     $  .83     $ 1.70
                                                 ======      ======     ======
Earnings (loss) per share
    Basic
     As reported                                 $ (.21)     $  .72     $ 1.65
     Goodwill amortization                          .04         .06        .07
                                                 ------      ------     ------
      As adjusted                                $ (.17)     $  .78     $ 1.72
                                                 ======      ======     ======
    Diluted
     As reported                                 $ (.21)     $  .71     $ 1.59
     Goodwill amortization                          .04         .06        .07
                                                 ------      ------     ------
      As adjusted                                $ (.17)     $  .77     $ 1.66
                                                 ======      ======     ======


c. The company has two business segments:  Services and Technology.  Revenue 
   classifications by segment are as follows:  Services - systems integration 
   and consulting, outsourcing, network services, and core maintenance; 
   Technology - enterprise-class servers and specialized technologies.  The 
   accounting policies of each business segment are the same as those followed 
   by the company as a whole.  Intersegment sales and transfers are priced as if
   the sales or transfers were to third parties.  The company evaluates business
   segment performance on operating income exclusive of restructuring charges 
   and unusual and nonrecurring items, which are included in Corporate.  All 
   other corporate and centrally incurred costs are allocated to the business 
   segments based principally on assets, revenue, employees, square footage or 
   usage.










<PAGE> 8

   A summary of the company's operations by business segment for the three and
   nine month periods ended September 30, 2002 and 2001 is presented below (in
   millions of dollars):


                             Total    Corporate    Services    Technology
   Three Months Ended       --------  ---------    --------    ---------- 
   September 30, 2002
   ------------------
   Customer revenue         $1,332.3               $1,016.3     $  316.0
   Intersegment                        $( 69.4)         6.5         62.9
                            --------   -------     --------     --------
   Total revenue            $1,332.3   $( 69.4)    $1,022.8     $  378.9
                            ========   =======     ========     ========
   Operating income (loss)  $   96.2   $    -      $   57.9     $   38.3
                            ========   =======     ========     ========
   Three Months Ended        
   September 30, 2001
   ------------------
   Customer revenue         $1,376.0               $1,051.3     $  324.7
   Intersegment                        $(102.0)        20.3         81.7
                            --------   -------     --------     --------
   Total revenue            $1,376.0   $(102.0)    $1,071.6     $  406.4     
                            ========   =======     ========     ========
   Operating income(loss)   $   43.8   $( 10.0)    $   23.5     $   30.3    
                            ========   =======     ========     ========
   Nine Months Ended
   September 30, 2002
   ----------------
   Customer revenue         $4,054.6               $3,104.8     $  949.8
   Intersegment                        $(233.0)        32.2        200.8    
                            --------   -------     --------     --------
   Total revenue            $4,054.6   $(233.0)    $3,137.0     $1,150.6
                            ========   =======     ========     ========
   Operating income (loss)  $  272.0   $( 15.0)    $  171.5     $  115.5
                            ========   =======     ========     ========
   Nine Months Ended  
   September 30, 2001
   ------------------
   Customer revenue         $4,461.2               $3,311.7     $1,149.5 
   Intersegment                        $(267.0)        51.8        215.2
                            --------   -------     --------     --------
   Total revenue            $4,461.2   $(267.0)    $3,363.5     $1,364.7
                            ========   =======     ========     ========
   Operating income (loss)  $  195.9   $( 29.6)    $   60.4     $  165.1
                            ========   =======     ========     ========


   Presented below is a reconciliation of total business segment operating
   income to consolidated income before taxes (in millions of dollars):


                                       Three Months Ended   Nine Months Ended
                                         September 30,        September 30,
                                       ------------------   -----------------
                                         2002      2001       2002      2001
                                         ----      ----       ----      ----
   Total segment operating income       $ 96.2    $ 53.8     $287.0    $225.5  
   Interest expense                      (17.6)    (16.5)     (53.2)    (50.0) 
   Other income (expense), net             9.5       3.9      (18.9)     32.6  
   Corporate and eliminations                      (10.0)     (15.0)    (29.6) 
                                        ------    ------     ------    ------
   Total income before income taxes     $ 88.1    $ 31.2     $199.9    $178.5  
                                        ======    ======     ======    ======











<PAGE> 9

d. Comprehensive income for the three and nine months ended September 30, 2002
   and 2001 includes the following components (in millions of dollars):


                                       Three Months Ended   Nine Months Ended
                                         September 30,        September 30,
                                       ------------------   -----------------
                                         2002      2001       2002      2001
                                         ----      ----       ----      ----
   Net income                           $ 59.0    $ 20.9     $133.9    $102.3 
 
   Other comprehensive income (loss)
     Cumulative effect of change in
       accounting principle (SFAS
       No. 133), net of tax of $1.8                                       3.3
     Cash flow hedges
       Income (loss), net of tax of     
        $.5, $(2.3), $(1.9) and $2.1        .8    ( 4.2)      ( 3.6)      3.9 
       Reclassification adjustments,
        net of tax of $.2, $(.9),
        $(.4) and $(3.5)                    .4    ( 1.6)      (  .9)    ( 6.5) 
     Foreign currency translation         
       adjustments, net of tax of
       $0                                (50.2)   ( 6.2)      (68.5)    (67.0) 
                                        ------    ------     ------    ------
     Total other comprehensive
       income (loss)                     (49.0)   (12.0)      (73.0)   ( 66.3) 
                                        ------    ------     ------    ------
     Comprehensive income               $ 10.0    $  8.9     $ 60.9    $ 36.0  
                                        ======    ======     ======    ======


    Accumulated other comprehensive income (loss) as of December 31, 2001 and
    September 30, 2002 is as follows (in millions of dollars):
    
                                                                      Cash
                                                       Translation    Flow
                                               Total   Adjustments   Hedges
                                               -----   -----------   ------

    Balance at December 31, 2000             $(643.7)    $(643.7)         
    Change during period                      ( 63.1)     ( 67.5)    $  4.4
                                             -------     -------     ------
    Balance at December 31, 2001              (706.8)     (711.2)       4.4   
    Change during period                      ( 73.0)     ( 68.5)     ( 4.5)
                                             -------     -------     ------
    Balance at September 30, 2002            $(779.8)    $(779.7)    $(  .1)
                                             =======     =======     ======


e.   In response to the weak economic environment in 2001, the company took
     actions to reduce its cost structure.  In the fourth quarter of 2001, the 
     company recorded a pretax charge of $276.3 million, or $.64 per share, 
     primarily for a work-force reduction of approximately 3,750 people (1,700 
     in the United States and 2,050 outside the United States).  Of the total, 
     1,910 people left the company in 2001, which included 764 people who 
     accepted an early retirement program in the United States.  For those 
     employees who accepted the early retirement program, cash requirements were
     provided through the company's pension plan.  Cash expenditures in 2001 
     related to the involuntary reductions were $23.3 million.  These activities
     did not significantly affect the company's operations while they were 
     ongoing.  A further breakdown of the individual components of these costs 
     follows:












<PAGE> 10

                                       Work-Force
                                       Reductions(1)
                                       ----------                              
                                                         Idle Lease 
     ($ in Millions)  Headcount   Total   U.S.   Int'l     Costs       Other(2)
     ------------------------------------------------------------------------
     Work-force
      reductions(1)

     Early retirement    764      $ 58.8  $ 58.8

     Involuntary
      reductions       3,001       145.9    18.8  $127.1
                       -----      ------  ------  ------
       Subtotal        3,765       204.7    77.6   127.1
     Other                          71.6                   $ 29.5     $ 42.1
                      ------      ------  ------  ------   ------     ------
     Total charge      3,765       276.3    77.6   127.1     29.5       42.1
     Utilized         (1,910)     (127.2) ( 62.5) ( 22.6)             ( 42.1)
                      ------      ------  ------  ------   ------     ------
     Balance at
      Dec. 31, 2001    1,855       149.1    15.1   104.5     29.5         - 

     Utilized         (1,698)     ( 79.9)  (12.6)  (62.7)  (  4.6)
     Additional
      provisions         568        20.2     1.7    17.1      1.4
     Reversal of
      excess reserves (  306)     ( 15.9) (  4.3) (  8.4)   ( 3.2)
     Other(3)                        14.4     2.3    14.2    ( 2.1)        
                      ------      ------  ------  ------   ------     ------
     Balance at
      Sept. 30, 2002     419      $ 87.9  $  2.2  $ 64.7   $ 21.0     $   -
                      ======      ======  ======  ======   ======     ======
     Expected future
     cash utilization:
     2002 fourth quarter          $ 28.7  $  2.0  $ 23.1   $  3.6
     2003 and thereafter            59.2      .2    41.6     17.4
                                  ------  ------  ------   ------
     (1)Includes severance, notice pay, medical and other benefits.
     (2)Includes product and program discontinuances, principally representing 
       a provision for asset write-offs.
     (3)Changes in estimates and translation adjustments.
                                              
     Most of the 2001 fourth-quarter charges were related to work-force 
     reductions ($204.7 million), principally severance costs.  Other employee-
     related costs are not significant.  Approximately $58.8 million of this
     total was funded from the company's U.S. pension plan.  The remainder of
     the cost related to work-force reductions as well as idle lease costs, 
     discussed below, is being funded from the company's operating cash flow.  
     The charge related to idle lease costs was $29.5 million and relates to 
     contractual obligations (reduced by estimated sublease income) existing 
     under long-term leases of vacated facilities.  Estimates of the amounts 
     and timing of sublease income were based on discussions with real estate 
     brokers that considered the marketability of the individual property 
     involved.  The charge for product and program discontinuances was $42.1 
     million and principally represented capitalized marketable software and 
     inventory related to products or programs that were discontinued at 
     December 31, 2001.  These actions have lowered the company's cost base 
     (principally employee-related costs), thereby making the company better 
     able to compete in the marketplace.

     Cash expenditures related to the 2001 and prior-year restructuring charges
     were approximately $87 million in the nine months ended September 30, 2002
     compared to $41 million for the prior-year period, and are expected to be 
     approximately $31 million (which includes approximately $2 million related
     to restructuring charges taken prior to 2001) for the remainder of 2002 
     and $69 million (which includes approximately $10 million related to
     restructuring charges taken prior to 2001) in total for all subsequent 
     years, principally for work-force reductions and idle lease costs.  
     Personnel reductions in the first nine months of 2002 related to these
     restructuring actions were 1,698 and are expected to be 323 for the 
     remainder of the year.
  


<PAGE> 11

     During the nine months ended September 30, 2002, the company reduced its 
     accrued workforce reserve by $12.7 million.  This reduction related to 306
     employees who were designated for involuntary termination but were 
     retained as a result of job positions that became available due to 
     voluntary terminations or acceptance of alternative positions within the 
     company.  In addition, given the continuing weak economic environment, 
     the company identified new restructuring activities and recorded, in the 
     second quarter of 2002, an additional provision of $20.2 million, 
     principally for a workforce reduction of 568 people.

f.   The amount credited to stockholders' equity for the income tax benefit
     related to the company's stock plans for the nine months ended September
     30, 2002 and 2001 was $3.1 million and $4.1 million, respectively. The 
     company expects to realize these tax benefits on future Federal income tax
     returns.

g.   In April 2002, the Financial Accounting Standards Board ("FASB") issued
     Statement of Financial Accounting Standards ("SFAS") No. 145, "Rescission 
     of FASB Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, 
     and Technical Corrections."  SFAS No. 145 rescinds SFAS No. 4 which 
     required that all gains and losses from extinguishment of debt be reported
     as an extraordinary item.  SFAS No. 145 also amends SFAS No. 13, Accounting
     for Leases," in respect to sale-leaseback transactions.  

     The provisions of SFAS No. 145 related to the rescission of SFAS No. 4 must
     be applied in fiscal years beginning after May 15, 2002.  The company will 
     adopt this statement effective January 1, 2003.  Any gain or loss on 
     extinguishment of debt that was classified as an extraordinary item in 
     prior periods that does not meet the criteria of Opinion 30 for 
     classification as an extraordinary item will be reclassified from 
     extraordinary item to other income (expense), net.  Adoption of SFAS No. 
     145 will have no effect on the company's consolidated financial position, 
     consolidated net income or liquidity.

     In June 2002, the FASB issued SFAS No. 146, "Accounting for Costs 
     Associated with Exit or Disposal Activities."  SFAS No. 146 requires 
     companies to recognize costs associated with exit or disposal activities 
     when they are incurred rather than at the date of a commitment to an exit 
     or disposal plan.  SFAS No. 146 replaces previous accounting guidance 
     provided by EITF Issue No. 94-3, "Liability Recognition for Certain 
     Employee Termination Benefits and Other Costs to Exit an Activity 
     (including Certain Costs Incurred in a Restructuring)" and will be 
     effective for the company for exit or disposal activities initiated after 
     December 31, 2002.  The company does not believe that adoption of this 
     statement will have a material impact on its consolidated financial 
     position, consolidated results of operations, or liquidity.

h.   Certain prior-year amounts have been reclassified to conform with the 2002
     presentation.

                                            






















<PAGE> 12


I
tem 2.  Management's Discussion and Analysis of Financial
         Condition and Results of Operations.


Results of Operations
---------------------

For the three months ended September 30, 2002, the company reported net income 
of $59.0 million, or $.18 per share, compared to $20.9 million, or $.07 per 
share, for the three months ended September 30, 2001.  

Total revenue for the quarter ended September 30, 2002 was $1.33 billion, down 
3% from revenue of $1.38 billion for the quarter ended September 30, 2001.  
Both Services revenue of $1.02 billion and Technology revenue of $316 million 
declined 3% from the prior-year period.  

U.S. revenue increased 3% in the third quarter to $619 million from $599 
million in the year-ago period, while revenue in international markets 
decreased 8% to $713 million from $777 million in the year-ago period.  
Currency changes had a negligible impact on revenue in the quarter when 
compared to the prior-year quarter, with currency strength in Europe 
offsetting currency weakness in Latin America.  

Total gross profit was 30.3% in the third quarter of 2002 compared to 27.6% in 
the year-ago period.  The increase was principally due to the company's focus 
on higher value-added business opportunities and continued tight cost controls.

For the three months ended September 30, 2002, selling, general and 
administrative expenses were $241.3 million (18.1% of revenue) compared to 
$262.7 million (19.1% of revenue) for the three months ended September 30, 2001.
The decline in selling, general and administrative expenses was principally 
driven by the company's cost reduction actions.  

Research and development ("R&D") expense was $65.5 million compared to $73.4 
million a year earlier.  The lower level of R&D reflects changes that the 
company has made to improve efficiencies, to consolidate R&D activities in 
systems integration to improve synergies, and to make use of lower-cost 
offshore resources for software support.  Although the amount of R&D is down, 
the company continues to invest in high-end CMP server technology and in key 
programs within its industry practices.

For the third quarter of 2002, the company reported an operating income 
percent of 7.2% compared to 3.2% for the third quarter of 2001.

The company has two business segments:  Services and Technology.  Revenue 
classifications by segment are as follows:  Services - systems integration and 
consulting, outsourcing, network services, and core maintenance; 
Technology - enterprise-class servers and specialized technologies.  The 
accounting policies of each business segment are the same as those followed by 
the company as a whole.  Intersegment sales and transfers are priced as if the 
sales or transfers were to third parties.  The company evaluates business 
segment performance on operating income exclusive of restructuring charges and 
unusual and nonrecurring items, which are included in Corporate.  All other 
corporate and centrally incurred costs are allocated to the business segments 
based principally on assets, revenue, employees, square footage or usage.  The 
following gross profit percent and operating income percent are as a percent 
of total revenue.





    



<PAGE> 13


Information by business segment is presented below (in millions):
                                                                     
                                       Elimi-    
                            Total      nations      Services    Technology
                           -------     -------      --------    ----------
Three Months Ended
September 30, 2002
------------------
Customer revenue          $1,332.3                  $1,016.3   $ 316.0
Intersegment                           $( 69.4)          6.5      62.9
                          --------     -------      --------    ------      
Total revenue             $1,332.3     $( 69.4)     $1,022.8   $ 378.9
                          ========     =======      ========    ====== 

Gross profit percent          30.3%                     22.5%     46.4%
                          ========                  ========    ======
Operating income
     percent                   7.2%                      5.7%     10.1%
                          ========                  ========    ======

Three Months Ended
September 30, 2001
------------------
Customer revenue          $1,376.0                  $1,051.3    $324.7
Intersegment                           $(102.0)         20.3      81.7
                          --------     -------      --------    ------      
Total revenue             $1,376.0     $(102.0)     $1,071.6    $406.4
                          ========     =======      ========    ====== 

Gross profit percent          27.6%                     20.8%     42.1%
                          ========                  ========    ======
Operating income
     percent                   3.2%                      2.2%      7.5%
                          ========                  ========    ======


In the Services segment, customer revenue was $1.02 billion, down 3% from 
$1.05 billion in the year-ago period, as a 12% increase in outsourcing ($371 
million in the third quarter of 2002 compared to $332 million in the prior 
period) was more than offset by a 12% decline in network services ($199 
million in the current period compared to $227 million in the prior-year 
period), a 12% decline in systems integration ($308 million in the current 
period compared to $348 million in the prior period), and a 4% decline in core 
maintenance revenue ($139 million in the current period compared to 
$145 million in the prior period).  Within the Services segment, the year-over-
year change in revenue reflects market conditions.  Market demand in the 
Services segment currently varies by revenue classification.  Demand for 
services that drive short-term cost and process efficiencies (outsourcing) 
remains strong, while market demand for project-based work (systems 
integration and network services) remains weak.  The growth in outsourcing 
revenue, which was particularly driven by growth in business process 
outsourcing, as well as the decline in both systems integration and network 
services in the quarter were reflective of these market conditions.  
Additionally, the core maintenance decline in the quarter is reflective of the 
long-term industry trend for reduction in maintenance, as the underlying 
equipment reliability has improved over time.  The Services segment gross 
profit percent increased to 22.5% in the current quarter from 20.8% in the 
prior period.  The Services segment's operating profit percent increased to 
5.7% in the current quarter compared to 2.2% in the year-ago period.  The 
company achieved these margin improvements by executing its strategy of 
selective pursuit of higher value-added business opportunities, growing its 
annuity-based outsourcing business and resizing its workforce to meet the 
market demand.  

In the Technology segment, customer revenue declined 3% to $316 million in the 
third quarter of 2002 from $325 million in the prior-year period.  Demand in 
the Technology segment remained weak industry-wide as customers deferred 
spending on new computer hardware and software.  Sales of enterprise-class 
servers declined 7% to $206 million from $222 million in the year-ago quarter, 
primarily reflecting lower ClearPath server sales.  Sales of specialized 
technology products increased 8% to $110 million in the third quarter of 2002 
from $103 million in the third quarter of 2001, principally driven by the 
payment systems business.  

<PAGE> 14

The gross profit percent in the Technology segment was 46.4% in the current 
quarter compared to 42.1% in the prior period, and operating profit in this 
segment increased to 10.1% in the current quarter from 7.5% in 2001, 
primarily reflecting, within ClearPath revenue, a higher proportion of
high-end, higher margin products, as well as increased demand for 
high-end payment systems products.

Interest expense for the three months ended September 30, 2002 was 
$17.6 million compared to $16.5 million for the three months ended 
September 30, 2001.  

Other income (expense), net was income of $9.5 million in the current quarter 
compared to income of $3.9 million in the year-ago quarter.  The principal 
reason for the increase was foreign exchange gains, principally in Latin 
America, of $9.6 million in the current period compared to $3.1 million of 
foreign exchange gains in the year-ago period.  

Income before income taxes was $88.1 million in the third quarter of 2002 
compared to $31.2 million last year.  The provision for income taxes was $29.1 
million in the current period compared to $10.3 million in the year-ago period.
The effective tax rate in both periods was 33%.

Pension income for the three months ended September 30, 2002 was approximately 
$37 million compared to approximately $42 million for the three months ended 
September 30, 2001.  At the beginning of each year, accounting rules require 
that the company establish an expected long-term rate of return on its pension 
plan assets.  The principal reason for the decline in pension income was that, 
effective January 1, 2002, the company reduced its expected long-term rate of 
return on plan assets for its U.S. pension plan to 9.5% from 10.0%.  This 
change will cause 2002 pension income in the U.S. to decline by approximately 
$24 million from the 2001 amount. The company records pension income or 
expense, as well as other employee-related costs such as FICA and medical 
insurance costs, in operating income in the following income statement 
categories:  cost of sales, selling, general and administrative expenses, and 
research and development expenses.  The amount allocated to each line is based 
on where the salaries of the active employees are charged.  

For the nine months ended September 30, 2002, net income was $133.9 million, 
or $.41 per share, compared to net income of $102.3 million, or $.32 per share,
last year.  The prior-year period included an extraordinary item for the early 
extinguishment of debt of $17.2 million, or $.05 per share.  Excluding this 
item, income in the prior-year period was $119.5 million, or $.37 per share.  
Revenue for the nine months ended September 30, 2002 was $4.05 billion, down 
9% from $4.46 billion for the nine months ended September 30, 2001.  Other 
income (expense), net for the nine months ended September 30, 2002 was an 
expense of $18.9 million compared to income of $32.6 million for the nine 
months ended September 30, 2001.  The decline was principally due to foreign 
exchange losses in the current period of $1.5 million compared to foreign 
exchange gains of $25.2 million in the prior year and equity losses of $12.8 
million in the current period compared to equity gains of $13.0 million last 
year.

Financial Condition
-------------------

Cash and cash equivalents at September 30, 2002 were $166.2 million compared 
to $325.9 million at December 31, 2001.  

For the nine months ended September 30, 2002, cash provided by operations was 
$70.0 million compared to cash used of $64.7 million for the nine months ended 
September 30, 2001.  Cash expenditures in the nine months ended September 30, 
2002 related to prior-year restructuring charges (which are included in 
operating activities) were approximately $87 million compared to $41 million 
in the prior-year period.  These expenditures are expected to be approximately 
$31 million for the remainder of 2002 and $69 million in total for all 
subsequent years, principally for work-force reductions and idle lease costs.  
Personnel reductions in the first nine months of 2002 relating to these 
restructuring actions were 1,698 and are expected to be 323 for the remainder 
of the year.  See Note e of the Notes to Consolidated Financial Statements.

Cash used for investing activities for the nine months ended September 30, 2002
was $285.5 million compared to $227.9 million during the nine months ended 
September 30, 2001.  The increase was principally due to net purchases of 
investments (derivative financial instruments used to manage the company's 


<PAGE> 15

exposure to market risks from changes in foreign currency exchange rates) of 
$23.9 million for the nine months ended September 30, 2002 compared to net 
proceeds from investments of $9.1 million in the prior-year period, as well as 
higher current period additions to properties, principally related to the 
outsourcing business.  

Cash provided by financing activities during the nine months ended September 30,
2002 was $54.1 million compared to cash provided of $130.7 million in the prior 
year.  The decrease was due to lower net proceeds from short-term borrowings 
for the nine months ended September 30, 2002 of $33.8 million, compared to net 
proceeds from short-term borrowings of $68.9 million in the prior-year period.
In addition, during the nine months ended September 30, 2001, the company had 
net proceeds from issuance of long-term debt of $35.6 million compared to a 
net payment of $1.6 million in the current period.  

At September 30, 2002, total debt was $863.4 million, an increase of $37.3 
million from December 31, 2001.  The debt to capital ratio was 28% at 
September 30, 2002 and December 31, 2001.   

The company has a $450 million credit agreement that expires March 2004.  As 
of September 30, 2002, there were no borrowings under this facility.  
Borrowings under the agreement bear interest based on the then current LIBOR 
or prime rates and the company's credit rating.  The credit agreement contains 
financial and other covenants, including maintenance of certain financial 
ratios, a minimum level of net worth and limitations on certain types of 
transactions, which could reduce the amount the company is able to borrow.  
Events of default under the credit agreement include failure to perform 
covenants, material adverse change, change of control and default under other 
debt aggregating at least $25 million.  If an event of default were to occur 
under the credit agreement, the lenders would be entitled to declare all 
amounts borrowed under it immediately due and payable.  The occurrence of an 
event of default under the credit agreement could also cause the acceleration 
of obligations under certain other agreements and the termination of the 
company's U.S. trade accounts receivable facility described below.

The company and certain international subsidiaries have access to certain 
uncommitted lines of credit from various banks.  Other sources of short-term 
funding are operational cash flows, including customer prepayments, and the 
company's U.S. trade accounts receivable facility.  Using this facility, the 
company sells, on an on-going basis, up to $225 million of its eligible U.S. 
trade accounts receivable through a wholly owned subsidiary, Unisys Funding 
Corporation I.  At September 30, 2002, receivables of $177 million were sold 
and therefore removed from the accompanying consolidated balance sheet.  The 
facility is renewable annually at the purchasers' option and expires in 
December 2003.

At September 30, 2002, the company has met all of the covenants and conditions 
under its various lending and funding agreements.  Since the company believes 
that it will continue to meet these covenants and conditions, the company 
believes that it has adequate sources and availability of short-term funding 
to meet its expected cash requirements.

The company may, from time to time, redeem, tender for, or repurchase its 
securities in the open market or in privately negotiated transactions 
depending upon availability, market conditions and other factors.

The company has on file with the Securities and Exchange Commission an 
effective registration statement covering $1.5 billion of debt or equity 
securities, which enables the company to be prepared for future market 
opportunities.

At September 30, 2002, the company had deferred tax assets in excess of 
deferred tax liabilities of $1,384 million.  For the reasons cited below, 
management determined that it is more likely than not that $1,037 million of 
such assets will be realized, therefore resulting in a valuation allowance of 
$347 million.

The company evaluates quarterly the realizability of its deferred tax assets 
and adjusts the amount of the related valuation allowance, if necessary.  
The factors used to assess the likelihood of realization are the company's 
forecast of future taxable income, and available tax planning strategies that
could be implemented to realize deferred tax assets. Approximately 
$3.2 billion of future 



<PAGE> 16


taxable income (predominantly U.S.) is needed to realize all of the net 
deferred tax assets.  Failure to achieve forecasted taxable income might 
affect the ultimate realization of the net deferred tax assets.  See "Factors 
that may affect future results" below. 

Accounting rules require that a company determine the fair value of its 
pension plan assets as well as the discount rate to be used to calculate the 
present value of plan liabilities as of the end of its fiscal year, or if 
used consistently from year to year, as of a date not more than three months 
prior to that date.  The company has chosen December 31 as its measurement 
date.  The discount rate is an estimate of the interest rate at which the 
pension benefits could be effectively settled.  In estimating the discount 
rate, the company looks to rates of return on high quality, fixed income 
investments currently available and expected to be available during the 
period to maturity of the pension benefits.  The company specifically uses 
a portfolio of fixed-income securities, which receive at least the second 
highest rating given by a recognized rating agency.  The discount rate is 
used to calculate the present value of the pension obligation (the 
accumulated benefit obligation, or "ABO") at a point in time.

Each year, at its normal measurement date (December 31st for the company),
accounting rules further require a company to recognize a liability on 
its balance sheet for each pension plan if the fair value of the assets 
of that pension plan is less than the ABO.  This liability is called a 
"minimum pension liability" and is recorded as a charge in "accumulated 
other comprehensive income (loss)" in stockholders' equity.  In addition,
any prepaid pension assets related to pension plans with a minimum 
pension liability must be reclassified to stockholders' equity.

Due to declines in the market value of equity securities during the quarter 
ended September 30, 2002, the ABO (estimated as of December 31, 2002) of the 
company's U.S. defined benefit pension plan, as well as certain foreign 
defined benefit pension plans, exceeded the fair value of plan assets by 
approximately $600 million. Should the actual ABO at December 31, 2002 exceed 
the fair market value of plan assets at December 31, 2002, the company would 
be required to record an additional minimum pension liability to the extent of 
such difference. However, if the fair value of plan assets were to increase or 
long-term interest rates were to increase to the extent that the fair value of 
the assets for such defined benefit pension plans exceeded the ABO at December 
31, 2002, no additional minimum pension liability would be required.

Assuming that the December 31, 2002 pension asset and liability amounts were 
the same as at September 30, 2002, the company would record a charge to 
stockholders' equity, of approximately $1.3 billion, representing the net of
tax impact of recording the minimum pension liability for the U.S. and 
certain foreign pension plans and reclassifying the prepaid pension assets 
related to these plans.  This accounting would have no effect on the 
company's net income, liquidity or cash flows.  Financial covenants in the 
company's credit agreement specifically exclude the effects of the charge 
to stockholders' equity caused by recording a minimum pension liability.  
If at the following year-end (December 31, 2003), the fair value of the 
pension plan assets exceeds the ABO, the charge to stockholders' equity 
would be reversed.

Stockholders' equity increased $98.9 million during the nine months ended 
September 30, 2002, principally reflecting net income of $133.9 million, $34.8 
million for issuance of stock under stock option and other plans, and $3.1 
million of tax benefits related to employee stock plans, partially offset by 
currency translation of $68.6 million. 

Factors That May Affect Future Results
--------------------------------------

From time to time, the company provides information containing "forward-
looking" statements, as defined in the Private Securities Litigation Reform 
Act of 1995.  All forward-looking statements rely on assumptions and are 
subject to risks, uncertainties and other factors that could cause the 
company's actual results to differ materially from expectations.  These other 
factors include, but are not limited to, those discussed below.

The company's business is affected by changes in general economic and business 
conditions.  It also could be affected by acts of war, terrorism or natural 
disasters.  During 2002, the company is facing a very challenging economic 
environment.  In this environment, many organizations are delaying planned 




<PAGE> 17


purchases of information technology products and services.  If the level of 
demand for the company's products and services declines in the future, the 
company's business could be adversely affected.

The information services and technology markets in which the company operates 
include a large number of companies vying for customers and market share both
domestically and internationally.  The company's competitors include computer 
hardware manufacturers, software providers, systems integrators, consulting 
and other professional services firms, outsourcing providers, and network 
services providers.  Some of the company's competitors may develop competing 
products and services that offer better price-performance or that reach the 
market in advance of the company's offerings.  Some competitors also have or 
may develop greater financial and other resources than the company, with 
enhanced ability to compete for market share generally, in some instances 
through significant economic incentives to secure contracts.  Some may also be 
better able to compete for skilled professionals.  Any of this could have an 
adverse effect on the company's business.  Future results will depend on the 
company's ability to mitigate the effects of aggressive competition on 
revenues, pricing and margins and on the company's ability to attract and 
retain talented people.

The company operates in a highly volatile industry characterized by rapid 
technological change, evolving technology standards, short product life-cycles 
and continually changing customer demand patterns.  Future success will
depend in part on the company's ability to anticipate and respond to these
market trends and to design, develop, introduce, deliver, or obtain new and 
innovative products and services on a timely and cost-effective basis.  The 
company may not be successful in anticipating or responding to changes in
technology, industry standards or customer preferences, and the market may not
demand or accept its services and product offerings.  In addition, products 
and services developed by competitors may make the company's offerings less 
competitive.

The company's future results will depend in part on its ability to accelerate 
growth in outsourcing and managed services.  The company's outsourcing 
contracts are multi-year engagements under which the company takes over 
management of a client's technology operations, business processes or networks.
The company will need to maintain a strong financial position in order to grow 
its outsourcing business.  In a number of these arrangements, the company hires
certain of its clients' employees and may become responsible for the related 
employee obligations, such as pension and severance commitments.  

In addition, system development activity on outsourcing contracts may require 
the company to make significant up-front investments.  As long-term 
relationships, these outsourcing contracts provide a base of recurring revenue.
However, in the early phases of these contracts, gross margins may be lower 
than in later years when the work force and facilities have been rationalized 
for efficient operations and an integrated systems solution has been 
implemented. 

Future results will also depend in part on the company's ability to drive 
profitable growth in systems integration and consulting.  The company's 
systems integration and consulting business has been adversely affected by the 
current economic slowdown.  In this economic environment, customers have been 
delaying systems integration projects.  The company's ability to grow 
profitably in this business will depend in part on an improvement in economic 
conditions and a pick-up in demand for systems integration projects.  It will 
also depend on the success of the actions the company has taken to enhance the 
skills base and management team in this business and to refocus the business 
on integrating best-of-breed, standards-based solutions to solve client needs.
In addition, profit margins in this business are largely a function of the 
rates the company is able to charge for services and the chargeability of its 
professionals.  If the company is not able to maintain the rates it charges or 
appropriate chargeability for its professionals, profit margins will suffer.  
The rates the company is able to charge for services are affected by a number 
of factors, including:  clients' perception of the company's ability to add 
value through its services; introduction of new services or products by the 
company or its competitors; pricing policies of competitors; and general 
economic conditions.  Chargeability is also affected by a number of factors, 
including:  the company's ability to transition employees from completed 
projects to new engagements; and its ability to forecast demand for services 
and thereby maintain an appropriate head count.


<PAGE> 18

Future results will also depend in part on market acceptance of the company's 
high-end enterprise servers.  In its technology business, the company is 
focusing its resources on high-end enterprise servers based on its Cellular 
MultiProcessing (CMP) architecture.  The company's CMP servers are designed to 
provide mainframe-class capabilities with compelling price-performance by 
making use of standards-based technologies such as Intel chips and Microsoft 
operating system software.  Recently the company has transitioned both its 
legacy ClearPath servers and its Intel-based ES7000s to the CMP platform, 
creating a common platform for all the company's high-end server lines.  Future
results will depend, in part, on customer acceptance of the new CMP-based 
ClearPath Plus systems and the company's ability to maintain its installed 
base for ClearPath, which continues to provide the majority of operating 
profit in the company's technology business.  In addition, future results will 
depend, in part, on the company's ability to generate new customers and 
accelerate sales of the lower-margin Intel-based ES7000 line.  The company 
believes there is significant growth potential in the developing market for 
high-end Intel-based servers running Microsoft operating system software.  
However, competition in this new market is likely to intensify in coming 
years, and the company's ability to succeed will depend on its ability to 
compete effectively against enterprise server competitors with more 
substantial resources and its ability to achieve market acceptance of the 
ES7000 technology by clients, systems integrators, and independent software 
vendors.

A number of the company's long-term contracts for network services, 
outsourcing, help desk and similar services do not provide for minimum 
transaction volumes.  As a result, revenue levels are not guaranteed.  In 
addition, some of these contracts may permit termination or may impose other 
penalties if the company does not meet the performance levels specified in the 
contracts.  

Some of the company's systems integration contracts are fixed-priced contracts 
under which the company assumes the risk for delivery of the contracted 
services and products at an agreed-upon fixed price.  At times the company has 
experienced problems in performing some of these fixed-price contracts on a 
profitable basis and has provided periodically for adjustments to the 
estimated cost to complete them.  Future results will depend on the company's 
ability to perform these services contracts profitably.

The company frequently enters into contracts with governmental entities.  
Risks and uncertainties associated with these government contracts include the 
availability of appropriated funds and contractual provisions that allow 
governmental entities to terminate agreements at their discretion before the 
end of their terms.

The success of the company's business is dependent on strong, long-term client 
relationships and on its reputation for responsiveness and quality.  As a 
result, if a client is not satisfied with the company's services or products, 
its reputation could be damaged and its business adversely affected.  In 
addition, if the company fails to meet its contractual obligations, it could 
be subject to legal liability, which could adversely affect its business, 
operating results and financial condition.

The company has commercial relationships with suppliers, channel partners and 
other parties that have complementary products, services or skills.  Future 
results will depend in part on the performance and capabilities of these third 
parties, on the ability of external suppliers to deliver components at 
reasonable prices and in a timely manner, and on the financial condition of, 
and the company's relationship with, distributors and other indirect channel 
partners.  

Approximately 56% of the company's total revenue derives from international 
operations.  The risks of doing business internationally include foreign 
currency exchange rate fluctuations, changes in political or economic 
conditions, trade protection measures, import or export licensing 
requirements, multiple and possibly overlapping and conflicting tax laws, 
and weaker intellectual property protections in some jurisdictions.

The company cannot be sure that its services and products do not infringe on 
the intellectual property rights of third parties, and it may have 
infringement claims asserted against it or against its clients.  These claims 
could cost the company money, prevent it from offering some services or 
products, or damage its reputation.  




<PAGE> 19


I
tem 4.  Controls and Procedures

Within 90 days prior to the date of filing of this report, the company 
carried out an evaluation, under the supervision and with the participation 
of the company's management, including the Chief Executive Officer and 
the Chief Financial Officer, of the design and operation of the company's 
disclosure controls and procedures.  Based on this evaluation, the 
company's Chief Executive Officer and Chief Financial Officer concluded 
that the company's disclosure controls and procedures are effective for 
gathering, analyzing and disclosing the information the company is 
required to disclose in the reports it files under the Securities Exchange 
Act of 1934, within the time periods specified in the SEC's rules and forms.
There have been no significant changes in the company's internal controls 
or in other factors that could significantly affect internal controls 
subsequent to the date of this evaluation.













<PAGE> 20


Part II - OTHER INFORMATION
-------   -----------------


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

(a)       Exhibits

          See Exhibit Index

(b)       Reports on Form 8-K

          During the quarter ended September 30, 2002, the company 
          filed one Current Report on Form 8-K, dated August 13, 2002, 
          to report under items 7 and 9 of that Form.



<PAGE> 21



                               SIGNATURES
                               ----------



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

                                              UNISYS CORPORATION

Date: October 31, 2002         By: /s/ Janet M. Brutschea Haugen
                                   -----------------------------
                                       Janet M. Brutschea Haugen
                                       Senior Vice President and 
                                       Chief Financial Officer 
                                   (Principal Financial Officer)


                                      By: /s/ Carol S. Sabochick
                                          ----------------------
                                          Carol S. Sabochick
                                          Vice President and 
                                          Corporate Controller
                                      (Chief Accounting Officer)



<PAGE>

                                  CERTIFICATION


I, Lawrence A. Weinbach, certify that:

1.  I have reviewed this quarterly report on Form 10-Q of Unisys Corporation;

2.  Based on my knowledge, this quarterly report does not contain any untrue 
statement of a material fact or omit to state a material fact necessary to 
make the statements made, in light of the circumstances under which such 
statements were made, not misleading with respect to the period covered by 
this quarterly report;

3.  Based on my knowledge, the financial statements, and other financial 
information included in this quarterly report, fairly present in all material 
respects the financial condition, results of operations and cash flows of the 
registrant as of, and for, the periods presented in this quarterly report;

4.  The registrant's other certifying officers and I are responsible for 
establishing and maintaining disclosure controls and procedures (as defined in 
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     a.  designed such disclosure controls and procedures to ensure that 
material information relating to the registrant, including its consolidated 
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this quarterly report is being prepared;

     b.  evaluated the effectiveness of the registrant's disclosure controls 
and procedures as of a date within 90 days prior to the filing date of this 
quarterly report (the "Evaluation Date"); and

     c.  presented in this quarterly report our conclusions about the 
effectiveness of the disclosure controls and procedures based on our 
evaluation as of the Evaluation Date;

5.  The registrant's other certifying officers and I have disclosed, based on 
our most recent evaluation, to the registrant's auditors and the audit 
committee of registrant's board of directors (or persons performing the 
equivalent function):

     a.  all significant deficiencies in the design or operation of internal 
controls which could adversely affect the registrant's ability to record, 
process, summarize and report financial data and have identified for the 
registrant's auditors any material weakness in internal controls; and

     b.  any fraud, whether or not material, that involves management or other 
employees who have a significant role in the registrant's internal controls; and

6.  The registrant's other certifying officers and I have indicated in this 
quarterly report whether or not there were significant changes in internal 
controls or in other factors that could significantly affect internal controls 
subsequent to the date of our most recent evaluation, including any corrective 
actions with regard to significant deficiencies and material weaknesses.


Date: October 31, 2002                   /s/ Lawrence A. Weinbach 
                                          ------------------------
                                     Name:  Lawrence A. Weinbach
                                     Title: Chairman, President and
                                            Chief Executive Officer



<PAGE>
                                 CERTIFICATION


I, Janet Brutschea Haugen, certify that:

1.  I have reviewed this quarterly report on Form 10-Q of Unisys Corporation;

2.  Based on my knowledge, this quarterly report does not contain any untrue 
statement of a material fact or omit to state a material fact necessary to 
make the statements made, in light of the circumstances under which such 
statements were made, not misleading with respect to the period covered by 
this quarterly report;

3.  Based on my knowledge, the financial statements, and other financial 
information included in this quarterly report, fairly present in all material 
respects the financial condition, results of operations and cash flows of the 
registrant as of, and for, the periods presented in this quarterly report;

4.  The registrant's other certifying officers and I are responsible for 
establishing and maintaining disclosure controls and procedures (as defined in 
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     a.  designed such disclosure controls and procedures to ensure that 
material information relating to the registrant, including its consolidated 
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this quarterly report is being prepared;

     b.  evaluated the effectiveness of the registrant's disclosure controls 
and procedures as of a date within 90 days prior to the filing date of this 
quarterly report (the "Evaluation Date"); and

     c.  presented in this quarterly report our conclusions about the 
effectiveness of the disclosure controls and procedures based on our 
evaluation as of the Evaluation Date;

5.  The registrant's other certifying officers and I have disclosed, based on 
our most recent evaluation, to the registrant's auditors and the audit 
committee of registrant's board of directors (or persons performing the 
equivalent function):

     a.  all significant deficiencies in the design or operation of internal 
controls which could adversely affect the registrant's ability to record, 
process, summarize and report financial data and have identified for the 
registrant's auditors any material weakness in internal controls; and

     b.  any fraud, whether or not material, that involves management or other 
employees who have a significant role in the registrant's internal controls; and

6.  The registrant's other certifying officers and I have indicated in this 
quarterly report whether or not there were significant changes in internal 
controls or in other factors that could significantly affect internal controls 
subsequent to the date of our most recent evaluation, including any corrective 
actions with regard to significant deficiencies and material weaknesses.


Date: October 31, 2002                     /s/ Janet Brutschea Haugen
                                           -------------------------- 
                                        Name:  Janet Brutschea Haugen
                                       Title:  Senior Vice President and 
                                               Chief Financial Officer



<PAGE> 

                             EXHIBIT INDEX

Exhibit
Number                        Description
-------                       -----------

12       Statement of Computation of Ratio of Earnings to Fixed 
         Charges 











<PAGE>

<TABLE>
                                                                    Exhibit 12

                             UNISYS CORPORATION
       COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (UNAUDITED)
                               ($ in millions)

<CAPTION>                                

                                  Nine            
                                  Months     
                                  Ended           Years Ended December 31
                                  Sept. 30, ----------------------------------
                                  2002     2001   2000   1999   1998    1997    
                                  -------- ----   ----   ----   ----    ----    
<S>                               <C>     <C>    <C>    <C>    <C>     <C>
Fixed charges
Interest expense                  $  53.2 $ 70.0 $ 79.8 $127.8 $171.7  $233.2       
Interest capitalized during 
  the period                          8.4   11.8   11.4    3.6                     
Amortization of debt issuance
  expenses                            2.0    2.7    3.2    4.1    4.6     6.7 
Portion of rental expense
  representative of interest         40.4   53.9   42.2   46.3   49.1    51.8    
                                   ------ ------ ------ ------ ------ -------   
    Total Fixed Charges             104.0  138.4  136.6  181.8  225.4   291.7   
                                   ------ ------ ------ ------ ------ -------
Earnings                             
Income (loss) from continuing
 operations before income taxes     199.9  (46.5) 379.0  770.3  594.2  (748.1)   
Add (deduct) the following:
 Share of loss (income) of
  associated companies               13.7   (8.6) (20.5)   8.9    (.3)    5.9     
 Amortization of capitalized
  interest                            6.1    5.4    2.2                            
                                   ------ ------ ------ ------ ------  ------  
    Subtotal                        219.7  (49.7) 360.7  779.2  593.9  (742.2)   
                                   ------ ------ ------ ------ ------  ------

Fixed charges per above             104.0  138.4  136.6  181.8  225.4   291.7  
Less interest capitalized during
  the period                        ( 8.4) (11.8) (11.4)  (3.6)                 
                                   ------  ------ ------ ------ ------ ------
Total earnings (loss)              $315.3  $76.9 $485.9 $957.4 $819.3 $(450.5)
                                   ======  ===== ====== ====== ====== =======

Ratio of earnings to fixed 
  charges                            3.03     *    3.56   5.27   3.63      *
                                   ======  ===== ====== ====== ====== =======
</TABLE>


* Earnings for the years ended December 31, 2001 and 1997 were inadequate to
  cover fixed charges by approximately $61.5 million and $742.2 million,
  respectively.