Filed Pursuant to Rule 424(b)(3)
                                                      Registration No. 333-98661



                                   Prospectus


                                 601,218 Shares

                          HANGER ORTHOPEDIC GROUP, INC.

                                  Common Stock



     We are registering these shares of our common stock for resale by the
selling shareholder named in this prospectus. The selling shareholder has the
right to acquire the shares directly from our company pursuant to a
Non-qualified Stock Option Agreement, dated as of December 12, 2001 and amended
July 23, 2002. We will not receive any proceeds from the sale of these shares,
although we have paid the expenses of preparing this prospectus and the related
registration statement.

     The shares are being registered to permit the selling shareholder to sell
the shares from time to time in the public market. The selling shareholder may
sell this common stock through ordinary brokerage transactions, directly to
market makers of our shares or through any other means described in the section
entitled "Plan of Distribution" beginning on page 6.

                      -------------------------------------

BEFORE PURCHASING ANY OF THE SHARES COVERED BY THIS PROSPECTUS, CAREFULLY READ
AND CONSIDER THE RISK FACTORS IN THE SECTION ENTITLED "RISK FACTORS" BEGINNING
ON PAGE 1.

                      -------------------------------------

     Our common stock is traded on the New York Stock Exchange under the symbol
"HGR." On August 22, 2002, the last reported sales price of our common stock was
$16.85 per share.

     Our principal executive offices are located at Two Bethesda Metro Center,
Suite 1200, Bethesda, Maryland 20814, and our telephone number at that address
is (301) 986-0701.

                      -------------------------------------

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THE SALE OF THE COMMON STOCK OR
DETERMINED THAT THE INFORMATION IN THIS PROSPECTUS IS ACCURATE AND COMPLETE. IT
IS ILLEGAL FOR ANY PERSON TO TELL YOU OTHERWISE.

                      -------------------------------------

                 The date of this prospectus is Spetember 6, 2002.


                                TABLE OF CONTENTS



The Company.........................................................   1

Risk Factors........................................................   1

Forward-Looking Statements..........................................   4

Use of Proceeds.....................................................   5

Selling Shareholder.................................................   5

Plan of Distribution................................................   6

Legal Matters.......................................................   9

Experts  ...........................................................   9

Where You Can Find More Information.................................   9

Incorporation of Certain Documents by Reference.....................  10



     This prospectus is a part of the registration statement that we filed with
the Securities and Exchange Commission. The selling shareholder named in this
prospectus may from time to time sell the securities described in the
prospectus. You should read this prospectus together with the more detailed
information regarding our company, our common stock and our financial statements
and notes to those statements that appear elsewhere in this prospectus or that
we incorporate in this prospectus by reference.

     YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN, OR INCORPORATED BY
REFERENCE IN, THIS PROSPECTUS AND IN ANY ACCOMPANYING PROSPECTUS SUPPLEMENT. WE
HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION DIFFERENT FROM THAT
CONTAINED IN, OR INCORPORATED BY REFERENCE IN, THIS PROSPECTUS. THE COMMON STOCK
IS NOT BEING OFFERED IN ANY JURISDICTION WHERE THE OFFER IS NOT PERMITTED. YOU
SHOULD NOT ASSUME THAT THE INFORMATION IN THIS PROSPECTUS OR ANY PROSPECTUS
SUPPLEMENT IS ACCURATE AS OF ANY DATE OTHER THAN THE DATE ON THE FRONT OF THE
PROSPECTUS OR PROSPECTUS SUPPLEMENT, AS APPLICABLE.




                                       ii

                                   THE COMPANY

     We are the largest owner and operator of orthotic and prosthetic ("O&P")
patient-care centers in the United States. In our orthotics business, we design,
fabricate, fit and maintain a wide range of standard and custom-made braces and
other devices (such as spinal, knee and sports-medicine braces) that provide
external support to patients suffering from musculoskeletal disorders, such as
ailments of the back, extremities or joints and injuries from sports or other
activities. In our prosthetics business, we design, fabricate, fit and maintain
custom-made artificial limbs for patients who are without limbs as a result of
traumatic injuries, vascular diseases, diabetes, cancer or congenital disorders.
O&P devices are increasingly technologically advanced and are custom-designed to
add functionality and comfort to patients' lives, shorten the rehabilitation
process and lower the cost of rehabilitation. We are also a leading distributor
of branded and private label O&P devices and components in the United States,
all of which are manufactured by third parties.

     At June 30, 2002, we operated 586 O&P patient-care centers in 44 states and
the District of Columbia and employed 859 certified O&P practitioners. Patients
are referred to our local patient-care centers directly by physicians as a
result of our relationships with them or through our agreements with managed
care providers. Our patient-care centers are staffed by certified O&P
practitioners and technicians. Our practitioners generally design and fit
patients with, and the technicians fabricate, O&P devices as prescribed by the
referring physician. Following the initial design, fabrication and fitting of
our O&P devices, our technicians conduct regular, periodic maintenance of O&P
devices as needed. Our practitioners are also responsible for managing and
operating our patient-care centers and are compensated, in part, based on their
success in managing costs and collecting accounts receivable. We provide
centralized administrative, marketing and materials management services to take
advantage of economies of scale and to increase the time practitioners have to
provide patient care. In areas where we have multiple patient-care centers, we
also utilize shared fabrication facilities where technicians fabricate devices
for practitioners in that area.

     We have increased our net sales through acquisitions, by opening new
patient-care centers and through same-center net sales growth, the latter being
achieved primarily through physician referral marketing and branding
initiatives. We strive to improve our local market position to enhance operating
efficiencies and generate economies of scale by implementing our disciplined
growth strategy. We have generally acquired small and medium-sized O&P
patient-care businesses and opened new patient-care centers to achieve greater
density in our existing markets.

                                  RISK FACTORS

     An investment in the common stock offered by this prospectus includes
significant risk. You should carefully consider the following risk factors in
addition to the other information contained in this prospectus before deciding
to purchase our common stock. You should be prepared to accept any and all of
the risks associated with purchasing the shares.

     These risks and uncertainties are not the only ones we face. Others that we
do not know about now, or that we do not now think are important, may impair our
business or the trading price of our common stock, and you may lose all or part
of your investment.

We have a recent history of net losses and may incur net losses in the future.

     From time to time, we have historically incurred net losses. We incurred
net losses of $14.0 million for the year ended December 31, 2000 and $8.9
million for the year ended December 31, 2001. We cannot assure that we will not
incur net losses in the future. To the extent that we incur net losses in the
future, we

                                       1


may be unable to meet our obligations to make payments on our indebtedness. We
have financed our operating cash requirements, as well as our capital needs,
with the proceeds of financing activities, including the issuance of preferred
stock and additional borrowings. We cannot assure that we will generate
sufficient operating cash flow in the future to pay our debt service obligations
or that we will be able to obtain sufficient additional financing to meet our
debt service requirements on terms acceptable to us, or at all.

Changes in government reimbursement levels could adversely affect our net sales,
cash flows and profitability.

     We estimate that we derived 41.0%, 38.4% and 40.5% of our net sales for the
years ended December 31, 1999, 2000 and 2001, respectively, from reimbursements
for O&P services and products from programs administered by Medicare, Medicaid
and the U.S. Veterans Administration. Each of these programs sets maximum
reimbursement levels for O&P services and products. If these agencies reduce
reimbursement levels for O&P services and products in the future, our net sales
could substantially decline. In addition, the percentage of our net sales
derived from these sources may increase as the portion of the U.S. population
over age 65 continues to grow, making us more vulnerable to maximum
reimbursement level reductions by these organizations. Reduced government
reimbursement levels could result in reduced private payor reimbursement levels
because of indexing of Medicare fee schedules by certain third party payors.
Furthermore, the healthcare industry is experiencing a trend towards cost
containment as government and other third-party payors seek to impose lower
reimbursement rates and negotiate reduced contract rates with service providers.
This trend could adversely affect our net sales. Medicare provides for
reimbursement for O&P products and services based on prices set forth in fee
schedules for ten regional service areas. Additionally, if the U.S. Congress
were to enact into law modifications to the Medicare fee schedules to include
upper limits based on national median prices, our net sales from Medicare
reimbursements and other payors could be adversely affected, which could have a
material adverse effect on us. We cannot predict whether any such modifications
to the fee schedules will be enacted or what the final form of any modifications
might be.

We have not yet fully implemented our performance improvement plan and may be
unable to achieve the future operating efficiencies and results that we desire.

     We expect by the end of 2002 to have substantially implemented the major
performance improvement initiatives that we commenced last year. We initially
targeted $45.0 million in cash flow improvements over two years, which included
$30.0 million in annualized recurring operating and general and administrative
expense improvements and $15.0 million in one-time working capital improvements
over two years. While we have made substantial progress, we have not yet fully
completed those performance improvement initiatives, and we are unable to
represent that we will fully achieve or maintain the planned operating
efficiencies and results that we desire.

If we cannot continue to improve our controls and procedures for managing our
accounts receivable and inventory, our business, results of operations,
financial condition and ability to satisfy our obligations under our
indebtedness could be adversely affected.

     Members of our senior management team have spent a significant amount of
time improving systems and controls relating to our collection of accounts
receivable. As of December 31, 2000 and 2001, and June 30, 2002, our accounts
receivable over 120 days represented approximately 33%, 30% and 29% of total
accounts receivable outstanding in each period, respectively. In order to
adequately provide for doubtful accounts, we recorded an increase in the
allowance of $9.0 million in the fourth quarter of December 31, 2000. While the
allowance has decreased since December 31, 2000 due to improved collections and
the write-off of doubtful accounts, an increase in the allowance may be
necessary in the future if there is a


                                       2


decrease in the present rate of collections. If our efforts do not improve our
controls and procedures for managing accounts receivable, we may be unable to
collect certain accounts receivable, which could adversely affect our business,
results of operations, financial condition and ability to satisfy our
obligations under our indebtedness. In addition, our principal means of control
with respect to accounting for inventory and costs of goods sold is a physical
inventory conducted on an annual basis. While this method of accounting controls
and procedures is acceptable under generally accepted accounting principles, it
may result in an understatement or overstatement, as the case may be, of
inventory between our annual physical inventories. For example, in conjunction
with the physical inventory performed on September 30, 2000, we recorded a $9.6
million inventory write-down. Conversely, in conjunction with our physical
inventory performed on December 31, 2001, we recorded a $4.2 million increase in
inventory. Because our gross profit percentage is based on our inventory levels,
adjustments to inventory following physical inventory could adversely affect our
results of operations and financial condition.

If we are unable to maintain good relations with our suppliers, our existing
purchasing discounts may be jeopardized, which could adversely affect our net
sales.

     We currently enjoy significant purchasing discounts with most of our
suppliers, and our ability to sustain our gross margins has been, and will
continue to be, dependent, in part, on our ability to continue to obtain
favorable discount terms from our suppliers. These terms may be subject to
changes in suppliers' strategies, from time to time, which could adversely
affect our gross margins over time. The profitability of our business depends,
in part, upon our ability to maintain good relations with these suppliers.

We depend on the continued employment of our orthotists and prosthetists who
work at our patient-care centers and their relationships with referral sources
and patients. Our ability to provide O&P services at our patient-care centers
would be impaired and our net sales reduced if we were unable to maintain these
employment and referral relationships.

     Our net sales would be reduced if a significant number of our practitioners
leave us. In addition, any failure of these practitioners to maintain the
quality of care provided or to otherwise adhere to certain general operating
procedures at our facilities or any damage to the reputation of a significant
number of our practitioners could damage our reputation, subject us to liability
and significantly reduce our net sales. A substantial amount of our business is
derived from patient referrals by orthopedic surgeons and other healthcare
providers. If the quality of our services and products declines in the opinion
of these sources, the number of their patient referrals may decrease, which
would adversely affect our net sales.

If the non-competition agreements we have with our key executive officers and
key practitioners were found by a court to be unenforceable, we could experience
increased competition resulting in a decrease in our net sales.

     We generally enter into employment agreements with our executive officers
and a significant number of our practitioners which contain non-compete and
other provisions. The laws of each state differ concerning the enforceability of
non-competition agreements. State courts will examine all of the facts and
circumstances at the time a party seeks to enforce a non-compete covenant. We
cannot predict with certainty whether or not a court will enforce a non-compete
covenant in any given situation based on the facts and circumstances at that
time. If one of our key executive officers and/or a significant number of our
practitioners were to leave us and the courts refused to enforce the non-compete
covenant, we might be subject to increased competition, which could materially
and adversely affect our business, financial condition and results of
operations.

                                       3


We face periodic reviews, audits and investigations under our contracts with
federal and state government agencies, and these audits could have adverse
findings that may negatively impact our business.

     We contract with various federal and state governmental agencies to provide
O&P services. Pursuant to these contracts, we are subject to various
governmental reviews, audits and investigations to verify our compliance with
the contracts and applicable laws and regulations. Any adverse review, audit or
investigation could result in:

       o      refunding of amounts we have been paid pursuant to our government
              contracts;

       o      imposition of fines, penalties and other sanctions on us;

       o      loss of our right to participate in various federal programs; or

       o      damage to our reputation in various markets.

We may be unable to successfully integrate and operate other O&P businesses that
we acquire in the future.

     Part of our business strategy involves the acquisition and integration of
small and medium-sized O&P businesses. We may not be able to successfully
consummate and/or integrate future acquisitions. We continuously review
acquisition prospects that would complement our existing operations, increase
our size and expand our geographic scope of operations or otherwise offer growth
opportunities. The financing for these acquisitions could significantly dilute
our investors or result in an increase in our indebtedness. While we have no
current agreements with respect to any such acquisitions, we may acquire or make
investments in businesses or products in the future. Acquisitions may entail
numerous integration risks and impose costs on us, including:

       o      difficulties in assimilating acquired operations or products,
              including the loss of key employees from acquired businesses;

       o      diversion of management's attention from our core business
              concerns;

       o      adverse effects on existing business relationships with suppliers
              and customers;

       o      risks of entering markets in which we have no or limited
              experience;

       o      dilutive issuances of equity securities;

       o      incurrence of substantial debt;

       o      assumption of contingent liabilities; and

       o      incurrence of significant immediate write-offs.

Our failure to successfully complete the integration of future acquisitions
could have a material adverse effect on our results of operations, business and
financial condition.


                           FORWARD-LOOKING STATEMENTS

     Some of the statements contained in this report discuss our plans and
strategies for our business or make other forward-looking statements, as this
term is defined in the Private Securities Litigation Reform Act. The words
"anticipates," "believes," "estimates," "expects," "plans," "intends" and
similar expressions are


                                       4


intended to identify these forward-looking statements, but are not the exclusive
means of identifying them. These forward-looking statements reflect the current
views of our management; however, various risks, uncertainties and contingencies
could cause our actual results, performance or achievements to differ materially
from those expressed in, or implied by, these statements, including the
following:

       o      our indebtedness and the impact of increases in interest rates on
              such indebtedness; o the demand for our orthotic and prosthetic
              services and products;

       o      our ability to integrate effectively the operations of businesses
              that we plan to acquire in the future;

       o      our ability to successfully implement our performance improvement
              plan and realize and maintain its benefits;

       o      our ability to attract and retain qualified orthotic and
              prosthetic practitioners;

       o      changes in federal Medicare reimbursement levels and other
              governmental policies affecting orthotic and prosthetic
              operations;

       o      changes in prevailing interest rates and the availability of
              favorable terms of equity and debt financing to fund the
              anticipated growth of our business;

       o      changes in, or failure to comply with, federal, state and/or local
              governmental regulations; and

       o      liability relating to orthotic and prosthetic services and
              products and other claims asserted against us.

     For a discussion of important risks of an investment in our securities,
including factors that could cause actual results to differ materially from
results referred to in the forward-looking statements, see "Risk Factors" and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" below. We do not have any obligation to update publicly any
forward-looking statements, whether as a result of new information, future
events or otherwise

                                 USE OF PROCEEDS

     The selling shareholder will receive all of the proceeds from the sale of
the common stock offered by this prospectus. We will not receive any of the
proceeds from the sale of the common stock.

                               SELLING SHAREHOLDER

     We are registering the 601,218 shares covered by this prospectus on behalf
of the selling shareholder named in the table below. The shares may be acquired
by the selling shareholder upon the exercise of an option granted to it by us
under a Non-qualified Stock Option Agreement entered into as of December 12,
2001 and amended on July 23, 2002 (the "Agreement"). We retained the selling
shareholder in December 2000 to assess the opportunities available for improved
financial and operating performance and to assist us with certain performance
improvement initiatives that our Board of Directors determined to be necessary
or appropriate. In January 2001, we developed, with the assistance of the
selling shareholder, a performance improvement plan which contained many
initiatives that were designed to effect further cost savings through improved
utilization and efficiency of support services, enhanced purchasing and
inventory management, improved collection methods, consolidation of distribution
services, enhancement of net sales through improved marketing and branding
initiatives and more efficient billing procedures.

                                       5


     In accordance with the contract with the selling shareholder, we approved
for payment two invoices for success fees in the fourth quarter of 2001. The
invoices were satisfied by the payment of $1.1 million in cash and the issuance
under the Agreement of nonqualified options to purchase, on or before May 31,
2007, 1,202,436 shares of our stock for an exercise price of $1.40 per share.
The options were valued using a Black-Scholes option-pricing model, and an
expense of $4.8 million was recorded. On July 23, 2002, we agreed to amend the
Agreement and to purchase 601,218 of the options previously granted for a
payment of $3.98 per share, or a total of $2,392,704. On July 23, 2002, our
shares opened for trading at $12.00 per share. We also agreed to file a
Registration Statement on Form S-3 with the Securities and Exchange Commission
within 20 business days of the amendment to register the remaining 601,218
shares underlying the option in order to permit the selling shareholder to sell
the shares of the Company's stock that it may acquire upon exercise of the
option.

     In connection with the purchase and registration of the options, the
selling shareholder agreed to limit sales of shares of our stock that it may
acquire by exercise of the options, to 40,000 shares in any calendar week. The
selling shareholder also agreed to permanently amend its contract with us so
that the payment of future success fees, if any, would be made only in cash. We
are registering the remaining 601,218 shares to permit the selling shareholder
to offer these shares for resale from time to time, subject to the restrictions
set forth below. The selling shareholder may sell all, some or none of the
shares covered by this prospectus. All information with respect to beneficial
ownership has been furnished to us by the selling shareholder. For more
information, see "Plan of Distribution."

     The table below lists the selling shareholder and information regarding its
ownership of common stock:


                                    NUMBER OF SHARES
                                   BENEFICIALLY OWNED      NUMBER OF SHARES         NUMBER OF SHARES
                                     PRIOR TO THIS              BEING                 OWNED AFTER
   SELLING SHAREHOLDER                OFFERING (1)          OFFERED HEREBY            OFFERING (2)

                                                                                  
AlixPartners, LLC
(Formerly known as Jay Alix &
Associates, Inc.)                        601,218                601,218                    0

 (1) The number of shares reported above as beneficially owned may be acquired
     upon exercise of an option to purchase such shares at an exercise price
     $1.40 per share on or prior to May 31, 2007.

(2)  Assumes that the selling shareholder disposes of all of the shares of
     common stock covered by this prospectus and does not acquire or dispose of
     any additional shares of common stock. However, the selling shareholder is
     not representing that any of the shares covered by this prospectus will be
     offered for sale, and the selling shareholder reserves the right to accept
     or reject, in whole or in part, any proposed sale of shares.


     This prospectus also covers any additional shares of common stock that
     become issuable in connection with the shares being registered by reason of
     any stock dividend, stock split, recapitalization or other similar
     transaction effected without the receipt of consideration which results in
     an increase in the number of outstanding shares of our common stock.

                              PLAN OF DISTRIBUTION

     The selling shareholder may resell or redistribute the securities listed
elsewhere in this prospectus from time to time on any stock exchange or
automated interdealer quotation system on which the securities are listed, in
the over-the-counter market, in privately negotiated transactions, or in any
other legal manner, at fixed prices that may be changed, at market prices
prevailing at the time of sale, at prices related to prevailing market prices or
at negotiated prices. The subsequent sale by the selling shareholder of the

                                       6


securities shall be limited to a volume limitation of (a) no more than 40,000
shares during each calendar week following the date of this prospectus until all
such shares are sold, or (b) a greater number of shares sold in a single "block
trade" transaction upon such terms as are reasonably acceptable to us in our
sole discretion. Subject to that limitation, the selling shareholder may sell
the securities by one or more of the following methods, without limitation:

       o      block trades (which may include cross trades) in which the broker
              or dealer so engaged will attempt to sell the securities as agent
              but may position and resell a portion of the block as principal to
              facilitate the transaction;

       o      purchases by a broker or dealer as principal and resale by the
              broker or dealer for its own account;

       o      an exchange distribution or secondary distribution in accordance
              with the rules of any stock exchange on which the securities are
              listed;

       o      ordinary brokerage transactions and transactions in which the
              broker solicits purchases;

       o      an offering at other than a fixed price on or through the
              facilities of any stock exchange on which the securities are
              listed or to or through a market maker other than on that stock
              exchange;

       o      privately negotiated transactions, directly or through agents;

       o      short sales;

       o      through the writing of options on the securities, whether or not
              the options are listed on an options exchange;

       o      through the distribution of the securities by the selling
              shareholder to its partners, members or stockholders;

       o      one or more underwritten offerings;

       o      agreements between a broker or dealer and the selling shareholder
              to sell a specified number of the securities at a stipulated price
              per share; and

       o      any combination of any of these methods of sale or distribution,
              or any other method permitted by applicable law.

     We do not know of any current arrangements by the selling shareholder for
the sale or distribution of any of the securities.

     The selling shareholder may engage brokers and dealers, and any brokers or
dealers may arrange for other brokers or dealers to participate in effecting
sales of the securities. These brokers, dealers or underwriters may act as
principals, or as an agent of the selling shareholder. Broker-dealers may agree
with the selling shareholder to sell a specified number of the securities at a
stipulated price per security. If the broker-dealer is unable to sell securities
acting as agent for the selling shareholder, it may purchase as principal any
unsold securities at the stipulated price. Broker-dealers who acquire securities
as principals may thereafter resell the securities from time to time in
transactions in any stock exchange or automated interdealer quotation system on
which the securities are then listed, at prices and on terms then prevailing at
the time of sale, at prices related to the then-current market price or in
negotiated transactions. Broker-dealers may use block transactions and sales to
and through broker-dealers, including transactions of the nature described
above. The selling shareholder may also sell the securities in accordance with
Rule 144


                                       7


under the Securities Act rather than pursuant to this prospectus, regardless of
whether the securities are covered by this prospectus.

     From time to time, the selling shareholder may pledge, hypothecate or grant
a security interest in some or all of the securities owned by it. The pledgees,
secured parties or persons to whom the securities have been hypothecated will,
upon foreclosure in the event of default, be deemed to be selling shareholders.
The number of the selling shareholder's securities offered under this prospectus
will decrease as and when it takes such actions. The plan of distribution for
the selling shareholder's securities will otherwise remain unchanged.

     The selling shareholder and any underwriters, brokers, dealers or agents
that participate in the distribution of the securities may be deemed to be
"underwriters" within the meaning of the Securities Act, and any discounts,
concessions, commissions or fees received by them and any profit on the resale
of the securities sold by them may be deemed to be underwriting discounts and
commissions.

     The selling shareholder and other persons participating in the sale or
distribution of the securities will be subject to applicable provisions of the
Securities Exchange Act of 1934, as amended, and the related rules and
regulations adopted by the Securities and Exchange Commission, including
Regulation M. This regulation may limit the timing of purchases and sales of any
of the securities by the selling shareholder and any other person. The
anti-manipulation rules under the Exchange Act may apply to sales of securities
in the market and to the activities of the selling shareholders and their
affiliates. Furthermore, Regulation M may restrict the ability of any person
engaged in the distribution of the securities to engage in market-making
activities with respect to the particular securities being distributed for a
period of up to five business days before the distribution. These restrictions
may affect the marketability of the securities and the ability of any person or
entity to engage in market-making activities with respect to the securities.

     We have agreed to indemnify the selling shareholder, any underwriter for
the selling shareholder, any directors or officers of the selling shareholder
and any person who controls (within the meaning of the federal securities laws)
the selling shareholder or acts as an investment advisor to the selling
shareholder against specified liabilities, including liabilities under the
federal securities laws. The selling shareholder has agreed to indemnify us,
each of our directors, each of our officers who sign the registration statement
and each person who controls (within the meaning of the federal securities laws)
us against specified liabilities arising from information provided by the
selling shareholder for use in this prospectus, including liabilities under the
federal securities laws. The selling shareholder may agree to indemnify any
brokers, dealers or agents who participate in transactions involving sales of
the securities against specified liabilities arising under the federal
securities laws in connection with the offering and sale of the securities.

     The securities offered under this prospectus may be acquired by the selling
shareholder upon the exercise of an option granted to it by us pursuant to a
Non-qualified Stock Option Agreement, dated December 12, 2001. We agreed to
register the securities under the Securities Act and to keep the registration
statement of which this prospectus is a part effective until the date on which
all the shares of common stock subject to the registration statement have been
sold under the registration statement or pursuant to Rule 144 of the Securities
Act.

      We will not receive any proceeds from sales of any securities by the
selling shareholder.

     We cannot assure you that the selling shareholder will sell all or any
portion of the securities offered under this prospectus.

                                       8


     We will supply the selling shareholder and any stock exchange upon which
the securities are listed with reasonable quantities of copies of this
prospectus. To the extent required by Rule 424 under the Securities Act in
connection with any resale or redistribution by the selling shareholder, we will
file a prospectus supplement setting forth:

       o      the aggregate number of shares to be sold;

       o      the purchase price;

       o      the public offering price;

       o      if applicable, the names of any underwriter, agent or
              broker-dealer; and

       o      any applicable commissions, discounts, concessions, fees or other
              items constituting compensation to underwriters, agents or
              broker-dealers with respect to the particular transaction (which
              may exceed customary commissions or compensation).

     If the selling shareholder notifies us that a material arrangement has been
entered into with a broker-dealer for the sale of shares through a block trade,
special offering, exchange, distribution or secondary distribution or a purchase
by a broker or dealer, then we will file a prospectus supplement that includes
any other facts that are material to the transaction. If applicable, this may
include a statement to the effect that the participating broker-dealers did not
conduct any investigation to verify the information set out or incorporated by
reference in this prospectus.

                                  LEGAL MATTERS

     The validity of the shares of common stock offered by this prospectus will
be passed on for us by Foley & Lardner, Washington, D.C.

                                     EXPERTS

     The financial statements incorporated in this prospectus by reference to
the Annual Report on Form 10-K of Hanger Orthopedic Group, Inc. for the year
ended December 31, 2001, have been so incorporated in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
said firm as experts in auditing and accounting.

                       WHERE YOU CAN FIND MORE INFORMATION

     We are subject to the informational reporting requirements of the Exchange
Act. In accordance with the Exchange Act, we file reports, proxy statements and
other information with the Securities and Exchange Commission. You can inspect
and copy these reports, proxy statements and other information at the Public
Reference Room of the Securities and Exchange Commission, 450 Fifth Street,
N.W., Washington, D.C. 20549, at prescribed rates. Please call the Securities
and Exchange Commission at 1-800-SEC-0330 for further information on the
operation of the public reference rooms. Our filings with the Securities and
Exchange Commission are also available on the Securities and Exchange
Commission's web site. The address of this site is http://www.sec.gov.

     We have filed with the Securities and Exchange Commission a registration
statement (which term includes all amendments, exhibits and schedules thereto)
on Form S-3 under the Securities Act with respect to the shares offered by this
prospectus. This prospectus does not contain all the information set forth in
the


                                       9


registration statement because certain information has been incorporated
into the registration statement by reference in accordance with the rules and
regulations of the Securities and Exchange Commission. Please review the
documents incorporated by reference for a more complete description of the
matters to which such documents relate. The registration statement may be
inspected at the public reference facilities maintained by the Securities and
Exchange Commission at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549 and is available to you on the Securities and Exchange
Commission's web site.

                 INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

     The Securities and Exchange Commission allows us to incorporate by
reference into this prospectus the information we file with the Securities and
Exchange Commission, which means that we can disclose important information to
you by referring you to those documents. The information incorporated by
reference is considered to be part of this prospectus, and information we file
later with the Securities and Exchange Commission will automatically update and
supersede this information. We incorporate by reference the documents listed
below and any future filings made by us with the Securities and Exchange
Commission under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act until
the sale of all of the shares of common stock that are part of this offering.
The documents we are incorporating by reference are as follows:

       -      our Annual Report on Form 10-K for the fiscal year ended December
              31, 2001;

       -      our Quarterly Reports on Form 10-Q for the quarters ended March
              31, 2002 and June 30, 2002;

       -      our Current Report on Form 8-K dated February 19, 2002;

       -      our Current Report on Form 8-K dated August 22, 2002; and

       -      the description of our common stock contained in a Registration
              Statement on Form 8-A filed on December 17, 1990.

     All documents that we file with the Securities and Exchange Commission
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act subsequent
to the date of this registration statement and prior to the filing of a
post-effective amendment to this registration statement that indicates that all
securities offered under this prospectus have been sold, or that deregisters all
securities then remaining unsold, will be deemed to be incorporated in this
registration statement by reference and to be a part hereof from the date of
filing of such documents.

     Any statement contained in a document we incorporate by reference will be
modified or superseded for all purposes to the extent that a statement contained
in this prospectus (or in any other document that is subsequently filed with the
Securities and Exchange Commission and incorporated by reference) modifies or is
contrary to that previous statement. Any statement so modified or superseded
will not be deemed a part of this prospectus except as so modified or
superseded.

     You may request a copy of these filings at no cost (other than exhibits
unless such exhibits are specifically incorporated by reference) by writing or
telephoning us at the following address and telephone number:

                          Hanger Orthopedic Group, Inc.
                      Two Bethesda Metro Center, Suite 1200
                            Bethesda, Maryland 20814
                                 (301) 986-0701
                          Attention: Glenn M. Lohrmann


                                       10

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                                 601,218 SHARES

                          HANGER ORTHOPEDIC GROUP, INC.

                                  COMMON STOCK

                                SEPTEMBER 6, 2002




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