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


                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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


                                    FORM 8-K

                                 CURRENT REPORT

     Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934


                          Date of Report: July 30, 1997
                        (Date of earliest event reported)

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


                        VIDEO LOTTERY TECHNOLOGIES, INC.
             (Exact name of registrant as specified in its charter)



   DELAWARE                          0-19322                    81-0470853
(State or other                    (Commission               (I.R.S. Employer   
jurisdiction                       file number)              Identification No.)
of incorporation 
or organization)

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


                              2311 South 7th Avenue
                             Bozeman, Montana 59715
                     (Address of principal executive office)

                                 (406) 585-6600
              (Registrant's telephone number, including area code)


                                                                          Page 1
--------------------------------------------------------------------------------

<PAGE>
                                                         



Item 6.           Resignation of Registrant's Director.
-------           -------------------------------------

     (a) On June 18, 1997, the Board of Directors of Video Lottery Technologies,
Inc.  ("VLT" or the "Company")  determined not to nominate  William P. Lyons for
re-election  to the Board of Directors  ("Board") at the  Company's  next annual
stockholders meeting,  which had been tentatively scheduled for August 21, 1997.
Subsequently, in a letter to the Board dated July 30, 1997 ("Lyons Letter"), Mr.
Lyons  informed  the Board of his  decision to resign as a  director,  effective
immediately.  Mr.  Lyons  indicated  that he was  resigning  as a result  of his
disagreement  with  certain  policies  and actions of the Board.  The  following
summary of Mr.  Lyons'  description  of his  disagreement  is  qualified  in its
entirety by reference to the Lyons Letter, a copy of which is attached hereto as
Exhibit 17. As more fully discussed in Item 6 (b), below,  the Company  believes
that  the  Lyons  Letter  contains  numerous  statements  that  are  inaccurate,
incorrect  and/or  incomplete.  The summary of the Company's  views set forth in
Item 6 (b),  below,  is qualified in its entirety by reference to the  Company's
letter to Mr. Lyons dated August 6, 1997, a copy of which is attached  hereto as
Exhibit 99.

     In advising the Board of his resignation, Mr. Lyons alleged that the Board,
in his view,  had ignored  certain  principles of corporate  governance  and had
failed  to  conduct  itself  in a  manner  consistent  with the  obligations  of
directors  of  a  publicly-owned   company.  Mr.  Lyons  further  expressed  his
disagreement  with certain alleged  policies and practices of the Board that, in
his view,  resulted "... in the  entrenchment  and  enrichment of management and
certain  Board  members at the  expense of  stockholders,  and  subvert[ed]  the
independent supervisory role of a board of directors."

     Specifically, Mr. Lyons disagreed with: (1) the Board's handling of certain
payments made by the Company to International Equity Partners ("IEP"), a firm of
which the Company's Chairman,  Richard Burt, is a principal; and (2) the Board's
appointment of John Hardesty as a director, effective December 18, 1996, and its
decision to nominate Mr. Hardesty for re-election as a director at the Company's
next annual meeting of stockholders. In addition, as more particularly described
in the Lyons Letter, Mr. Lyons criticized the Board for its alleged  "systematic
quashing of independent review and supervision of management actions."

     (b) The Company believes that numerous  statements included in Lyons Letter
are inaccurate, incorrect and/or incomplete and therefore provides the following
statement  of its  views  regarding  matters  raised in the  Lyons  Letter.  The
following  statement is qualified in its entirety by reference to the  Company's
letter to Mr. Lyons, dated August 6, 1997, a copy of which is attached hereto as
Exhibit 99.



                                       1                                  Page 2
<PAGE>





     The Company  categorically  denies  that the Board  ignored  principles  of
responsible  corporate  governance  and  maintains  that the Board has conducted
itself at all times in a manner  entirely  consistent  with the obligations of a
Board of  Directors  of a  publicly  owned  company.  Furthermore,  the  Company
categorically  denies that any policy or  practice of the Board  resulted in the
entrenchment  or improper  enrichment  of  management or any Board member at the
expense  of  stockholders.  In the  Company's  view,  the  Board  has  played an
appropriate independent supervisory role with respect to the business affairs of
the Company and has fully and faithfully executed its fiduciary duties.

     Mr.  Lyons  served on the Board as a designee of director  and  stockholder
William Spier, pursuant to a stockholders  agreement between the Company and Mr.
Spier's  investor group. In August of 1996, Mr. Spier,  with Mr. Lyons' support,
asked  the Board to name him  Chief  Executive  Officer  of the  Company.  After
careful  consideration  by the Board,  which included input from  management and
other key stockholders,  the Board declined to name Mr. Spier CEO. Subsequently,
Messrs.  Spier and Lyons have disagreed with the Board on most matters and have,
from time to time, raised many of the issues outlined in the Lyons Letter.

     The Company believes that Mr. Lyons' concerns regarding certain payments by
the Company to IEP (which were first expressed at the time the Board declined to
name Mr. Spier as CEO) were thoroughly investigated by the Company's independent
auditors,  the Company's  Director of Internal Audit,  and  disinterested  board
members,  all of  which  concluded  that  the  matter  had  been  satisfactorily
resolved.  This issue, including the views of Messrs. Lyons and Spier, was fully
discussed in the Company's Proxy Statement dated December 31, 1996,  relating to
its most  recent  annual  stockholder's  meeting.  

     The  December  31, 1996 Proxy  Statement  also  encompasses  certain of the
concerns expressed by Mr. Lyons concerning Director John Hardesty.  With respect
to the Board's appointment of Mr. Hardesty,  the Board (except for Messrs. Lyons
and Spier) disagreed,  and continues to disagree, with the view of Messrs. Lyons
and Spier regarding Mr. Hardesty's  experience and  qualifications to serve as a
member of the Board of Directors. The Board (except for Messrs. Lyons and Spier)
believes that Mr. Hardesty is an experienced  businessman who brings distinction
and talent to the Board.  Moreover,  with respect to allegations made by Messrs.
Lyons and Spier regarding certain of Mr. Hardesty's securities trading activity,
the  Board  requested  and  then  carefully  reviewed  reports  prepared  by  an
independent board member and independent  outside  securities  counsel regarding
the legality of Mr. Hardesty's trading. Both reports concluded that Mr. Hardesty
had acted entirely legally.



                                         2                                Page 3
<PAGE>







     Finally,  the Company also vigorously  denies Mr. Lyons allegation that the
Board has in any way quashed  independent  review and  supervision of management
actions. None of the examples cited in the Lyons letter supports his conclusion,
first, under the Company's bylaws,  appropriate  responsibility for compensation
decisions lies with the Board.  Second,  the Board followed all  recommendations
made by the director of internal audit and its independent outside auditors with
respect to effective internal controls. Third, the Board's reconstitution of the
Audit and  Compensation  Committees was consistent with the Company's bylaws and
entirely proper.  Fourth, the Company's 1996 Proxy Statement complied fully with
all  federal  securities  law  requirements.  Finally,  the  Board  was under no
obligation to nominate Mr. Lyons for  re-election as a director and its decision
not to do so was based on a number of legitimate factors.  The Board (except for
Messrs.  Lyons and Spier) believes in good faith that it is in the Company's and
its  stockholders'  best interest that Mr. Lyons not continue as a member of the
Board.

     Further,  the Company  believes that Mr. Lyons'  suggestion  that he was an
independent  director is also misleading.  Mr. Lyons was a designee of Mr. Spier
and a representative  of Mr. Spier's investor group which owns  approximately 14
1/2% of the  Company's  common  stock,  and Mr.  Lyon  played a role in  various
matters of interest to Mr. Spier,  including the Spier group's offer to purchase
the Company in late 1996 and Mr.  Spier's  unsuccessful  attempt to be appointed
CEO earlier that year.

     The Company  believes that it is important to note the context in which Mr.
Lyons makes the statements  contained in the Lyons Letter.  He did not decide to
resign  and to submit  that  letter  until  after the Board had  decided  not to
nominate him for  re-election as a director.  In that light,  the Board views as
pretextual his asserted reasons for resigning.

     In addition,  while many of the allegations made in the Lyons Letter repeat
statements  made  earlier by either Mr.  Lyons or Mr.  Spier,  the Company  also
believes it important to note that none of these complaints surfaced until after
the Board had declined Mr. Spier's request to become Chief Operationg Officer.

     In sum,  the  Board  believes  that  Mr.  Lyons  has  attempted  to use his
resignation  as a  vehicle  to harass  the  Company,  which  the Board  views as
inconsistent with Mr. Lyons' responsibility as a director.



                                       3                                  Page 4
<PAGE>

Item 7.   Financial Statements and Exhibits.
-------   ----------------------------------

          (c)      Exhibits.

                   Exhibit 17  Letter to the Company from Mr. William P. Lyons,
                               dated July 30, 1997.

                   Exhibit 99  Letter from the Company to Mr. William P. Lyons,
                               dated August 6, 1997

































                                      4                                   Page 5
<PAGE>




                                   SIGNATURES

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



                                                VIDEO LOTTERY TECHNOLOGIES, INC.


                                                By:  /s/ Dennis Gallagher       
                                                   -----------------------------
                                                   Dennis Gallagher
                                                   General Counsel and Secretary
                                    (authorized to sign on behalf of Registrant)
Dated:  August 6, 1997



























                                         5                                Page 6
<PAGE>




                                  EXHIBIT INDEX


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

Exhibit 17     Letter to the Company from Mr. William P. Lyons,       8
               dated July 30, 1997.

Exhibit 99     Letter from the Company to Mr. William P. Lyons,       19
               dated August 6, 1997.




























                                         6                                Page 7
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--------------------------------------------------------------------------------

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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

                                    FORM 8-K

                                 CURRENT REPORT

     Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

                          Date of Report: July 30, 1997
                        (Date of earliest event reported)

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

                        VIDEO LOTTERY TECHNOLOGIES, INC.
             (Exact name of registrant as specified in its charter)

   DELAWARE                          0-19322                    81-0470853
(State or other                    (Commission               (I.R.S. Employer   
jurisdiction                       file number)              Identification No.)
of incorporation 
or organization)

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

                              2311 South 7th Avenue
                             Bozeman, Montana 59715
                     (Address of principal executive office)

                                 (406) 585-6600
              (Registrant's telephone number, including area code)

                                                                          Page 1
--------------------------------------------------------------------------------
Item 6.           Resignation of Registrant's Director.
-------           -------------------------------------

     (a) On June 18, 1997, the Board of Directors of Video Lottery Technologies,
Inc.  ("VLT" or the "Company")  determined not to nominate  William P. Lyons for
re-election  to the Board of Directors  ("Board") at the  Company's  next annual
stockholders meeting,  which had been tentatively scheduled for August 21, 1997.
Subsequently, in a letter to the Board dated July 30, 1997 ("Lyons Letter"), Mr.
Lyons  informed  the Board of his  decision to resign as a  director,  effective
immediately.  Mr.  Lyons  indicated  that he was  resigning  as a result  of his
disagreement  with  certain  policies  and actions of the Board.  The  following
summary of Mr.  Lyons'  description  of his  disagreement  is  qualified  in its
entirety by reference to the Lyons Letter, a copy of which is attached hereto as
Exhibit 17. As more fully discussed in Item 6 (b), below,  the Company  believes
that  the  Lyons  Letter  contains  numerous  statements  that  are  inaccurate,
incorrect  and/or  incomplete.  The summary of the Company's  views set forth in
Item 6 (b),  below,  is qualified in its entirety by reference to the  Company's
letter to Mr. Lyons dated August 6, 1997, a copy of which is attached  hereto as
Exhibit 99.

     In advising the Board of his resignation, Mr. Lyons alleged that the Board,
in his view,  had ignored  certain  principles of corporate  governance  and had
failed  to  conduct  itself  in a  manner  consistent  with the  obligations  of
directors  of  a  publicly-owned   company.  Mr.  Lyons  further  expressed  his
disagreement  with certain alleged  policies and practices of the Board that, in
his view,  resulted "... in the  entrenchment  and  enrichment of management and
certain  Board  members at the  expense of  stockholders,  and  subvert[ed]  the
independent supervisory role of a board of directors."

     Specifically, Mr. Lyons disagreed with: (1) the Board's handling of certain
payments made by the Company to International Equity Partners ("IEP"), a firm of
which the Company's Chairman,  Richard Burt, is a principal; and (2) the Board's
appointment of John Hardesty as a director, effective December 18, 1996, and its
decision to nominate Mr. Hardesty for re-election as a director at the Company's
next annual meeting of stockholders. In addition, as more particularly described
in the Lyons Letter, Mr. Lyons criticized the Board for its alleged  "systematic
quashing of independent review and supervision of management actions."

     (b) The Company believes that numerous  statements included in Lyons Letter
are inaccurate, incorrect and/or incomplete and therefore provides the following
statement  of its  views  regarding  matters  raised in the  Lyons  Letter.  The
following  statement is qualified in its entirety by reference to the  Company's
letter to Mr. Lyons, dated August 6, 1997, a copy of which is attached hereto as
Exhibit 99.

                                       1                                  Page 2
The Company  categorically  denies  that the Board  ignored  principles  of
responsible  corporate  governance  and  maintains  that the Board has conducted
itself at all times in a manner  entirely  consistent  with the obligations of a
Board of  Directors  of a  publicly  owned  company.  Furthermore,  the  Company
categorically  denies that any policy or  practice of the Board  resulted in the
entrenchment  or improper  enrichment  of  management or any Board member at the
expense  of  stockholders.  In the  Company's  view,  the  Board  has  played an
appropriate independent supervisory role with respect to the business affairs of
the Company and has fully and faithfully executed its fiduciary duties.

     Mr.  Lyons  served on the Board as a designee of director  and  stockholder
William Spier, pursuant to a stockholders  agreement between the Company and Mr.
Spier's  investor group. In August of 1996, Mr. Spier,  with Mr. Lyons' support,
asked  the Board to name him  Chief  Executive  Officer  of the  Company.  After
careful  consideration  by the Board,  which included input from  management and
other key stockholders,  the Board declined to name Mr. Spier CEO. Subsequently,
Messrs.  Spier and Lyons have disagreed with the Board on most matters and have,
from time to time, raised many of the issues outlined in the Lyons Letter.

     The Company believes that Mr. Lyons' concerns regarding certain payments by
the Company to IEP (which were first expressed at the time the Board declined to
name Mr. Spier as CEO) were thoroughly investigated by the Company's independent
auditors,  the Company's  Director of Internal Audit,  and  disinterested  board
members,  all of  which  concluded  that  the  matter  had  been  satisfactorily
resolved.  This issue, including the views of Messrs. Lyons and Spier, was fully
discussed in the Company's Proxy Statement dated December 31, 1996,  relating to
its most  recent  annual  stockholder's  meeting.  

     The  December  31, 1996 Proxy  Statement  also  encompasses  certain of the
concerns expressed by Mr. Lyons concerning Director John Hardesty.  With respect
to the Board's appointment of Mr. Hardesty,  the Board (except for Messrs. Lyons
and Spier) disagreed,  and continues to disagree, with the view of Messrs. Lyons
and Spier regarding Mr. Hardesty's  experience and  qualifications to serve as a
member of the Board of Directors. The Board (except for Messrs. Lyons and Spier)
believes that Mr. Hardesty is an experienced  businessman who brings distinction
and talent to the Board.  Moreover,  with respect to allegations made by Messrs.
Lyons and Spier regarding certain of Mr. Hardesty's securities trading activity,
the  Board  requested  and  then  carefully  reviewed  reports  prepared  by  an
independent board member and independent  outside  securities  counsel regarding
the legality of Mr. Hardesty's trading. Both reports concluded that Mr. Hardesty
had acted entirely legally.

                                         2                                Page 3
Finally,  the Company also vigorously  denies Mr. Lyons allegation that the
Board has in any way quashed  independent  review and  supervision of management
actions. None of the examples cited in the Lyons letter supports his conclusion,
first, under the Company's bylaws,  appropriate  responsibility for compensation
decisions lies with the Board.  Second,  the Board followed all  recommendations
made by the director of internal audit and its independent outside auditors with
respect to effective internal controls. Third, the Board's reconstitution of the
Audit and  Compensation  Committees was consistent with the Company's bylaws and
entirely proper.  Fourth, the Company's 1996 Proxy Statement complied fully with
all  federal  securities  law  requirements.  Finally,  the  Board  was under no
obligation to nominate Mr. Lyons for  re-election as a director and its decision
not to do so was based on a number of legitimate factors.  The Board (except for
Messrs.  Lyons and Spier) believes in good faith that it is in the Company's and
its  stockholders'  best interest that Mr. Lyons not continue as a member of the
Board.

     Further,  the Company  believes that Mr. Lyons'  suggestion  that he was an
independent  director is also misleading.  Mr. Lyons was a designee of Mr. Spier
and a representative  of Mr. Spier's investor group which owns  approximately 14
1/2% of the  Company's  common  stock,  and Mr.  Lyon  played a role in  various
matters of interest to Mr. Spier,  including the Spier group's offer to purchase
the Company in late 1996 and Mr.  Spier's  unsuccessful  attempt to be appointed
CEO earlier that year.

     The Company  believes that it is important to note the context in which Mr.
Lyons makes the statements  contained in the Lyons Letter.  He did not decide to
resign  and to submit  that  letter  until  after the Board had  decided  not to
nominate him for  re-election as a director.  In that light,  the Board views as
pretextual his asserted reasons for resigning.

     In addition,  while many of the allegations made in the Lyons Letter repeat
statements  made  earlier by either Mr.  Lyons or Mr.  Spier,  the Company  also
believes it important to note that none of these complaints surfaced until after
the Board had declined Mr. Spier's request to become Chief Operationg Officer.

     In sum,  the  Board  believes  that  Mr.  Lyons  has  attempted  to use his
resignation  as a  vehicle  to harass  the  Company,  which  the Board  views as
inconsistent with Mr. Lyons' responsibility as a director.

                                       3                                  Page 4
Item 7.   Financial Statements and Exhibits.
-------   ----------------------------------

          (c)      Exhibits.

                   Exhibit 17  Letter to the Company from Mr. William P. Lyons,
                               dated July 30, 1997.

                   Exhibit 99  Letter from the Company to Mr. William P. Lyons,
                               dated August 6, 1997

                                      4                                   Page 5
SIGNATURES

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

                                                VIDEO LOTTERY TECHNOLOGIES, INC.

                                                By:  /s/ Dennis Gallagher       
                                                   -----------------------------
                                                   Dennis Gallagher
                                                   General Counsel and Secretary
                                    (authorized to sign on behalf of Registrant)
Dated:  August 6, 1997

                                         5                                Page 6
EXHIBIT INDEX

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

Exhibit 17     Letter to the Company from Mr. William P. Lyons,       8
               dated July 30, 1997.

Exhibit 99     Letter from the Company to Mr. William P. Lyons,       19
               dated August 6, 1997.

                                         6                                Page 7