FOCUS ENHANCEMENTS INC
424B3, 1997-11-20
COMPUTER COMMUNICATIONS EQUIPMENT
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PROSPECTUS

                            FOCUS ENHANCEMENTS, INC.

                        3,498,855 Shares of Common Stock
                150,000 Redeemable Common Stock Purchase Warrants

         This Prospectus  relates to 3,498,855 shares of Common Stock,  $.01 par
value per share (the  "Common  Stock"),  and  150,000  Redeemable  Common  Stock
Purchase Warrants (the "Unit Warrants") of FOCUS Enhancements,  Inc., a Delaware
corporation (the "Company").  The Common Stock offered hereby consists of (a) up
to  2,896,507  shares  issuable  by  the  Company  upon  exercise  of  1,632,755
Redeemable  Common  Stock  Purchase  Warrants  issued to the public (the "Public
Warrants") in May 1993 in connection with the Company's  initial public offering
(the "IPO");  (b) up to 160,000 shares  issuable by the Company upon exercise of
warrants  (the "Private  Warrants")  issued in private  transactions  to certain
persons by the Company;  (c) up to 416,100  shares  issuable by the Company upon
exercise of a warrant (the "Underwriter's Warrant"), including the Unit Warrants
contained  therein,  sold to Thomas James & Associates,  Inc. (now known as H.J.
Meyers & Co., Inc.) in connection with the IPO; and (d) 26,248 shares  currently
issued and outstanding offered by certain persons, who together with the holders
of the Private Warrants,  the Unit Warrants and the Underwriter's  Warrant shall
be hereinafter referred to as the"Selling Stockholders." The Public Warrants are
currently  exercisable at a price of $6.75 per Warrant; the Private Warrants are
exercisable at prices ranging from $1.25 to $2.07 per Warrant; the Underwriter's
Warrant is exercisable  to purchase  150,000 Units at a price of $5.74 per Unit,
each Unit consisting of one share of Common Stock and one Unit Warrant;  and the
Unit Warrants are exercisable at a price of $9.11 per Warrant.  Hereinafter, the
Unit Warrants,  the Public Warrants,  the Private Warrants and the Underwriter's
Warrant shall be collectively  referred to as the "Warrants." To the extent that
the Warrants are  exercised,  the Company  will  receive  proceeds  equal to the
exercise  price  of  the  Warrants.   The  Common  Stock  held  by  the  Selling
Stockholders and the Common Stock issuable to the Selling  Stockholders upon the
exercise of the Private  Warrants is registered  hereunder  for resale  purposes
only.  The Company will not receive any  proceeds  from the sale of Common Stock
offered by the  Selling  Stockholders.  See  "SELLING  STOCKHOLDERS  AND PLAN OF
DISTRIBUTION."

         The Common Stock offered by the Selling Stockholders may be offered and
sold from time to time by the Selling  Stockholders,  or by pledgees,  donees or
transferees   or   other   successors-in-interest,   in   privately   negotiated
transactions  directly or through  brokers,  or in the  over-counter  market and
otherwise at prices and on terms then prevailing.  In connection with any sales,
the  Selling  Stockholders  and any  broker  participating  in such sales may be
deemed to be "underwriters" within the meaning of the Securities Act of 1933, as
amended.

         The Common Stock and Public Warrants are traded on the Nasdaq Small-Cap
Market under the symbols FCSE and FCSEW, respectively. On November 19, 1997, the
last  sale  price of the  Company's  Common  Stock  as  reported  on the  Nasdaq
Small-Cap Market was $4.25. See "PRICE RANGE OF COMMON STOCK."
                             ----------------------

          THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
           SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
               COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COM-
                MISSION OR ANY STATE SECURITIES COMMISSION PASSED
                      UPON THE ACCURACY OR ADEQUACY OF THIS
                      PROSPECTUS. ANY REPRESENTATION TO THE
                         CONTRARY IS A CRIMINAL OFFENSE.
                             ----------------------

                 AN INVESTMENT IN THE SECURITIES OFFERED HEREBY
               INVOLVES A HIGH DEGREE OF RISK. SEE "RISK FACTORS"
                              AT PAGES 5 THROUGH 7.
                             ----------------------

                The date of this Prospectus is November 20, 1997.
<PAGE>

         No person has been  authorized to give any  information  or to make any
representations  other than those contained or incorporated by reference in this
Prospectus in connection  with the offer  contained in this  Prospectus  and, if
given or made, such  information or  representations  must not be relied upon as
having  been  authorized  by the  Company  or  the  Selling  Stockholders.  This
Prospectus  does not constitute an offer to sell or  solicitation of an offer to
buy securities in any  jurisdiction to any person to whom it is unlawful to make
such offer or solicitation. Neither the delivery of this Prospectus nor any sale
made hereunder shall, under any circumstances,  create an implication that there
has been no change in the  affairs of the  Company  since the date hereof or the
information contained or incorporated by reference herein is correct at any time
subsequent to the date hereof.

                              AVAILABLE INFORMATION

         The  Company  is  subject  to  the  informational  requirements  of the
Securities  Exchange  Act of 1934,  as amended  (the  "Exchange  Act"),  and, in
accordance therewith, files reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission").  Such reports,  proxy
statements and other information filed by the Company with the Commission can be
inspected and copies obtained at the public reference  facilities  maintained by
the  Commission  at  Judiciary  Plaza,  Room  1024,  450  Fifth  Street,   N.W.,
Washington, D.C. 20549, and at the following regional offices of the Commission:
Chicago Regional Office,  Citicorp Center, 500 West Madison Street,  Suite 1400,
Chicago,  Illinois 60661- 2511; and New York Regional Office,  Seven World Trade
Center,  Suite 1300,  New York,  New York 10048.  Copies of such material can be
obtained at prescribed rates from the Public Reference Section of the Commission
at its principal office at 450 Fifth Street, N.W., Washington,  D.C. 20549. Such
materials may also be accessed  electronically by means of the Commission's home
page at http://www.sec.gov.

         The Company has filed with the Commission a Post-Effective Amendment on
Form S-3 to its Registration  Statement on Form SB-2 (herein,  together with all
amendments and exhibits,  referred to as the "Registration Statement") under the
Securities  Act of 1933, as amended (the  "Securities  Act").  This  prospectus,
which constitutes part of a Registration Statement filed by the Company with the
Commission under the Securities Act omits certain  information  contained in the
Registration  Statement  in  accordance  with the rules and  regulations  of the
Commission.  Reference  is hereby  made to the  Registration  Statement  and the
exhibits  relating  thereto for further  information with respect to the Company
and the securities  offered hereby.  Any statements  contained herein concerning
provisions of any documents are not necessarily complete, and, in each instance,
reference  is made to the  copy of such  document  filed  as an  exhibit  to the
Registration  Statement  or  otherwise  filed  with the  Commission.  Each  such
statement is qualified in its entirety by such reference.

                 INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

         The  following  documents,  which have been  filed with the  Commission
pursuant to the Exchange Act, are hereby  incorporated  in this  Prospectus  and
specifically made a part hereof by reference: (i) the Company's Annual Report on
Form 10-KSB/A-1 for the year ended December 31, 1996; (ii) the Company's Current
Report on Form  8K/A-1  filed on  January  6,  1997  relating  to the  Company's
acquisition  of TView , Inc.;  (iii) the  Company's  Current  Report on Form 8-K
filed on  January  16,  1997  relating  to the sale of  securities  pursuant  to
Regulation  S; (iv) the  definitive  Proxy  Statement  dated  February  18, 1997
provided to  stockholders  in connection  with a Special Meeting of Stockholders
held March 18, 1997; (v) the Company's Current Report on Form 8-K filed on March
3, 1997  relating to the sale of  securities  pursuant to Regulation S; (vi) the
definitive  Proxy  Statement  filed  with the  Commission  dated  June 20,  1997
provided to  stockholders  in connection with the Annual Meeting of Stockholders
held on July 25, 1997;  (vii) the Company's  Quarterly Report on Form 10-QSB/A-1
for the period ended March 31, 1997;  (viii) the Company's  Quarterly  Report on
Form 10-QSB/A-1 for the period ended June 30, 1997; (x) the Company's

                                      -2-

<PAGE>


Quarterly Report on Form 10-QSB for the period ended September 30, 1997; and (x)
the  description  of the Company's  Common Stock  contained in the  Registration
Statement on Form SB-2 File No.  33-60248-B  filed with the  Commission on March
29, 1993,  as amended.  All documents  filed by the Company  pursuant to Section
13(a),  13(c),  14 or 15(d) of the Exchange Act  subsequent  to the date of this
Prospectus  and  prior to the  termination  of the  offering  of the  securities
offered  hereby  shall be  deemed  to be  incorporated  by  reference  into this
Prospectus and to be a part hereof from the  respective  dates of filing of such
documents.

         Any statement contained herein or in a document  incorporated or deemed
to be  incorporated  herein  by  reference  shall be deemed  to be  modified  or
superseded  for  purposes  of this  Prospectus  to the extent  that a  statement
contained  herein  (or  in  the  applicable  Prospectus  Supplement),  or in any
subsequently filed document that also is or is deemed to be incorporated  herein
by  reference,  modifies or supersedes  such  statement.  Any such  statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.

         The Company hereby  undertakes to provide without charge to each person
to whom this  Prospectus is delivered,  upon the written or oral request of such
person, a copy of any and all of the information  that has been  incorporated by
reference  in this  Prospectus  (excluding  exhibits  unless such  exhibits  are
specifically incorporated by reference into the information that this Prospectus
incorporates).  Requests  for such  copies  should be made to the Company at its
principal  executive  offices,  142 North Road,  Sudbury,  Massachusetts  01776,
Attention: Harry G. Mitchell, telephone (508) 371-2000.


                                      -3-

<PAGE>



                               PROSPECTUS SUMMARY

         The following  summary  information is qualified in its entirety by the
more detailed information appearing elsewhere in this Prospectus or incorporated
herein by reference and the financial  statements which are incorporated  herein
by reference.

THE COMPANY..........................   FOCUS Enhancements,  Inc. (the "Company"
                                        or "FOCUS") internally develops, markets
                                        and sells  worldwide a proprietary  line
                                        of PC-to-TV  video  conversion  products
                                        for   Windows(TM)  and  Mac(TM)OS  based
                                        personal   computers.    The   Company's
                                        proprietary  PC-to-TV  video  conversion
                                        products  include  video output  devices
                                        marketed  and sold  under the  Company's
                                        registered brand name, TView. All of the
                                        Company's PC-to-TV  conversion  products
                                        enable  users to transmit  at  low-cost,
                                        high quality,  computer generated images
                                        from  any DOS,  Windows  or Mac OS based
                                        personal  computer to any  television of
                                        any size with a standard  RCA or S-Video
                                        interface.  FOCUS's PC-to-TV  technology
                                        provides      sharp,       flicker-free,
                                        computer-generated images on televisions
                                        for  multimedia/business  presentations,
                                        classroom/training     sessions,    game
                                        playing  or even  collective  viewing of
                                        spreadsheets or internet  browsing.  The
                                        Company  markets  and  sells  its  FOCUS
                                        branded   consumer   products   globally
                                        through  a  network   of   distributors,
                                        volume  resellers,   mail  order,  value
                                        added  resellers  ("VARs")  and original
                                        equipment manufacturers ("OEMs").

RISK FACTORS..........................  The Offering involves  substantial risk.
                                        See "RISK FACTORS".

SECURITIES OFFERED....................  3,498,855  shares  of  Common  Stock and
                                        150,000 Redeemable Common Stock Purchase
                                        Warrants  (the  "Unit  Warrants").   The
                                        Common Stock offered hereby  consists of
                                        (a) up to 2,896,507  shares  issuable by
                                        the Company  upon  exercise of 1,632,755
                                        Public  Warrants;   (b)  up  to  160,000
                                        shares  issuable  by  the  Company  upon
                                        exercise of the Private Warrants; (c) up
                                        to 416,100 shares issuable upon exercise
                                        of the  Underwriter's  Warrant;  and (d)
                                        26,248  shares   currently   issued  and
                                        outstanding     offered    by    Selling
                                        Stockholders.    See   "DESCRIPTION   OF
                                        SECURITIES."

OFFERING PRICE.......................   All or part of the Shares offered hereby
                                        may be sold from time to time in amounts
                                        and on  terms  to be  determined  by the
                                        Selling  Stockholders  at  the  time  of
                                        sale.

USE OF PROCEEDS......................   To the  extent  that  the  Warrants  are
                                        exercised,  the  Company  intends to use
                                        the net  proceeds  for  general  working
                                        capital   purposes.   The  Company  will
                                        receive no part of the proceeds from the
                                        sale of the shares  registered  pursuant
                                        to this Registration Statement.

NASDAQ TRADING SYMBOL................   FCSE

                                      -4-
<PAGE>

                                  RISK FACTORS

         An investment in the Securities  offered hereby  involves a high degree
of risk and should only be purchased  by investors  who can afford to lose their
entire  investment.  The  following  factors,  in  addition  to those  discussed
elsewhere in the  Prospectus,  should be considered  carefully in evaluating the
Company and its business.

         Future  Capital  Needs.  At September 30, 1997, the Company had working
capital of  $5,160,342,  cash and cash  equivalents  of $2,492,705 and was fully
drawn on its line of credit (approximately  $750,000 at September 30, 1997) with
its  bank  and  its  $1.5  million  term  note  with  an  unaffiliated   lender.
Historically,  the  Company has been  required to meet its short- and  long-term
cash needs  through debt and the sale of Common Stock in private  placements  in
that cash flow from operations has been  insufficient.  During 1996, the Company
received approximately $6,116,000 in net proceeds from the exercise of warrants,
stock options and the sale of Common  Stock.  During the nine month period ended
September  30,  1997,  the  Company  received  approximately  $5,783,174  in net
proceeds  from the  exercise of warrants,  stock  options and the sale of Common
Stock.

         The Company's future capital  requirements will depend on many factors,
including  cash flow from  operations,  continued  progress in its  research and
development programs,  competing technological and market developments,  and the
Company's ability to market its products successfully.  During 1997, the Company
may be required to raise additional  funds through equity or debt financing,  of
which there can be no assurance.  Any equity  financing could result in dilution
to the  Company's  then-existing  stockholders.  Sources of debt  financing  may
result in higher interest expense. Any financing, if available,  may be on terms
unfavorable to the Company. If adequate funds are not available, the Company may
be required to curtail its activities significantly.

         Reliance on Major  Customers.  For the nine months ended  September 30,
1997,  approximately  22% of the  Company's  revenues were derived from sales to
Ingram Micro D  ("Ingram"),  a national  distributor,  approximately  19% of the
Company's  revenues  were  derived  from  sales to SCI  Systems,  Inc.  ("SCI"),
approximately  12% of the  Company's  revenues  were derived from sales to Apple
Computer,  Inc. ("Apple"),  and approximately 11% of the Company's revenues were
derived from sales to Zenith Electronics,  Inc.  ("Zenith").  Management expects
that sales to Ingram,  SCI and Zenith will  continue to represent a  significant
percentage  of the  Company's  future  revenues.  In October  1996,  the Company
entered into a two-year exclusive agreement with Zenith, under which Zenith must
purchase at least  $12,000,000  of PC-to-TV  conversion  products in 1997 and at
least  $30,000,000 of these  products in 1998 in order to maintain  exclusivity.
For the nine months ended September 30, 1997, the Company shipped  approximately
$1,987,000  of PC-to-TV  products to Zenith and  projects  that total  shipments
through December 31, 1997 will be less than the $12 million contract minimum. As
a result, under the terms of the Agreement, Zenith has ceased to be an exclusive
OEM for the Company's PC to TV products in the television market.

         History of  Operating  Losses.  The  Company  has  experienced  limited
profitability  since its inception and at September 30, 1997, had an accumulated
deficit of $19,763,443. Although the Company reported net income of $662,089 for
the nine-month  period ended September 30, 1997,  there can be no assurance that
the Company will remain profitable during the remainder of 1997.

         The  Company's   independent  auditors  have  included  an  explanatory
paragraph in their report on the  Company's  financial  statements  for the year
ended December 31, 1996 to the effect that the Company's  ability to continue as
a going  concern is contingent  upon its ability to secure  financing and attain
profitable operations. In addition, the Company's ability to continue as a going
concern must be considered in light of the problems,  expenses and complications
frequently  encountered  by  its  entrance  into  established  markets  and  the
competitive environment in which the Company operates.

                                      -5-
<PAGE>

         Limited Availability of Capital under Credit Arrangements with Lenders.
The Company  maintains a line of credit with Silicon Valley Bank which was fully
drawn as of  September  30,  1997.  At  December  31,  1996,  the Company was in
violation of certain  debt  covenants  relating to the line of credit.  In March
1997,  the Company  received a waiver of the covenants from the bank, a revision
of the loan  covenants  and an agreement to extend the line until March 1998. As
of September 30, 1997, approximately $750,000 is owed to the bank under the line
of credit.

         In October 1994, the Company  borrowed  $2,500,000 from an unaffiliated
lender to help finance its  inventory and accounts  receivable  under its Master
Purchase  Agreement with Apple. The Company issued to this  unaffiliated  lender
its term note in the aggregate  principal  amount of  $2,500,000.  The term note
ccrues interest at the revolving rate of prime plus 2%, is payable  quarterly in
arrears at the end of December, March, June, and September, and was due February
1, 1996. In January 1996,  the Company  repaid  approximately  $1 million of the
amount owed under the term note.  On June 28, 1996,  the Company  negotiated  an
amendment  to the term note with the  lender to extend  the due date of the term
note to March 31,  1997.  Pursuant to the  amendment,  the  Company  granted the
lender a second security interest in all the assets of the Company.  The Company
is currently negotiating an additional extension with the lender, however, there
can be no assurances  that the term note will be extended on terms  favorable to
the Company.

         Market  Acceptance.  The  Company's  sales and  marketing  strategy  is
targeted to sales of its PC-to- TV video-graphics  products to the Windows,  MAC
OS markets,  including computer  manufacturers,  VGA graphic card developers and
VGA  chip  developers,  as well as to  television  manufacturers.  Although  the
Company has to date experienced success in penetrating these markets,  there can
be no  assurance  that the  Company's  marketing  strategy  will  continue to be
effective  and  that  current  customers  will  continue  to buy  the  Company's
products.  Market acceptance of the Company's current and proposed products will
depend upon the  ability of the Company to  demonstrate  the  advantages  of its
products over other PC-to-TV video- graphics products.

         Reliance on Single Vendor. In the nine months ended September 30, 1997,
approximately 68% of the components for the Company's  products were secured and
manufactured  on a turnkey basis by a single vendor,  Pagg  Corporation.  In the
event that the vendor was to cease  supplying the Company,  management  believes
there are  alternative  vendors for the components  for the Company's  products.
However,  the Company would experience  short-term delays in the shipment of its
products.

         Dependence on Timely  Delivery of the FOCUS Scan 300 Chip. In the third
quarter of 1997, the Company  completed  development of an ASIC called the FOCUS
Scan 300 Chip which the Company will incorporate into all of its next generation
PC-to-TV video-graphics products. The Company is relying on an outside vendor to
manufacture its  requirements for the Chip that it intends to ship in the fourth
quarter of 1997. A significant portion of the Company's anticipated revenues and
gross margins for 1997 are dependent on timely delivery of sufficient quantities
of the FOCUS Scan 300 Chip in order to fill  pending  orders.  In the event that
the Company does not receive  sufficient  quantities of the Chip to fill orders,
the Company's revenues and profitability for 1997 could be adversely effected.

         Technological  Obsolescence.   The  Windows  and  MAC  OS  markets  are
characterized  by extensive  research and  development  and rapid  technological
change resulting in product life cycles of nine to eighteen months.  Development
by others of new or improved  products,  processes or technologies  may make the
Company's  products  or proposed  products  obsolete  or less  competitive.  The
Company will be required to devote substantial  efforts and financial  resources
to enhance its existing  products and to develop new  products.  There can be no
assurance that the Company will succeed with these efforts.

         Competition.  The Windows and MAC OS markets are extremely competitive.
The Company  currently  competes with other  developers  of PC-to-TV  conversion
products  and with  video-graphic  integrated  circuit  developers.  Many of the
Company's competitors have greater market recognition and greater

                                      -6-
<PAGE>

financial,  technical,  marketing and human resources than the Company. Although
the Company is not currently aware of any  announcements by its competitors that
would have a material impact on the Company or its  operations,  there can be no
assurance that the Company will be able to compete successfully against existing
companies or new entrants to the marketplace.

         Component Supply Problems.  The Company purchases all of its parts from
outside  suppliers and from time to time  experiences  delays in obtaining  some
components or  peripheral  devices.  The Company  attempts to reduce the risk of
supply interruption by evaluating and obtaining  alternative sources for various
components or peripheral devices. However, there can be no assurance that supply
shortages  will not occur in the future which could  significantly  increase the
cost,  or delay  shipment  of,  the  Company's  products,  which  in turn  could
adversely affect its results of operations.

         Protection of Proprietary  Information.  Although the Company has filed
three patents and expects to file two  additional  patents in the fourth quarter
of 1997 with respect to its PC-to-TV  video-graphics  products, the Company does
not  currently  have any  patents.  The  Company  treats its  technical  data as
confidential  and  relies  on  internal  nondisclosure   safeguards,   including
confidentiality  agreements with employees, and on laws protecting trade secrets
to protect its  proprietary  information.  There can be no assurance  that these
measures  will  adequately   protect  the   confidentiality   of  the  Company's
proprietary  information or that others will not independently  develop products
or technology that are equivalent or superior to those of the Company.  While it
may be necessary or desirable in the future to obtain  licenses  relating to one
or more of its products or relating to current or future technologies, there can
be no  assurance  that  the  Company  will  be  able  to  do so on  commercially
reasonable terms.


                                      -7-
<PAGE>

                                   THE COMPANY

         FOCUS   Enhancements,   Inc.  (the  "Company"  or  "FOCUS")  internally
develops,  markets and sells  worldwide  a  proprietary  line of PC-to-TV  video
conversion  products for  Windows(TM)  and Mac(TM)OS  based personal  computers.
Based on an  independent  survey by PC Data  Corp.,  the  Company is an industry
leader in the  development  and marketing of PC-to-TV  conversion  products that
make personal computers "TV- ready" and televisions "PC-ready".

         The Company's  proprietary  PC-to-TV video conversion  products include
video output  devices  marketed and sold under the  Company's  registered  brand
name, TView. All of the Company's PC-to-TV  conversion  products enable users to
transmit at low-cost,  high  quality,  computer  generated  images from any DOS,
Windows or Mac OS based  personal  computer to any television of any size with a
standard RCA or S-Video interface.  FOCUS's PC-to-TV  technology provides sharp,
flicker-free,  computer-generated  images on televisions for multimedia/business
presentations,  classroom/training  sessions,  game  playing or even  collective
viewing of spreadsheets or internet browsing.

         The  Company  markets  and sells its FOCUS  branded  consumer  products
globally through a network of distributors,  volume resellers, mail order, value
added resellers ("VARs") and original equipment manufacturers ("OEMs"). In North
America,   the  Company  markets  and  sells  its  products   through   national
distributors  such as Ingram Micro D, D & H, Academic and Nuvo;  national volume
resellers such as CompUSA,  Computer City,  Micro Center,  Staples and Egg Head;
and through third party mail order  companies such as  MicroWarehouse,  Multiple
Zones, Global, PC Connection and Tiger Direct.

         In addition,  the FOCUS branded PC-to-TV products have been selected by
leading  personal  computer  manufacturers  to be marketed with the use of their
select brand of personal computers.  Compaq, Toshiba and Apple have included the
Company's  PC-to-TV  products on their selected market price lists,  and promote
the FOCUS PC-to-TV products in their box materials.

         The Company also markets and sells its products internationally in over
30 countries by  independent  distributors  in each country.  These  independent
distributors market and sell the FOCUS branded products to retailers, mail order
companies, and VARs in their respective countries.

         In addition to the FOCUS branded products,  the Company markets,  sells
or licenses its proprietary PC-to-TV technology to television manufacturers such
as Zenith  Electronics,  and to personal  computer  manufacturers  such as Apple
Computer.  The  Company  is  currently  in  discussions  with  several  other PC
manufacturers,  television  manufacturers,  VGA  chip  developers  and VGA  card
developers globally.

         The  Company  was  founded  in  December   1991,  as  a   Massachusetts
corporation and was  reincorporated in Delaware in April 1993. In December 1993,
the  Company  acquired  Lapis  Technologies  Inc.  ("Lapis"),   a  developer  of
high-quality,   low-cost  Macintosh  multimedia  graphics  products.   Effective
September 30, 1996, the Company  consummated the  acquisition of TView,  Inc., a
developer of PC-to-TV video conversion technology. This acquisition has played a
major strategic role in allowing FOCUS to gain a major  technological  lead over
competitors in the video scan conversion  category and has positioned FOCUS as a
leader in PC-to-TV video conversion technology.

         The  Company's  principal  executive  offices  are located at 142 North
Road,  Sudbury,  Massachusetts  01776.  Its research and  development  center is
located at 9275 SW Nimbus Drive, Beaverton, Oregon 97008. The Company's European
sales and marketing office,  FOCUS  Enhancements B.V., is located at Schipholweg
118,  Kantorenhuis,  2316 XD Leiden,  The  Netherlands.  The  Company's  general
telephone   number  is  (508)   371-2000  and  its   worldwide  web  address  is
http://www.focusinfo.com.

                                      -8-
<PAGE>
                                USE OF PROCEEDS

         The gross  proceeds to be received by the Company from  exercise of all
of  the  Warrants  (assuming  that  all  of  the  Warrants  are  exercised)  are
$13,522,496,  and  management  intends to use such proceeds for general  working
capital  purposes  including  expenditures in connection  with the  development,
sales and marketing of future products for the Company.

         The  Company  will not  receive  any  proceeds  from the  resale by the
Selling Stockholders of the Shares.

                              SELLING STOCKHOLDERS

         The following  table sets forth  information  concerning the beneficial
ownership of Shares of Common Stock by the Selling  Stockholders  as of the date
of this  Prospectus  and the  number of such  shares  included  for sale in this
Prospectus  assuming the exercise of Warrants  held by the Selling  Stockholders
and the sale of all Shares being offered by this Prospectus.  To the best of the
Company's  knowledge,  none of the Selling  Stockholders have held any office or
maintained any material  relationship  with the Company or its  predecessors  or
affiliates  over the past three years,  except as set forth  below.  The Selling
Stockholders  reserve the right to reduce the number of Shares  offered for sale
or to otherwise decline to sell any or all of the Shares  registered  hereunder.
The  calculation  of the number of Shares owned after the Offering  assumes that
all of the Shares offered hereby are sold.

<TABLE>
<CAPTION>
                                                          Shares to be Sold in Offering
                                                          -----------------------------
                                                        Shares Owned
                                                          Prior to             Shares         Shares Owned
            Name of Selling Stockholder                   Offering             Offered       After Offering
            ---------------------------                 -------------         --------       --------------
<S>                                                     <C>                 <C>                   <C>
Mark Allen (1)                                              6,935               6,935              0
Karl Brenza (1)                                             4,161               4,161              0
Marshall Cox (2)                                           10,000              10,000              0
Culverwell & Co., Inc.                                     50,000              50,000              0
Highlands Group (3)                                        10,000              10,000              0
David Hughes (1)                                            4,161               4,161              0
Fred Kassner (4)                                           50,000              50,000              0
Jodi Ogden (1)                                              1,387               1,387              0
Judith M. Ott Family Limited Partnership, III (5)          16,248              16,248              0
John A. Piccione (1)(6)                                    72,740              72,740              0
George Salloum (1)                                          4,161               4,161              0
James A. Villa (1)                                        367,555             367,555              0
Venture Investment Management Co., L.L.C. (7)               5,000               5,000              0
- -----------------------------                                                                  
(footnotes on next page)

                                      -9-
<PAGE>
<FN>
(1)  Represents shares issuable upon exercise of the Underwriter's Warrants originally issued to Thomas James Associates,  Inc. (now
     known as H.J. Meyers & Co., Inc.) in connection with the Company's initial public offering.

(2)  This stockholder was a director of the Company from September 1992 until January 1996.

(3)  Highlands Group is wholly-owned by Timothy Mahoney, a director of the Company.

(4)  Mr.  Kassner has provided a line of credit to the Company in the original  principal  amount of $2.5  million  (currently  $1.5
     million).

(5)  Ms. Ott,  the General  Partner of the Judith M. Ott Family  Limited  Partnership  III,  was the  Secretary  of the Company from
     inception to August 1995 and a director of the Company  from  inception  until 1993.  Ms. Ott is also a partner in the law firm
     that previously served as general counsel to the Company.

(6)  Mr. Piccione is the Secretary of the Company and a partner at Sullivan & Worcester, LLP, the Company's general counsel.

(7)  A predecessor firm of Venture Management Co., L.L.C. was formerly a principal stockholder of the Company.
</FN>
</TABLE>

                              PLAN OF DISTRIBUTION

         Of the 3,498,855 Shares being registered herein for sale by the Selling
Stockholders,  (a) up to  2,896,507  shares are  issuable  by the  Company  upon
exercise of 1,632,755 Public Warrants;  (b) up to 160,000 shares are issuable by
the Company upon exercise of the Private Warrants;  (c) up to 416,100 shares are
issuable upon exercise of the Underwriter's  Warrant;  and (d) 26,248 shares are
currently issued and outstanding offered by Selling Stockholders.  All Shares to
be  registered  hereby  are to be offered  by  certain  security  holders of the
Company,  and, other than the exercise  price of the Warrants,  the Company will
receive no proceeds from the sale of Shares offered hereby.

         The  Selling  Stockholders  may sell the  Common  Stock  registered  in
connection  with this Offering on the NASDAQ  market system or otherwise.  There
will  be  no  charges  or  commissions  paid  to  the  Company  by  the  Selling
Stockholders  in connection  with the issuance of the Shares.  It is anticipated
that usual and customary brokerage fees will be paid by the Selling Stockholders
upon sale of the Common  Stock  offered  hereby.  The Company will pay the other
expenses  of this  Offering.  The  Shares  may be sold  from time to time by the
Selling Stockholders, or by pledgees, donees, 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:  (a) a
block  trade in which the broker so engaged  will  attempt to sell the Shares as
agent but may  position  and  resell a  portion  of the  block as  principal  to
facilitate the transaction; (b) purchases by a broker or dealer as principal and
resale by such broker or dealer for its account pursuant to this Prospectus; (c)
an  exchange  distribution  in  accordance  with the  rules of  NASDAQ;  and (d)
ordinary brokerage transactions.  In effecting sales, brokers or dealers engaged
by the  Selling  Stockholders  may  arrange  for other  brokers  or  dealers  to
participate.  Brokers or dealers will  receive  commissions  or  discounts  from
Selling Stockholders in amounts to be negotiated prior to the sale. Such brokers
or dealers  and any other  participating  brokers or dealers may be deemed to be
"underwriters"  within the meaning of the Act in connection  with such sales. In
addition, any securities covered by this prospectus

                                      -10-
<PAGE>

which  qualify  for sale  pursuant to Rule 144 of the Act may be sold under Rule
144 rather than pursuant to this Prospectus.

         The Company has agreed to indemnify certain of the Selling Stockholders
against certain liabilities,  including certain liabilities under the Act, or to
contribute to payments  which a Selling  Stockholder  may be required to make in
respect thereof.

                                  LEGAL MATTERS

         The  validity of certain of shares of Common Stock  offered  hereby was
passed  upon  for  the  Company  by  Epstein,  Becker  &  Green,  P.C.,  Boston,
Massachusetts  02109. At the time that the opinion was issued, John A. Piccione,
Esq., currently Secretary of the Company,  was an attorney at Epstein,  Becker &
Green, P.C. Mr. Piccione holds options to purchase 45,000 shares of Common Stock
and warrants to purchase 27,740 shares of Common Stock.

                                     EXPERTS

         The consolidated  financial statements of the Company as of and for the
year ended  December 31, 1996  appearing in the Company's  Annual Report on Form
10-KSB/A-1  for the year ended  December 31,  1996,  have been audited by Wolf &
Company,  P.C.  independent  accountants  as set forth in their report  thereon,
which report includes an explanatory  paragraph  regarding the Company's ability
to continue as a going  concern,  included  therein and  incorporated  herein by
reference.  Such financial  statements are  incorporated  herein by reference in
reliance  upon such report  given upon the  authority of such firm as experts in
accounting and auditing.

         The consolidated financial statements of FOCUS Enhancements, Inc. as of
and for the year ended December 31, 1995,  included in the Annual Report on Form
10-KSB/A-1  of the Company for the fiscal year ended  December 31, 1996 referred
to above have been audited by Coopers & Lybrand L.L.P., independent accountants,
as set forth in their report dated April 11, 1996, which included an explanatory
paragraph  related to the  Company's  ability to  continue  as a going  concern,
accompanying such financial statements, and are incorporated herein by reference
in  reliance  upon the  report of such  firm,  which  report is given upon their
authority as experts in accounting and auditing.

                      DISCLOSURE OF COMMISSION POSITION ON
                 INDEMNIFICATION FOR SECURITIES ACT LIABILITIES

         Insofar as indemnification for liabilities arising under the Act may be
permitted to  directors,  officers  and  controlling  persons of the  Registrant
pursuant to the foregoing  provisions,  or otherwise,  the  Registrant  has been
advised that in the opinion of the Commission  such  indemnification  is against
public policy as expressed in such 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 Shares 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 such Act and will
be governed by the final adjudication of such issue.

                                      -11-

<PAGE>


         No dealer,  salesman or other  person has been  authorized  to give any
information  or make any  representation  other  than  those  contained  in this
Prospectus.  If given or made, such information or  representations  must not be
relied upon as having been  authorized by the Company.  This Prospectus does not
constitute  an offer to sell or the  solicitation  of an offer to buy any of the
securities other than the specific  securities to which it relates,  or as offer
or  solicitation  to any  person  in any  jurisdiction  where  such an  offer or
solicitation would be unlawful.


                                TABLE OF CONTENTS

                                                        Page

Available Information....................................2
Incorporation of Certain
  Documents by Reference.................................2
Prospectus Summary.......................................4
Risk Factors.............................................5
The Company............................................. 8
Use of Proceeds..........................................9
Selling Stockholders.....................................9
Plan of Distribution....................................10
Legal Matters...........................................11
Experts.................................................11
Disclosure of Commission Position on
  Indemnification for Securities Act
  Liabilities ..........................................11



                        3,498,855 Shares of Common Stock
                        150,000 Redeemable Common Stock
                               Purchase Warrants


                            FOCUS ENHANCEMENTS, INC.

                                 ______________
                       
                                   PROSPECTUS
                                 ______________
                       
                       
                                November 20, 1997




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