10-Q

                                                                        1.
                          UNITED STATES
               SECURITIES AND EXCHANGE COMMISSION
                    WASHINGTON, D.C.   20549

                            FORM 10Q

[X]Quarterly Report Pursuant to Section 13 or 15(d) of the
   Securities Exchange Act of 1934 for the quarterly period
   ended March 31, 2001.

Commission File No. 1-1169

                       THE TIMKEN COMPANY
            Exact name of registrant as specified in its charter

Ohio                                       34-0577130
State or other jurisdiction of             I.R.S. Employer
incorporation or organization              Identification No.

1835 Dueber Avenue, S.W., Canton, Ohio     44706-2798
Address of principal executive offices     Zip Code

(330) 438-3000
Registrant's telephone number, including area code

Not Applicable
Former name, former address and former fiscal year if changed
since last report.

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,
and (2) has been subject to such filing requirements for the past
90 days.

                    YES    X      NO
                          ___         ___

Common shares outstanding at March 31, 2001, 59,990,686.


PART I.  FINANCIAL INFORMATION                                          2.
THE TIMKEN COMPANY AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(Unaudited)

                                                         Mar. 31      Dec. 31
                                                           2001         2000
ASSETS                                                 ----------    ----------
Current Assets                                          (Thousands of dollars)
Cash and cash equivalents...........................   $   18,872    $   10,927
Accounts receivable, less allowances,
(2001-$12,106; 2000-$11,259)........................      404,343       354,972
Deferred income taxes...............................       44,903        43,094
Inventories (Note 2) ...............................      488,396       489,549
                                                       ----------    ----------
          Total Current Assets......................      956,514       898,542

Property, Plant and Equipment.......................    2,957,331     2,974,379
 Less allowances for depreciation...................    1,625,464     1,610,607
                                                       ----------    ----------
                                                        1,331,867     1,363,772

Costs in excess of net assets of acquired businesses,
less amortization, (2001-$41,772; 2000-$41,228).....      151,117       151,487
Intangible Pension Asset............................       88,405        88,405
Other assets........................................       73,188        61,899
                                                       ----------    ----------
      Total Assets..................................   $2,601,091    $2,564,105
                                                       ==========    ==========

LIABILITIES
Current Liabilities
Accounts payable and other liabilities..............   $  246,557    $  239,182
Short-term debt and commercial paper................      259,779       209,423
Accrued expenses....................................      145,223       138,847
                                                       ----------    ----------
          Total Current Liabilities.................      651,559       587,452

Noncurrent Liabilities
Long-term debt (Note 3) ............................      303,592       305,181
Accrued pension cost................................      233,633       237,952
Accrued postretirement benefits cost................      399,252       394,097
Deferred income taxes...............................       10,090        11,742
Other noncurrent liabilities........................       18,690        22,999
                                                       ----------    ----------
          Total Noncurrent Liabilities..............      965,257       971,971

Shareholders' Equity (Note 4)
Common stock........................................      250,964       250,353
Earnings invested in the business...................      830,666       839,242
Accumulated other comprehensive income (loss).......      (97,355)      (84,913)
                                                       ----------    ----------
          Total Shareholders' Equity................      984,275     1,004,682

      Total Liabilities and Shareholders' Equity....   $2,601,091    $2,564,105
                                                       ==========    ==========


PART I.  FINANCIAL INFORMATION Continued                                3.

THE TIMKEN COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
                                                        Three Months Ended
                                                       Mar. 31       Mar. 31
                                                        2001          2000
                                                     ----------    ----------
(Thousands of dollars, except per share data)
Net sales.........................................   $  661,516    $  685,791
Cost of products sold.............................      543,502       540,826
                                                     ----------    ----------
   Gross Profit...................................      118,014       144,965

Selling, administrative and general expenses......       96,538        94,145
Impairment and restructuring charges (Note 5).....        7,907        14,759
                                                     ----------    ----------
   Operating Income...............................       13,569        36,061

Interest expense..................................       (8,894)       (7,222)
Interest income...................................          489           549
Other expense.....................................       (1,210)       (2,655)
                                                     ----------    ----------
   Income Before Income Taxes.....................        3,954        26,733
Provision for income taxes (Note 6)...............        1,732        10,693
                                                     ----------    ----------
   Net Income.....................................   $    2,222    $   16,040
                                                     ==========    ==========

   Earnings Per Share * ..........................        $0.04         $0.26
   Earnings Per Share - assuming dilution **......        $0.04         $0.26

   Dividends Per Share............................        $0.18         $0.18
                                                     ==========    ==========

*  Average shares outstanding.....................   59,981,237    61,099,962
** Average shares outstanding - assuming dilution.   60,122,806    61,237,143


PART I.  FINANCIAL INFORMATION Continued                                4.

THE TIMKEN COMPANY AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
                                                         Three Months Ended
Cash Provided (Used)                                    Mar. 31     Mar. 31
                                                          2001        2000
                                                        -------     -------
OPERATING ACTIVITIES                                 (Thousands of dollars)
Net Income............................................. $ 2,222     $16,040
Adjustments to reconcile net income to net cash
provided by operating activities:
 Depreciation and amortization.........................  37,898      38,221
 (Credit) provision for deferred income taxes..........  (2,725)         85
 Stock issued in lieu of cash to employee benefit plans     106         300
 Impairment and restructuring charges..................   4,225      14,759
 Changes in operating assets and liabilities:
  Accounts receivable.................................. (54,854)    (57,277)
  Inventories..........................................  (7,491)    (34,968)
  Other assets......................................... (11,221)      1,011
  Accounts payable and accrued expenses................   9,659      37,694
  Foreign currency translation.........................   2,876        (167)
                                                        -------     -------
   Net Cash (Used) Provided by Operating Activities.... (19,305)     15,698

INVESTING ACTIVITIES
 Purchases of property, plant and equipment - net...... (14,848)    (20,061)
 Acquisitions..........................................  (1,170)        -0-
                                                        -------     -------
   Net Cash Used by Investing Activities............... (16,018)    (20,061)

FINANCING ACTIVITIES
 Cash dividends paid to shareholders................... (10,798)    (11,002)
 Issuance (purchase) of Treasury Shares - net..........     505      (3,791)
 Payments on long-term debt............................    (884)       (964)
 Proceeds from issuance of long-term debt..............      18          27
 Short-term debt activity - net........................  55,701      22,190
                                                        -------     -------
   Net Cash Provided by Financing Activities...........  44,542       6,460

Effect of exchange rate changes on cash................  (1,274)       (383)

Increase in Cash and Cash Equivalents..................   7,945       1,714
Cash and Cash Equivalents at Beginning of Period.......  10,927       7,906
                                                        -------     -------
Cash and Cash Equivalents at End of Period............. $18,872     $ 9,620
                                                        =======     =======


PART I.  NOTES TO FINANCIAL STATEMENTS (Unaudited)                      5.

Note 1 -- Basis of Presentation
The accompanying consolidated condensed financial statements (unaudited) for
the Timken Company (the "company") have been prepared in accordance with the
instructions to Form 10-Q and do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements.  In the opinion of management, all adjustments
(consisting of normal recurring accruals) and disclosures considered necessary
for a fair presentation have been included.  For further information, refer to
the consolidated financial statements and footnotes included in the company's
annual report on Form 10-K for the year ended December 31, 2000.

Change in Method of Accounting
Effective January 1, 2001, the Company adopted Statement of Financial
Accounting Standards (SFAS) No. 133, "Accounting for Derivative Instruments
and Hedging Activities", as amended.  The Statement requires the Company to
recognize all derivatives on the balance sheet at fair value.  Derivatives that
are not designated as hedges must be adjusted to fair value through earnings.
If the derivative is designated as a hedge, depending on the nature of the
hedge, changes in the fair value of the derivatives will either be offset
against the change in fair value of the hedged assets, liabilities, or firm
commitments through earnings or recognized in other comprehensive income until
the hedged item is recognized in earnings.  The ineffective portion of the
change in fair value of a derivative that is designated as a hedge will be
immediately recognized in earnings. Certain of the Company's holdings of for-
ward foreign exchange contracts have been deemed derivatives pursuant to the
criteria established in SFAS No. 133, of which the Company has designated
certain of those derivatives as hedges.  The adoption of SFAS No. 133 did not
have a significant effect on the company's financial position or results of
operations.

Note 2 -- Inventories                                      3/31/01    12/31/00
                                                          --------   ---------
                                                         (Thousands of dollars)
Finished products                                         $198,450    $201,228
Work-in-process and raw materials                          249,644     247,806
Manufacturing supplies                                      40,302      40,515
                                                          --------    --------
                                                          $488,396    $489,549
                                                          ========    ========

An actual valuation of inventory under the LIFO method can be made only at the
end of each year based on the inventory levels and costs at that time.
Accordingly, interim LIFO calculations must necessarily be based on manage-
ment's estimates of expected year-end inventory levels and costs.  Because
these are subject to many forces beyond management's control, interim results
are subject to the final year-end LIFO inventory valuation.


PART I.  NOTES TO FINANCIAL STATEMENTS (Unaudited)
(Continued)                                                             6.

Note 3 -- Long-term Debt                                   3/31/01    12/31/00
                                                          --------   ---------
                                                         (Thousands of dollars)
State of Ohio Pollution Control Revenue Refunding Bonds,
   maturing on July 1, 2003.  The variable interest
   rate is tied to the bank's tax exempt weekly interest
   rate.  The rate at March 31, 2001 is 3.55%.             $17,000     $17,000
State of Ohio Water Development Revenue Refunding
   Bond, maturing on May 1, 2007.  The variable interest
   rate is tied to the bank's tax exempt weekly interest
   rate. The rate at March 31, 2001 is 3.50%.                8,000       8,000
State of Ohio Air Quality and Water Development Revenue
   Refunding Bonds, maturing on June 1, 2001.  The
   variable interest rate is tied to the bank's tax
   exempt weekly interest rate.  The rate at
   March 31, 2001 is 3.50%.                                 21,700      21,700
State of Ohio Water Development Authority Solid Waste
   Revenue Bonds, maturing on July 2, 2032.  The
   variable interest rate is tied to the bank's tax
   exempt weekly interest rate.  The rate at
   March 31, 2001 is 3.60%.                                 24,000      24,000
Fixed Rate Medium-Term Notes, Series A, due at various
   dates through May, 2028 with interest rates ranging
   from 6.20% to 7.76%.                                    252,000     252,000
Other                                                        8,589       9,455
                                                          --------    --------
                                                           331,289     332,155
Less:  Current Maturities                                   27,697      26,974
                                                          --------    --------
                                                          $303,592    $305,181
                                                          ========    ========

Note 4 -- Shareholders' Equity                    3/31/01  12/31/00
                                                 --------  --------
Class I and Class II serial preferred stock    (Thousands of dollars)
without par value:
   Authorized -- 10,000,000 shares each class
   Issued - none                                 $    -0-  $    -0-
Common Stock without par value:
   Authorized -- 200,000,000 shares
   Issued (including shares in treasury)
      2001 - 63,082,626 shares
      2000 - 63,082,626 shares
   Stated Capital                                  53,064    53,064
   Other paid-in capital                          256,979   256,873
Less cost of Common Stock in treasury
      2001 - 3,091,940 shares
      2000 - 3,117,469 shares                      59,079    59,584
                                                 --------  --------
                                                 $250,964  $250,353
                                                 ========  ========


PART I.  NOTES TO FINANCIAL STATEMENTS (Unaudited)
Continued                                                               7.

Note 4 -- Shareholders' Equity (continued)

An analysis of the change in capital and earnings invested in the business is as follows:

                                               Common Stock       Earnings     Accumulated
                                                        Other     Invested        Other
                                              Stated   Paid-In     in the    Comprehensive   Treasury
                                             Capital   Capital    Business   Income (Loss)     Stock       Total
                                             -------   --------   --------     ----------    --------   ----------
                                                                    (Thousands of dollars)
Balance December 31, 2000                    $53,064   $256,873   $839,242       ($84,913)   ($59,584)  $1,004,682

Net Income                                                           2,222                                   2,222
Foreign currency translation adjustment                                           (12,134)                 (12,134)
Cumulative effect of change in method of
  accounting                                                                          (34)                     (34)
Change in fair value of derivative
  financial instruments                                                              (274)                    (274)
                                                                                                        ----------
Total comprehensive income (loss)                                                                          (10,220)

Dividends  - $.18 per share                                        (10,798)                                (10,798)
Stock Options, employee benefit and dividend
  reinvestment plans:                                       106                                   505          611
Treasury - issued 25,530 shares
                                             -------   --------   --------     ----------    --------   ----------
Balance March 31, 2001                       $53,064   $256,979   $830,666       ($97,355)   ($59,079)  $  984,275
                                             =======   ========   ========     ==========    ========   ==========

The total comprehensive income for the three months ended March 31, 2000 was $11,197,000.


PART I. NOTES TO FINANCIAL STATEMENTS (Unaudited)                       8.
Continued

Note 5 -- Impairment and Restructuring Charges

The $55 million restructuring program announced in March 2000 concluded during
the first quarter of 2001, with total expenditures of $51.4 million recorded
for impairment, restructuring and reorganization charges to streamline oper-
ations, reduce costs and to realign businesses with global industries.  Of the
$51.4 million, $20.7 million were impairment charges, $15 million restructuring
charges, and the remaining $15.7 million were reorganization charges classi-
fied as cost of products sold ($7.7 million) and selling, administrative and
general expenses ($8 million).  The restructuring charges of $15 million were
primarily separation expenses with associated payments of $10.5 million to date
and the remaining $4.5 million expected to be disbursed by this year-end.

The company expects an annualized savings rate of $29 million before taxes by
the end of this year.  Savings realized in the first quarter of 2001 approx-
imate $7 million.  Seven hundred twenty-three (723) associates will be
terminated, with five hundred ninety-one (591) having exited through the first
quarter of 2001 and the remainder by this year-end.

Key elements of the total restructuring and impairment charges by industry are
as follows (in millions of dollars):

                                    Auto      Industrial     Steel      Total
Restructuring:                    --------    ----------    --------   --------
Separation costs - operations     $    -0-    $     10.1    $    -0-   $   10.1
Separation costs - administration      1.1           3.1         0.7        4.9
                                  --------    ----------    --------   --------
                                  $    1.1    $     13.2    $    0.7   $   15.0

Impaired assets:
Property, plant and equipment     $    -0-    $      5.6    $   10.9   $   16.5
Abandoned acquisitions                 0.1           0.1         4.0        4.2
                                  --------    ----------    --------   --------
                                  $    0.1    $      5.7    $   14.9   $   20.7
                                  --------    ----------    --------   --------
                                  $    1.2    $     18.9    $   15.6   $   35.7
                                  ========    ==========    ========   ========

Charges recorded in the first quarter of 2001 were $12.5 million consisting of
$3.8 million impairment, $4.1 restructuring and $4.6 million reorganization
charges classified as cost of products sold ($3.6 million) and selling, admini-
strative and general expenses ($1 million).  The majority of the impairment and
restructuring charges related to the downsizing of the company's bearing manu-
facturing facility in Duston, England.  Reorganization charges of $3.6 million
related to the bearing business, primarily the Duston downsizing, and
$1 million related to the write-off of inventory associated with the sale of
assets of Timken Latrobe's European steel business.


PART I. NOTES TO FINANCIAL STATEMENTS (Unaudited)                       9.
Continued

Note 5 -- Impairment and Restructuring Charges (continued)

Key elements of the restructuring and impairment charges for the first quarter
2001 by segment are as follows (in millions of dollars):

                                    Auto      Industrial     Steel      Total
Restructuring:                    --------    ----------    --------   --------
Separation costs - operations     $    -0-    $      3.3    $    -0-   $    3.3
Separation costs - administration      0.1           0.7         -0-        0.8
                                  --------    ----------    --------   --------
                                  $    0.1    $      4.0    $    -0-   $    4.1

Impaired assets:
Property, plant and equipment     $    -0-    $      3.4    $    0.4   $    3.8
                                  --------    ----------    --------   --------
                                  $    0.1    $      7.4    $    0.4   $    7.9
                                  ========    ==========    ========   ========

Note 6 -- Income Tax Provision       Three Months Ended
                                     Mar. 31     Mar. 31
                                      2001        2000
                                    --------    --------
                 U.S.              (Thousands of dollars)
                    Federal          $  (805)    $ 6,931
                    State & Local       (112)        505
                 Foreign               2,649       3,257
                                     -------     -------
                                     $ 1,732     $10,693
                                     =======     =======

Taxes provided exceed the U.S. statutory rate primarily due to losses without
current tax benefits.  This unfavorable permanent difference had a greater
percentage impact on the company's effective tax rate due to lower earnings.

Note 7 -- Segment Information

In previous reporting periods, the company had two reportable segments con-
sisting of Bearings and Steel.  Based on the company's reorganization into
global business units, management has determined that the Automotive Bearings
and Industrial Bearings segments meet the quantitative and qualitative
thresholds of a reportable segment as defined by SFAS No. 131, "Disclosures
about Segments of an Enterprise and Related Information."

Automotive Bearings include products for passenger cars, light and heavy trucks
and trailers.  Industrial Bearings include industrial, rail, aerospace and
super precision products as well as emerging markets in China, India and
Central and Eastern Europe.  Steel products include steels of intermediate
alloy, vacuum processed alloys, tool steel and some carbon grades.  The company
sells these steels in the form of tubes, bars and custom-made precision steel
components.

Prior quarter data has been restated to comply with the current year
presentation.


PART I.  NOTES TO FINANCIAL STATEMENTS (Unaudited)
Continued                                                               10.

Note 7 -- Segment Information (continued)

(Thousands of Dollars)                             Three Months Ended
                                                   Mar. 31    Mar. 31
                                                     2001       2000
Automotive Bearings                                --------   --------
  Net sales to external customers                  $194,257   $237,571
  Depreciation and amortization                       8,959      8,974
  Impairment and restructuring charges                   82         96
  Earnings before interest and taxes                 (1,986)    16,480

Industrial Bearings
  Net sales to external customers                  $241,994   $232,803
  Depreciation and amortization                      12,195     12,313
  Impairment and restructuring charges                7,393      1,813
  Earnings before interest and taxes                  4,774     15,653

Steel
  Net sales to external customers                  $225,265   $215,417
  Intersegment sales                                 42,477     55,582
  Depreciation and amortization                      16,744     16,934
  Impairment and restructuring charges                  432     12,850
  Earnings before interest and taxes                  9,282      2,791

Profit Before Taxes

  Total EBIT for reportable segments                 12,070     34,924
  Interest expense                                   (8,894)    (7,222)
  Interest income                                       489        549
  Intersegment adjustments                              289     (1,518)
  Income before income taxes                          3,954     26,733


PART I.  NOTES TO FINANCIAL STATEMENTS (Unaudited)
Continued                                                               11.

Note 8 -- Subsequent Event

In April 2001, the company announced a strategic global refocusing of its
manufacturing operations to establish a foundation for accelerating the com-
pany's growth initiatives.  The company determined that the core businesses
were not generating enough cash to fund opportunities for business growth and
continuous improvement initiatives.  Therefore, this second phase of the com-
pany's transformation will create focused factories for each product line or
component, replace specific manufacturing processes with state-of-the-art
processes through the company's global supply chain, rationalize production to
the lowest cost plants in the company's global manufacturing system and
implement lean manufacturing process redesign, using various tools to continue
improving quality and productivity.  The company intends to close bearing
plants in Columbus, Ohio and Duston, England and sell a tooling plant in
Ashland, Ohio.  The Columbus plant employs about 219 associates, Duston 950
and Ashland 115.  The company's intent is to continue operating the Columbus
and Duston plants for periods ranging from 6 to 20 months.  During that time,
plans will be implemented to transfer production processes to other plants in
the company's global manufacturing system.  These changes will affect
production processes and employment as the company reduces positions by about
1,500 during the next two years.

As a result of this plan, the company has targeted an annualized pretax rate of
savings of approximately $100 million by the end of 2004.  To implement these
actions, the company expects to take approximately $100-$110 million in
severance, impairment and implementation charges over the next two years, with
$18 million expected to occur in the second quarter of 2001.  Approximately
one-half of the charges will be non-cash.


                                                                          12.

Management's Discussion and Analysis of Financial Condition and Results of
Operations

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

First quarter net sales reported by the Timken Company were $661.5 million,
a decrease of 3.5% from $685.8 million in the first quarter of 2000.  Net
income decreased by 86.1% to $2.2 million compared to $16 million in the
same quarter a year ago.  In the first quarter of 2001, the company incurred
total pretax charges of $12.5 million related to the company's restructuring
and reorganization.  These charges included $7.9 million related to
impairment and restructuring charges and $4.6 million related to reorganization
expenses, which were reflected in the company's cost of products sold and
selling, administrative and general expenses for the quarter.  The first
quarter of 2000 included pretax charges of $16.8 million.  Of this,
$14.8 million represented impairment and restructuring charges and $2 million
represented reorganization charges.

Although sales volume increased in the first quarter of 2001 compared to the
third and fourth quarters of 2000, net sales decreased in comparison to the
first quarter of 2000.  First quarter 2001 results were hurt by the decline in
automotive demand and weak North American markets.  Automotive light vehicle
production in the first quarter of 2001 was slightly below the fourth quarter
2000 depressed rate.  Also, heavy truck production was down significantly and
industrial and rail demand in North America remained weak.  These economic
factors contrast greatly with the first quarter of 2000, when U.S. and European
automotive demand remained strong and international markets, especially the
industrial sectors, showed improvement.

Gross profit was $118 million (17.8% of net sales) in the first quarter of
2001, compared to $145 million (21.1% of net sales).  The lower sales volume,
fueled by weakened automotive and industrial product demand, unfavorable
product mix and manufacturing shutdowns to control inventory reduced
profitability in the first quarter of 2001 compared with the same period a
year ago.

Selling, administrative and general expenses were $96.5 million (14.6% of net
sales) in the first quarter of 2001, compared to $94.1 million (13.7% of net
sales) recorded in the first quarter of 2000.  The increase was primarily due
to higher technology and e-business costs to fund the company's growth
initiatives.

The $55 million restructuring program announced in March 2000 concluded during
the first quarter of 2001, with total expenditures of $51.4 million recorded
for impairment, restructuring and reorganization charges.  The restructuring
initiatives have improved competitiveness by streamlining operations, reducing
costs and realigning the businesses into global units to better position them
for profitable growth.  The company expects an annualized rate of savings of
$29 million before taxes by the end of this year.

Of the $51.4 million total expenditures recorded during the period of March
2000 through March 2001, $20.7 million related to non-cash asset impairment
and abandoned acquisition expenses.  Restructuring severance expenses
accounted for approximately $15 million, and reorganization expenses were


                                                                          13.

Management's Discussion and Analysis of Financial Condition and Results of
Operations

$15.7 million.  As a result of the restructuring program, the workforce has
been reduced by 723 positions, with 591 having exited through the end of the
first quarter of 2001.

Included in the $20.7 million of impairment charges, $10.9 million related
to the Steel business consolidation of four areas:  small bar finish equipment
related to exiting the small bar business; excess equipment resulting from the
new bar mill; idling of rotoroll equipment from product rationalization between
the Wooster Steel plant and Timken Desford Steel; and the sale of the flat-
ground tool steel business of Timken Latrobe Steel in Sheffield, England.  The
Steel business also recorded $4 million related to abandoned acquisition,
affiliation and divestiture efforts.  The majority of the $5.8 million
impairment expense recorded by the Bearing business related to the downsizing
of the Duston, England manufacturing plant.

Severance charges of $15 million were comprised mainly of Bearing business
initiatives to reduce costs and shift manufacturing to lower cost facilities,
to implement the Yantai labor management program, to consolidate the European
distribution functions and to streamline the management structure.  The Duston
downsizing constituted approximately $5.3 million related to 189 terminations;
the Yantai labor management program amounted to $2.7 million related to 425
terminations; the European distribution consolidation was $1.1 million related
to 47 terminations; and management streamlining of $3 million related to 62
terminations.  Operational issues resulted in the suspension of the European
distribution operation in 2000.  During the first quarter of 2001, these issues
were resolved.  As a result, management has resumed its efforts to consolidate
the European distribution consolidation. Cash expenditures of  $10.5 million
were paid from operations with additional expenditures of $4.5 million anti-
cipated by year-end.  Reorganization expenses of $15.7 million represent
relocation expenses, write-off of obsolete inventory and professional fees.

In April 2001, the company announced a strategic global refocusing of its manu-
facturing operations to establish a foundation for accelerating the company's
growth initiatives.  The company determined that the core businesses were not
generating enough cash to fund opportunities for business growth and continuous
improvement initiatives.  Therefore, this second phase of the company's trans-
formation will create focused factories for each product line or component,
replace specific manufacturing processes with state-of-the-art processes
through the company's global supply chain, rationalize production to the lowest
total cost plants in the company's global manufacturing system and implement
lean manufacturing process redesign, using various tools to continue improving
quality and productivity.  The company intends to close bearing plants in
Columbus, Ohio, and Duston, England, and to sell a tooling plant in Ashland,
Ohio.  The Columbus plant employs about 219 associates, Duston 950 and Ashland
115.  The company's intent is to continue operating the Columbus and Duston
plants for periods ranging from 6 to 20 months.  These changes will affect
production processes and employment as the company reduces positions by about
1,500 during the next two years.


                                                                          14.

Management's Discussion and Analysis of Financial Condition and Results of
Operations

As a result of this plan, the company has targeted an annualized pretax rate of
savings of approximately $100 million by the end of 2004.  To implement these
actions, the company expects to take approximately $100-$110 million in
severance, impairment and implementation charges over the next two years, with
$18 million expected to occur in the second quarter of 2001.  Approximately
one-half of the charges will be non-cash.

Other expense reflected lower expense in the first quarter of 2001 primarily
due to a non-recurring gain on sale of land.

The effective tax rate for the first quarter of 2001 was higher than the first
quarter of 2000, as a result of the company's inability to utilize tax credits
and certain losses incurred.

Automotive Bearings

The Automotive Bearings Business includes products for passenger cars, light
and heavy trucks and trailers.  The continuing decline in global automotive
demand that began in the second half of 2000 negatively impacted sales of
automotive bearings in the first quarter of 2001.  Global Automotive Bearings'
sales for the first quarter of 2001 decreased 18.2% to $194.3 million from
$237.6 million in the first quarter of 2000.  Last year's first quarter sales
were at a record level.  North American automotive bearings sales were down
21.4%, reflecting weakness in all vehicle segments, including passenger cars,
light and heavy trucks and trailers.  In Europe, automotive bearing sales for
the first quarter of 2001 decreased approximately 11% as compared to the same
period a year ago as a result of slowed demand for passenger cars, although
truck demand remained stable.  For the rest of the world, automotive bearing
sales decreased approximately 12% in the first quarter of 2001 compared to
a year ago.  The company anticipates that the global light vehicle industry
will remain sluggish through the second quarter of 2001, but should improve
as the year progresses with increased demand and new product launches expected.

Excluding $0.4 million in restructuring and reorganization charges, Automotive
Bearings' earnings before interest and income taxes (EBIT) was a loss of
$1.6 million compared to income of $16.6 million in 2000's first quarter.
Including these charges, Automotive Bearings' EBIT for the first quarter was
a loss of $2 million, compared to income of $16.5 million in the first quarter
of 2000, which included $0.1 million in restructuring and reorganization
charges.  The decline in EBIT was a result of lower sales volume than a year
ago and extensive plant shutdowns to control inventory.

Automotive Bearings' selling and administrative expenses in the first quarter
of 2001 were higher than the year-ago quarter due primarily to technology and
e-business costs incurred to fund the company's growth initiatives.

Industrial Bearings

The Industrial Bearings Business includes industrial, rail, aerospace and super
precision products as well as emerging markets in China, India and Central and


                                                                          15.

Management's Discussion and Analysis of Financial Condition and Results of
Operations

Eastern Europe.  Industrial Bearings' net sales were $242 million, an increase
of 3.9% over the first quarter 2000 net sales of $232.8 million, with strong
sales in Europe offsetting weakening European currencies and flat demand in
North America.  Although demand for industrial products has remained flat in
North America compared to the same period a year ago, European sales increased
approximately 27% compared to last year's first quarter.  The increase in Euro-
pean industrial sales was significantly impacted by the shipment of backlog
orders during the first quarter.  This backlog resulted from the operational
issues experienced in the consolidation of the European distribution operations
during 2000.  Aerospace sales in the first quarter of 2001 in North America and
Europe as well as super precision bearing demand increased approximately 13%
over first quarter 2000 levels.  Increased aerospace and super precision
product sales were a result of improving aerospace demand and increased sales
to dental handpiece customers.  First quarter 2001 rail sales outside North
America were up significantly over last year's first quarter, but were not
enough to overcome poor conditions in North American rail markets.  A weak
economy in India also adversely affected Industrial sales.  Included in net
sales for the first quarter of 2001 were sales by the dental handpiece repair
and service company acquired in January 2001.  Sales of industrial products in
Europe are expected to have moderate growth, while North American rail sales
are expected to remain weak in 2001.  The aerospace and super precision
business is expected to show modest growth in 2001.

Unfavorable product mix, sluggish North American industrial aftermarket sales
and lower production volumes reduced profitability in the first quarter of
2001, compared to the same period a year ago.  Improved EBIT performance in
aerospace and super precision was not enough to offset the decline in profit-
ability experienced in the overall Industrial Bearings segment.

Industrial Bearings' selling and administrative expenses in the first quarter
of 2001 were slightly lower than the year-ago quarter due primarily to reduced
reorganization costs.

Steel

Steel's net sales, including intersegment sales, were $267.7 million in the
first quarter of 2001, a decrease of 1.2% from the $271 million recorded a
year earlier.  Sales to oil country and aerospace customers were up and
shipments of bar products to service center and industrial customers also
increased.  Shipments of higher-value products for automotive and bearing
applications were down approximately 24% from a year ago as a result of the
weakened automotive demand.  Consistent with the second half of 2000, the
continued weakness of the Euro and other currencies against the U.S.
dollar has enabled European and other overseas producers to export into
North America with lower prices, putting pressure on pricing and operating
margins.

The company expects slightly improved steel automotive sales in the second
half of 2001 as customer inventories are depleted and automotive production


                                                                          16.

Management's Discussion and Analysis of Financial Condition and Results of
Operations

schedules are more aligned with sales.  Also, the aerospace business is
expected to show modest growth in 2001.  Industrial sales are expected to be
sluggish, reflecting weak North American industrial markets, while sales of
bars are expected to be strong as many domestic competitors struggle with
bankruptcy issues.

Excluding Steel's portion of the restructuring and reorganization charges of
$1.4 million, Steel's EBIT for the first quarter of 2001 was $10.7 million.
The restructuring and reorganization charges for 2001's first quarter related
to asset impairment and the write-off of inventory associated with the sale of
the Timken Latrobe Steel - Europe.  This compares with EBIT of $16.1 million
in the first quarter of 2000, excluding restructuring and reorganization
charges of $13.3 million.  Including restructuring and reorganization
charges, Steel EBIT was $9.3 million compared to $2.8 million a year ago.
Due to pressure from imports, Steel has had to lower prices to maintain
penetration in certain markets, resulting in lower margins.  In addition,
significantly higher energy costs have reduced Steel's profitability compared
to a year ago.  Natural gas costs in the first quarter of 2001 were about
double the cost incurred in the same period a year ago.  Also, first quarter
2001 EBIT was higher by $2.4 million due to non-recurring items associated
with operating costs.

Steel's selling and administrative expenses in the first quarter of 2001
compared to the same period a year ago were flat.  Steel had no reorganization
charges included in selling and administrative expenses in the first quarter
of 2001 compared to $0.4 million in 2000.

Financial Condition
- -------------------
Total assets as shown on the Consolidated Condensed Balance Sheets increased
by approximately $37 million from December 31, 2000.  The number of days'
supply in inventory was flat compared to December 31, 2000, at 108 days.
Bearings' inventory decreased by one day.  The decrease in inventories was
primarily a result of plant shutdowns during the first quarter to bring inven-
tory levels more in line with demand.  Steel's inventories increased about two
days.  This was a function of the change in production levels between quarters.
Plant shutdowns were of a longer duration in the fourth quarter of 2000
compared to the first quarter of 2001.

As shown on the Consolidated Condensed Statement of Cash Flows, inventories
required $6.5 million of cash during the first quarter of 2001.  Accounts
receivable have increased by $54.9 million since December 31, 2000.  Each of
the company's reported segments' number of days' sales in receivables are
comparable to December 31, 2000.  Cash was provided as a result of a
$9.7 million increase in accounts payable and accrued expenses primarily due
to increases in amounts payable to suppliers and higher reserves for pension
and post-retirement liabilities.  Purchases of property, plant and equipment,
net used $14.8 million of cash in the three months of 2001, below the
$20.1 million spent during the same period in 2000.  The company's expects


                                                                          17.

Management's Discussion and Analysis of Financial Condition and Results of
Operations

2001 capital spending for maintenance and replacement to be below 2000 levels.
Taking into account the initiatives related to the recently announced manu-
facturing strategies, capital spending may increase above 2000 levels.

The 36.4% debt-to-total-capital ratio at March 31, 2001 was higher than the
33.9% at year-end 2000.  Debt increased by $48.8 million during the first
three months to $563.4 million at March 31, 2001.  The increase in debt was
used primarily to fund increases to working capital and fund capital
expenditures.  The company expects that any cash requirements in excess of
cash generated from operating activities (such as those which may be required
for potential future acquisitions and affiliations as well as cash
contributions to the company's pension plans) could be met by short-term
borrowing and issuance of medium-term notes.  Total shareholders' equity has
decreased by approximately $20.4 million since December 31, 2000.  The increase
of approximately $2.2 million in equity from net income was primarily offset
by the $12.1 million foreign currency translation adjustment, $0.3 million
unrealized loss on derivatives as well as the payment of $10.8 million in
dividends. The majority of the increase in the foreign currency translation
adjustment was a result of the fluctuation in exchange rates for currencies
such as the British pound, Euro and Australian and Canadian dollars.
Effective January 1, 2001, the company adopted Statement of Accounting Stan-
dards No. 133, "Accounting for Derivative Instruments and Hedging Activities."
The adoption of this standard did not have a significant effect on the com-
pany's financial position or result of operations.

There was no activity during the first quarter of 2001 related to the company's
2000 stock purchase plan.  This plan authorizes the company to buy in the open
market or in privately negotiated transactions up to 4 million shares of common
stock, which are to be held as treasury shares and used for specified purposes.
The company may exercise this authorization until December 31, 2006. Main-
taining a strong balance sheet is an important objective for the company.
Therefore, the company plans to be judicious in carrying out this program
throughout the year.

Other Information
- ----------------------

Assets and liabilities of subsidiaries, other than Timken Romania, which is
considered to operate in a highly inflationary economy, are translated at the
rate of exchange in effect on the balance sheet date; income and expenses are
translated at the average rates of exchange prevailing during the quarter.
Related translation adjustments are reflected as a separate component of
accumulated other comprehensive income (loss).  Foreign currency gains and
losses resulting from transactions and the translation of financial state-
ments are included in the results of operations.

Foreign currency exchange losses included in the company's operating results
for the first three months of 2001 totaled $3.7 million compared to
$0.5 million in the same year-ago period.  The increase in translation losses
is related to continued weakening of European currencies against a strong U.S.
dollar and the devaluing Brazilian Real in the first quarter of 2001.  Also,
for the first three months of 2001, the company recorded a foreign currency


                                                                          18.

Management's Discussion and Analysis of Financial Condition and Results of
Operations

translation adjustment of $12.1 million that reduced shareholders' equity
compared to a foreign currency translation adjustment of $4.8 million that
decreased equity in the first quarter of 2000.  Continued weakening of
currencies in many of the countries in which the company operates caused the
higher impact of negative foreign currency adjustments in the first quarter of
2001.

On December 31, 1998, certain countries that are members of the European Union
irrevocably fixed the conversion rates between their national currencies and a
common currency, the "Euro."  The participating countries' former national
currencies will continue to exist as denominations of the Euro until January 1,
2002.  The company has been evaluating the business implications of conversion
to the Euro, including the need to adapt internal systems to accommodate the
various Euro-denominated transactions, the competitive implications of cross-
border pricing and other strategic issues.  The company established a Euro
project team to manage the changes required to conduct business operations in
compliance with Euro-related regulations.  The company does not expect the
conversion to the Euro to have a material effect on its financial condition or
results of operations.

In February 2001, the company announced that it completed the previously
announced sale of the tool and die steel operations of Timken Latrobe Steel -
Europe.

The company announced in March, 2001 the opening of a bearing reconditioning
facility in Mexico City as part of its Timken de Mexico operations.  The
bearing service facility will remanufacture railroad bearings used in loco-
motives and freight cars.

In May 2001, the company announced that it entered into a joint venture with
Axicon Technologies Inc. to pursue advanced gearing solutions for automotive
and industrial applications.

The statements set forth in this document that are not historical in nature
are forward-looking statements.  The company cautions readers that actual
results may differ materially from those projected or implied in forward-
looking statements made by or on behalf of the company due to a variety of
important factors, such as:

a)   changes in world economic conditions.  This includes the potential
     instability of governments and legal systems in countries in which the
     company conducts business and significant changes in currency valuations.

b)   the effects of changes in customer demand on sales, product mix, and
     prices.  This includes the effects of customer strikes, the impact of
     changes in industrial business cycles and whether conditions of fair trade
     continue in the U.S. market, in light of the U.S. International Trade
     Commission voting in the second quarter of 2000 to revoke the antidumping
     orders on imports of tapered roller bearings from Japan, Romania and
     Hungary.


                                                                          19.

Management's Discussion and Analysis of Financial Condition and Results of
Operations

c)   competitive factors, including changes in market penetration, the intro-
     duction of new products by existing and new competitors, and new
     technology that may impact the way the company's products are sold or
     distributed.

d)   changes in operating costs.  This includes the effect of changes in the
     company's manufacturing processes; unexpected costs related to the
     implementation of the company's global restructuring and recently
     announced manufacturing transformation; changes in costs associated with
     varying levels of operations; changes resulting from inventory management
     and cost reduction initiatives and different levels of customer demands;
     the effects of unplanned work stoppages; changes in the cost of labor and
     benefits; and the cost and availability of raw materials and energy.

e)   the success of the company's operating plans, including its ability to
     achieve the benefits from its global restructuring and recently announced
     manufacturing transformation as well as its ongoing continuous improvement
     and rationalization programs; its ability to integrate acquisitions into
     company operations; the ability of recently acquired companies to achieve
     satisfactory operating results; its ability to maintain appropriate
     relations with unions that represent company associates in certain
     locations in order to avoid disruptions of business and its ability to
     successfully implement its new organizational structure.

f)   unanticipated litigation, claims or assessments.  This includes claims or
     problems related to product warranty and environmental issues.

g)   changes in worldwide financial markets to the extent they affect the
     company's ability or costs to raise capital, have an impact on the overall
     performance of the company's pension fund investments and/or cause changes
     in the economy which affect customer demand.

The company undertakes no obligation to update any forward-looking statement.
                                                                 20.

Part II.  OTHER INFORMATION

Item 1.  Legal Proceedings

          Not applicable.

Item 2.  Changes in Securities

          Not applicable.

Item 3.  Defaults Upon Senior Securities

          Not applicable.

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

          (1)    The Board of Directors recommended the four individuals set
                 forth below be Directors in Class I at the 2001 Annual
                 Meeting of Shareholders of The Timken Company held on April
                 17, 2001 to serve a term of three years expiring at the
                 Annual Meeting in 2004 (or until their respective successors
                 are elected and qualified).  The first three individuals had
                 been previously elected as Directors by the shareholders and
                 were re-elected at the 2001 meeting.

                                            Affirmative          Withheld

                 James W. Griffith           48,669,182          6,493,114
                 John A. Luke, Jr.           54,360,809            801,487
                 Ward J. Timken              48,574,172          6,588,124
                 Martin D. Walker            54,296,313            865,983

Item 5.  Other Information

          Not applicable.

Item 6.  Exhibits and Reports on Form 8-K

          (a).  Exhibits

               10    The form of The Timken Company Nonqualified Stock Option
                     Agreement for nontransferable options without dividend
                     credit as adopted on April 17, 2001.

               10.1  Retirement Agreement entered into with Stephen A. Perry

               11    Computation of Per Share Earnings

               12    Computation of Ratio of Earnings to Fixed Charges

          (b)   Reports on Form 8-K:

                On April 17, 2001, the company filed a Form 8-K regarding
                Other Events, which contained a news release, dated April 17,
                2001 titled "The Timken Company Launches Next Phase of Trans-
                formation with Refocusing of Global Manufacturing Operations."
                No financial statements were filed.
                                                                 21.

          (b)   Reports on Form 8-K (continued)

                On April 23, 2001, the company filed a Form 8-K regarding Other
                Events and Regulation FD Disclosure, which contained estimated
                market data and industry trend information relating to a number
                of industry segments in which the company sells bearing and
                steel products.  No financial statements were filed.


                                                                  22.

                            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.

                                         The Timken Company
                                  _______________________________

Date       May 14, 2001            BY   /s/ W. R. Timken, Jr.
      ________________________    _______________________________
                                   W. R. Timken, Jr.,
                                   Director and Chairman;
                                   Chief Executive Officer

Date       May 14, 2001            BY   /s/ G. E. Little
      ________________________    _______________________________
                                   G. E. Little
                                   Senior Vice President - Finance

EX-10

                                   EXHIBIT 10

                             THE  TIMKEN  COMPANY

                       Nonqualified Stock Option Agreement

          WHEREAS, _____________ (the "Optionee") is an employee of The Timken
Company (the "Company"); and

          WHEREAS, the grant of stock options evidenced hereby was authorized
by a resolution of the Compensation Committee (the "Committee") of the Board of
Directors (the "Board") of the Company that was duly adopted on _______________
(the "Date of Grant"), and the execution of a stock option agreement in the
form hereof was authorized by a resolution of the Committee duly adopted on
April 17, 2001; and

          WHEREAS, the option evidenced hereby is intended to be a nonqualified
stock option and shall not be treated as an "incentive stock option" within the
meaning of that term under Section 422 of the Internal Revenue Code of 1986;

          NOW, THEREFORE, pursuant to the Company's Long-term Incentive Plan
(as Amended and Restated as of December 16, 1999) (the "Plan") and subject to
the terms and conditions thereof and the terms and conditions hereinafter set
forth, the Company hereby grants to the Optionee (i) a nonqualified stock
option (the "Option") to purchase ____________ shares of the Company's common
stock without par value (the "Common Shares") at the exercise price of
__________ ($__________) per Common Share (the "Exercise Price").

       1. Vesting of Option.  (a)  Unless terminated as hereinafter provided,
the Option shall be exercisable to the extent of one-fourth (1/4th) of the
Common Shares covered by the Option after the Optionee shall have been in the
continuous employ of the Company or a subsidiary for one full year from the
Date of Grant and to the extent of an additional one-fourth (1/4th)


thereof after each of the next three successive years thereafter during which
the Optionee shall have been in the continuous employ of the Company or a
subsidiary.  For the purposes of this agreement:  "subsidiary" shall mean a
corporation, partnership, joint venture, unincorporated association or other
entity in which the Company has a direct or indirect ownership or other equity
interest; the continuous employment of the Optionee with the Company or a
subsidiary shall not be deemed to have been interrupted, and the Optionee shall
not be deemed to have ceased to be an employee of the Company or a subsidiary,
by reason of the transfer of his employment among the Company and its
subsidiaries.

          (b)  Notwithstanding the provisions of Section 1(a) hereof, the
Option shall become immediately exercisable in full upon any change in control
of the Company that shall occur while the Optionee is an employee of the
Company or a subsidiary.  For the purposes of this agreement, the term "change
in control" shall mean the occurrence of any of the following events:

               (i)  The acquisition by any individual, entity or group (within
the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
1934) (a "Person") of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Securities Exchange Act of 1934) of 30% or more of
either:  (A) the then-outstanding Common Shares or (B) the combined voting
power of the then-outstanding voting securities of the Company entitled to vote
generally in the election of directors ("Voting Shares"); provided, however,
that for purposes of this subsection (i), the following acquisitions shall not
constitute a change in control:  (1) any acquisition directly from the Company,
(2) any acquisition by the Company, (3) any acquisition by any employee benefit
plan (or related trust) sponsored or maintained by the Company or any


Subsidiary, or (4) any acquisition by any Person pursuant to a transaction
which complies with clauses (A), (B) and (C) of subsection (iii) of this
Section 1(b); or

               (ii) Individuals who, as of the date hereof, constitute the
Board (the "Incumbent Board") cease for any reason (other than death or
disability) to constitute at least a majority of the Board; provided, however,
that any individual becoming a director subsequent to the date hereof whose
election, or nomination for election by the Company's shareholders, was
approved by a vote of at least a majority of the directors then comprising
the Incumbent Board (either by a specific vote or by approval of the proxy
statement of the Company in which such person is named as a nominee for
director, without objection to such nomination) shall be considered as though
such individual were a member of the Incumbent Board, but excluding for this
purpose, any such individual whose initial assumption of office occurs as a
result of an actual or threatened election contest (within the meaning of Rule
14a-11 of the Securities Exchange Act of 1934) with respect to the election or
removal of directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board; or

               (iii) Consummation of a reorganization, merger or consolidation
or sale or other disposition of all or substantially all of the assets of the
Company (a "Business Combination"), in each case, unless, following such
Business Combination, (A) all or substantially all of the individuals and
entities who were the beneficial owners, respectively, of the Common Shares
and Voting Shares immediately prior to such Business Combination beneficially
own, directly or indirectly, more than 66-2/3% of, respectively, the then-
outstanding shares of common stock and the combined voting power of the then-
outstanding voting securities entitled to vote generally in the election of
directors, as the case may be, of the entity resulting from such Business

Combination (including, without limitation, an entity which as a result of such
transaction owns the Company or all or substantially all of the Company's
assets either directly or through one or more subsidiaries) in substantially
the same proportions relative to each other as their ownership, immediately
prior to such Business Combination, of the Common Shares and Voting Shares of
the Company, as the case may be, (B) no Person (excluding any entity resulting
from such Business Combination or any employee benefit plan (or related trust)
sponsored or maintained by the Company or such entity resulting from such
Business Combination) beneficially owns, directly or indirectly, 30% or more
of, respectively, the then-outstanding shares of common stock of the entity
resulting from such Business Combination, or the combined voting power of
the then-outstanding voting securities of such corporation except to the
extent that such ownership existed prior to the Business Combination, and
(C) at least a majority of the members of the board of directors of the
corporation resulting from such Business Combination were members of the
Incumbent Board at the time of the execution of the initial agreement, or of
the action of the Board, providing for such Business Combination; or

               (iv) Approval by the shareholders of the Company of a complete
liquidation or dissolution of the Company.

          (c)  Notwithstanding the provisions of Section 1(a) hereof, the
Option shall become immediately exercisable in full if the Optionee should
die or become permanently disabled while in the employ of the Company or any
subsidiary, or if the Optionee should retire with the Company's consent.

          For purposes of this agreement, retirement "with the Company's
consent" shall mean: (i) the retirement of the Optionee prior to age 62 under
a retirement plan of the Company or a subsidiary, if the Board or the Committee

determines that his retirement is for the convenience of the Company or a
subsidiary, or (ii) the retirement of the Optionee at or after age 62 under a
retirement plan of the Company or a subsidiary.  For purposes of this
agreement, "permanently disabled" shall mean that the Optionee has qualified
for disability benefits under a disability plan or program of the Company or,
in the absence of a disability plan or program of the Company, under a
government-sponsored disability program.

          (d)  To the extent that the Option shall have become exercisable in
accordance with the terms of this agreement, it may be exercised in whole or
in part from time to time thereafter.

          2.   Termination of Option.  The Option shall terminate automatically
and without further notice on the earliest of the following dates:

          (a)  thirty days after the date upon which the Optionee ceases to be
an employee of the Company or a subsidiary, unless the cessation of his
employment (i) is a result of his death, permanent disability or retirement
with the Company's consent or (ii) follows a change in control;

          (b)  five years after the date upon which the Optionee ceases to be
an employee of the Company or subsidiary (i) as a result of his permanent
disability, (ii) as a result of his retirement with the Company's consent,
unless he is also a director of the Company who continues to serve as such
following his retirement with the Company's consent, or (iii) following a
change in control, unless the cessation of his employment following a change
in control is a result of his death;

          (c)  five years after the date upon which the Optionee ceases to be a
director of the Company, but not less than five years after the date upon which
he ceases to be an employee of the Company or a subsidiary, if (i) the
cessation of his employment is a result of his retirement with the Company's
consent and (ii) he continues to serve as a director of the Company following
the cessation of his employment;

          (d)  one year after the date of the Optionee's death regardless of
whether he ceases to be an employee of the Company or a subsidiary prior to
his death (i) as a result of his permanent disability or retirement with the
Company's consent or (ii) following a change in control; or

          (e)  ten years after the Date of Grant.

     In the event that the Optionee shall intentionally commit an act that the
Committee determines to be materially adverse to the interests of the Company
or a subsidiary, the Option shall terminate at the time of that determination
notwithstanding any other provision of this agreement.

     3.   Payment of Exercise Price.  The Exercise Price shall be payable (a)
in cash in the form of currency or check or other cash equivalent acceptable
to the Company, (b) by transfer to the Company of nonforfeitable, unrestricted
Common Shares that have been owned by the Optionee for at least six months
prior to the date of exercise or (c) by any combination of the methods of
payment described in Sections 3(a) and 3(b) hereof.  Nonforfeitable,
unrestricted Common Shares that are transferred by the Optionee in payment
of all or any part of the Exercise Price shall be valued on the basis of their
fair market value as determined by the Committee from time to time.  Subject
to the terms and conditions of Section 6 hereof, and subject to any deferral

election the Optionee may have made pursuant to any plan or program of the
Company, the Company shall cause certificates for any shares purchased
hereunder to be delivered to the Optionee upon payment of the Exercise Price
in full.

     4.   Compliance with Law.  The Company shall make reasonable efforts to
comply with all applicable federal and state securities laws; provided,
however, notwithstanding any other provision of this agreement, the Option
shall not be exercisable if the exercise thereof would result in a violation
of any such law.  To the extent that the Ohio Securities Act shall be
applicable to the Option, the Option shall not be exercisable unless the Common
Shares or other securities covered by the Option are (a) exempt from
registration thereunder, (b) the subject of a transaction that is exempt from
compliance therewith, (c) registered by description or qualification
thereunder or (d) the subject of a transaction that shall have been registered
by description thereunder.

               5.   Transferability and Exercisability.  The Option, including
any interest therein, shall not be transferable by the Optionee except by will
or the laws of descent and distribution, and the Option shall be exercisable
during the lifetime of the Optionee only by him or, in the event of his legal
incapacity to do so, by his guardian or legal representative acting on behalf
of the Optionee in a fiduciary capacity under state law and court supervision.

               6.   Adjustments.  The Committee shall make any adjustments in
the Exercise Price and the number or kind of shares of stock or other
securities covered by the Option that the Committee may determine to be
equitably required to prevent any dilution or expansion of the Optionee's
rights under this agreement that otherwise would result from any (a) stock
dividend, stock split, combination of shares, recapitalization or other change

in the capital structure of the Company, (b) merger, consolidation, separation,
reorganization or partial or complete liquidation involving the Company or (c)
other transaction or event having an effect similar to any of those referred
to in Section 8(a) or 8(b) hereof.  Furthermore, in the event that any
transaction or event described or referred to in the immediately preceding
sentence shall occur, the Committee may provide in substitution of any or all
of the Optionee's rights under this agreement such alternative consideration
as the Committee may determine in good faith to be equitable under the
circumstances.

               7.   Withholding Taxes.  If the Company shall be required to
withhold any federal, state, local or foreign tax in connection with any
exercise of the Option, the Optionee shall pay the tax or make provisions
that are satisfactory to the Company for the payment thereof.  The Optionee
may elect to satisfy all or any part of any such withholding obligation by
surrendering to the Company a portion of the Common Shares that are issuable
to the Optionee upon the exercise of the Option.  If such election is made,
the shares so surrendered by the Optionee shall be credited against any such
withholding obligation at their fair market value (as determined by the
Committee from time to time) on the date of such surrender.

          8.   Right to Terminate Employment.  No provision of this agreement
shall limit in any way whatsoever any right that the Company or a subsidiary
may otherwise have to terminate the employment of the Optionee at any time.

      9.  Relation to Other Benefits.  Any economic or other benefit to the
Optionee under this agreement or the Plan shall not be taken into account in
determining any benefits to which the Optionee may be entitled under any
profit-sharing, retirement or other benefit or compensation plan maintained
by the Company or a subsidiary and shall not affect the amount of any life

insurance coverage available to any beneficiary under any life insurance plan
covering employees of the Company or a subsidiary.

     10.  Amendments.  Any amendment to the Plan shall be deemed to be an
amendment to this agreement to the extent that the amendment is applicable
hereto; provided, however, that no amendment shall adversely affect the rights
of the Optionee with respect to the Option without the Optionee's consent.

     11.  Severability.  In the event that one or more of the provisions of
this agreement shall be invalidated for any reason by a court of competent
jurisdiction, any provision so invalidated shall be deemed to be separable
from the other provisions hereof, and the remaining provisions hereof shall
continue to be valid and fully enforceable.

     12.  Governing Law.  This agreement is made under, and shall be construed
in accordance with, the laws of the State of Ohio.

          This agreement is executed by the Company on this ________ day of
          __________.

                         THE  TIMKEN  COMPANY

                         By _______________________
                              Scott A. Scherff
                              Corporate Secretary & Asst. General Counsel

          The undersigned Optionee hereby acknowledges receipt of an executed
original of this agreement and accepts the Option granted hereunder, subject
to the terms and conditions of the Plan and the terms and conditions
hereinabove set forth.

                         __________________________
                         Optionee

                         Date:  ___________________

EX-10.1

                                   EXHIBIT 10.1

                                RETIREMENT AGREEMENT

          THIS RETIREMENT AGREEMENT (this "Agreement'), is made and entered
into as of March 30, 2001 by and between The Timken Company, an Ohio
corporation (the "Company"), and Stephen A. Perry ("Perry").

                                    WITNESSETH;

         WHEREAS, Perry currently serves as Senior Vice President-Human
Resources, Purchasing and Communications of the Company; and

         WHEREAS, Perry, throughout the course of his career, has made numerous
and lasting contributions to the success of the Company;

         WHEREAS, Perry intends to retire from the Company effective as of the
close of business on March 30, 2001; and

         WHEREAS, the Company and Perry have determined that in connection
with Perry's retirement from the Company, Perry shall resign from any and all
offices of the Company and any other directorship, office, or position of any
other entity for which Perry was serving at the request of the Company, as of
March 30, 2001;

          NOW, THEREFORE, in consideration of the premises and agreements
contained herein and other good and valuable consideration, the sufficiency
and receipt of which are hereby acknowledged, and intending to be legally
bound, the Company and Perry hereby agree as follows:

     1.  Resignation.  Perry shall resign as an employee of the Company, and
its subsidiaries and related or affiliated companies, effective as of the close
of business on March 30, 2001.  Perry shall also resign, effective the close
of business on March 30, 2001: (a) from all offices of the Company to which
he has been elected by the Board of Directors of the Company (or to which he
has otherwise been appointed), (b) from all offices of any entity that is a
subsidiary of, or is otherwise related to or affiliated with, the Company,
(c) from all administrative, fiduciary or other positions he may hold with
respect to arrangements or plans for, of or relating to the Company, and (d)
from any other directorship, office, or position of any corporation,
partnership, joint venture, trust or other enterprise (each, an "Other Entity")
insofar as Perry is serving in the directorship, office, or position of the
Other Entity at the request of the Company.  The Company shall consent to and
accept such resignations effective as of the close of business on March 30,
2001.  Perry will execute any documents reasonably requested by the Company
to evidence such resignations.


     2.   Severance Payment.  The Company will pay Perry an amount equal to
Seven Hundred Thirty-Five Thousand Dollars ($735,000), less applicable with-
holding taxes, in a lump sum on March 30, 2001.

     3.  Release by Perry

          a.   Perry, for himself and his dependents, successors, assigns,
heirs, executors and administrators (and his and their legal representatives
of every kind), hereby releases, dismisses, remisses and forever discharges
the Company from any and all arbitrations, claims (including claims for
attorneys' fees), demands, damages, suits, proceedings, actions or causes of
action of any kind and every description, whether known or unknown, which
Perry now has or may have had for, upon or by reason of any cause whatsoever
(except that this release shall not apply to the obligations of the Company
arising under this Agreement), against the Company ("Claims"), including but
not limited to:

               (i) any and all Claims arising out of or relating to:
    (A) Perry's past employment or service with the Company, or (B) Perry's
    resignation as Senior Vice President - Human Resources, Purchasing and
    Communications of the Company or his resignation from any other position
    described in Section 1 of this Agreement.

               (ii) any and all Claims of discrimination, including but not
    limited to claims of discrimination on the basis of sex, race, age,
    national origin, marital status, religion or disability, including,
    without limiting the generality of the foregoing, any claims under the Age
    Discrimination in Employment Act, as amended (the "ADEA") Title VII of the
    Civil Rights Act of 1964, as amended, the Americans with Disabilities Act,
    The Civil Rights Act of 1991, or Chapter 4112, Ohio Revised Code, and

               (iii) any and all Claims of wrongful or unjust discharge or
    breach of any contract or promise, express or implied, except for any claim
    asserted in any action for breach of this Retirement Agreement.

          b.  Perry further understands and acknowledges that:

               (i) The release provided for in this Section 3, including claims
    under the ADEA to and including the date of this Agreement, is in exchange
    for the additional consideration provided for in Section 2 of this
    Agreement, to which consideration he was not heretofore entitled;

               (ii) He has been advised by the Company to consult with legal
    counsel prior to executing this Agreement and the release provided for in
    this Section 3, has had an opportunity to consult with and to be advised
    by legal counsel of his choice, fully understands the terms of this
    Agreement, and enters into this Agreement freely, voluntarily and intending
    to be bound;


               (iii) He has been given a period of twenty-one days to review
     and consider the terms of this Agreement, and the release contained
     herein, prior to its execution and that he has used as much of the
     twenty-one day period as he desires; and

               (iv) He may, within seven days after execution, revoke this
     Agreement. Revocation shall be made by delivering a written notice of
     revocation to the Senior Vice President and General Counsel at the
     Company. For such revocation to be effective, written notice must be
     actually received by the Senior Vice President and General Counsel at
     the Company no later than the close of business on the seventh day after
     Perry executes this Agreement.

          c.  Perry acknowledges that his retirement and resignation is by
mutual agreement between the Company and Perry, and that Perry waives and
releases any Claim that he has or may have to reemployment.

          d.   Perry will execute all additional documents necessary to
effectuate the purposes and provisions of this Agreement;

          e.  For purposes of this Section 5, the "Company" shall include
its predecessors, parents, subsidiaries, divisions, related or affiliated
companies, officers, directors, stockholders, members, employees, heirs,
successors, assigns, representatives, agents and counsel.

     4.  Successors and Binding Agreement.

          a.   This Agreement shall be binding upon and inure to the benefit
of the Company and any successor of or to the Company, including, without
limitation, any persons acquiring, directly or indirectly, all or substantially
all of the business or assets of the Company, whether by purchase, merger,
consolidation, reorganization, or otherwise (and such successor shall
thereafter be deemed included in the definition of the "Company" for purposes
of this Agreement), but shall not otherwise be assignable or delegable by the
Company.

          b.  This Agreement shall inure to the benefit of and be enforceable
by Perry's personal or legal representatives, executors, administrators,
successors, heirs, distributees, or legatees.

          c.  This Agreement is personal in nature and none of the parties
hereto shall, without the consent of the other parties, assign, transfer or
delegate this Agreement or any rights or obligations hereunder except as
expressly provided in Subsections (a) and (b) of this Section 4.

          d.  This Agreement is intended to be for the exclusive benefit of
the parties hereto, and except as provided in Subsections (a) and (b) of this
Section 4, no third party shall have any rights hereunder.


     5.  Notices.  For all purposes of this Agreement, all communications
provided for herein shall be in writing and shall be deemed to have been duly
given when delivered, addressed to the Company (to the attention of the
Senior Vice President and General Counsel) at the Company's principal
executive offices and to Perry at his principal residence, or to such other
address as any party may have furnished to the other in writing and in
accordance herewith.  Notices of change of address shall be effective upon
receipt.

     6.   Miscellaneous.

          a.   No provision of this Agreement may be modified, waived or
discharged unless such modification, waiver or discharge is agreed to in
writing signed by Perry and the Company. No waiver by either party hereto at
any time of any breach by the other party hereto or compliance with any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time.

          b.   Validity, interpretation, construction and performance of
this Agreement shall be governed by the substantive laws of the State of Ohio,
without giving effect to the principles of conflict of laws of the State of
Ohio.

          c.   To the extent any provision of this Agreement shall be invalid
or unenforceable, it shall be considered deleted herefrom and the remainder of
such provision and of this Agreement shall be unaffected and shall continue in
full force and effect.

          d.   This Agreement may be executed in one or more counterparts,
each of which shall be deemed to be an original, but all of which together
shall constitute one and the same Agreement.

          e.   Captions and Section headings used herein are for convenience
and are not part of this Agreement and shall not be used in construing it.

          f.   Each party hereto shall execute such additional documents, and
do such additional things, as may reasonably be requested by the other party
to effectuate the purposes and provisions of this Agreement.


          IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of the date first set forth above.

                                       THE TIMKEN COMPANY

_______________________________        By: _______________________________
Witness

                                       Date: __________________

_______________________________        ___________________________________
Witness                                Stephen A. Perry

                                       Date: __________________

EX-11

Exhibit 11 - COMPUTATION OF PER SHARE EARNINGS
(Thousands of dollars, except per share data)

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

BASIC
Average shares outstanding                         59,981,237      61,099,962
Net income                                            $ 2,222         $16,040

     Per share amount                                   $0.04           $0.26
                                                        =====           =====

DILUTED
Average shares outstanding                         59,981,237      61,099,962

Effect of dilutive securities based on the
  treasury stock method using the average
  market price if higher than the exercise price      141,569         137,181
                                                   ----------      ----------
                                                   60,122,806      61,237,143
Net income                                            $ 2,222         $16,040

     Per share amount                                   $0.04           $0.26
                                                        =====           =====

EX-12

                                  EXHIBIT 12
               COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

                                                 Three Months Ended
                                                Mar. 31       Mar. 31
                                                 2001          2000
                                               --------      --------
                                               (Thousands of Dollars)

Income before income taxes,
      extraordinary item and cumulative
      effect of accounting changes              $ 3,954       $26,733
Amortization of capitalized interest                620           608
Interest expense                                  8,894         7,222
Interest portion of rental expense                  620           598
                                               --------      --------
Earnings                                        $14,088       $35,161
                                               ========      ========

Interest                                        $ 9,102       $ 7,586
Interest portion of rental expense                  620           598
                                               --------      --------
Fixed Charges                                   $ 9,722       $ 8,184
                                               ========      ========

Ratio of Earnings to Fixed Charges                 1.45          4.30
                                               ========      ========