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                                                                       EXHIBIT 1


REPORT TO SHAREHOLDERS
3RD QUARTER 2001
(U.S. DOLLARS)

Over the past quarter, International Uranium Corporation (the "Company")
continued to evaluate and pursue alternate feed opportunities. Two proposals for
alternate feed projects were submitted during the quarter, and the Company
anticipates receiving a decision on those proposals in the next quarter. In
addition to the alternate feed materials from the Company's two FUSRAP (Formerly
Utilized Sites Remedial Action Program) contracts, material from Heritage
Minerals began to arrive at the Mill. The Company anticipates receiving
approximately 3,000 tons of this uranium bearing material, which was a waste
stream from a monazite sand operation.

The Company is continuing to plan for a spring 2002 Mill run. During the current
stand-by period Mill personnel continue to receive alternate feed material and
perform the necessary modifications to the Mill to ensure a smooth start-up.
Metallurgical test programs for potential alternate feed projects were also
performed in support of the Company's alternate feed program. During the last
quarter, the Company began efforts to prepare Cell 4A for potential
refurbishment, which will increase the Mill's tailings capacity for future
contracts. The design and permitting process is well underway.

In August, the Company completed the sale of its Reno Creek in-situ leach
project located in northeastern Wyoming. The buyer assumed all of the
reclamation obligations associated with the property. The sale of the Company's
Colorado Plateau and Arizona Strip uranium mining assets continues but progress
is slow given the recent softening in the uranium market. After a 30% increase
in price over the first five months of 2001, from $7.00 to $9.10 per pound U3O8,
market optimism dampened due to a lack of demand and other factors. As a result,
the price remains at approximately $9.00 per pound and current forecasts are for
it to remain at this level for the remainder of the year.

The Company continues to hold approximately 568,000 pounds of vanadium
inventory, of which approximately 144,000 pounds is under contract and the
remainder of which the Company intends to sell as vanadium prices strengthen.
Vanadium prices continued to be in the lower range of their historical value,
trading from $1.25 to $1.55 per pound V2O5 throughout the quarter, and are
currently trading in the $1.30 to $1.50 per pound V2O5 range.

IUC recorded a net loss of $1,274,500 ($0.02 per share) and $3,020,492 ($0.05
per share) for the third quarter and first nine months of fiscal 2001, as
compared to a net loss of $1,661,603 ($0.03 per share) and $2,640,341 ($0.04 per
share) for the third quarter and first nine months of fiscal 2000. The losses
for fiscal 2001 were partially due to the fact that the Company's White Mesa
Mill was on stand-by during the first nine months of fiscal 2001 and did not
generate revenues from the processing of alternate feed materials, combined with
the fact that, having sold all of its uranium inventory and uranium contracts in
fiscal 2000, the Company had no revenues from uranium sales in fiscal 2001.
Nevertheless, the Company's cash position has remained strong at $11,898,113 at
June 30, 2001, as compared to $11,650,600 at September 30, 2000, due to the
receipt of alternate feed materials at the Mill during the period and continued
efforts to reduce overhead expenditures.

MANAGEMENT'S DISCUSSION AND ANALYSIS

The following discussion and analysis of the financial condition and results of
operations for International Uranium Corporation ("IUC" or the "Company") for
the period ended June 30, 2001 should be read in conjunction with the
consolidated financial statements and accompanying notes. The consolidated
financial statements are prepared in accordance with generally accepted
accounting principles in Canada.


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RESULTS OF OPERATIONS

REVENUES

Revenues for the third quarter and first nine months of fiscal 2001 consisted
primarily of process milling fees generated under the Company's alternate feed
processing agreements. The Company receives a recycling fee as alternate feed
materials are delivered to the Mill. A portion of the fees, equal to the costs
that are incurred receiving materials, is recognized as revenue, while the
remaining recycling fees are recorded as deferred revenue until the material is
processed. Revenues for the third quarter and first nine months of fiscal 2001
were $153,147 and $722,280 respectively, as compared to $3,273,616 and
$9,431,424 for the third quarter and first nine months of fiscal 2000. The
decreases were a combination of the fact that, because the Company sold all of
its remaining long-term uranium sales contracts and uranium in fiscal 2000,
there have been no uranium sales revenues in fiscal 2001 and the fact that the
Company has postponed the majority of its vanadium sales until prices
strengthen.

COST OF PRODUCTS AND SERVICES SOLD

Alternate feed processing activities for the third quarter and first nine months
of fiscal 2001 consisted of the receipt, sampling and analysis of the Ashland 1
and Linde materials. Process milling expenditures for the third quarter and
first nine months of fiscal 2001 of $153,147 and $560,509 respectively,
increased $43,443 and $197,771 as compared to $109,704 and $362,738 for the
comparable periods in fiscal 2000. The increase was due to the higher volume of
materials received during the third quarter and first nine months of fiscal 2001
as compared to fiscal 2000. Approximately 20,000 tons of material was received
during the third quarter bringing the total received at the White Mesa Mill to
over 197,000 tons from the Ashland 1 and Linde sites.

MILL STAND-BY

Mill stand-by expenses consist primarily of payroll and related expenses for
personnel, parts and supplies, contract services and other overhead expenditures
required to maintain the Mill in a stand-by mode. Mill stand-by expenses for the
third quarter and first nine months of fiscal 2001, which were $653,617 and
$1,991,087 respectively, increased $484 and $521,064 as compared to $653,133 and
$1,470,023 for the comparable periods in fiscal 2000. The increase of $521,064
during the comparable year to date periods was due to nine months of stand-by
during fiscal 2001 versus three months in fiscal 2000.

SELLING, GENERAL AND ADMINISTRATIVE

Selling, general and administrative expenses consist primarily of payroll and
related expenses for personnel, legal, contract services and other overhead
expenditures. Selling, general and administrative expenses for the third quarter
and first nine months of fiscal 2001 were $485,432 and $1,572,725 respectively.
This represents a decrease of $420,152 or 46% and $1,555,863 or 50% as compared
to expenditure levels of $905,584 and $3,128,588 for the comparable periods in
fiscal 2000. The decrease was primarily due to the Company's decision during
fiscal 2000 to significantly reduce overhead costs. The Company anticipates that
selling, general and administrative expenses for the remainder of fiscal 2001
will increase slightly as the Company expands its alternate feed business
development efforts.

OTHER INCOME AND EXPENSE

Net interest and other income for the third quarter and first nine months of
fiscal 2001 was $341,918 and $1,018,928 respectively, as compared to a net loss
of $726 and net income of $384,642 for the comparable periods in fiscal 2000.
The increase of $342,644 and $634,286 for the third quarter and first


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nine months of fiscal 2001 is primarily the result of improved interest income
from the higher cash balances available for investment, as well as a decrease in
interest expense. Net interest and other income was also affected by the sale of
land and surplus mining equipment. During the third quarter of fiscal 2000, the
mining operations center and mining equipment located in Fredonia Arizona were
sold, resulting in a net loss of $227,610.

CAPITAL RESOURCES AND LIQUIDITY

At June 30, 2001, the Company had cash and cash equivalents of $11,898,113 and
marketable securities of $1,383,450 as compared to cash and cash equivalents of
$11,650,600 and no marketable securities at September 30, 2000. The Company
acquired the marketable securities at a cost of $1,383,450 in the second quarter
of fiscal 2001 as a short-term investment. As of June 30, 2001 the market value
of the securities was $1,755,000.

At June 30, 2001, the Company's working capital position was $14,888,083 as
compared to $10,556,005 at September 30, 2000. The increase in working capital
is primarily due to the Company's revised plan to delay processing of the
Ashland 1 and Linde materials until the second quarter of fiscal 2002. As a
result of this plan, deferred revenue of $11,991,730 was accounted for as a
long-term liability. As the Ashland 1 and Linde materials are processed, the
deferred revenue will be reclassified as revenue. The cost of processing will be
recorded as process milling expenditures and the Company's cash position will
decrease accordingly by the cost of processing.

Net cash used in operating activities was $1,262,640 for the first nine months
of fiscal 2001 and consisted primarily of the loss from continuing operations of
$3,020,492 offset by non-cash items of depreciation and amortization of
$941,028, decreases to accounts receivable of $737,567 and the increase in Mill
reclamation obligations of $300,663.

Net cash used in investing activities was $3,000,762 for the first nine months
of fiscal 2001 and consisted primarily of increases in marketable securities of
$1,383,450 and increases in restricted marketable securities of $1,480,094.

Net cash provided by financing activities was $4,510,914 for the first nine
months of fiscal 2001 and consisted primarily of increases in deferred revenue
of $4,524,138.

2001 FISCAL OUTLOOK

The Company anticipates that revenues will remain at existing levels until March
2002 when the Mill currently expects to begin processing alternate feed
materials. Due to the decision to sell the uranium inventory and contracts,
which occurred during the fourth quarter of fiscal 2000, the Company's revenue
is dependent upon the processing of alternate feed materials. Therefore the
Company continues to work towards developing the backlog necessary to operate
the Mill efficiently on a continuous basis. Additional revenues will also be
recognized as vanadium prices strengthen.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

The Company wishes to caution readers that disclosures made in the foregoing
Financial Review and elsewhere in this Report to Shareholders represent
forward-looking statements. These forward-looking statements involve known and
unknown risks and uncertainties which may cause the actual results, performance,
or achievements of the Company to be materially different from any future
results, performance, or achievements expressed or implied by any
forward-looking statements made by or on behalf of the Company.


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Risk factors that affect the Company's results and the above discussion include,
but are not limited to, competition, environmental regulations, the ability to
develop the alternate feed business, changes to reclamation requirements,
dependence on a limited number of customers, volatility and sensitivity to
market prices for uranium and vanadium, the impact of changes in foreign
currencies' exchange rates, political risk arising from operating in Mongolia,
changes in government regulation and policies including trade laws and policies,
demand for nuclear power, replacement of reserves and production, receipt of
permits and approvals from governmental authorities (including amendments for
each alternate feed transaction) and other operating and development risks.

As a result of the foregoing and other factors, no assurance can be given as to
the future results, levels of activity and achievement.


ON BEHALF OF THE BOARD

/s/ Ron F. Hochstein
Ron F. Hochstein
President and Chief Executive Officer
August 29, 2001