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 (Date of earliest event reported): September 30, 2002

                            ONSITE ENERGY CORPORATION
             (Exact name of registrant as specified in its charter)

                                    Delaware
                 (State or other jurisdiction of incorporation)

        1-12738                                           33-0576371
(Commission File Number)                       (IRS Employer Identification No.)

             701 Palomar Airport Road, Suite 200, Carlsbad, CA 92009
               (Address of principal executive offices) (Zip Code)

                                 (760) 931-2400
              (Registrant's telephone number, including area code)



ITEM 2.  ACQUISITION OR DISPOSITION OF ASSETS.

    (i)  Effective September 30, 2002, Onsite Energy Corporation ("Onsite") sold
         its  rights  to  certain  excess  revenues  under  an  Energy  Services
         Agreement for $650,000  to its customer,  a real  estate  trust.  Under
         the Energy Services  Agreement, Onsite provides certain services to the
         customer, which  included  collecting  payments  for  electricity   and
         electrical  services. These  revenues  were  deposited  in  a  lock-box
         account and used to pay utility bills and other identified obligations,
         as  set  forth  in  the  Energy  Services Agreement, with any remaining
         revenues being distributed between Onsite and the customer. In exchange
         for $650,000, paid by the customer to Onsite, Onsite  relinquished  its
         right to its share of the remaining  revenues.  The  purchase price was
         determined based on an analysis of the present value of Onsite's future
         share of the remaining revenues to be earned  under the Energy Services
         Agreement,  which was to terminate in or about 2019. While  Onsite will
         continue  to  perform  certain  services  under  the  Energy   Services
         Agreement, the customer will assume  responsibility for the maintenance
         of the lock-box  account and  payment of the  obligations.  The parties
         also acknowledged  their  mutual  intent  for  the customer to engage a
         third party other than Onsite to perform the future services  Onsite is
         continuing  to  perform  under  the  Energy  Services  Agreement.  Upon
         engagement of this third party,  Onsite will no longer have any further
         obligations under the Energy Services Agreement.


<PAGE>


ITEM 7.  FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.


     (a) (b) and (c)   Not applicable.





              [The remainder of this page is intentionally blank.]


<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 hereunto duly authorized.

                                                   ONSITE ENERGY CORPORATION



Date:  October 14, 2002                        By: /S/ RICHARD T. SPERBERG
                                                  ------------------------------
                                                  Richard T. Sperberg, President
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{"company-data": {"conformed-name": "ONSITE ENERGY CORP", "cik": "0000909171", "assigned-sic": "8711", "irs-number": "330576371", "state-of-incorporation": "DE"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-12738", "film-number": "02788864"}, "business-address": {"street1": "701 PALOMAR AIRPORT RD", "street2": "STE 200", "city": "CARLSBAD", "state": "CA", "zip": "92009", "phone": "6199312400"}, "mail-address": {"street1": "701 PALOMAR AIRPORT RD", "street2": "STE 200", "city": "CARLSBAD", "state": "CA", "zip": "92009"}}
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 (Date of earliest event reported): September 30, 2002

                            ONSITE ENERGY CORPORATION
             (Exact name of registrant as specified in its charter)

                                    Delaware
                 (State or other jurisdiction of incorporation)

        1-12738                                           33-0576371
(Commission File Number)                       (IRS Employer Identification No.)

             701 Palomar Airport Road, Suite 200, Carlsbad, CA 92009
               (Address of principal executive offices) (Zip Code)

                                 (760) 931-2400
              (Registrant's telephone number, including area code)

ITEM 2.  ACQUISITION OR DISPOSITION OF ASSETS.

    (i)  Effective September 30, 2002, Onsite Energy Corporation ("Onsite") sold
         its  rights  to  certain  excess  revenues  under  an  Energy  Services
         Agreement for $650,000  to its customer,  a real  estate  trust.  Under
         the Energy Services  Agreement, Onsite provides certain services to the
         customer, which  included  collecting  payments  for  electricity   and
         electrical  services. These  revenues  were  deposited  in  a  lock-box
         account and used to pay utility bills and other identified obligations,
         as  set  forth  in  the  Energy  Services Agreement, with any remaining
         revenues being distributed between Onsite and the customer. In exchange
         for $650,000, paid by the customer to Onsite, Onsite  relinquished  its
         right to its share of the remaining  revenues.  The  purchase price was
         determined based on an analysis of the present value of Onsite's future
         share of the remaining revenues to be earned  under the Energy Services
         Agreement,  which was to terminate in or about 2019. While  Onsite will
         continue  to  perform  certain  services  under  the  Energy   Services
         Agreement, the customer will assume  responsibility for the maintenance
         of the lock-box  account and  payment of the  obligations.  The parties
         also acknowledged  their  mutual  intent  for  the customer to engage a
         third party other than Onsite to perform the future services  Onsite is
         continuing  to  perform  under  the  Energy  Services  Agreement.  Upon
         engagement of this third party,  Onsite will no longer have any further
         obligations under the Energy Services Agreement.
ITEM 7.  FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.

     (a) (b) and (c)   Not applicable.

              [The remainder of this page is intentionally blank.]
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 hereunto duly authorized.

                                                   ONSITE ENERGY CORPORATION

Date:  October 14, 2002                        By: /S/ RICHARD T. SPERBERG
                                                  ------------------------------
                                                  Richard T. Sperberg, President