As filed with the Securities and Exchange Commission on October 9, 2003
                                                      Registration No. 333-_____
================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   ----------

                                    FORM S-8
                             REGISTRATION STATEMENT
                                      UNDER
                           THE SECURITIES ACT OF 1933

                                   ----------

                                SPATIALIGHT, INC.
               (Exact name of issuer as specified in its charter)

                New York                                       16-1363082
     (State or other jurisdiction of                        (I.R.S. Employer
     incorporation or organization)                        Identification No.)

    Five Hamilton Landing, Suite 100
           Novato, California                                     94949
(Address of Principal Executive Offices)                       (Zip Code)

                    SpatiaLight, Inc. 1999 Stock Option Plan
                Robert A. Olins Option to Purchase Common Shares
                Steven F. Tripp Option to Purchase Common Shares
        Theodore H. Banzhaf Time Accelerated Restricted Stock Award Plan
                            (Full title of the plan)

                                 Robert A. Olins
                         Acting Chief Executive Officer
                                SpatiaLight, Inc.
                        Five Hamilton Landing, Suite 100
                            Novato, California 94949
                                 (415) 883-1693
            (Name, address and telephone number of agent for service)

                                   Copies to:
                                Melvin Katz, Esq.
                                 Bryan Cave LLP
                           1290 Avenue of the Americas
                            New York, New York 10104
                Approximate date of proposed sale to the public:
   From time to time after the effective date of this Registration Statement.

                         CALCULATION OF REGISTRATION FEE

<TABLE>
<CAPTION>
=============================== ========================= ========================== ======================== =====================
        Title of Each                                         Proposed Maximum          Proposed Maximum
     Class of Securities              Amount to be             Offering Price          Aggregate Offering           Amount of
       to be Registered                Registered               Per Share(1)                Price(1)             Registration Fee
------------------------------- ------------------------- -------------------------- ------------------------ ---------------------
<S>                                    <C>                         <C>                     <C>                      <C>
Common Shares, par value $.01
per share (2)                          1,000,000                   $ 5.17                 $5,170,000               $418.25
------------------------------- ------------------------- -------------------------- ------------------------ ---------------------
Common Shares, par value $.01
per share (3)                           750,000                    $ 5.17                 $3,877,500               $313.68
------------------------------- ------------------------- -------------------------- ------------------------ ---------------------
Common Shares, par value $.01
per share (4)                           150,000                    $ 5.17                 $  775,500               $62.73
------------------------------- ------------------------- -------------------------- ------------------------ ---------------------
Common Shares, par value $.01
per share (5)                           800,000                    $ 5.17                 $4,136,000               $334.60
------------------------------- ------------------------- -------------------------- ------------------------ ---------------------
</TABLE>


(1)      Estimated  solely for the purpose of  computing  the  registration  fee
         pursuant  to Rules  457(c) and (h) of the  Securities  Act of 1933,  as
         amended,  based  upon the  average  of the high  and low  sales  prices
         reported on the Nasdaq SmallCap Market on October 3, 2003.

(2)      These shares represent the underlying  Common Shares for options issued
         to participants in the Company's 1999 Stock Option Plan, as amended.

(3)      These shares represent the underlying Common Shares for options granted
         outside of any Company plan to Robert A. Olins,  Acting Chief Executive
         Officer and a director of the Company.

(4)      These shares represent the underlying Common Shares for options granted
         outside of any  Company  plan to Steven F.  Tripp,  a  director  of the
         Company.

(5)      These shares represent the underlying Common Shares for options granted
         outside of any Company plan to Theodore H. Banzhaf,  an Executive  Vice
         President  of  the   Company,   under  the  Theodore  H.  Banzhaf  Time
         Accelerated Restricted Stock Award Plan.



<PAGE>

                                EXPLANATORY NOTES


                          INCORPORATION BY REFERENCE OF
                    PRIOR REGISTRATION STATEMENT ON FORM S-8

         This registration statement on Form S-8 filed by SpatiaLight, Inc. (the
"Company")  with the  Securities  and  Exchange  Commission  (the  "Commission")
relates in part to the registration of an additional  1,000,000 of the Company's
Common Shares,  $.01 par value per share,  for issuance under the Company's 1999
Stock Option Plan, as amended (the "1999  Plan").  A  registration  statement on
Form S-8 (File No. 333-91259) was filed with the Commission on November 19, 1999
(the "Prior Registration  Statement")  relating to the registration of 4,000,000
of the  Company's  Common Shares for issuance  under the 1999 Plan.  Pursuant to
General  Instruction  E of Form S-8,  the  contents  of the  Prior  Registration
Statement  are  incorporated  herein by  reference  insofar as it relates to the
registration  of  the  additional   1,000,000  Common  Shares.   The  securities
registered  hereunder are the same class as the securities  registered under the
Prior Registration Statement.

                        REGISTRATION OF SHARES UNDERLYING
                            CERTAIN NON-PLAN OPTIONS

         This  Registration  Statement  is also being  filed for the  purpose of
registering  certain  non-plan  options to  purchase  Common  Shares,  which the
Company granted to certain of its officers and directors.

                       REGISTRATION OF SHARES PURSUANT TO
                               REOFFER PROSPECTUS

         This  Registration  Statement  is also  being  filed  for  purposes  of
registering  Common Shares underlying  certain options for resale by the Selling
Shareholders, whose names are set forth in the accompanying Reoffer Prospectus.

         This  Registration  Statement  contains  three  parts.  The first  part
contains the Reoffer Prospectus, which has been prepared in accordance with Part
I of  Form  S-8  (in  accordance  with  General  Instruction  C of  the  General
Instructions  to Form S-8),  which  covers  reoffers  and resales of the Selling
Shareholders'  Common Shares. The second part contains  information  required by
Part I of Form S-8 and is presented only in connection with the  registration of
the non-plan options held by Messrs.  Olins,  Tripp and Banzhaf.  The third part
contains information required in the Registration  Statement pursuant to Part II
of Form  S-8.  Information  required  by Part I, as it  relates  to the  Reoffer
Prospectus,  of  Form  S-8  is  omitted  from  this  Registration  Statement  in
accordance  with Rule 428 under the Securities Act of 1933, as amended,  and the
"Note" to Part I of Form S-8.


<PAGE>



                               REOFFER PROSPECTUS

                                SPATIALIGHT, INC.

                             1,700,000 COMMON SHARES

         This Prospectus  relates to the resale of up to 1,700,000 of our Common
Shares, par value $.01 per share, by certain Selling Shareholders listed in this
Prospectus  under the section  entitled  "Selling  Shareholders."  These  Shares
(which we refer to in this Prospectus as the "Shares") include (i) up to 750,000
Common  Shares which are issuable  upon  exercise of certain  options  issued to
Robert A. Olins,  Acting Chief Executive  Officer and a director of the Company;
(ii) up to 150,000  Common  Shares which are issuable  upon  exercise of certain
options  issued to Steven F. Tripp,  a director of the Company;  and (iii) up to
800,000  Common  Shares  which are  issuable  upon  exercise of certain  options
granted to Theodore F. Banzhaf, an Executive Vice President of the Company.  Our
Common Shares are traded on The Nasdaq  SmallCap Market under the symbol "HDTV".
On October 3, 2003,  the last sale price of our Common Shares as reported on The
Nasdaq SmallCap Market was $5.14 per share.

         No underwriter is being used in connection  with the sale of the Shares
being offered by the Selling Shareholders. The Selling Shareholders, directly or
through  agents or  dealers,  may sell all or some of their  Shares that are the
subject of this  Prospectus  on terms to be  determined  at the time of sale. We
will not receive any of the proceeds  from the sale of the Shares being  offered
hereby for the  account  of the  Selling  Shareholders.  Such  proceeds  will be
received by the Selling Shareholders.

         Our principal  executive  offices are located at Five Hamilton Landing,
Suite 100, Novato, California 94949, and our telephone number is (415) 883-1693.

         AN  INVESTMENT  IN OUR COMMON  SHARES  INVOLVES A HIGH  DEGREE OF RISK.
PLEASE  CAREFULLY  CONSIDER THE  INFORMATION  UNDER THE HEADING  "RISK  FACTORS"
BEGINNING ON PAGE 2.

         NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS  IS TRUTHFUL OR  COMPLETE.  ANY  REPRESENTATION  TO THE CONTRARY IS A
CRIMINAL OFFENSE.

         THE  INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED.
THE SELLING  SHAREHOLDERS  MAY NOT SELL THESE  SECURITIES UNTIL THE REGISTRATION
STATEMENT FILED WITH THE SECURITIES AND EXCHANGE  COMMISSION IS EFFECTIVE.  THIS
PROSPECTUS IS NOT AN OFFER TO SELL THESE  SECURITIES AND IT IS NOT SOLICITING AN
OFFER TO BUY  THESE  SECURITIES  IN ANY  STATE  WHERE  THE  OFFER OR SALE IS NOT
PERMITTED.

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




                 The date of this Prospectus is October 9, 2003.



<PAGE>

                                TABLE OF CONTENTS


<TABLE>
<CAPTION>
                                                                                    Page
<S>                                                                                   <C>
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS..............................1

GENERAL AND RECENT DEVELOPMENTS........................................................1

RISK FACTORS...........................................................................2

ABOUT SPATIALIGHT.....................................................................10

USE OF PROCEEDS.......................................................................13

DESCRIPTION OF COMMON SHARES..........................................................14

PLAN OF DISTRIBUTION..................................................................15

LEGAL MATTERS.........................................................................16

EXPERTS...............................................................................16

WHERE TO FIND MORE INFORMATION........................................................16

DOCUMENTS INCORPORATED BY REFERENCE...................................................16

DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES...17
</TABLE>


<PAGE>



            CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

         Certain  statements  and  information   contained  in  this  Prospectus
concerning our future, proposed and anticipated activities;  certain trends with
respect to our revenue,  operating results,  capital resources, and liquidity or
with respect to the markets in which we compete or the  electronics  industry in
general;  and other statements  contained in this Prospectus  regarding  matters
that are not historical facts are  forward-looking  statements,  as such term is
defined under applicable securities laws.  Forward-looking  statements, by their
very  nature,  include  risks and  uncertainties,  many of which are  beyond our
control. Accordingly,  actual results may differ, perhaps materially, from those
expressed in or implied by such forward-looking  statements.  Factors that could
cause actual results to differ  materially  include those  discussed below under
"Risk Factors."

                         GENERAL AND RECENT DEVELOPMENTS

         We are in the business of manufacturing  high-resolution  microdisplays
for applications such as high definition  television,  computer monitors,  video
projectors  and  other  applications.  To  date,  we  have  entered  into  seven
agreements  or  memoranda  of  understanding   with  eight  original   equipment
manufacturers  (OEMs) in China and two such agreements with OEMs in the Republic
of South  Korea.  We are  currently  working with Fuji Photo  Optical Co.,  Ltd.
(Fuji) for the  manufacture  of light engines  being used with our  microdisplay
products to be sold to our current and prospective customers.  Please see "About
SpatiaLight" for a more detailed discussion of the terms of these agreements.

         Purchase   Orders  Received  -  In  late  January  2003,  we  concluded
negotiations  with  Skyworth,  one of the  Chinese  OEMs  with  which  we had an
agreement to test prototypes of our microdisplay products, resulting in a signed
agreement for the purchase by Skyworth of 14,100  display units from us during a
one year delivery period.  The purchase order originally  provided for 200 units
to be  delivered in February  and an  additional  200 units in each of March and
April 2003.  Skyworth and we subsequently  agreed to delay the first delivery of
units. As of the date of this Prospectus,  we have completed partial shipment of
the 200 units  originally  scheduled for delivery in the first month.  Following
the  initial  delivery  provisions  of 200 units  per month for the first  three
months,  we are  scheduled  to deliver  1,500 units per month until the order is
completed.  Pursuant to the terms of the  purchase  order,  the  obligations  of
Skyworth will be backed by letters of credit in our favor. The purchase order is
cancelable  by  Skyworth  on  a  quarterly  basis  and  is  subject  to  pricing
contingencies and other customary terms and conditions.

         In September  2003 we announced  that we signed an agreement with China
Electronics  Corporation (CEC), another of the Chinese OEMs with which we had an
agreement to test prototypes of our microdisplay  products,  for the purchase by
CEC of 2,000  display  units  from us.  The  agreement  provides  for an initial
delivery of ten display units,  which was completed in September,  with a second
delivery of 100 units to follow.  Additional shipments will be made periodically
according to a schedule to be  determined  by CEC and us. The purchase  order is
cancelable by CEC after delivery of 110 units and is subject to other  customary
terms and conditions.

         Purchase  Orders Being  Negotiated - We are also currently  negotiating
the terms of purchase  orders for our products  with certain of our  prospective
Chinese   customers   who  are  parties  to  the   agreements  or  memoranda  of
understanding  described under "About  SpatiaLight".  There are significant open
issues with respect to these prospective purchase orders that have to be finally
negotiated,  including  prices and quantities of our products.  We cannot assure
whether we will receive any purchase  orders  binding on any of these  companies
for their purchase of commercial  quantities of our microdisplay products in the
near future.  Even assuming that we receive  purchase orders that are binding on
the  prospective  customers,  these orders and our sales to these  customers are
subject to certain contingencies described under "Risk Factors."


<PAGE>

Private Placement of $5.15 Million of Equity Securities

         On May 28, 2003 we  completed a private sale of 2,796,328 of our Common
Shares and warrants to purchase 699,080 Common Shares for an aggregate  purchase
price of $5.15 million,  with five  purchasers,  including  Robert A. Olins, our
Acting Chief  Executive  Officer and a director of  SpatiaLight,  who  purchased
1,357,441  shares and acquired  warrants to purchase  339,360  shares  (which we
refer to in this Prospectus as the "May  Transaction").  The shares and warrants
in  the  May  Transaction  were  included  in a  currently  effective  Form  S-3
Registration Statement pursuant to registration rights granted to the purchasers
in that transaction. Funds from the May Transaction have been used to reduce our
liabilities and are being used for working capital purposes.

Private Placement of $2.76 Million of Equity Securities

         On August 19, 2003 we  completed  a private  sale of  1,212,061  of our
Common  Shares and warrants to purchase  303,015  Common Shares for an aggregate
purchase  price  of  $2.76  million,  with  six  purchasers,  none of whom is an
affiliate of the Company (the "August Transaction").  The shares and warrants in
the  August  Transaction  were  included  in  a  currently  effective  Form  S-3
Registration Statement pursuant to registration rights granted to the purchasers
in that  transaction.  Funds  from the  August  Transaction  are being  used for
working capital purposes.

                                  RISK FACTORS

         THE SHARES OFFERED HEREBY ARE  SPECULATIVE IN NATURE AND INVOLVE A HIGH
DEGREE  OF RISK.  PRIOR  TO  MAKING  AN  INVESTMENT  DECISION  WITH  RESPECT  TO
SECURITIES OF SPATIALIGHT,  PROSPECTIVE  INVESTORS  SHOULD  CAREFULLY  CONSIDER,
ALONG WITH THE OTHER MATTERS  DISCUSSED IN THIS  PROSPECTUS,  THE FOLLOWING RISK
FACTORS:

We have a history  of losses and may incur  losses in the  future and  therefore
cannot assure you that we will achieve profitability.

         We have incurred  losses over the past five years and have  experienced
cash shortages. For the six months ended June 30, 2003 and 2002, we incurred net
losses of approximately $4,874,000 and $3,900,000, respectively. In addition, we
had an  accumulated  deficit  of  $53,600,000  as of June 30,  2003.  We  expect
additional  losses as we continue  spending for  production  and other  business
activities as well as further  research and  development  of our products.  As a
result, we will need to generate substantial sales to support our costs of doing
business  before we can begin to recoup our  operating  losses  and  accumulated
deficit and achieve profitability.

If we are  unable to obtain  further  financing  or  generate  required  working
capital our ability to operate could suffer or cease. Our auditors have issued a
report on our financial  statements,  which  contains an  explanatory  paragraph
regarding substantial doubt about our ability to continue as a going concern.

         Our  operations to date have consumed  substantial  amounts of cash and
will continue to require  substantial amounts of capital in the future. In order
to  remain  competitive,  we  must  continue  to  make  significant  investments
essential to our ability to operate profitably, including investments in further
research and  development,  equipment,  facilities  and  production  activities.
Although our financial  condition and liquidity  have been assisted  through the
previous  exercises  of warrants  and  private


<PAGE>

purchases of our Common Shares including the  approximately  $8.0 million raised
by us in the two  recently  completed  stock  financings,  we may still  require
additional  financing to satisfy our increasing  working  capital  requirements.
Reliance for  financing  upon  exercise of warrants and private  stock  purchase
agreements entails the additional risks of non-exercise of such warrants because
of the prevailing  market prices of our  underlying  Common Shares or default by
stock  purchasers  under  these  agreements.  In the event that we are unable to
obtain  further  financing  on  satisfactory  terms  or at all,  generate  sales
sufficient to offset our costs,  or if the costs of  development  and operations
are greater  than we  anticipated,  we may be unable to grow our business at the
rate  desired  or may be  required  to delay,  reduce,  or cease  certain of our
operations,  any of which  could  materially  harm our  business  and  financial
results.  Our  independent  auditors have included an  explanatory  paragraph in
their report in our Form 10-KSB on our financial  statements for our last fiscal
year  regarding  substantial  doubt  about our  ability to  continue  as a going
concern.

We are subject to lengthy  development  periods and  product  acceptance  cycles
which may significantly harm our business.

         Our business  model requires us to develop  microdisplays  that perform
better  than  existing  technologies,  contract  with  one or  more  third-party
manufacturers  to manufacture  our display units in bulk, and sell the resulting
display units to original  equipment  manufacturers  that will then  incorporate
them  into  their   products.   Original   equipment   manufacturers   make  the
determination  during  their  product  development  programs  whether  or not to
incorporate our SpatiaLight imagEngine(TM) microdisplays and/or display units in
their  products.  This  requires  us to invest  significant  amounts of time and
capital in designing our SpatiaLight imagEngine(TM) microdisplays and/or display
units before we can be assured that we will  generate any  significant  sales to
our  customers  or even  recover  our  investment.  If we fail  to  recover  our
investment  from the  SpatiaLight  imagEngine(TM)  microdisplays  and/or display
units, it could seriously harm our financial condition.  In addition, the length
of time that our products may be successfully received by our customers could be
limited by the acceptance of new technologies developed by our competitors.

We  incur  substantial   research  and  development  costs  in  connection  with
technologies that may not be successful.

         We  currently  have  eleven  full-time  engineering  and six  full-time
manufacturing  personnel  based in  California  working on  microdisplays.  This
staffing  creates  significant  research and  development  costs that may not be
recouped.  Even if our current microdisplays become accepted or successful,  due
to the rapid technological change in our industry,  we must continue to use, and
may increase in number,  our engineering and manufacturing  personnel to develop
future  generations  of our  microdisplays.  As a result,  we expect to continue
incurring significant research and development costs.



<PAGE>



In recent months we have commenced  manufacturing and shipping our microdisplays
in  commercial   quantities,   but  unanticipated   difficulties  in  continuing
manufacturing  our  microdisplays may make it difficult to meet customer demands
from time to time and our  operating  results could be  significantly  harmed by
such difficulties.

         We need to work  closely  with  our  manufacturing  sources  to  assure
production of our current  display  units.  Problems in production or lower than
expected  manufacturing  yields could significantly harm our business because we
will have already  incurred the costs for the materials used in the microdisplay
manufacturing  process.  These  problems  could cause delays that might lead our
potential customers to seek other sources.

         We  currently  obtain  silicon  backplanes,  a vital  component  in our
microdisplays,   from  the  Far  East.  Some  Asian  countries  are  subject  to
earthquakes, typhoons and political instability. Unless we obtain an alternative
source, any disruption or termination of our silicon manufacturing operations in
Taiwan or air  transportation  with the Far East  could  significantly  harm our
operations.

         Our  microdisplays  are assembled by combining  the silicon  backplanes
with  electronic  components.  The  design  and  manufacture  of liquid  crystal
displays and display units are highly complex  processes that are sensitive to a
wide  variety  of  factors,   including  the  level  of   contaminants   in  the
manufacturing environment, impurities in the materials used, and the performance
of personnel and equipment.  While in the past we have had working  arrangements
with several  independent  liquid  crystal  display  fabricators  to manufacture
certain of our products,  we are now manufacturing our microdisplays  ourselves.
We  believe  that  the  internal   manufacture   of  all  such  liquid   crystal
microdisplays  will  benefit us by allowing us to enhance  quality  control over
such products as well as protect more  effectively our  proprietary  interest in
those products, but the risks discussed above associated with the highly complex
processes of manufacturing these liquid crystal microdisplays remain applicable.

         We continue to have working  arrangements  with the manufacturer of the
light engines and lamps required in the assembly of our display  units.  We have
entered  into an agreement  for the supply of prisms and filters  which are also
required for the assembly of such units.  Except for that  agreement,  we do not
have written  agreements  which are binding upon the  manufacturers of the other
components  and no such  manufacturer  is bound to furnish us with any  specific
quantities of their products at previously  specified  prices.  At this date, we
are not aware that any of our component  manufacturers  have known  shortages of
critical material.

         Because the manufacture of our SpatiaLight imagEngine(TM) microdisplays
involves highly complex  processes and technical  problems may arise, we, in our
capacity as internally manufacturing the liquid crystal microdisplays, which are
an integral part of the display units, cannot assure the manufacturing yields of
our products. Problems in production or lower than expected manufacturing yields
could  significantly harm our business and operating results.  In addition,  the
complexity of our manufacturing processes will increase as the sophistication of
our microdisplays and display units increases.

If a market for our  products  does not  develop,  our  business  will likely be
significantly harmed.

         Various target  markets for our  microdisplays,  including  projectors,
monitors, high-definition televisions, and portable microdisplays, are uncertain
and may be slow to  develop.  In  addition,  companies  in those  markets  could
utilize  competing  technologies.  High-definition  television has only recently
become available to consumers, and widespread market acceptance is uncertain. In
addition,  the  commercial  success  of  the  portable  microdisplay  market  is
uncertain. The acceptance of our display units and/or SpatiaLight imagEngine(TM)
microdisplays  will be dependent  upon the  pricing,  quality,  reliability  and

<PAGE>

useful life of these units compared to competing technologies, as to which there
can be no  assurance.  In  order  for us to  succeed,  not  only  must we  offer
end-product  manufacturers  better  and less  expensive  microdisplays  than our
competitors,  but the  manufacturers  themselves must also develop  commercially
successful products using our microdisplays. SpatiaLight's marketing efforts are
focused on developing strategic customer and governmental relationships in China
and the Republic of South Korea.  Our failure to sell our  microdisplays to such
manufacturers  or the failure of the  ultimate  target  markets to develop as we
expect will negatively affect our anticipated growth.

If our  microdisplays  do not become  widely  accepted by our  customers  or the
end-users, our business could be significantly harmed.

         Our microdisplays may not be accepted by a widespread  market.  Even if
we  successfully  obtain  customer  orders,  our  customers may determine not to
introduce or may terminate  products  utilizing the  technology for a variety of
reasons, including the following:

o        superior technologies developed by our competitors;

o        price considerations; and

o        lack of anticipated or actual market demand for the products.

         We  currently  have  agreements  with a limited  number  of  customers.
Despite  our  reasonable  efforts  to  retain  these  customers,  we may  not be
successful in this regard.  The loss of any one or more of these customers could
materially harm our business and financial condition.

To date,  we have only  received two purchase  orders from our  customers and we
cannot  assure you that we will  obtain  additional  purchase  orders from these
customers  or our other  prospective  customers,  or, if we do, that such orders
will generate significant revenues.

         Since late October 2001,  we have entered into  agreements or memoranda
of understanding  with eight OEMs in China  contemplating  the purchase by these
prospective  customers of our display  units and/or  SpatiaLight  imagEngine(TM)
microdisplays  for use in certain  of their  products.  All of these  agreements
require  that we supply  prototypes  of our  display  units  and/or  SpatiaLight
imagEngine(TM)  microdisplays and that they meet technical criteria satisfactory
to each of such  prospective  customers.  In 2003 we entered into  Agreements of
Principal  Terms  with two OEMs in the  Republic  of South  Korea.  One of these
agreements is a development  agreement and the second  contemplates the purchase
of our  display  units for use in certain of the OEM's products. This  agreement
requires  that we  supply  a  prototype  of our  display  unit  and that it meet
technical  criteria  satisfactory to the prospective  customer.  The Company has
been advised by the other prospective  Chinese customers that they are satisfied
with the results of the testing of the prototypes  under their  agreements  with
the Company and we are currently  negotiating  terms of purchase  orders for our
display units and/or SpatiaLight imagEngine(TM) microdisplays with each of them.
There remain open issues that have to be finally  negotiated,  including  prices
and quantities of our products. We cannot offer assurances that we will receive,
in the future,  binding  purchase  orders from any of these  companies for their
purchase of commercial quantities of our microdisplay products.

         In  addition,  even if we  receive  purchase  orders  from our  current
customer or prospective  customers for our display  units,  we may have problems
implementing  volume  production of such display  units.  Furthermore,  sales to
manufacturers  in the  electronics  industry  are subject to severe  competitive
pressures,  rapid technological change, and product obsolescence.  Manufacturers
may,  at any time,  cancel  purchase  orders or  commitments  or reduce or delay
orders, thereby increasing our inventory and overhead


<PAGE>

risks.  Therefore,  even if we obtain  purchase  orders from several  current or
prospective customers, we cannot assure you that these agreements will result in
significant revenues to us.

If our customers' products are not successful,  our business would be materially
harmed.

         We do not sell any  products  to  end-users.  Instead,  we  design  and
manufacture  various  product  solutions  that our  customers  (i.e.,  OEMs) may
incorporate  into  their  products.  As a result,  our  success  depends  almost
entirely upon the widespread market acceptance of our customers'  products.  Any
significant  slowdown in the demand for our customers' products would materially
harm our business.

         Our dependence on the success of the products of our customers  exposes
us to a variety of risks, including our need to do the following:

o        maintain  customer  satisfaction  with  our  design  and  manufacturing
         services;

o        match our design and  manufacturing  capacity with customer  demand and
         maintain satisfactory delivery schedules;

o        anticipate customer order patterns, changes in order mix, and the level
         and timing of orders that we can meet; and

o        adjust to the cyclical nature of the industries and markets we serve.

         Our  failure to address  these  risks may cause us to lose sales or for
sales to decline.

The electronics  industry is highly competitive,  which may result in lost sales
or lower gross margins.

         We serve highly competitive  industries that are characterized by price
erosion,  rapid  technological  change and  competition  from major domestic and
international  companies.  This  intense  competition  could  result in  pricing
pressures,  lower sales,  reduced  margins and lower market  share.  Some of our
competitors  have  greater  market  recognition,   larger  customer  bases,  and
substantially greater financial,  technical,  marketing,  distribution and other
resources  than we  possess.  As a  result,  they may be able to  introduce  new
products and respond to customer requirements more quickly than we can.

         Our  competitive  position could suffer if one or more of our customers
decide to design and  manufacture  their own display units, to contract with our
competitors,  or to use  alternative  technologies.  In addition,  our customers
typically develop a second source. Second source suppliers may win an increasing
share of a program.  Our ability to compete  successfully depends on a number of
factors,  both  within and  outside  our  control.  These  factors  include  the
following:

o        our success in designing and manufacturing new display technologies;

o        our ability to address the needs of customers;

o        the quality, performance,  reliability, features, ease of use, pricing,
         and diversity of our display products;

o        foreign currency  fluctuations,  which may cause a foreign competitor's
         products to be priced significantly lower than our displays;


<PAGE>

o        the quality of our customer services;

o        the efficiency of our production sources;

o        the rate at which  customers  incorporate  our displays  into their own
         products; and

o        products or technologies introduced by our competitors.

Our business is significantly  affected by conditions or events occurring in the
electronics industry generally.

         The electronics industry has experienced significant economic downturns
at various  times,  characterized  by  diminished  product  demand,  accelerated
erosion of average  selling  prices,  and  production  over-capacity.  Since the
electronics  industry  is  cyclical  in nature,  we may  experience  substantial
period-to-period  fluctuations  in future  operating  results because of general
industry conditions or events occurring in the general economy.

Our operating results are subject to significant fluctuations.

         Our results of  operations  have varied  significantly  from quarter to
quarter in the past and are likely to vary  significantly  in the future,  which
makes it  difficult to predict our future  operating  results.  Accordingly,  we
believe that  quarter-to-quarter  comparisons  of our operating  results are not
meaningful  and  should  not be  relied  upon  as an  indicator  of  our  future
performance. Some of the factors, which cause our operating results to fluctuate
include the following:

o        introductions  of displays and market  acceptance of new generations of
         displays;

o        timing of expenditures in anticipation of future orders;

o        changes in our cost structure;

o        availability of labor and components;

o        pricing and availability of competitive products and services;

o        the timing of orders;

o        the  volume of orders  relative  to the  capacity  we can  contract  to
         produce;

o        evolution in the life cycles of customers' products; and

o        changes or anticipated changes in economic conditions.

The market price of our Common Shares is highly volatile.

         The market  price of our Common  Shares  has been  extremely  volatile,
reflecting  reported  losses,  receipt of  additional  financing  and changes of
management.  Other companies have found similar volatility correlates with class
action securities  lawsuits although to date we have not been a defendant in any
such  lawsuit.  The  trading  price of our  Common  Shares in the  future  could
continue to be subject to wide  fluctuations  in  response  to various  factors,
including the following:


<PAGE>

o        quarterly variations in our operating results;

o        actual or  anticipated  announcements  of technical  innovations or new
         product developments by us or our competitors;

o        public announcements regarding our business developments;

o        changes in analysts' estimates of our financial performance;

o        sales of large numbers of our Common Shares by our shareholders;

o        general conditions in the electronics industry; and

o        worldwide economic and financial conditions.

         In addition,  the stock market has  experienced  significant  price and
volume  fluctuations that have particularly  affected the market prices for many
high-technology  companies  and that often have been  unrelated to the operating
performance  of these  companies.  These  broad  market  fluctuations  and other
factors may adversely affect the market price of our Common Shares.

By further  increasing the number of our Common Shares that may be sold into the
market,  this offering by the Selling  Shareholders could cause the market price
of our Common Shares to decrease significantly,  even if our business operations
are performing well.

         The 1,700,000  Shares covered by this Reoffer  Prospectus (all of which
are issuable  upon  exercise of options)  represent  approximately  5.44% of the
total number of our Common Shares that are issued and  outstanding as of October
3, 2003.  All of these  Shares will be freely  salable  beginning on the date of
this Prospectus.  Sales of these Shares in the public market,  or the perception
that future  sales of these  Shares  could  occur,  might  adversely  affect the
prevailing market price of our Common Shares in the near future.

Our Common Shares may not be liquid.

         Our Common Shares are currently  traded on The NASDAQ SmallCap  Market.
Our  shareholders  may find that it is more  difficult to sell our Common Shares
than  shares  that are  listed on The NASDAQ  National  Market,  American  Stock
Exchange or New York Stock Exchange. The trading volume of our Common Shares may
be adversely affected due to the limited marketability of our Common Shares. Any
substantial  sales of our Common  Shares may result in a material  reduction  in
price  because  relatively  few buyers may be  available  to purchase our Common
Shares.

If we lose our key  personnel  or are  unable to attract  and retain  additional
personnel, our ability to compete could be harmed.

         Our development and operations depend  substantially on the efforts and
abilities  of our senior  management  and  qualified  technical  personnel.  Our
products  require  sophisticated   production,   research  and  development  and
technical  support.  The  competition  for  qualified  management  and technical
personnel is intense.  The loss of services of one or more of our key  employees
or the inability to add key personnel  could have a material  adverse  affect on
us,  particularly  since currently we do not have any life insurance policies in
place to cover that  contingency.  Our  success  will depend upon our ability to
attract  and  retain  highly  qualified  scientific,  marketing,  manufacturing,
financial and other key management  personnel.  We face intense  competition for
the limited number of people  available with the necessary


<PAGE>

technical  skills and  understanding  of our products and technology.  We cannot
assure you that we will be able to attract or retain such personnel or not incur
significant  costs  in  order  to do  so.  If  we  are  unable  to  protect  our
intellectual  property from use by third parties,  our ability to compete in the
industry will be harmed.

         We  believe  that  our  success  depends  in  part  on  protecting  our
proprietary technology. We rely on a combination of patent, copyright, trademark
and trade secret laws, as well as  confidentiality  and assignment of inventions
agreements from our employees,  consultants  and advisors and other  contractual
provisions,  to establish and protect our intellectual property rights. Policing
unauthorized use of our products and technology is difficult,  however.  Despite
our efforts to protect our proprietary rights, we face the following risks:

o        pending patent applications may not be issued;

o        patents issued to us may be challenged, invalidated, or circumvented;

o        unauthorized  parties may obtain and use information  that we regard as
         proprietary despite our efforts to protect our proprietary rights;

o        others may  independently  develop similar  technology or design around
         any patents issued to us;

o        breach of confidentiality agreements;

o        intellectual  property laws may not protect our intellectual  property;
         and

o        effective protection of intellectual  property rights may be limited or
         unavailable in some foreign  countries,  such as China, in which we may
         operate.  Specifically,  although we consider  the  following  unlikely
         because of the complex technological  structure of our products, one or
         more  of  our  prospective  Chinese  customers,   or  their  respective
         employees or other persons including our competitors, that have or gain
         access to our products for testing purposes, may seek to misappropriate
         or improperly convert to their own use our intellectual  property and a
         lack of adequate  remedies  and  impartiality  under the Chinese  legal
         system may  adversely  impact our ability to protect  our  intellectual
         property.

         There can be no assurance  that we will have  adequate  remedies in the
event any of the  foregoing  materializes.  Failure to protect our  intellectual
property  would  limit our  ability to produce  and market our  products  in the
future,  which would materially  adversely affect our revenues  generated by the
sale of such products. In addition, third parties could assert that our products
and technology infringe their patents or other intellectual  property rights. As
a  result,  we may  become  subject  to  future  patent  infringement  claims or
litigation,  the  defense of which is costly,  time-consuming  and  diverts  the
attention of management and other personnel.

Political,   economic  and  regulatory  risks   associated  with   international
operations may limit our ability to do business abroad.

         A substantial number of our manufacturers,  customers and suppliers are
located  outside  of the  United  States,  principally  in  the  Far  East.  Our
international  operations  are  subject to  political  and  economic  conditions
abroad,  and  protectionist  trade  legislation  in either the United  States or
foreign countries, such as a change in the current tariff structures,  export or
import  compliance  laws, or other trade policies,  any of which could adversely
affect our ability to  manufacture  or sell  displays in foreign  markets and to
purchase  materials or equipment from foreign  suppliers.  All of our agreements
with  customers  are  governed  by foreign  law and  therefore,  are  subject to
uncertainty with regard to their enforceability.


<PAGE>

Risks related to doing business in China may negatively affect our business.

         Our  business  is  subject  to   significant   political  and  economic
uncertainties  and may be adversely  affected by political,  economic and social
developments in China.  Over the past several years, the Chinese  government has
pursued economic reform policies including the encouragement of private economic
activity and greater economic  decentralization.  The Chinese government may not
continue  to  pursue  these  policies  or may  significantly  alter  them to our
detriment from time to time with little, if any, prior notice.

         A lack of adequate  remedies and  impartiality  under the Chinese legal
system may  adversely  impact our ability to do business in China and to enforce
the agreements or purchase orders to which we are, or may become, a party.

         At various times during recent years,  the United States and China have
had  significant  disagreements  over  political,  economic  and social  issues.
Controversies may arise in the future between these two countries. Any political
or trade  controversies  between  the United  States  and China,  whether or not
directly  related to our  business,  could  adversely  affect our  ability to do
business in China.

We do not pay cash dividends.

         We have never paid any cash  dividends on our Common  Shares and do not
anticipate  that we will pay cash  dividends  in the near  future.  Instead,  we
intend to apply any future  earnings to the  expansion  and  development  of our
business.

                                ABOUT SPATIALIGHT

         We  manufacture  microdisplays  that  provide  high  resolution  images
suitable for applications  such as high definition  television,  rear projection
computer monitors and video projectors, and potential applications such as those
used in wireless communication  devices,  portable games and digital assistants.
Our  microdisplays  are designed  for use in end products of original  equipment
manufacturers,  and therefore we work closely with customers to incorporate  our
microdisplays  into their final products.  While in the past we have had working
arrangements  with several  independent  liquid crystal  display  fabricators to
manufacture  certain of our prototype  products,  we are now  manufacturing  our
microdisplays  ourselves  in a 500 square  foot Class 100  cleanroom  and a 1200
square foot Class 1000 cleanroom.  By reason of these current  arrangements,  we
have  enhanced  quality  control and we have more  effective  protection  of our
proprietary  technology in our products.  Internal  manufacturing  is subject to
certain risks described under "Risk Factors." We have patents  covering parts of
our designs;  however,  the key designs of the  circuitry in the silicon,  drive
electronics,  and liquid crystal  assembly  techniques are  proprietary  and not
covered by patents.

         Our microdisplays are high-resolution liquid crystal displays. They are
constructed  with a silicon  chip, a layer of liquid  crystals and a glass cover
plate in contrast to the more common  construction of liquid crystals sandwiched
between two glass plates. These displays are also known as and commonly referred
to as liquid crystal  displays  (LCD),  active matrix liquid  crystal  displays,
liquid crystal on silicon (LCoS), and spatial light modulators.


<PAGE>

         The image on a  microdisplay  can be  projected  onto a screen or other
surface for individual or group viewing or used in a portable  application  that
is  viewed  through a  magnifying  device  similar  to a  viewfinder.  Potential
microdisplay applications include:

         o        large-screen   rear-projection  television  systems,  in  both
                  standard  television  format  and high  definition  television
                  formats;

         o        large-screen rear-projection computer monitors in a variety of
                  resolutions;

         o        video projectors for presentations;

         o        head-mounted  displays  which  are  used for  virtual  reality
                  systems, defense, aerospace and gaming applications; and

         o        other  potential   applications  such  as  point  of  purchase
                  displays, optical computing and data storage.

         Our technology  uses liquid crystals and silicon chips. An advantage of
these  materials is that  processes  for working with them are already known and
they  may  be  produced  more  quickly  than  competing   technologies  offering
comparable quality.  By using existing  manufacturing  processes,  we believe we
will be able to obtain  economies of scale.  We are currently  working with Fuji
Photo  Optical   Company  for  the   manufacture  of  light  engines  using  our
microdisplays to be sold to our customers.

         Since late  October  2001,  we have entered  into seven  agreements  or
memoranda of understanding  with eight OEMs in China  contemplating the purchase
by  these  prospective   customers  of  our  display  units  and/or  SpatiaLight
imagEngine(TM)  microdisplays for use in certain of their products. All of these
agreements  require  that we  supply  prototypes  of our  display  units  and/or
SpatiaLight  imagEngine(TM)  microdisplays and that they meet technical criteria
satisfactory to each of such prospective customers. Two of these agreements have
resulted in purchase  orders,  the terms of which are described below under this
caption.  We are  currently  negotiating  the terms of  purchase  orders for our
display units and/or SpatiaLight  imagEngine(TM)  microdisplays with four of the
other prospective Chinese customers.

         In  addition,  in January and June 2003,  we entered  into  preliminary
agreements with two OEMs in the Republic of South Korea. One of these agreements
requires  that we  supply  a  prototype  of our  display  unit  and that it meet
technical criteria satisfactory to the prospective customer.  The agreement with
the other South Korean OEM is an agreement to jointly  develop a high definition
television  incorporating a SpatiaLight  microdisplay  device. We have delivered
the  requisite  prototypes to both South Korean OEMs and we have been advised by
both that  testing  of such  prototypes  is in  progress.  In the event that the
technical  criteria  are  satisfactory  to  the  prospective   customer,   these
agreements  provide for a market testing period where the  prospective  customer
has  the  opportunity  to  evaluate  the  performance  of  our  product  in  the
marketplace.

         The  following  is the  current  status  of each of the  agreements  or
memoranda of understanding:

         Skyworth Display Ltd. (Skyworth)

         In late January 2003, we concluded  negotiations with Skyworth,  one of
the  Chinese  OEMs with  which we had an  agreement  to test  prototypes  of our
microdisplay  products,  resulting  in a signed  agreement  for the  purchase by
Skyworth of 14,100 display units from us during a one year delivery period.  The
purchase order originally provided for 200 units to be delivered in February and
an  additional  200  units in each of March  and  April  2003.  Skyworth  and we
subsequently agreed to delay the first delivery of units. As of the date of this
prospectus,  we have  completed  partial  shipment  of the 200 units  originally
scheduled  for  delivery in the first  month.  Following  the  initial  delivery
provisions of 200 units per month for the first three  months,  we are scheduled
to deliver 1,500 units per month until the order is  completed.  Pursuant to the
terms of the  purchase  order,  the  obligations  of Skyworth  will be backed by
letters of credit in our favor.  The purchase order is cancelable by Skyworth on
a quarterly  basis and is subject to pricing  contingencies  and other customary
terms and conditions.



<PAGE>


         China Electronics Corporation (CEC)

         In September  2003 we announced  that we signed an agreement with China
Electronics  Corporation (CEC), another of the Chinese OEMs with which we had an
agreement to test prototypes of our microdisplay  products,  for the purchase by
CEC of 2,000  display  units  from us.  The  agreement  provides  for an initial
delivery of ten display units,  which was completed in September,  with a second
delivery of 100 units to follow.  Additional shipments will be made periodically
according to a schedule to be  determined  by CEC and us. The purchase  order is
cancelable by CEC after delivery of 110 units and is subject to other  customary
terms and conditions.

         Shanghai  Information  Industry Co. Ltd. (SVA), Hisense Electronic Co.,
Ltd.  (Hisense),  Shanghai  China  Display Co., Ltd.  (China  Display) and Panda
Electronics Group Co. Ltd. (Panda)

         We are  currently  negotiating  the terms of  purchase  orders  for our
products with four of our prospective  Chinese customers - SVA,  Hisense,  China
Display and Panda.  There are significant open issues that are being negotiated,
including  prices and  quantities of our products.  We cannot assure  whether we
will receive  purchase  orders binding on all four or any of these companies for
their purchase of commercial  quantities of our microdisplay products commencing
in the near  future.  Even  assuming  that we receive  purchase  orders that are
binding  on the  prospective  customers,  these  orders  and our  sales to these
customers are subject to certain contingencies described under "Risk Factors."

         Sichuan Changhong Electric Co. (Changhong)

         We are currently preparing to ship the requisite prototype display unit
to Changhong  for testing  purposes.  Even if the testing of our display unit is
satisfactory  to Changhong,  we cannot assure  whether we will receive  purchase
orders  binding on Changhong  for its purchase of  commercial  quantities of our
microdisplay  products.  Even assuming that we receive a purchase  order that is
binding on  Changhong,  this  order and our sales to  Changhong  are  subject to
certain contingencies described under "Risk Factors."

         South Korean OEMs

         The  agreement  with one South  Korean  OEM  requires  that we supply a
prototype of our display unit and that it meet technical  criteria  satisfactory
to the prospective customer. The agreement with the other South Korean OEM is an
agreement  to  jointly  develop a high  definition  television  incorporating  a
SpatiaLight  microdisplay  device.  We have shipped the requisite  number of our
prototype display units to these South Korean prospective  customers and we have
been advised by both companies  that they are conducting  testing of the display
units.  Even if the testing of our display  units is  satisfactory  to the South
Korean OEMs, we cannot assure whether we will receive purchase orders binding on
both or either of these companies for their purchase of commercial quantities of
our microdisplay  products  commencing in the near future. Even assuming that we
receive  purchase  orders that are binding on the prospective  customers,  these
orders and our sales to these  customers  are  subject to certain  contingencies
described under "Risk Factors."


<PAGE>

         May Transaction

         On May 28, 2003 we  completed a private sale of 2,796,328 of our Common
Shares and warrants to purchase 699,080 Common Shares for an aggregate  purchase
price of $5.15 million,  with five  purchasers,  including  Robert A. Olins, our
Acting Chief  Executive  Officer and a director of  SpatiaLight,  who  purchased
1,357,441 shares and acquired  warrants to purchase  339,360 shares.  The shares
and warrants in the May Transaction were included in a currently  effective Form
S-3  Registration  Statement  pursuant  to  registration  rights  granted to the
purchasers in that transaction. Funds from the May Transaction have been used to
reduce our  liabilities  and are being used for  working  capital  purposes.  In
addition, warrants to purchase 77,126 Shares were granted to the placement agent
for the May Transaction.

         August Transaction

         On August 19, 2003 we  completed  a private  sale of  1,212,061  of our
Common  Shares and warrants to purchase  303,015  Common Shares for an aggregate
purchase  price  of  $2.76  million,  with  six  purchasers,  none of whom is an
affiliate of the Company. The shares and warrants in the August Transaction were
included in a currently  effective Form S-3 Registration  Statement  pursuant to
registration rights granted to the purchasers in that transaction.  In addition,
warrants to purchase  48,482 Shares were granted to the placement  agent for the
financing.  Funds from the August Transaction are being used for working capital
purposes.

State of Incorporation and Principal Office

         We were  incorporated  under the laws of the State of New York in 1989.
Our executive offices are located at Five Hamilton  Landing,  Suite 100, Novato,
California 94949.

                                 USE OF PROCEEDS

         We will not  receive  any of the  proceeds  from the sale of the Shares
being offered hereby for the account of the Selling Shareholders.  Such proceeds
will be received  by the  Selling  Shareholders.  However,  we will  receive the
proceeds of the exercise of the options held by these  Selling  Shareholders  to
the extent that such options are exercised. There can be no assurance concerning
the  number  or the  timing  of the  exercise  of such  options  by the  Selling
Shareholders at this date.



<PAGE>

                              SELLING SHAREHOLDERS

         The following table sets forth with respect to each Selling Shareholder
the number of Common Shares beneficially owned as of October 3, 2003, the number
of Shares being offered pursuant to this Prospectus, the number of Common Shares
owned after the offering and the percentage of the Common Shares owned after the
offering.

<TABLE>
<CAPTION>
                                                                                                     Percentage of
                                      Number of                               Number of Common       Common Shares
       Name of Selling           Common Shares Owned     Number of Shares    Shares Owned After     Owned after the
         Shareholder            Prior to the Offering     Being Offered      the Offering/1/           Offering
         -----------            ---------------------     -------------      -------------             --------
<S>                                     <C>                    <C>                  <C>
Robert A. Olins/2/                      6,904,441              750,000              6,154,441           19.71%
Steven F. Tripp/3/                        373,457              150,000                223,457             .72%
Theodore H. Banzhaf/4/                          0              800,000                      0            0.00%

            TOTAL                       7,277,898            1,700,000              6,377,898           20.42%
                                        =========            =========              =========          =======
</TABLE>

         We assume  that the Selling  Shareholders  will seek to sell all of the
Shares offered under this  Prospectus,  but we are unable to determine the exact
number of Shares that will actually be sold or whether and to what extent any of
the Selling  Shareholders  will exercise the warrants referred to under "Selling
Shareholders."  However, the right to purchase the Shares under the options will
be forfeited unless exercised before October 18, 2010, October 18, 2010 and July
7, 2006, respectively, the expiration date of such options.

                          DESCRIPTION OF COMMON SHARES

         Our Restated Certificate of Incorporation,  as amended,  authorizes the
issuance of up to 50,000,000  Common  Shares,  $.01 par value.  As of October 3,
2003, 31,226,869 Common Shares were issued and outstanding.


         The holders of our Common Shares have equal ratable rights to dividends
from funds  legally  available  therefor,  when and if  declared by our Board of
Directors and are entitled to share  ratably in all of our assets  available for
distribution  to holders of Common Shares upon the  liquidation,  dissolution or
winding up of our affairs.  We have not paid,  and have no current plans to pay,
dividends on our Common Shares. Holders of our Common Shares are entitled to one
vote per share on all matters  which  shareholders  are entitled to vote upon at
all  meetings of  shareholders.  All  outstanding  Common  Shares are, and those
offered   hereby  will  be  when  issued,   validly   issued,   fully  paid  and
nonassessable.  The holders of our Common Shares do not have  cumulative  voting
rights, which means that the holders of more than 50% of such outstanding Common
Shares can elect all of our directors then standing for election.


--------------------
/1/      Assumes the sale by each Selling Shareholder,  as part of the offering,
         of all of the  Shares  subject  to  Options  included  in this  Reoffer
         Prospectus held by such Selling  Shareholder,  as to which there can be
         no assurance.

/2/      Includes  2,376,000 Shares  beneficially owned subject to conversion of
         principal  and  interest of  convertible  notes held by Argyle  Capital
         Management Corporation,  of which Mr. Olins is President and over which
         Mr. Olins exercises  voting  control.  Also includes  2,275,000  Shares
         subject  to  outstanding  stock  options  held by Mr.  Olins  that were
         exercisable  as of June 30, 2003,  and also includes  1,357,411  Common
         Shares  which were  purchased  in a private  purchase  transaction  and
         349,864  Common Shares  issuable  upon exercise of warrants  which were
         acquired in the same private purchase transaction

/3/      Includes  175,000 Shares  subject to outstanding  stock options held by
         Mr. Tripp that were  exercisable as of April 23, 2003 and 50,000 Shares
         subject to  options  not  exercisable  within 60 days.  142,857  Shares
         issuable upon conversion of principal and interest of convertible notes
         held by the Steven F. Tripp Trust are not  included.  Steven F. Tripp a
         director  of the Company and  beneficiary  of the Trust,  does not have
         voting or dispositive power over these shares.

/4/      Mr. Banzhaf is Executive Vice President of the Company.


<PAGE>

         The American Stock Transfer Company, 59 Maiden Lane, New York, New York
10038, is the transfer agent and registrar for our Common Shares.

                              PLAN OF DISTRIBUTION

         All  restrictions  under the  Securities Act (and legends on the Shares
evidencing  such  restrictions)  on  the  Shares  to  be  sold  by  the  Selling
Shareholders  are  to be  removed  upon  and  as of the  effective  date  of the
Registration Statement of which this Prospectus is a part.

         The Shares may be sold from time to time  following the effective  date
by the Selling  Shareholders,  or by any of their pledgees,  donees,  assignees,
transferees  or other  successors in interest.  Such sales may be made on one or
more exchanges or in the over-the-counter market, or otherwise, at prices and at
terms then  prevailing or at prices related to the then current market price, or
in  negotiated  transactions.  The  Shares  may be  sold  by one or  more of the
following,   without  limitation:   (a)  ordinary  brokerage   transactions  and
transactions in which the broker-dealer solicits purchasers; (b) block trades in
which  the  broker-dealer  will  attempt  to sell the  Shares  as agent  but may
position  and  resell a portion  of the block as  principal  to  facilitate  the
transaction;  (c)  purchases by a  broker-dealer  as principal and resale by the
broker-dealer for its account;  (d) an exchange  distribution in accordance with
the rules of the applicable exchange; (e) privately negotiated transactions; (f)
settlement  of short  sales;  (g)  broker-dealers  may  agree  with the  Selling
Stockholders to sell a specified number of such Shares at a stipulated price per
Share;  (h) a combination  of any such methods of sale; and (i) any other method
permitted  pursuant to applicable  law. In addition,  any securities  covered by
this  Prospectus  which  qualify for sale pursuant to Rule 144 may be sold under
Rule 144 rather than pursuant to this Prospectus, as supplemented.  From time to
time the Selling Shareholders may engage in short sales, short sales against the
box, puts and calls and other  transactions  in our  securities  or  derivatives
thereof, and may sell and deliver the Shares in connection therewith. The Shares
may  also be used to  settle  short  sales to the  extent  permitted  under  the
Securities Act.

         From time to time the  Selling  Shareholders  may pledge  their  Shares
pursuant to the margin provisions of their respective  customer  agreements with
their respective brokers.  Upon a default by a Selling  Shareholder,  the broker
may offer and sell the pledged  Shares from time to time under the Prospectus or
amendment  to this  Prospectus,  subject to  relevant  rules of the SEC or under
other applicable provisions of the Securities Act.

         All fees and expenses  incurred in connection with the  registration of
the Shares,  including  but not  limited to all  registration  and filing  fees,
printing expenses and fees of the Company's  counsel and accountants,  are to be
borne by the Company.  The Selling Shareholders shall bear the cost of brokerage
commissions  and dealers,  discounts and any taxes to be paid, by reason of such
transactions.

         The Selling  Shareholders and the brokers or dealers through whom sales
of the Shares are made, may be deemed to be "underwriters" within the meaning of
Section  2(11) of the  Securities  Act of 1933,  as amended.  In  addition,  any
profits  realized by the Selling  Shareholders or such brokers or dealers may be
deemed to be underwriting commissions.

         We have informed the Selling  Shareholders  that the  anti-manipulative
provisions of Regulation M promulgated under the Exchange Act may apply to their
sales of Shares and has furnished the Selling  Shareholders  with a copy of that
regulation  and  have  also  informed  the  Selling  Shareholders  of the  rules
governing the required  delivery of copies of this Prospectus in connection with
the sale of such Shares.


<PAGE>

         There is no assurance that the Selling Shareholders will offer for sale
or sell any or all of the Shares  offered  pursuant to this  Prospectus.  In the
event the Shares are sold by the Selling  Shareholders,  we will not receive any
of the proceeds from any such sale, except for the payment to us of the exercise
price of the outstanding warrants referred to under "Selling Shareholders."



                                  LEGAL MATTERS

         The legality of the Shares  offered by this  Prospectus is being passed
upon by Bryan Cave LLP, New York, New York.

                                     EXPERTS

         The financial  statements  incorporated by reference in this Prospectus
have been audited by BDO Seidman, LLP, independent certified public accountants,
to the extent and for the periods set forth in their report  (which  contains an
explanatory  paragraph  regarding the  Company's  ability to continue as a going
concern) and are incorporated herein in reliance upon such report given upon the
authority of said firm as experts in auditing and accounting.

                         WHERE TO FIND MORE INFORMATION

         We are a  reporting  company  and file  annual,  quarterly  and special
reports, proxy statements and other information with the Securities and Exchange
Commission,  or the SEC. These reports,  proxy statements and other  information
filed with the SEC may be inspected and copied at the SEC Public Reference Room,
450 Fifth Street, N.W., Washington, D.C. 20549.

         You may  obtain  information  about  the  operation  of the SEC  Public
Reference  Room by calling  1-800-SEC-0330.  You may also inspect this  material
free of charge at the SEC's  web site at  http://www.sec.gov.  Finally,  you may
also inspect reports and other information concerning SpatiaLight at the offices
of the National Association of Securities Dealers, Inc., Market Listing Section,
1735 K Street,  N.W.,  Washington,  D.C.  20006.  SpatiaLight  Common Shares are
traded on The Nasdaq  SmallCap  Market  under the symbol  "HDTV".  SpatiaLight's
Internet web site is located at http://www.spatialight.com.

                       DOCUMENTS INCORPORATED BY REFERENCE

         The SEC allows us to  "incorporate  by reference"  information  that we
file with them which means that we can disclose important  information to you by
referring you to those documents.  The information  incorporated by reference is
an important part of this  Prospectus and information we later file with the SEC
will  automatically  update  and  supersede  this  information.   The  following
documents filed by us with the SEC (File No. 000-19828) are incorporated in this
Prospectus by reference:

         o        Annual  Report  on Form  10-KSB  for  the  fiscal  year  ended
                  December 31, 2002, filed on April 15, 2003.

         o        The  description  of  our  Common  Shares   contained  in  our
                  Registration  Statement  on Form  8-A  filed  with  the SEC on
                  February  5,  1992,  under  Section  12 of the  Exchange  Act,
                  including  any  amendment  or report  filed for the purpose of
                  updating that description.


<PAGE>

         o        Quarterly  Reports on Form 10-Q for the fiscal  quarters ended
                  March 31,  2003 and June 30,  2003,  filed on May 15, 2003 and
                  August 14, 2003, respectively.

         All documents  filed by us with the SEC under Section 13(a),  13(c), 14
or 15(d) of the Exchange Act  following the date of this  Prospectus  and before
the  termination  of the offering of the Shares under this  Prospectus  shall be
considered  incorporated  by reference in this  Prospectus and be a part of this
Prospectus  from  the  date of the  filing  of  such  documents.  Any  statement
contained  herein or in a document  incorporated by reference in this Prospectus
shall be deemed to be modified or superseded for purposes of this  Prospectus to
the extent that a statement contained in any subsequently filed document,  which
also  is  considered  to  be  incorporated  by  reference  herein,  modifies  or
supersedes such prior statement.  Any statement modified or superseded shall not
be considered,  except as so modified or superseded,  to constitute part of this
Prospectus.  We will  provide  without  charge  to  each  person  to  whom  this
Prospectus  is delivered,  upon request,  a copy of any and all of the documents
that have been  incorporated by reference in this Prospectus or the registration
statement   (other  than  exhibits  to  such  documents   unless   exhibits  are
specifically  incorporated by reference into such  documents).  Any such request
should be  directed  to the  Assistant  Secretary  of  SpatiaLight,  Inc.,  Five
Hamilton  Landing,   Suite  100,  Novato,   California  94949  (telephone  (415)
883-1693).

              DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION
                         FOR SECURITIES ACT LIABILITIES

         Our  Bylaws  provide  that we will  indemnify  (a) any  person  made or
threatened  to be made a party to any action or proceeding by reason of the fact
that  he,  his  testator  or  intestate,  is or was a  director  or  officer  of
SpatiaLight  and (b) any director or officer of SpatiaLight who served any other
company in any capacity at the request of SpatiaLight,  in the manner and to the
maximum  extent set forth in the  Business  Corporation  Law of the State of New
York; and  SpatiaLight  may at the  discretion of the Board  indemnify all other
corporate personnel to the extent permitted by law.

         In addition, our Certificate of Incorporation provides that no director
shall be liable to SpatiaLight or its shareholders for damages for any breach of
duty in such capacity.  However,  such provision does not eliminate or limit the
liability of any director if a judgment or other final  adjudication  adverse to
him or her  establishes  that his or her acts or omissions  were in bad faith or
involved  intentional  misconduct  or a  knowing  violation  of law or  that  he
personally  gained a financial  profit or other advantage to which he or she was
not  legally  entitled or that his or her acts  violated  Section 719 of the New
York Business  Corporation Law (relating to the making of illegal  distributions
to shareholders or loans to directors).

         At present,  there is no pending  litigation or proceeding  involving a
director,   officer,  employee  or  other  agent  of  SpatiaLight  as  to  which
indemnification  is being sought nor are we aware of any  threatened  litigation
that may result in claims for indemnification by any director, officer, employee
or other agent.

         Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors,  officers or persons controlling  SpatiaLight
as provided above, we have been informed that, in the opinion of the Commission,
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable.



<PAGE>



================================================================================
WE HAVE NOT AUTHORIZED ANYONE TO GIVE ANY INFORMATION OR MAKE ANY REPRESENTATION
OTHER THAN THOSE CONTAINED OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS.  YOU
SHOULD  RELY  ONLY  ON  THE  INFORMATION  CONTAINED  IN  THIS  PROSPECTUS.   THE
INFORMATION  IN THIS  PROSPECTUS  IS CORRECT AS OF THE DATE OF THIS  PROSPECTUS.
DELIVERY OF THIS  PROSPECTUS  AFTER THE DATE INDICATED  BELOW DOES NOT MEAN THAT
THE INFORMATION IS STILL CORRECT AS OF ANY SUBSEQUENT DATE.











                                SPATIALIGHT, INC.

                             1,700,000 COMMON SHARES










                                   PROSPECTUS

                                 October 9, 2003




================================================================================


<PAGE>


                                     PART I


              INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS

Items 1 and 2. Plan Information; Registrant Information and Employee Plan Annual
               Information.

         The   document(s)   containing   the   information   specified  in  the
instructions  to Part I of Form  S-8  will be sent or  given  to the  respective
participants in the Robert A. Olins Option Plan, Steven F. Tripp Option Plan and
TARSAP as specified by Rule 428(b)(1). In addition, the statement required to be
made  pursuant to Item 2 of Part I to Form S-8 shall be contained in each of the
Section 10(a) prospectuses.

                                     PART II


               INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3.  Incorporation of Documents by Reference.

         The  following  documents  filed  by  SpatiaLight,  Inc.,  a  New  York
corporation  (the "Company"),  with the Securities and Exchange  Commission (the
"Commission") are incorporated in this Registration Statement by reference:

         1.       Annual  Report  on Form  10-KSB  for  the  fiscal  year  ended
                  December 31, 2002.

         2.       Quarterly Reports on Form 10-Q for the quarterly periods ended
                  March 31, 2003, and June 30, 2003.

         3.       The  description  of  our  Common  Shares   contained  in  our
                  Registration  Statement  on Form  8-A  filed  with  the SEC on
                  February  5,  1992,  under  Section  12 of the  Exchange  Act,
                  including  any  amendment  or report  filed for the purpose of
                  updating that description.

         All documents filed subsequent to the filing date of this  Registration
Statement with the Commission by the Company pursuant to Sections 13(a),  13(c),
14 and 15(d) of the  Securities  Exchange Act of 1934, as amended (the "Exchange
Act"),  prior to the filing of a  post-effective  amendment which indicates that
all securities  offered by this  Registration  Statement have been sold or which
de-registers  all such securities then remaining  unsold,  shall be deemed to be
incorporated by reference in this Registration Statement and to be a part hereof
from the date of the filing of such  documents.  Any  statement  contained  in a
document  incorporated or deemed to be incorporated herein by reference shall be
deemed to be modified or superseded for purposes of this Registration  Statement
to the extent  that a  statement  contained  herein or in any  subsequent  filed
document  which also is, or is deemed to be,  incorporated  by reference  herein
modifies or supersedes such prior  statement.  Any such statement so modified or
superseded  shall  not be  deemed,  except  as so  modified  or  superseded,  to
constitute a part of this Registration Statement, except as indicated herein.

Item 4.  Description of Securities.

         Not applicable.





                                       1
<PAGE>

Item 5.  Interests of Named Experts and Counsel.

         Not applicable.

Item 6.  Indemnification of Directors and Officers.

         Our  Bylaws  provide  that we will  indemnify  (a) any  person  made or
threatened  to be made a party to any action or proceeding by reason of the fact
that  he,  his  testator  or  intestate,  is or was a  director  or  officer  of
SpatiaLight  and (b) any director or officer of SpatiaLight who served any other
company in any capacity at the request of SpatiaLight,  in the manner and to the
maximum  extent set forth in the  Business  Corporation  Law of the State of New
York; and  SpatiaLight  may at the  discretion of the Board  indemnify all other
corporate personnel to the extent permitted by law.

         In addition, our Certificate of Incorporation provides that no director
shall be liable to SpatiaLight or its shareholders for damages for any breach of
duty in such capacity.  However,  such provision does not eliminate or limit the
liability of any director if a judgment or other final  adjudication  adverse to
him or her  establishes  that his or her acts or omissions  were in bad faith or
involved  intentional  misconduct  or a  knowing  violation  of law or  that  he
personally  gained a financial  profit or other advantage to which he or she was
not  legally  entitled or that his or her acts  violated  Section 719 of the New
York Business  Corporation Law (relating to the making of illegal  distributions
to shareholders or loans to directors).

         At present,  there is no pending  litigation or proceeding  involving a
director,   officer,  employee  or  other  agent  of  SpatiaLight  as  to  which
indemnification  is being sought nor are we aware of any  threatened  litigation
that may result in claims for indemnification by any director, officer, employee
or other agent.

         Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors,  officers or persons controlling  SpatiaLight
as provided above, we have been informed that, in the opinion of the Commission,
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable.

Item 7.  Exemption from Registration Claimed.

         Not applicable.

Item 8.  Exhibits.

4.1      SpatiaLight, Inc. 1999 Stock Option Plan, as amended.

4.2      Robert A. Olins Option to Purchase Common Shares.

4.3      Steven F. Tripp Option to Purchase Common Shares.

4.4      Theodore H. Banzhaf Time Accelerated Restricted Stock Award Plan.

5.1      Opinion of Bryan Cave LLP.

23.1     Consent of BDO Seidman, LLP, independent certified public accountants.

23.2     Consent of Bryan Cave LLP (included as part of Exhibit 5.1).

24.1     Power of Attorney (included on signature page).



                                       2
<PAGE>

Item 9.  Undertakings.

         (a) The undersigned registrant hereby undertakes:

                  (1) To file,  during any  period in which  offers or sales are
being made, a post-effective amendment to this Registration Statement:

                           (i) To include  any  prospectus  required  by Section
10(a)(3) of the Securities Act of 1933,
as amended (the "Securities Act");

                           (ii) To reflect in the prospectus any facts or events
arising after the effective date of
this Registration Statement (or the most recent post-effective amendment hereof)
which,  individually or in the aggregate,  represent a fundamental change in the
information set forth in this Registration Statement; and

                           (iii)  To  include  any  material   information  with
respect to the plan of distribution not
previously  disclosed in this  Registration  Statement or any material change to
such  information  in  this  Registration  Statement;  provided,  however,  that
paragraphs  (1)(a)(i) and (1)(a)(ii) will not apply if the information  required
to be included in a post-effective amendment by those paragraphs is contained in
periodic reports filed by the registrant pursuant to Section 13 or Section 15(d)
of the Exchange  Act that are  incorporated  by  reference in this  Registration
Statement.

                  (2) That, for the purpose of determining  any liability  under
the Securities Act, each such  post-effective  amendment shall be deemed to be a
new registration  statement relating to the securities offered therein,  and the
offering of such  securities at that time shall be deemed to be the initial bona
fide offering thereof.

                  (3) To remove from  registration by means of a  post-effective
amendment  any of the  securities  being  registered  which remain unsold at the
termination of the offering.

         (b) The  undersigned  registrant  hereby further  undertakes  that, for
purposes of determining  any liability  under the Securities Act, each filing of
the registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act that is  incorporated by reference in this  Registration  Statement
shall be deemed to be a new  registration  statement  relating to the securities
offered  therein,  and the  offering  of such  securities  at that time shall be
deemed to be the initial bona fide offering thereof.

         (c)  Insofar  as  indemnification  for  liabilities  arising  under the
Securities Act may be permitted to directors,  officers and controlling  persons
of the registrant  pursuant to the foregoing  provisions  described under Item 6
above, or otherwise,  the registrant has been advised that in the opinion of the
Commission  such  indemnification  is against  public policy as expressed in the
Securities Act and is, therefore,  unenforceable.  In the event that a claim for
indemnification  against  such  liabilities  (other  than  the  payment  by  the
registrant of expenses  incurred or paid by a director,  officer or  controlling
person of the  registrant  in the  successful  defense  of any  action,  suit or
proceeding)  is  asserted by such  director,  officer or  controlling  person in
connection with the securities being registered,  the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit  to a  court  of  appropriate  jurisdiction  the  question  whether  such
indemnification  by it is against  public policy as expressed in the  Securities
Act and will be governed by the final adjudication of such issue.




                                       3
<PAGE>

                                   SIGNATURES

         Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the  requirements  for  filing  on  Form  S-8 and has  duly  caused  this
Registration Statement to be signed on its behalf by the undersigned,  thereunto
duly authorized, in the City of Novato, State of California, on October 9, 2003.

                                       SPATIALIGHT, INC.

                                       By: /s/ ROBERT A. OLINS
                                           -------------------------------------
                                           Robert A. Olins, Acting Chief
                                           Executive Officer



                                       By: /s/ TIMOTHY V. DESCAMPS
                                           -------------------------------------
                                           Timothy V. Descamps, Chief
                                           Financial Officer



                                POWER OF ATTORNEY

         KNOW ALL PERSONS BY THESE  PRESENTS,  that each person whose  signature
appears below  constitutes  and appoints Robert A. Olins, as his or her true and
lawful   attorney-in-fact  and  agent,  with  full  power  of  substitution  and
resubstitution,  for him or her and in his or her name,  place and stead, in any
and all  capacities,  to sign any and all amendments  (including  post-effective
amendments)  to this  Registration  Statement on Form S-8, and to file the same,
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange  Commission,  granting unto said  attorneys-in-fact  and
agents,  and each of them,  full power and  authority to do and perform each and
every act and thing requisite and necessary to be done in connection  therewith,
as fully to all intents  and  purposes as he or she might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

         Pursuant to the requirements of the Securities Act of 1933, as amended,
this  Registration  Statement  has been signed by the  following  persons in the
capacities and on the dates indicated.


<TABLE>
<CAPTION>
               Signature                                    Title                                  Date
               ---------                                    -----                                  ----
<S>                                      <C>                                                <C>
/s/ ROBERT A. OLINS                      Acting Chief Executive Officer, Secretary,         October 9, 2003
---------------------------------        Treasurer and Director
Robert A. Olins


*/s/ Lawrence J. Matteson                Director                                           October 9, 2003
 --------------------------------
 Lawrence J. Matteson


*/s/ Steven F. Tripp                     Director                                           October 9, 2003
 --------------------------------
 Steven F. Tripp


*/s/ Claude Piaget                       Director                                           October 9, 2003
 --------------------------------
 Claude Piaget


*By: /s/ ROBERT A. OLINS                                                                    October 9, 2003
     -------------------
     Robert A. Olins
     (Attorney-in-fact)
</TABLE>


                                       4
<PAGE>


                                  EXHIBIT INDEX

No.      Document
---      --------

4.1      SpatiaLight, Inc. 1999 Stock Option Plan, as amended.

4.2      Robert A. Olins Option to Purchase Common Shares.

4.3      Steven F. Tripp Option to Purchase Common Shares.

4.4      Theodore H. Banzhaf Time Accelerated Restricted Stock Award Plan.

5.1      Opinion of Bryan Cave LLP.

23.1     Consent of BDO Seidman, LLP, independent certified public accountants.

23.3     Consent of Bryan Cave LLP (included as part of Exhibit 5.1).

24.1     Power of Attorney (included on signature page).
[{"type": "S-8", "sequence": "1", "filename": "form_s8.txt", "secsgml_size_bytes": 89647}]
{"company-data": {"conformed-name": "SPATIALIGHT INC", "cik": "0000881468", "assigned-sic": "3861", "irs-number": "161363082", "state-of-incorporation": "NY", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "S-8", "act": "33", "file-number": "333-109595", "film-number": "03935434"}, "business-address": {"street1": "9 COMMERICAL BLVD STE 200", "street2": "ST C", "city": "NOVATO", "state": "CA", "zip": "94949", "phone": "4158831693"}, "mail-address": {"street1": "9 COMMERICAL BLVD", "street2": "SUITE 200", "city": "NOVATO", "state": "CA", "zip": "94949"}, "former-company": {"former-conformed-name": "SAYETT GROUP INC", "date-changed": "19930328"}}
As filed with the Securities and Exchange Commission on October 9, 2003
                                                      Registration No. 333-_____
================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   ----------

                                    FORM S-8
                             REGISTRATION STATEMENT
                                      UNDER
                           THE SECURITIES ACT OF 1933

                                   ----------

                                SPATIALIGHT, INC.
               (Exact name of issuer as specified in its charter)

                New York                                       16-1363082
     (State or other jurisdiction of                        (I.R.S. Employer
     incorporation or organization)                        Identification No.)

    Five Hamilton Landing, Suite 100
           Novato, California                                     94949
(Address of Principal Executive Offices)                       (Zip Code)

                    SpatiaLight, Inc. 1999 Stock Option Plan
                Robert A. Olins Option to Purchase Common Shares
                Steven F. Tripp Option to Purchase Common Shares
        Theodore H. Banzhaf Time Accelerated Restricted Stock Award Plan
                            (Full title of the plan)

                                 Robert A. Olins
                         Acting Chief Executive Officer
                                SpatiaLight, Inc.
                        Five Hamilton Landing, Suite 100
                            Novato, California 94949
                                 (415) 883-1693
            (Name, address and telephone number of agent for service)

                                   Copies to:
                                Melvin Katz, Esq.
                                 Bryan Cave LLP
                           1290 Avenue of the Americas
                            New York, New York 10104
                Approximate date of proposed sale to the public:
   From time to time after the effective date of this Registration Statement.

                         CALCULATION OF REGISTRATION FEE
=============================== ========================= ========================== ======================== =====================
        Title of Each                                         Proposed Maximum          Proposed Maximum
     Class of Securities              Amount to be             Offering Price          Aggregate Offering           Amount of
       to be Registered                Registered               Per Share(1)                Price(1)             Registration Fee
------------------------------- ------------------------- -------------------------- ------------------------ ---------------------
Common Shares, par value $.01
per share (2)                          1,000,000                   $ 5.17                 $5,170,000               $418.25
------------------------------- ------------------------- -------------------------- ------------------------ ---------------------
Common Shares, par value $.01
per share (3)                           750,000                    $ 5.17                 $3,877,500               $313.68
------------------------------- ------------------------- -------------------------- ------------------------ ---------------------
Common Shares, par value $.01
per share (4)                           150,000                    $ 5.17                 $  775,500               $62.73
------------------------------- ------------------------- -------------------------- ------------------------ ---------------------
Common Shares, par value $.01
per share (5)                           800,000                    $ 5.17                 $4,136,000               $334.60
------------------------------- ------------------------- -------------------------- ------------------------ ---------------------
(1)      Estimated  solely for the purpose of  computing  the  registration  fee
         pursuant  to Rules  457(c) and (h) of the  Securities  Act of 1933,  as
         amended,  based  upon the  average  of the high  and low  sales  prices
         reported on the Nasdaq SmallCap Market on October 3, 2003.

(2)      These shares represent the underlying  Common Shares for options issued
         to participants in the Company's 1999 Stock Option Plan, as amended.

(3)      These shares represent the underlying Common Shares for options granted
         outside of any Company plan to Robert A. Olins,  Acting Chief Executive
         Officer and a director of the Company.

(4)      These shares represent the underlying Common Shares for options granted
         outside of any  Company  plan to Steven F.  Tripp,  a  director  of the
         Company.

(5)      These shares represent the underlying Common Shares for options granted
         outside of any Company plan to Theodore H. Banzhaf,  an Executive  Vice
         President  of  the   Company,   under  the  Theodore  H.  Banzhaf  Time
         Accelerated Restricted Stock Award Plan.
EXPLANATORY NOTES

                          INCORPORATION BY REFERENCE OF
                    PRIOR REGISTRATION STATEMENT ON FORM S-8

         This registration statement on Form S-8 filed by SpatiaLight, Inc. (the
"Company")  with the  Securities  and  Exchange  Commission  (the  "Commission")
relates in part to the registration of an additional  1,000,000 of the Company's
Common Shares,  $.01 par value per share,  for issuance under the Company's 1999
Stock Option Plan, as amended (the "1999  Plan").  A  registration  statement on
Form S-8 (File No. 333-91259) was filed with the Commission on November 19, 1999
(the "Prior Registration  Statement")  relating to the registration of 4,000,000
of the  Company's  Common Shares for issuance  under the 1999 Plan.  Pursuant to
General  Instruction  E of Form S-8,  the  contents  of the  Prior  Registration
Statement  are  incorporated  herein by  reference  insofar as it relates to the
registration  of  the  additional   1,000,000  Common  Shares.   The  securities
registered  hereunder are the same class as the securities  registered under the
Prior Registration Statement.

                        REGISTRATION OF SHARES UNDERLYING
                            CERTAIN NON-PLAN OPTIONS

         This  Registration  Statement  is also being  filed for the  purpose of
registering  certain  non-plan  options to  purchase  Common  Shares,  which the
Company granted to certain of its officers and directors.

                       REGISTRATION OF SHARES PURSUANT TO
                               REOFFER PROSPECTUS

         This  Registration  Statement  is also  being  filed  for  purposes  of
registering  Common Shares underlying  certain options for resale by the Selling
Shareholders, whose names are set forth in the accompanying Reoffer Prospectus.

         This  Registration  Statement  contains  three  parts.  The first  part
contains the Reoffer Prospectus, which has been prepared in accordance with Part
I of  Form  S-8  (in  accordance  with  General  Instruction  C of  the  General
Instructions  to Form S-8),  which  covers  reoffers  and resales of the Selling
Shareholders'  Common Shares. The second part contains  information  required by
Part I of Form S-8 and is presented only in connection with the  registration of
the non-plan options held by Messrs.  Olins,  Tripp and Banzhaf.  The third part
contains information required in the Registration  Statement pursuant to Part II
of Form  S-8.  Information  required  by Part I, as it  relates  to the  Reoffer
Prospectus,  of  Form  S-8  is  omitted  from  this  Registration  Statement  in
accordance  with Rule 428 under the Securities Act of 1933, as amended,  and the
"Note" to Part I of Form S-8.
REOFFER PROSPECTUS

                                SPATIALIGHT, INC.

                             1,700,000 COMMON SHARES

         This Prospectus  relates to the resale of up to 1,700,000 of our Common
Shares, par value $.01 per share, by certain Selling Shareholders listed in this
Prospectus  under the section  entitled  "Selling  Shareholders."  These  Shares
(which we refer to in this Prospectus as the "Shares") include (i) up to 750,000
Common  Shares which are issuable  upon  exercise of certain  options  issued to
Robert A. Olins,  Acting Chief Executive  Officer and a director of the Company;
(ii) up to 150,000  Common  Shares which are issuable  upon  exercise of certain
options  issued to Steven F. Tripp,  a director of the Company;  and (iii) up to
800,000  Common  Shares  which are  issuable  upon  exercise of certain  options
granted to Theodore F. Banzhaf, an Executive Vice President of the Company.  Our
Common Shares are traded on The Nasdaq  SmallCap Market under the symbol "HDTV".
On October 3, 2003,  the last sale price of our Common Shares as reported on The
Nasdaq SmallCap Market was $5.14 per share.

         No underwriter is being used in connection  with the sale of the Shares
being offered by the Selling Shareholders. The Selling Shareholders, directly or
through  agents or  dealers,  may sell all or some of their  Shares that are the
subject of this  Prospectus  on terms to be  determined  at the time of sale. We
will not receive any of the proceeds  from the sale of the Shares being  offered
hereby for the  account  of the  Selling  Shareholders.  Such  proceeds  will be
received by the Selling Shareholders.

         Our principal  executive  offices are located at Five Hamilton Landing,
Suite 100, Novato, California 94949, and our telephone number is (415) 883-1693.

         AN  INVESTMENT  IN OUR COMMON  SHARES  INVOLVES A HIGH  DEGREE OF RISK.
PLEASE  CAREFULLY  CONSIDER THE  INFORMATION  UNDER THE HEADING  "RISK  FACTORS"
BEGINNING ON PAGE 2.

         NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS  IS TRUTHFUL OR  COMPLETE.  ANY  REPRESENTATION  TO THE CONTRARY IS A
CRIMINAL OFFENSE.

         THE  INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED.
THE SELLING  SHAREHOLDERS  MAY NOT SELL THESE  SECURITIES UNTIL THE REGISTRATION
STATEMENT FILED WITH THE SECURITIES AND EXCHANGE  COMMISSION IS EFFECTIVE.  THIS
PROSPECTUS IS NOT AN OFFER TO SELL THESE  SECURITIES AND IT IS NOT SOLICITING AN
OFFER TO BUY  THESE  SECURITIES  IN ANY  STATE  WHERE  THE  OFFER OR SALE IS NOT
PERMITTED.

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

                 The date of this Prospectus is October 9, 2003.
TABLE OF CONTENTS
Page
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS..............................1

GENERAL AND RECENT DEVELOPMENTS........................................................1

RISK FACTORS...........................................................................2

ABOUT SPATIALIGHT.....................................................................10

USE OF PROCEEDS.......................................................................13

DESCRIPTION OF COMMON SHARES..........................................................14

PLAN OF DISTRIBUTION..................................................................15

LEGAL MATTERS.........................................................................16

EXPERTS...............................................................................16

WHERE TO FIND MORE INFORMATION........................................................16

DOCUMENTS INCORPORATED BY REFERENCE...................................................16

DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES...17
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

         Certain  statements  and  information   contained  in  this  Prospectus
concerning our future, proposed and anticipated activities;  certain trends with
respect to our revenue,  operating results,  capital resources, and liquidity or
with respect to the markets in which we compete or the  electronics  industry in
general;  and other statements  contained in this Prospectus  regarding  matters
that are not historical facts are  forward-looking  statements,  as such term is
defined under applicable securities laws.  Forward-looking  statements, by their
very  nature,  include  risks and  uncertainties,  many of which are  beyond our
control. Accordingly,  actual results may differ, perhaps materially, from those
expressed in or implied by such forward-looking  statements.  Factors that could
cause actual results to differ  materially  include those  discussed below under
"Risk Factors."

                         GENERAL AND RECENT DEVELOPMENTS

         We are in the business of manufacturing  high-resolution  microdisplays
for applications such as high definition  television,  computer monitors,  video
projectors  and  other  applications.  To  date,  we  have  entered  into  seven
agreements  or  memoranda  of  understanding   with  eight  original   equipment
manufacturers  (OEMs) in China and two such agreements with OEMs in the Republic
of South  Korea.  We are  currently  working with Fuji Photo  Optical Co.,  Ltd.
(Fuji) for the  manufacture  of light engines  being used with our  microdisplay
products to be sold to our current and prospective customers.  Please see "About
SpatiaLight" for a more detailed discussion of the terms of these agreements.

         Purchase   Orders  Received  -  In  late  January  2003,  we  concluded
negotiations  with  Skyworth,  one of the  Chinese  OEMs  with  which  we had an
agreement to test prototypes of our microdisplay products, resulting in a signed
agreement for the purchase by Skyworth of 14,100  display units from us during a
one year delivery period.  The purchase order originally  provided for 200 units
to be  delivered in February  and an  additional  200 units in each of March and
April 2003.  Skyworth and we subsequently  agreed to delay the first delivery of
units. As of the date of this Prospectus,  we have completed partial shipment of
the 200 units  originally  scheduled for delivery in the first month.  Following
the  initial  delivery  provisions  of 200 units  per month for the first  three
months,  we are  scheduled  to deliver  1,500 units per month until the order is
completed.  Pursuant to the terms of the  purchase  order,  the  obligations  of
Skyworth will be backed by letters of credit in our favor. The purchase order is
cancelable  by  Skyworth  on  a  quarterly  basis  and  is  subject  to  pricing
contingencies and other customary terms and conditions.

         In September  2003 we announced  that we signed an agreement with China
Electronics  Corporation (CEC), another of the Chinese OEMs with which we had an
agreement to test prototypes of our microdisplay  products,  for the purchase by
CEC of 2,000  display  units  from us.  The  agreement  provides  for an initial
delivery of ten display units,  which was completed in September,  with a second
delivery of 100 units to follow.  Additional shipments will be made periodically
according to a schedule to be  determined  by CEC and us. The purchase  order is
cancelable by CEC after delivery of 110 units and is subject to other  customary
terms and conditions.

         Purchase  Orders Being  Negotiated - We are also currently  negotiating
the terms of purchase  orders for our products  with certain of our  prospective
Chinese   customers   who  are  parties  to  the   agreements  or  memoranda  of
understanding  described under "About  SpatiaLight".  There are significant open
issues with respect to these prospective purchase orders that have to be finally
negotiated,  including  prices and quantities of our products.  We cannot assure
whether we will receive any purchase  orders  binding on any of these  companies
for their purchase of commercial  quantities of our microdisplay products in the
near future.  Even assuming that we receive  purchase orders that are binding on
the  prospective  customers,  these orders and our sales to these  customers are
subject to certain contingencies described under "Risk Factors."
Private Placement of $5.15 Million of Equity Securities

         On May 28, 2003 we  completed a private sale of 2,796,328 of our Common
Shares and warrants to purchase 699,080 Common Shares for an aggregate  purchase
price of $5.15 million,  with five  purchasers,  including  Robert A. Olins, our
Acting Chief  Executive  Officer and a director of  SpatiaLight,  who  purchased
1,357,441  shares and acquired  warrants to purchase  339,360  shares  (which we
refer to in this Prospectus as the "May  Transaction").  The shares and warrants
in  the  May  Transaction  were  included  in a  currently  effective  Form  S-3
Registration Statement pursuant to registration rights granted to the purchasers
in that transaction. Funds from the May Transaction have been used to reduce our
liabilities and are being used for working capital purposes.

Private Placement of $2.76 Million of Equity Securities

         On August 19, 2003 we  completed  a private  sale of  1,212,061  of our
Common  Shares and warrants to purchase  303,015  Common Shares for an aggregate
purchase  price  of  $2.76  million,  with  six  purchasers,  none of whom is an
affiliate of the Company (the "August Transaction").  The shares and warrants in
the  August  Transaction  were  included  in  a  currently  effective  Form  S-3
Registration Statement pursuant to registration rights granted to the purchasers
in that  transaction.  Funds  from the  August  Transaction  are being  used for
working capital purposes.

                                  RISK FACTORS

         THE SHARES OFFERED HEREBY ARE  SPECULATIVE IN NATURE AND INVOLVE A HIGH
DEGREE  OF RISK.  PRIOR  TO  MAKING  AN  INVESTMENT  DECISION  WITH  RESPECT  TO
SECURITIES OF SPATIALIGHT,  PROSPECTIVE  INVESTORS  SHOULD  CAREFULLY  CONSIDER,
ALONG WITH THE OTHER MATTERS  DISCUSSED IN THIS  PROSPECTUS,  THE FOLLOWING RISK
FACTORS:

We have a history  of losses and may incur  losses in the  future and  therefore
cannot assure you that we will achieve profitability.

         We have incurred  losses over the past five years and have  experienced
cash shortages. For the six months ended June 30, 2003 and 2002, we incurred net
losses of approximately $4,874,000 and $3,900,000, respectively. In addition, we
had an  accumulated  deficit  of  $53,600,000  as of June 30,  2003.  We  expect
additional  losses as we continue  spending for  production  and other  business
activities as well as further  research and  development  of our products.  As a
result, we will need to generate substantial sales to support our costs of doing
business  before we can begin to recoup our  operating  losses  and  accumulated
deficit and achieve profitability.

If we are  unable to obtain  further  financing  or  generate  required  working
capital our ability to operate could suffer or cease. Our auditors have issued a
report on our financial  statements,  which  contains an  explanatory  paragraph
regarding substantial doubt about our ability to continue as a going concern.

         Our  operations to date have consumed  substantial  amounts of cash and
will continue to require  substantial amounts of capital in the future. In order
to  remain  competitive,  we  must  continue  to  make  significant  investments
essential to our ability to operate profitably, including investments in further
research and  development,  equipment,  facilities  and  production  activities.
Although our financial  condition and liquidity  have been assisted  through the
previous  exercises  of warrants  and  private
purchases of our Common Shares including the  approximately  $8.0 million raised
by us in the two  recently  completed  stock  financings,  we may still  require
additional  financing to satisfy our increasing  working  capital  requirements.
Reliance for  financing  upon  exercise of warrants and private  stock  purchase
agreements entails the additional risks of non-exercise of such warrants because
of the prevailing  market prices of our  underlying  Common Shares or default by
stock  purchasers  under  these  agreements.  In the event that we are unable to
obtain  further  financing  on  satisfactory  terms  or at all,  generate  sales
sufficient to offset our costs,  or if the costs of  development  and operations
are greater  than we  anticipated,  we may be unable to grow our business at the
rate  desired  or may be  required  to delay,  reduce,  or cease  certain of our
operations,  any of which  could  materially  harm our  business  and  financial
results.  Our  independent  auditors have included an  explanatory  paragraph in
their report in our Form 10-KSB on our financial  statements for our last fiscal
year  regarding  substantial  doubt  about our  ability to  continue  as a going
concern.

We are subject to lengthy  development  periods and  product  acceptance  cycles
which may significantly harm our business.

         Our business  model requires us to develop  microdisplays  that perform
better  than  existing  technologies,  contract  with  one or  more  third-party
manufacturers  to manufacture  our display units in bulk, and sell the resulting
display units to original  equipment  manufacturers  that will then  incorporate
them  into  their   products.   Original   equipment   manufacturers   make  the
determination  during  their  product  development  programs  whether  or not to
incorporate our SpatiaLight imagEngine(TM) microdisplays and/or display units in
their  products.  This  requires  us to invest  significant  amounts of time and
capital in designing our SpatiaLight imagEngine(TM) microdisplays and/or display
units before we can be assured that we will  generate any  significant  sales to
our  customers  or even  recover  our  investment.  If we fail  to  recover  our
investment  from the  SpatiaLight  imagEngine(TM)  microdisplays  and/or display
units, it could seriously harm our financial condition.  In addition, the length
of time that our products may be successfully received by our customers could be
limited by the acceptance of new technologies developed by our competitors.

We  incur  substantial   research  and  development  costs  in  connection  with
technologies that may not be successful.

         We  currently  have  eleven  full-time  engineering  and six  full-time
manufacturing  personnel  based in  California  working on  microdisplays.  This
staffing  creates  significant  research and  development  costs that may not be
recouped.  Even if our current microdisplays become accepted or successful,  due
to the rapid technological change in our industry,  we must continue to use, and
may increase in number,  our engineering and manufacturing  personnel to develop
future  generations  of our  microdisplays.  As a result,  we expect to continue
incurring significant research and development costs.
In recent months we have commenced  manufacturing and shipping our microdisplays
in  commercial   quantities,   but  unanticipated   difficulties  in  continuing
manufacturing  our  microdisplays may make it difficult to meet customer demands
from time to time and our  operating  results could be  significantly  harmed by
such difficulties.

         We need to work  closely  with  our  manufacturing  sources  to  assure
production of our current  display  units.  Problems in production or lower than
expected  manufacturing  yields could significantly harm our business because we
will have already  incurred the costs for the materials used in the microdisplay
manufacturing  process.  These  problems  could cause delays that might lead our
potential customers to seek other sources.

         We  currently  obtain  silicon  backplanes,  a vital  component  in our
microdisplays,   from  the  Far  East.  Some  Asian  countries  are  subject  to
earthquakes, typhoons and political instability. Unless we obtain an alternative
source, any disruption or termination of our silicon manufacturing operations in
Taiwan or air  transportation  with the Far East  could  significantly  harm our
operations.

         Our  microdisplays  are assembled by combining  the silicon  backplanes
with  electronic  components.  The  design  and  manufacture  of liquid  crystal
displays and display units are highly complex  processes that are sensitive to a
wide  variety  of  factors,   including  the  level  of   contaminants   in  the
manufacturing environment, impurities in the materials used, and the performance
of personnel and equipment.  While in the past we have had working  arrangements
with several  independent  liquid  crystal  display  fabricators  to manufacture
certain of our products,  we are now manufacturing our microdisplays  ourselves.
We  believe  that  the  internal   manufacture   of  all  such  liquid   crystal
microdisplays  will  benefit us by allowing us to enhance  quality  control over
such products as well as protect more  effectively our  proprietary  interest in
those products, but the risks discussed above associated with the highly complex
processes of manufacturing these liquid crystal microdisplays remain applicable.

         We continue to have working  arrangements  with the manufacturer of the
light engines and lamps required in the assembly of our display  units.  We have
entered  into an agreement  for the supply of prisms and filters  which are also
required for the assembly of such units.  Except for that  agreement,  we do not
have written  agreements  which are binding upon the  manufacturers of the other
components  and no such  manufacturer  is bound to furnish us with any  specific
quantities of their products at previously  specified  prices.  At this date, we
are not aware that any of our component  manufacturers  have known  shortages of
critical material.

         Because the manufacture of our SpatiaLight imagEngine(TM) microdisplays
involves highly complex  processes and technical  problems may arise, we, in our
capacity as internally manufacturing the liquid crystal microdisplays, which are
an integral part of the display units, cannot assure the manufacturing yields of
our products. Problems in production or lower than expected manufacturing yields
could  significantly harm our business and operating results.  In addition,  the
complexity of our manufacturing processes will increase as the sophistication of
our microdisplays and display units increases.

If a market for our  products  does not  develop,  our  business  will likely be
significantly harmed.

         Various target  markets for our  microdisplays,  including  projectors,
monitors, high-definition televisions, and portable microdisplays, are uncertain
and may be slow to  develop.  In  addition,  companies  in those  markets  could
utilize  competing  technologies.  High-definition  television has only recently
become available to consumers, and widespread market acceptance is uncertain. In
addition,  the  commercial  success  of  the  portable  microdisplay  market  is
uncertain. The acceptance of our display units and/or SpatiaLight imagEngine(TM)
microdisplays  will be dependent  upon the  pricing,  quality,  reliability  and
useful life of these units compared to competing technologies, as to which there
can be no  assurance.  In  order  for us to  succeed,  not  only  must we  offer
end-product  manufacturers  better  and less  expensive  microdisplays  than our
competitors,  but the  manufacturers  themselves must also develop  commercially
successful products using our microdisplays. SpatiaLight's marketing efforts are
focused on developing strategic customer and governmental relationships in China
and the Republic of South Korea.  Our failure to sell our  microdisplays to such
manufacturers  or the failure of the  ultimate  target  markets to develop as we
expect will negatively affect our anticipated growth.

If our  microdisplays  do not become  widely  accepted by our  customers  or the
end-users, our business could be significantly harmed.

         Our microdisplays may not be accepted by a widespread  market.  Even if
we  successfully  obtain  customer  orders,  our  customers may determine not to
introduce or may terminate  products  utilizing the  technology for a variety of
reasons, including the following:

o        superior technologies developed by our competitors;

o        price considerations; and

o        lack of anticipated or actual market demand for the products.

         We  currently  have  agreements  with a limited  number  of  customers.
Despite  our  reasonable  efforts  to  retain  these  customers,  we may  not be
successful in this regard.  The loss of any one or more of these customers could
materially harm our business and financial condition.

To date,  we have only  received two purchase  orders from our  customers and we
cannot  assure you that we will  obtain  additional  purchase  orders from these
customers  or our other  prospective  customers,  or, if we do, that such orders
will generate significant revenues.

         Since late October 2001,  we have entered into  agreements or memoranda
of understanding  with eight OEMs in China  contemplating  the purchase by these
prospective  customers of our display  units and/or  SpatiaLight  imagEngine(TM)
microdisplays  for use in certain  of their  products.  All of these  agreements
require  that we supply  prototypes  of our  display  units  and/or  SpatiaLight
imagEngine(TM)  microdisplays and that they meet technical criteria satisfactory
to each of such  prospective  customers.  In 2003 we entered into  Agreements of
Principal  Terms  with two OEMs in the  Republic  of South  Korea.  One of these
agreements is a development  agreement and the second  contemplates the purchase
of our  display  units for use in certain of the OEM's products. This  agreement
requires  that we  supply  a  prototype  of our  display  unit  and that it meet
technical  criteria  satisfactory to the prospective  customer.  The Company has
been advised by the other prospective  Chinese customers that they are satisfied
with the results of the testing of the prototypes  under their  agreements  with
the Company and we are currently  negotiating  terms of purchase  orders for our
display units and/or SpatiaLight imagEngine(TM) microdisplays with each of them.
There remain open issues that have to be finally  negotiated,  including  prices
and quantities of our products. We cannot offer assurances that we will receive,
in the future,  binding  purchase  orders from any of these  companies for their
purchase of commercial quantities of our microdisplay products.

         In  addition,  even if we  receive  purchase  orders  from our  current
customer or prospective  customers for our display  units,  we may have problems
implementing  volume  production of such display  units.  Furthermore,  sales to
manufacturers  in the  electronics  industry  are subject to severe  competitive
pressures,  rapid technological change, and product obsolescence.  Manufacturers
may,  at any time,  cancel  purchase  orders or  commitments  or reduce or delay
orders, thereby increasing our inventory and overhead
risks.  Therefore,  even if we obtain  purchase  orders from several  current or
prospective customers, we cannot assure you that these agreements will result in
significant revenues to us.

If our customers' products are not successful,  our business would be materially
harmed.

         We do not sell any  products  to  end-users.  Instead,  we  design  and
manufacture  various  product  solutions  that our  customers  (i.e.,  OEMs) may
incorporate  into  their  products.  As a result,  our  success  depends  almost
entirely upon the widespread market acceptance of our customers'  products.  Any
significant  slowdown in the demand for our customers' products would materially
harm our business.

         Our dependence on the success of the products of our customers  exposes
us to a variety of risks, including our need to do the following:

o        maintain  customer  satisfaction  with  our  design  and  manufacturing
         services;

o        match our design and  manufacturing  capacity with customer  demand and
         maintain satisfactory delivery schedules;

o        anticipate customer order patterns, changes in order mix, and the level
         and timing of orders that we can meet; and

o        adjust to the cyclical nature of the industries and markets we serve.

         Our  failure to address  these  risks may cause us to lose sales or for
sales to decline.

The electronics  industry is highly competitive,  which may result in lost sales
or lower gross margins.

         We serve highly competitive  industries that are characterized by price
erosion,  rapid  technological  change and  competition  from major domestic and
international  companies.  This  intense  competition  could  result in  pricing
pressures,  lower sales,  reduced  margins and lower market  share.  Some of our
competitors  have  greater  market  recognition,   larger  customer  bases,  and
substantially greater financial,  technical,  marketing,  distribution and other
resources  than we  possess.  As a  result,  they may be able to  introduce  new
products and respond to customer requirements more quickly than we can.

         Our  competitive  position could suffer if one or more of our customers
decide to design and  manufacture  their own display units, to contract with our
competitors,  or to use  alternative  technologies.  In addition,  our customers
typically develop a second source. Second source suppliers may win an increasing
share of a program.  Our ability to compete  successfully depends on a number of
factors,  both  within and  outside  our  control.  These  factors  include  the
following:

o        our success in designing and manufacturing new display technologies;

o        our ability to address the needs of customers;

o        the quality, performance,  reliability, features, ease of use, pricing,
         and diversity of our display products;

o        foreign currency  fluctuations,  which may cause a foreign competitor's
         products to be priced significantly lower than our displays;
o        the quality of our customer services;

o        the efficiency of our production sources;

o        the rate at which  customers  incorporate  our displays  into their own
         products; and

o        products or technologies introduced by our competitors.

Our business is significantly  affected by conditions or events occurring in the
electronics industry generally.

         The electronics industry has experienced significant economic downturns
at various  times,  characterized  by  diminished  product  demand,  accelerated
erosion of average  selling  prices,  and  production  over-capacity.  Since the
electronics  industry  is  cyclical  in nature,  we may  experience  substantial
period-to-period  fluctuations  in future  operating  results because of general
industry conditions or events occurring in the general economy.

Our operating results are subject to significant fluctuations.

         Our results of  operations  have varied  significantly  from quarter to
quarter in the past and are likely to vary  significantly  in the future,  which
makes it  difficult to predict our future  operating  results.  Accordingly,  we
believe that  quarter-to-quarter  comparisons  of our operating  results are not
meaningful  and  should  not be  relied  upon  as an  indicator  of  our  future
performance. Some of the factors, which cause our operating results to fluctuate
include the following:

o        introductions  of displays and market  acceptance of new generations of
         displays;

o        timing of expenditures in anticipation of future orders;

o        changes in our cost structure;

o        availability of labor and components;

o        pricing and availability of competitive products and services;

o        the timing of orders;

o        the  volume of orders  relative  to the  capacity  we can  contract  to
         produce;

o        evolution in the life cycles of customers' products; and

o        changes or anticipated changes in economic conditions.

The market price of our Common Shares is highly volatile.

         The market  price of our Common  Shares  has been  extremely  volatile,
reflecting  reported  losses,  receipt of  additional  financing  and changes of
management.  Other companies have found similar volatility correlates with class
action securities  lawsuits although to date we have not been a defendant in any
such  lawsuit.  The  trading  price of our  Common  Shares in the  future  could
continue to be subject to wide  fluctuations  in  response  to various  factors,
including the following:
o        quarterly variations in our operating results;

o        actual or  anticipated  announcements  of technical  innovations or new
         product developments by us or our competitors;

o        public announcements regarding our business developments;

o        changes in analysts' estimates of our financial performance;

o        sales of large numbers of our Common Shares by our shareholders;

o        general conditions in the electronics industry; and

o        worldwide economic and financial conditions.

         In addition,  the stock market has  experienced  significant  price and
volume  fluctuations that have particularly  affected the market prices for many
high-technology  companies  and that often have been  unrelated to the operating
performance  of these  companies.  These  broad  market  fluctuations  and other
factors may adversely affect the market price of our Common Shares.

By further  increasing the number of our Common Shares that may be sold into the
market,  this offering by the Selling  Shareholders could cause the market price
of our Common Shares to decrease significantly,  even if our business operations
are performing well.

         The 1,700,000  Shares covered by this Reoffer  Prospectus (all of which
are issuable  upon  exercise of options)  represent  approximately  5.44% of the
total number of our Common Shares that are issued and  outstanding as of October
3, 2003.  All of these  Shares will be freely  salable  beginning on the date of
this Prospectus.  Sales of these Shares in the public market,  or the perception
that future  sales of these  Shares  could  occur,  might  adversely  affect the
prevailing market price of our Common Shares in the near future.

Our Common Shares may not be liquid.

         Our Common Shares are currently  traded on The NASDAQ SmallCap  Market.
Our  shareholders  may find that it is more  difficult to sell our Common Shares
than  shares  that are  listed on The NASDAQ  National  Market,  American  Stock
Exchange or New York Stock Exchange. The trading volume of our Common Shares may
be adversely affected due to the limited marketability of our Common Shares. Any
substantial  sales of our Common  Shares may result in a material  reduction  in
price  because  relatively  few buyers may be  available  to purchase our Common
Shares.

If we lose our key  personnel  or are  unable to attract  and retain  additional
personnel, our ability to compete could be harmed.

         Our development and operations depend  substantially on the efforts and
abilities  of our senior  management  and  qualified  technical  personnel.  Our
products  require  sophisticated   production,   research  and  development  and
technical  support.  The  competition  for  qualified  management  and technical
personnel is intense.  The loss of services of one or more of our key  employees
or the inability to add key personnel  could have a material  adverse  affect on
us,  particularly  since currently we do not have any life insurance policies in
place to cover that  contingency.  Our  success  will depend upon our ability to
attract  and  retain  highly  qualified  scientific,  marketing,  manufacturing,
financial and other key management  personnel.  We face intense  competition for
the limited number of people  available with the necessary
technical  skills and  understanding  of our products and technology.  We cannot
assure you that we will be able to attract or retain such personnel or not incur
significant  costs  in  order  to do  so.  If  we  are  unable  to  protect  our
intellectual  property from use by third parties,  our ability to compete in the
industry will be harmed.

         We  believe  that  our  success  depends  in  part  on  protecting  our
proprietary technology. We rely on a combination of patent, copyright, trademark
and trade secret laws, as well as  confidentiality  and assignment of inventions
agreements from our employees,  consultants  and advisors and other  contractual
provisions,  to establish and protect our intellectual property rights. Policing
unauthorized use of our products and technology is difficult,  however.  Despite
our efforts to protect our proprietary rights, we face the following risks:

o        pending patent applications may not be issued;

o        patents issued to us may be challenged, invalidated, or circumvented;

o        unauthorized  parties may obtain and use information  that we regard as
         proprietary despite our efforts to protect our proprietary rights;

o        others may  independently  develop similar  technology or design around
         any patents issued to us;

o        breach of confidentiality agreements;

o        intellectual  property laws may not protect our intellectual  property;
         and

o        effective protection of intellectual  property rights may be limited or
         unavailable in some foreign  countries,  such as China, in which we may
         operate.  Specifically,  although we consider  the  following  unlikely
         because of the complex technological  structure of our products, one or
         more  of  our  prospective  Chinese  customers,   or  their  respective
         employees or other persons including our competitors, that have or gain
         access to our products for testing purposes, may seek to misappropriate
         or improperly convert to their own use our intellectual  property and a
         lack of adequate  remedies  and  impartiality  under the Chinese  legal
         system may  adversely  impact our ability to protect  our  intellectual
         property.

         There can be no assurance  that we will have  adequate  remedies in the
event any of the  foregoing  materializes.  Failure to protect our  intellectual
property  would  limit our  ability to produce  and market our  products  in the
future,  which would materially  adversely affect our revenues  generated by the
sale of such products. In addition, third parties could assert that our products
and technology infringe their patents or other intellectual  property rights. As
a  result,  we may  become  subject  to  future  patent  infringement  claims or
litigation,  the  defense of which is costly,  time-consuming  and  diverts  the
attention of management and other personnel.

Political,   economic  and  regulatory  risks   associated  with   international
operations may limit our ability to do business abroad.

         A substantial number of our manufacturers,  customers and suppliers are
located  outside  of the  United  States,  principally  in  the  Far  East.  Our
international  operations  are  subject to  political  and  economic  conditions
abroad,  and  protectionist  trade  legislation  in either the United  States or
foreign countries, such as a change in the current tariff structures,  export or
import  compliance  laws, or other trade policies,  any of which could adversely
affect our ability to  manufacture  or sell  displays in foreign  markets and to
purchase  materials or equipment from foreign  suppliers.  All of our agreements
with  customers  are  governed  by foreign  law and  therefore,  are  subject to
uncertainty with regard to their enforceability.
Risks related to doing business in China may negatively affect our business.

         Our  business  is  subject  to   significant   political  and  economic
uncertainties  and may be adversely  affected by political,  economic and social
developments in China.  Over the past several years, the Chinese  government has
pursued economic reform policies including the encouragement of private economic
activity and greater economic  decentralization.  The Chinese government may not
continue  to  pursue  these  policies  or may  significantly  alter  them to our
detriment from time to time with little, if any, prior notice.

         A lack of adequate  remedies and  impartiality  under the Chinese legal
system may  adversely  impact our ability to do business in China and to enforce
the agreements or purchase orders to which we are, or may become, a party.

         At various times during recent years,  the United States and China have
had  significant  disagreements  over  political,  economic  and social  issues.
Controversies may arise in the future between these two countries. Any political
or trade  controversies  between  the United  States  and China,  whether or not
directly  related to our  business,  could  adversely  affect our  ability to do
business in China.

We do not pay cash dividends.

         We have never paid any cash  dividends on our Common  Shares and do not
anticipate  that we will pay cash  dividends  in the near  future.  Instead,  we
intend to apply any future  earnings to the  expansion  and  development  of our
business.

                                ABOUT SPATIALIGHT

         We  manufacture  microdisplays  that  provide  high  resolution  images
suitable for applications  such as high definition  television,  rear projection
computer monitors and video projectors, and potential applications such as those
used in wireless communication  devices,  portable games and digital assistants.
Our  microdisplays  are designed  for use in end products of original  equipment
manufacturers,  and therefore we work closely with customers to incorporate  our
microdisplays  into their final products.  While in the past we have had working
arrangements  with several  independent  liquid crystal  display  fabricators to
manufacture  certain of our prototype  products,  we are now  manufacturing  our
microdisplays  ourselves  in a 500 square  foot Class 100  cleanroom  and a 1200
square foot Class 1000 cleanroom.  By reason of these current  arrangements,  we
have  enhanced  quality  control and we have more  effective  protection  of our
proprietary  technology in our products.  Internal  manufacturing  is subject to
certain risks described under "Risk Factors." We have patents  covering parts of
our designs;  however,  the key designs of the  circuitry in the silicon,  drive
electronics,  and liquid crystal  assembly  techniques are  proprietary  and not
covered by patents.

         Our microdisplays are high-resolution liquid crystal displays. They are
constructed  with a silicon  chip, a layer of liquid  crystals and a glass cover
plate in contrast to the more common  construction of liquid crystals sandwiched
between two glass plates. These displays are also known as and commonly referred
to as liquid crystal  displays  (LCD),  active matrix liquid  crystal  displays,
liquid crystal on silicon (LCoS), and spatial light modulators.
The image on a  microdisplay  can be  projected  onto a screen or other
surface for individual or group viewing or used in a portable  application  that
is  viewed  through a  magnifying  device  similar  to a  viewfinder.  Potential
microdisplay applications include:

         o        large-screen   rear-projection  television  systems,  in  both
                  standard  television  format  and high  definition  television
                  formats;

         o        large-screen rear-projection computer monitors in a variety of
                  resolutions;

         o        video projectors for presentations;

         o        head-mounted  displays  which  are  used for  virtual  reality
                  systems, defense, aerospace and gaming applications; and

         o        other  potential   applications  such  as  point  of  purchase
                  displays, optical computing and data storage.

         Our technology  uses liquid crystals and silicon chips. An advantage of
these  materials is that  processes  for working with them are already known and
they  may  be  produced  more  quickly  than  competing   technologies  offering
comparable quality.  By using existing  manufacturing  processes,  we believe we
will be able to obtain  economies of scale.  We are currently  working with Fuji
Photo  Optical   Company  for  the   manufacture  of  light  engines  using  our
microdisplays to be sold to our customers.

         Since late  October  2001,  we have entered  into seven  agreements  or
memoranda of understanding  with eight OEMs in China  contemplating the purchase
by  these  prospective   customers  of  our  display  units  and/or  SpatiaLight
imagEngine(TM)  microdisplays for use in certain of their products. All of these
agreements  require  that we  supply  prototypes  of our  display  units  and/or
SpatiaLight  imagEngine(TM)  microdisplays and that they meet technical criteria
satisfactory to each of such prospective customers. Two of these agreements have
resulted in purchase  orders,  the terms of which are described below under this
caption.  We are  currently  negotiating  the terms of  purchase  orders for our
display units and/or SpatiaLight  imagEngine(TM)  microdisplays with four of the
other prospective Chinese customers.

         In  addition,  in January and June 2003,  we entered  into  preliminary
agreements with two OEMs in the Republic of South Korea. One of these agreements
requires  that we  supply  a  prototype  of our  display  unit  and that it meet
technical criteria satisfactory to the prospective customer.  The agreement with
the other South Korean OEM is an agreement to jointly  develop a high definition
television  incorporating a SpatiaLight  microdisplay  device. We have delivered
the  requisite  prototypes to both South Korean OEMs and we have been advised by
both that  testing  of such  prototypes  is in  progress.  In the event that the
technical  criteria  are  satisfactory  to  the  prospective   customer,   these
agreements  provide for a market testing period where the  prospective  customer
has  the  opportunity  to  evaluate  the  performance  of  our  product  in  the
marketplace.

         The  following  is the  current  status  of each of the  agreements  or
memoranda of understanding:

         Skyworth Display Ltd. (Skyworth)

         In late January 2003, we concluded  negotiations with Skyworth,  one of
the  Chinese  OEMs with  which we had an  agreement  to test  prototypes  of our
microdisplay  products,  resulting  in a signed  agreement  for the  purchase by
Skyworth of 14,100 display units from us during a one year delivery period.  The
purchase order originally provided for 200 units to be delivered in February and
an  additional  200  units in each of March  and  April  2003.  Skyworth  and we
subsequently agreed to delay the first delivery of units. As of the date of this
prospectus,  we have  completed  partial  shipment  of the 200 units  originally
scheduled  for  delivery in the first  month.  Following  the  initial  delivery
provisions of 200 units per month for the first three  months,  we are scheduled
to deliver 1,500 units per month until the order is  completed.  Pursuant to the
terms of the  purchase  order,  the  obligations  of Skyworth  will be backed by
letters of credit in our favor.  The purchase order is cancelable by Skyworth on
a quarterly  basis and is subject to pricing  contingencies  and other customary
terms and conditions.
China Electronics Corporation (CEC)

         In September  2003 we announced  that we signed an agreement with China
Electronics  Corporation (CEC), another of the Chinese OEMs with which we had an
agreement to test prototypes of our microdisplay  products,  for the purchase by
CEC of 2,000  display  units  from us.  The  agreement  provides  for an initial
delivery of ten display units,  which was completed in September,  with a second
delivery of 100 units to follow.  Additional shipments will be made periodically
according to a schedule to be  determined  by CEC and us. The purchase  order is
cancelable by CEC after delivery of 110 units and is subject to other  customary
terms and conditions.

         Shanghai  Information  Industry Co. Ltd. (SVA), Hisense Electronic Co.,
Ltd.  (Hisense),  Shanghai  China  Display Co., Ltd.  (China  Display) and Panda
Electronics Group Co. Ltd. (Panda)

         We are  currently  negotiating  the terms of  purchase  orders  for our
products with four of our prospective  Chinese customers - SVA,  Hisense,  China
Display and Panda.  There are significant open issues that are being negotiated,
including  prices and  quantities of our products.  We cannot assure  whether we
will receive  purchase  orders binding on all four or any of these companies for
their purchase of commercial  quantities of our microdisplay products commencing
in the near  future.  Even  assuming  that we receive  purchase  orders that are
binding  on the  prospective  customers,  these  orders  and our  sales to these
customers are subject to certain contingencies described under "Risk Factors."

         Sichuan Changhong Electric Co. (Changhong)

         We are currently preparing to ship the requisite prototype display unit
to Changhong  for testing  purposes.  Even if the testing of our display unit is
satisfactory  to Changhong,  we cannot assure  whether we will receive  purchase
orders  binding on Changhong  for its purchase of  commercial  quantities of our
microdisplay  products.  Even assuming that we receive a purchase  order that is
binding on  Changhong,  this  order and our sales to  Changhong  are  subject to
certain contingencies described under "Risk Factors."

         South Korean OEMs

         The  agreement  with one South  Korean  OEM  requires  that we supply a
prototype of our display unit and that it meet technical  criteria  satisfactory
to the prospective customer. The agreement with the other South Korean OEM is an
agreement  to  jointly  develop a high  definition  television  incorporating  a
SpatiaLight  microdisplay  device.  We have shipped the requisite  number of our
prototype display units to these South Korean prospective  customers and we have
been advised by both companies  that they are conducting  testing of the display
units.  Even if the testing of our display  units is  satisfactory  to the South
Korean OEMs, we cannot assure whether we will receive purchase orders binding on
both or either of these companies for their purchase of commercial quantities of
our microdisplay  products  commencing in the near future. Even assuming that we
receive  purchase  orders that are binding on the prospective  customers,  these
orders and our sales to these  customers  are  subject to certain  contingencies
described under "Risk Factors."
May Transaction

         On May 28, 2003 we  completed a private sale of 2,796,328 of our Common
Shares and warrants to purchase 699,080 Common Shares for an aggregate  purchase
price of $5.15 million,  with five  purchasers,  including  Robert A. Olins, our
Acting Chief  Executive  Officer and a director of  SpatiaLight,  who  purchased
1,357,441 shares and acquired  warrants to purchase  339,360 shares.  The shares
and warrants in the May Transaction were included in a currently  effective Form
S-3  Registration  Statement  pursuant  to  registration  rights  granted to the
purchasers in that transaction. Funds from the May Transaction have been used to
reduce our  liabilities  and are being used for  working  capital  purposes.  In
addition, warrants to purchase 77,126 Shares were granted to the placement agent
for the May Transaction.

         August Transaction

         On August 19, 2003 we  completed  a private  sale of  1,212,061  of our
Common  Shares and warrants to purchase  303,015  Common Shares for an aggregate
purchase  price  of  $2.76  million,  with  six  purchasers,  none of whom is an
affiliate of the Company. The shares and warrants in the August Transaction were
included in a currently  effective Form S-3 Registration  Statement  pursuant to
registration rights granted to the purchasers in that transaction.  In addition,
warrants to purchase  48,482 Shares were granted to the placement  agent for the
financing.  Funds from the August Transaction are being used for working capital
purposes.

State of Incorporation and Principal Office

         We were  incorporated  under the laws of the State of New York in 1989.
Our executive offices are located at Five Hamilton  Landing,  Suite 100, Novato,
California 94949.

                                 USE OF PROCEEDS

         We will not  receive  any of the  proceeds  from the sale of the Shares
being offered hereby for the account of the Selling Shareholders.  Such proceeds
will be received  by the  Selling  Shareholders.  However,  we will  receive the
proceeds of the exercise of the options held by these  Selling  Shareholders  to
the extent that such options are exercised. There can be no assurance concerning
the  number  or the  timing  of the  exercise  of such  options  by the  Selling
Shareholders at this date.
SELLING SHAREHOLDERS

         The following table sets forth with respect to each Selling Shareholder
the number of Common Shares beneficially owned as of October 3, 2003, the number
of Shares being offered pursuant to this Prospectus, the number of Common Shares
owned after the offering and the percentage of the Common Shares owned after the
offering.
Percentage of
                                      Number of                               Number of Common       Common Shares
       Name of Selling           Common Shares Owned     Number of Shares    Shares Owned After     Owned after the
         Shareholder            Prior to the Offering     Being Offered      the Offering/1/           Offering
         -----------            ---------------------     -------------      -------------             --------
Robert A. Olins/2/                      6,904,441              750,000              6,154,441           19.71%
Steven F. Tripp/3/                        373,457              150,000                223,457             .72%
Theodore H. Banzhaf/4/                          0              800,000                      0            0.00%

            TOTAL                       7,277,898            1,700,000              6,377,898           20.42%
                                        =========            =========              =========          =======
We assume  that the Selling  Shareholders  will seek to sell all of the
Shares offered under this  Prospectus,  but we are unable to determine the exact
number of Shares that will actually be sold or whether and to what extent any of
the Selling  Shareholders  will exercise the warrants referred to under "Selling
Shareholders."  However, the right to purchase the Shares under the options will
be forfeited unless exercised before October 18, 2010, October 18, 2010 and July
7, 2006, respectively, the expiration date of such options.

                          DESCRIPTION OF COMMON SHARES

         Our Restated Certificate of Incorporation,  as amended,  authorizes the
issuance of up to 50,000,000  Common  Shares,  $.01 par value.  As of October 3,
2003, 31,226,869 Common Shares were issued and outstanding.

         The holders of our Common Shares have equal ratable rights to dividends
from funds  legally  available  therefor,  when and if  declared by our Board of
Directors and are entitled to share  ratably in all of our assets  available for
distribution  to holders of Common Shares upon the  liquidation,  dissolution or
winding up of our affairs.  We have not paid,  and have no current plans to pay,
dividends on our Common Shares. Holders of our Common Shares are entitled to one
vote per share on all matters  which  shareholders  are entitled to vote upon at
all  meetings of  shareholders.  All  outstanding  Common  Shares are, and those
offered   hereby  will  be  when  issued,   validly   issued,   fully  paid  and
nonassessable.  The holders of our Common Shares do not have  cumulative  voting
rights, which means that the holders of more than 50% of such outstanding Common
Shares can elect all of our directors then standing for election.

--------------------
/1/      Assumes the sale by each Selling Shareholder,  as part of the offering,
         of all of the  Shares  subject  to  Options  included  in this  Reoffer
         Prospectus held by such Selling  Shareholder,  as to which there can be
         no assurance.

/2/      Includes  2,376,000 Shares  beneficially owned subject to conversion of
         principal  and  interest of  convertible  notes held by Argyle  Capital
         Management Corporation,  of which Mr. Olins is President and over which
         Mr. Olins exercises  voting  control.  Also includes  2,275,000  Shares
         subject  to  outstanding  stock  options  held by Mr.  Olins  that were
         exercisable  as of June 30, 2003,  and also includes  1,357,411  Common
         Shares  which were  purchased  in a private  purchase  transaction  and
         349,864  Common Shares  issuable  upon exercise of warrants  which were
         acquired in the same private purchase transaction

/3/      Includes  175,000 Shares  subject to outstanding  stock options held by
         Mr. Tripp that were  exercisable as of April 23, 2003 and 50,000 Shares
         subject to  options  not  exercisable  within 60 days.  142,857  Shares
         issuable upon conversion of principal and interest of convertible notes
         held by the Steven F. Tripp Trust are not  included.  Steven F. Tripp a
         director  of the Company and  beneficiary  of the Trust,  does not have
         voting or dispositive power over these shares.

/4/      Mr. Banzhaf is Executive Vice President of the Company.
The American Stock Transfer Company, 59 Maiden Lane, New York, New York
10038, is the transfer agent and registrar for our Common Shares.

                              PLAN OF DISTRIBUTION

         All  restrictions  under the  Securities Act (and legends on the Shares
evidencing  such  restrictions)  on  the  Shares  to  be  sold  by  the  Selling
Shareholders  are  to be  removed  upon  and  as of the  effective  date  of the
Registration Statement of which this Prospectus is a part.

         The Shares may be sold from time to time  following the effective  date
by the Selling  Shareholders,  or by any of their pledgees,  donees,  assignees,
transferees  or other  successors in interest.  Such sales may be made on one or
more exchanges or in the over-the-counter market, or otherwise, at prices and at
terms then  prevailing or at prices related to the then current market price, or
in  negotiated  transactions.  The  Shares  may be  sold  by one or  more of the
following,   without  limitation:   (a)  ordinary  brokerage   transactions  and
transactions in which the broker-dealer solicits purchasers; (b) block trades in
which  the  broker-dealer  will  attempt  to sell the  Shares  as agent  but may
position  and  resell a portion  of the block as  principal  to  facilitate  the
transaction;  (c)  purchases by a  broker-dealer  as principal and resale by the
broker-dealer for its account;  (d) an exchange  distribution in accordance with
the rules of the applicable exchange; (e) privately negotiated transactions; (f)
settlement  of short  sales;  (g)  broker-dealers  may  agree  with the  Selling
Stockholders to sell a specified number of such Shares at a stipulated price per
Share;  (h) a combination  of any such methods of sale; and (i) any other method
permitted  pursuant to applicable  law. In addition,  any securities  covered by
this  Prospectus  which  qualify for sale pursuant to Rule 144 may be sold under
Rule 144 rather than pursuant to this Prospectus, as supplemented.  From time to
time the Selling Shareholders may engage in short sales, short sales against the
box, puts and calls and other  transactions  in our  securities  or  derivatives
thereof, and may sell and deliver the Shares in connection therewith. The Shares
may  also be used to  settle  short  sales to the  extent  permitted  under  the
Securities Act.

         From time to time the  Selling  Shareholders  may pledge  their  Shares
pursuant to the margin provisions of their respective  customer  agreements with
their respective brokers.  Upon a default by a Selling  Shareholder,  the broker
may offer and sell the pledged  Shares from time to time under the Prospectus or
amendment  to this  Prospectus,  subject to  relevant  rules of the SEC or under
other applicable provisions of the Securities Act.

         All fees and expenses  incurred in connection with the  registration of
the Shares,  including  but not  limited to all  registration  and filing  fees,
printing expenses and fees of the Company's  counsel and accountants,  are to be
borne by the Company.  The Selling Shareholders shall bear the cost of brokerage
commissions  and dealers,  discounts and any taxes to be paid, by reason of such
transactions.

         The Selling  Shareholders and the brokers or dealers through whom sales
of the Shares are made, may be deemed to be "underwriters" within the meaning of
Section  2(11) of the  Securities  Act of 1933,  as amended.  In  addition,  any
profits  realized by the Selling  Shareholders or such brokers or dealers may be
deemed to be underwriting commissions.

         We have informed the Selling  Shareholders  that the  anti-manipulative
provisions of Regulation M promulgated under the Exchange Act may apply to their
sales of Shares and has furnished the Selling  Shareholders  with a copy of that
regulation  and  have  also  informed  the  Selling  Shareholders  of the  rules
governing the required  delivery of copies of this Prospectus in connection with
the sale of such Shares.
There is no assurance that the Selling Shareholders will offer for sale
or sell any or all of the Shares  offered  pursuant to this  Prospectus.  In the
event the Shares are sold by the Selling  Shareholders,  we will not receive any
of the proceeds from any such sale, except for the payment to us of the exercise
price of the outstanding warrants referred to under "Selling Shareholders."

                                  LEGAL MATTERS

         The legality of the Shares  offered by this  Prospectus is being passed
upon by Bryan Cave LLP, New York, New York.

                                     EXPERTS

         The financial  statements  incorporated by reference in this Prospectus
have been audited by BDO Seidman, LLP, independent certified public accountants,
to the extent and for the periods set forth in their report  (which  contains an
explanatory  paragraph  regarding the  Company's  ability to continue as a going
concern) and are incorporated herein in reliance upon such report given upon the
authority of said firm as experts in auditing and accounting.

                         WHERE TO FIND MORE INFORMATION

         We are a  reporting  company  and file  annual,  quarterly  and special
reports, proxy statements and other information with the Securities and Exchange
Commission,  or the SEC. These reports,  proxy statements and other  information
filed with the SEC may be inspected and copied at the SEC Public Reference Room,
450 Fifth Street, N.W., Washington, D.C. 20549.

         You may  obtain  information  about  the  operation  of the SEC  Public
Reference  Room by calling  1-800-SEC-0330.  You may also inspect this  material
free of charge at the SEC's  web site at  http://www.sec.gov.  Finally,  you may
also inspect reports and other information concerning SpatiaLight at the offices
of the National Association of Securities Dealers, Inc., Market Listing Section,
1735 K Street,  N.W.,  Washington,  D.C.  20006.  SpatiaLight  Common Shares are
traded on The Nasdaq  SmallCap  Market  under the symbol  "HDTV".  SpatiaLight's
Internet web site is located at http://www.spatialight.com.

                       DOCUMENTS INCORPORATED BY REFERENCE

         The SEC allows us to  "incorporate  by reference"  information  that we
file with them which means that we can disclose important  information to you by
referring you to those documents.  The information  incorporated by reference is
an important part of this  Prospectus and information we later file with the SEC
will  automatically  update  and  supersede  this  information.   The  following
documents filed by us with the SEC (File No. 000-19828) are incorporated in this
Prospectus by reference:

         o        Annual  Report  on Form  10-KSB  for  the  fiscal  year  ended
                  December 31, 2002, filed on April 15, 2003.

         o        The  description  of  our  Common  Shares   contained  in  our
                  Registration  Statement  on Form  8-A  filed  with  the SEC on
                  February  5,  1992,  under  Section  12 of the  Exchange  Act,
                  including  any  amendment  or report  filed for the purpose of
                  updating that description.
o        Quarterly  Reports on Form 10-Q for the fiscal  quarters ended
                  March 31,  2003 and June 30,  2003,  filed on May 15, 2003 and
                  August 14, 2003, respectively.

         All documents  filed by us with the SEC under Section 13(a),  13(c), 14
or 15(d) of the Exchange Act  following the date of this  Prospectus  and before
the  termination  of the offering of the Shares under this  Prospectus  shall be
considered  incorporated  by reference in this  Prospectus and be a part of this
Prospectus  from  the  date of the  filing  of  such  documents.  Any  statement
contained  herein or in a document  incorporated by reference in this Prospectus
shall be deemed to be modified or superseded for purposes of this  Prospectus to
the extent that a statement contained in any subsequently filed document,  which
also  is  considered  to  be  incorporated  by  reference  herein,  modifies  or
supersedes such prior statement.  Any statement modified or superseded shall not
be considered,  except as so modified or superseded,  to constitute part of this
Prospectus.  We will  provide  without  charge  to  each  person  to  whom  this
Prospectus  is delivered,  upon request,  a copy of any and all of the documents
that have been  incorporated by reference in this Prospectus or the registration
statement   (other  than  exhibits  to  such  documents   unless   exhibits  are
specifically  incorporated by reference into such  documents).  Any such request
should be  directed  to the  Assistant  Secretary  of  SpatiaLight,  Inc.,  Five
Hamilton  Landing,   Suite  100,  Novato,   California  94949  (telephone  (415)
883-1693).

              DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION
                         FOR SECURITIES ACT LIABILITIES

         Our  Bylaws  provide  that we will  indemnify  (a) any  person  made or
threatened  to be made a party to any action or proceeding by reason of the fact
that  he,  his  testator  or  intestate,  is or was a  director  or  officer  of
SpatiaLight  and (b) any director or officer of SpatiaLight who served any other
company in any capacity at the request of SpatiaLight,  in the manner and to the
maximum  extent set forth in the  Business  Corporation  Law of the State of New
York; and  SpatiaLight  may at the  discretion of the Board  indemnify all other
corporate personnel to the extent permitted by law.

         In addition, our Certificate of Incorporation provides that no director
shall be liable to SpatiaLight or its shareholders for damages for any breach of
duty in such capacity.  However,  such provision does not eliminate or limit the
liability of any director if a judgment or other final  adjudication  adverse to
him or her  establishes  that his or her acts or omissions  were in bad faith or
involved  intentional  misconduct  or a  knowing  violation  of law or  that  he
personally  gained a financial  profit or other advantage to which he or she was
not  legally  entitled or that his or her acts  violated  Section 719 of the New
York Business  Corporation Law (relating to the making of illegal  distributions
to shareholders or loans to directors).

         At present,  there is no pending  litigation or proceeding  involving a
director,   officer,  employee  or  other  agent  of  SpatiaLight  as  to  which
indemnification  is being sought nor are we aware of any  threatened  litigation
that may result in claims for indemnification by any director, officer, employee
or other agent.

         Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors,  officers or persons controlling  SpatiaLight
as provided above, we have been informed that, in the opinion of the Commission,
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable.
================================================================================
WE HAVE NOT AUTHORIZED ANYONE TO GIVE ANY INFORMATION OR MAKE ANY REPRESENTATION
OTHER THAN THOSE CONTAINED OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS.  YOU
SHOULD  RELY  ONLY  ON  THE  INFORMATION  CONTAINED  IN  THIS  PROSPECTUS.   THE
INFORMATION  IN THIS  PROSPECTUS  IS CORRECT AS OF THE DATE OF THIS  PROSPECTUS.
DELIVERY OF THIS  PROSPECTUS  AFTER THE DATE INDICATED  BELOW DOES NOT MEAN THAT
THE INFORMATION IS STILL CORRECT AS OF ANY SUBSEQUENT DATE.

                                SPATIALIGHT, INC.

                             1,700,000 COMMON SHARES

                                   PROSPECTUS

                                 October 9, 2003

================================================================================
PART I

              INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS

Items 1 and 2. Plan Information; Registrant Information and Employee Plan Annual
               Information.

         The   document(s)   containing   the   information   specified  in  the
instructions  to Part I of Form  S-8  will be sent or  given  to the  respective
participants in the Robert A. Olins Option Plan, Steven F. Tripp Option Plan and
TARSAP as specified by Rule 428(b)(1). In addition, the statement required to be
made  pursuant to Item 2 of Part I to Form S-8 shall be contained in each of the
Section 10(a) prospectuses.

                                     PART II

               INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3.  Incorporation of Documents by Reference.

         The  following  documents  filed  by  SpatiaLight,  Inc.,  a  New  York
corporation  (the "Company"),  with the Securities and Exchange  Commission (the
"Commission") are incorporated in this Registration Statement by reference:

         1.       Annual  Report  on Form  10-KSB  for  the  fiscal  year  ended
                  December 31, 2002.

         2.       Quarterly Reports on Form 10-Q for the quarterly periods ended
                  March 31, 2003, and June 30, 2003.

         3.       The  description  of  our  Common  Shares   contained  in  our
                  Registration  Statement  on Form  8-A  filed  with  the SEC on
                  February  5,  1992,  under  Section  12 of the  Exchange  Act,
                  including  any  amendment  or report  filed for the purpose of
                  updating that description.

         All documents filed subsequent to the filing date of this  Registration
Statement with the Commission by the Company pursuant to Sections 13(a),  13(c),
14 and 15(d) of the  Securities  Exchange Act of 1934, as amended (the "Exchange
Act"),  prior to the filing of a  post-effective  amendment which indicates that
all securities  offered by this  Registration  Statement have been sold or which
de-registers  all such securities then remaining  unsold,  shall be deemed to be
incorporated by reference in this Registration Statement and to be a part hereof
from the date of the filing of such  documents.  Any  statement  contained  in a
document  incorporated or deemed to be incorporated herein by reference shall be
deemed to be modified or superseded for purposes of this Registration  Statement
to the extent  that a  statement  contained  herein or in any  subsequent  filed
document  which also is, or is deemed to be,  incorporated  by reference  herein
modifies or supersedes such prior  statement.  Any such statement so modified or
superseded  shall  not be  deemed,  except  as so  modified  or  superseded,  to
constitute a part of this Registration Statement, except as indicated herein.

Item 4.  Description of Securities.

         Not applicable.

                                       1
Item 5.  Interests of Named Experts and Counsel.

         Not applicable.

Item 6.  Indemnification of Directors and Officers.

         Our  Bylaws  provide  that we will  indemnify  (a) any  person  made or
threatened  to be made a party to any action or proceeding by reason of the fact
that  he,  his  testator  or  intestate,  is or was a  director  or  officer  of
SpatiaLight  and (b) any director or officer of SpatiaLight who served any other
company in any capacity at the request of SpatiaLight,  in the manner and to the
maximum  extent set forth in the  Business  Corporation  Law of the State of New
York; and  SpatiaLight  may at the  discretion of the Board  indemnify all other
corporate personnel to the extent permitted by law.

         In addition, our Certificate of Incorporation provides that no director
shall be liable to SpatiaLight or its shareholders for damages for any breach of
duty in such capacity.  However,  such provision does not eliminate or limit the
liability of any director if a judgment or other final  adjudication  adverse to
him or her  establishes  that his or her acts or omissions  were in bad faith or
involved  intentional  misconduct  or a  knowing  violation  of law or  that  he
personally  gained a financial  profit or other advantage to which he or she was
not  legally  entitled or that his or her acts  violated  Section 719 of the New
York Business  Corporation Law (relating to the making of illegal  distributions
to shareholders or loans to directors).

         At present,  there is no pending  litigation or proceeding  involving a
director,   officer,  employee  or  other  agent  of  SpatiaLight  as  to  which
indemnification  is being sought nor are we aware of any  threatened  litigation
that may result in claims for indemnification by any director, officer, employee
or other agent.

         Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors,  officers or persons controlling  SpatiaLight
as provided above, we have been informed that, in the opinion of the Commission,
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable.

Item 7.  Exemption from Registration Claimed.

         Not applicable.

Item 8.  Exhibits.

4.1      SpatiaLight, Inc. 1999 Stock Option Plan, as amended.

4.2      Robert A. Olins Option to Purchase Common Shares.

4.3      Steven F. Tripp Option to Purchase Common Shares.

4.4      Theodore H. Banzhaf Time Accelerated Restricted Stock Award Plan.

5.1      Opinion of Bryan Cave LLP.

23.1     Consent of BDO Seidman, LLP, independent certified public accountants.

23.2     Consent of Bryan Cave LLP (included as part of Exhibit 5.1).

24.1     Power of Attorney (included on signature page).

                                       2
Item 9.  Undertakings.

         (a) The undersigned registrant hereby undertakes:

                  (1) To file,  during any  period in which  offers or sales are
being made, a post-effective amendment to this Registration Statement:

                           (i) To include  any  prospectus  required  by Section
10(a)(3) of the Securities Act of 1933,
as amended (the "Securities Act");

                           (ii) To reflect in the prospectus any facts or events
arising after the effective date of
this Registration Statement (or the most recent post-effective amendment hereof)
which,  individually or in the aggregate,  represent a fundamental change in the
information set forth in this Registration Statement; and

                           (iii)  To  include  any  material   information  with
respect to the plan of distribution not
previously  disclosed in this  Registration  Statement or any material change to
such  information  in  this  Registration  Statement;  provided,  however,  that
paragraphs  (1)(a)(i) and (1)(a)(ii) will not apply if the information  required
to be included in a post-effective amendment by those paragraphs is contained in
periodic reports filed by the registrant pursuant to Section 13 or Section 15(d)
of the Exchange  Act that are  incorporated  by  reference in this  Registration
Statement.

                  (2) That, for the purpose of determining  any liability  under
the Securities Act, each such  post-effective  amendment shall be deemed to be a
new registration  statement relating to the securities offered therein,  and the
offering of such  securities at that time shall be deemed to be the initial bona
fide offering thereof.

                  (3) To remove from  registration by means of a  post-effective
amendment  any of the  securities  being  registered  which remain unsold at the
termination of the offering.

         (b) The  undersigned  registrant  hereby further  undertakes  that, for
purposes of determining  any liability  under the Securities Act, each filing of
the registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act that is  incorporated by reference in this  Registration  Statement
shall be deemed to be a new  registration  statement  relating to the securities
offered  therein,  and the  offering  of such  securities  at that time shall be
deemed to be the initial bona fide offering thereof.

         (c)  Insofar  as  indemnification  for  liabilities  arising  under the
Securities Act may be permitted to directors,  officers and controlling  persons
of the registrant  pursuant to the foregoing  provisions  described under Item 6
above, or otherwise,  the registrant has been advised that in the opinion of the
Commission  such  indemnification  is against  public policy as expressed in the
Securities Act and is, therefore,  unenforceable.  In the event that a claim for
indemnification  against  such  liabilities  (other  than  the  payment  by  the
registrant of expenses  incurred or paid by a director,  officer or  controlling
person of the  registrant  in the  successful  defense  of any  action,  suit or
proceeding)  is  asserted by such  director,  officer or  controlling  person in
connection with the securities being registered,  the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit  to a  court  of  appropriate  jurisdiction  the  question  whether  such
indemnification  by it is against  public policy as expressed in the  Securities
Act and will be governed by the final adjudication of such issue.

                                       3
SIGNATURES

         Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the  requirements  for  filing  on  Form  S-8 and has  duly  caused  this
Registration Statement to be signed on its behalf by the undersigned,  thereunto
duly authorized, in the City of Novato, State of California, on October 9, 2003.

                                       SPATIALIGHT, INC.

                                       By: /s/ ROBERT A. OLINS
                                           -------------------------------------
                                           Robert A. Olins, Acting Chief
                                           Executive Officer

                                       By: /s/ TIMOTHY V. DESCAMPS
                                           -------------------------------------
                                           Timothy V. Descamps, Chief
                                           Financial Officer

                                POWER OF ATTORNEY

         KNOW ALL PERSONS BY THESE  PRESENTS,  that each person whose  signature
appears below  constitutes  and appoints Robert A. Olins, as his or her true and
lawful   attorney-in-fact  and  agent,  with  full  power  of  substitution  and
resubstitution,  for him or her and in his or her name,  place and stead, in any
and all  capacities,  to sign any and all amendments  (including  post-effective
amendments)  to this  Registration  Statement on Form S-8, and to file the same,
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange  Commission,  granting unto said  attorneys-in-fact  and
agents,  and each of them,  full power and  authority to do and perform each and
every act and thing requisite and necessary to be done in connection  therewith,
as fully to all intents  and  purposes as he or she might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

         Pursuant to the requirements of the Securities Act of 1933, as amended,
this  Registration  Statement  has been signed by the  following  persons in the
capacities and on the dates indicated.
Signature                                    Title                                  Date
               ---------                                    -----                                  ----
/s/ ROBERT A. OLINS                      Acting Chief Executive Officer, Secretary,         October 9, 2003
---------------------------------        Treasurer and Director
Robert A. Olins

*/s/ Lawrence J. Matteson                Director                                           October 9, 2003
 --------------------------------
 Lawrence J. Matteson

*/s/ Steven F. Tripp                     Director                                           October 9, 2003
 --------------------------------
 Steven F. Tripp

*/s/ Claude Piaget                       Director                                           October 9, 2003
 --------------------------------
 Claude Piaget

*By: /s/ ROBERT A. OLINS                                                                    October 9, 2003
     -------------------
     Robert A. Olins
     (Attorney-in-fact)
4
EXHIBIT INDEX

No.      Document
---      --------

4.1      SpatiaLight, Inc. 1999 Stock Option Plan, as amended.

4.2      Robert A. Olins Option to Purchase Common Shares.

4.3      Steven F. Tripp Option to Purchase Common Shares.

4.4      Theodore H. Banzhaf Time Accelerated Restricted Stock Award Plan.

5.1      Opinion of Bryan Cave LLP.

23.1     Consent of BDO Seidman, LLP, independent certified public accountants.

23.3     Consent of Bryan Cave LLP (included as part of Exhibit 5.1).

24.1     Power of Attorney (included on signature page).