SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934

Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]

Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, For Use of the
[X] Definitive Proxy Statement Commission Only (as permitted
[ ] Definitive Additional Materials by Rule 14a-6(e)(2))
[ ] Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12

RENT-A-WRECK OF AMERICA, INC.
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(Name of Registrant as Specified In Its Charter)

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(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

1) Title of each class of securities to which transaction applies:

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2) Aggregate number of securities to which transaction applies:

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3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):

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4) Proposed maximum aggregate value of transaction:

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5) Total fee paid:

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[ ] Fee paid previously with preliminary materials:

[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.

1) Amount previously paid:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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RENT-A-WRECK OF AMERICA, INC.
10324 SOUTH DOLFIELD ROAD
OWINGS MILLS, MARYLAND 21117

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD NOVEMBER 20, 2001

TO THE STOCKHOLDERS:

The Annual Meeting of stockholders of Rent-A-Wreck of America, Inc., a
Delaware corporation (the "Company"), will be held on Tuesday, November 20, 2001
at 1:00 p.m. local time, at the Company's headquarters located at 10324 South
Dolfield Road, Owings Mills, Maryland 21117, for the following purposes:

1. To elect directors for the ensuing year and until their successors are
elected and qualified; and

2. To transact such other business as may properly come before the
meeting or any adjournment thereof.

The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.

Stockholders of record at the close of business on October 5, 2001 are
entitled to vote at the meeting and at any adjournment or postponement thereof.
Shares can be voted at the meeting only if the holder is present or represented
by proxy. A list of stockholders entitled to vote at the meeting will be open
for inspection at the Company's corporate headquarters for any purpose germane
to the meeting during ordinary business hours for 10 days prior to the meeting.

This Notice and Proxy Statement are being mailed on or about October 15,
2001.

A copy of the Company's 2001 Annual Report to stockholders and Form 10-KSB
for the fiscal year ended March 31, 2001, which includes audited financial
statements, is enclosed. All stockholders are cordially invited to attend the
Annual Meeting in person.

Sincerely,

KENNETH L. BLUM, SR.
CHAIRMAN AND CHIEF EXECUTIVE OFFICER

Owings Mills, Maryland
October 15, 2001

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IMPORTANT: PLEASE COMPLETE, DATE AND SIGN THE ENCLOSED PROXY AND MAIL IT
PROMPTLY IN THE ENCLOSED ENVELOPE TO ASSURE REPRESENTATION OF YOUR SHARES,
WHETHER OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING. IF YOU ATTEND THE ANNUAL
MEETING, YOU MAY REVOKE THE PROXY AND VOTE YOUR SHARES IN PERSON.
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RENT-A-WRECK OF AMERICA, INC.
10324 SOUTH DOLFIELD ROAD
OWINGS MILLS, MARYLAND 21117

PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD NOVEMBER 20, 2001

SOLICITATION, EXECUTION AND REVOCATION OF PROXIES

We are providing this proxy statement to you as a stockholder of RAWA in
connection with the solicitation of proxies by the Board of Directors for use at
the annual meeting. All executed proxies, unless such proxies have previously
been revoked, will be voted in accordance with the direction on the proxies. If
you fail to indicate a direction on your proxy, your shares will be voted in
favor of the proposals to be acted upon at the annual meeting. The Board of
Directors is not aware of any other matter which may come before the meeting,
except for those matters listed on the notice of Annual Meeting of Stockholders.
If any other matters are properly presented at the meeting for action, including
a question of adjourning the meeting from time to time, the persons named in the
proxies and acting thereunder will have discretion to vote on such matters in
accordance with their judgment.

When stock is in the name of more than one person, the proxy is valid if
signed by any of such persons unless we receive written notice to the contrary.
If the stockholder is a corporation, the proxy should be signed in the name of
such corporation by an executive or other authorized officer. If signed as
attorney, executor, administrator, trustee, guardian or in any other
representative capacity, the signer's full title should be given and, if not
previously furnished, a certificate or other evidence of appointment should be
furnished.

This Proxy Statement and the form of proxy which is enclosed are being
mailed to the Company's stockholders commencing on or about October 15, 2001.

You may revoke your proxy at any time before it is voted. If you wish to
revoke your proxy, you can do so (i) by executing a later-dated proxy relating
to the same shares and delivering it to the Secretary of the Company prior to
the vote at the annual meeting, (ii) by written notice of revocation received by
the Secretary prior to the vote at the annual meeting or (iii) by appearing in
person at the annual meeting, filing a written notice of revocation and voting
in person the shares to which the proxy relates.

In addition to the use of the mails, we may solicit proxies by personal
interview, telephone or telegram by the directors, officers and regular
employees of the Company. Such persons will receive no additional compensation
for such services. Arrangements will also be made with certain brokerage firms
and certain other custodians, nominees and fiduciaries for the forwarding of
solicitation materials to the beneficial owners of Common Stock held of record
by such persons, and such brokers, custodians, nominees and fiduciaries will be
reimbursed for their reasonable out-of-pocket expenses incurred in connection
therewith. We will bear all expenses incurred in connection with this
solicitation.

The mailing address of the principal corporate office of the Company is
10324 South Dolfield Road, Owings Mills, Maryland 21117.

VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF

Only stockholders of record at the close of business on October 5, 2001
(the "Record Date") will be entitled to vote at the meeting. On the Record Date,
the Company had outstanding 4,310,496 shares of Common Stock and 1,105,000
shares of Series A Convertible Preferred Stock ("Series A Preferred"), each of
which, except as noted below, entitles the record holder thereof on such date to
one vote on each matter presented at the meeting. As further described below,
the holders of Series A Preferred, voting as a class, have the right to elect up
to four directors of a seven-member Board of Directors, but a majority of
holders of Series A Preferred have chosen only to exercise their right to elect
three of the directors. Because of the Series A Preferred's right to vote as a
class for the election of Class II directors, the proxies solicited from holders
of Common Stock do not involve the election of directors nominated to positions
in Class II.

The presence of a majority of the Common Stock and a majority of the Series
A Preferred, represented in person or by proxy, constitutes a quorum for the
conduct of business at the annual meeting. The two Class I nominees for director
receiving the highest number of affirmative votes (whether or not a majority)
cast by the shares represented at the annual meeting and entitled to vote
thereon, a quorum being present, shall be elected as directors.

We will include abstentions and broker non-votes in determining the number
of shares present for quorum purposes. Because abstentions represent shares
entitled to vote, the effect of an abstention will be the same as a vote cast
against a proposal. A broker non-vote, on the other hand, will not be regarded
as representing a share entitled to vote on the proposal and, accordingly, will
have no effect on the voting for such proposal. However, only affirmative votes
are relevant in the election of directors.

Votes will be counted by the Inspector of Elections appointed by the
Chairman of the Annual Meeting and certified to the Company in writing.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

As of September 7, 2001 the persons and entities identified in the
following table, including all directors, executive officers and persons known
to the Company to own more than 5% of the Company's voting securities, owned
beneficially, within the meaning of Securities and Exchange Commission Rule
13d-3, the shares of voting securities reflected in such table. All the
outstanding shares of Series A Preferred are immediately convertible at the
option of the holder into Common Stock, on a share-for-share basis. Except as
otherwise specified, the named beneficial owner has sole investment and voting
power with respect to such shares.

TOTAL (1)
----------------------
SHARES PERCENT PERCENT
NAME AND ADDRESS OF BENEFICIAL OWNER TITLE OF CLASS BENEFICIALLY OWNED OF CLASS OF COMMON
------------------------------------ -------------- ------------------ -------- ---------

Kenneth L. Blum, Sr.(6) -- -- -- --
10324 S. Dolfield Road
Owings Mills, Maryland 21117

David Schwartz Common 400,000 9.3 9.3
Bundy Rent-A-Wreck
12333 W. Pico Blvd.
Los Angeles, California 90064

William L. Richter(3)(4) Common 992,706(3) 23.0(3) 23.0
c/o Richter Investment Corp. Preferred(3) 1,050,000(3) 95.0 37.5(4)
450 Park Avenue
New York, New York 10022

Alan L. Aufzien(5) Common 62,500 1.4 1.4
P.O. Box 2369 Preferred(4) 34,375 3.1 1.8
Secaucus, New Jersey 07094

Thomas J. Volpe(8) Common 5,000 ** **
c/o Babcock & Brown
599 Lexington Ave.
New York, NY 10022

Kenneth L. Blum, Jr.(6) Common 530,718 12.3 12.3
10324 S. Dolfield Road
Owings Mills, Maryland 21117

Alan Cohn (6)(7) Common 456,395 10.6 10.6
c/o Rent-A-Wreck of America, Inc.
10324 S. Dolfield Road
Owings Mills, Maryland 21117

Robert M. Temko Common 261,700*** 6.0 6.0
39 Hidden Valley Drive
Newark, Delaware 19711

All Directors and Executive Officers as Common 1,590,924 36.9 36.9
a Group, including the Directors Named Preferred 1,050,000 95.0 48.5
Above (4 persons) (3)(4)(5)(6)

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* Represents percentage ownership of Common Stock based upon shares of Common
Stock owned or deemed owned due to presently exercisable warrants and
options and after such person's conversion of Series A Preferred.
** Less than 1%.
*** Based upon a recent inquiry of Mr. Temko. According to Amendment No. 1 of
his Schedule 13G as filed with the Securities and Exchange Commission on
January 24, 2001, Mr. Temko was the beneficial owner of 236,000 shares of
Common Stock.

FOOTNOTES

(1) Based on 4,310,496 Common Shares and 1,105,000 Series A Preferred Shares
outstanding and 35,000 options for shares of Common Stock exercisable
immediately on the date of this table, September 7, 2001.
(2) Holders of Series A Preferred, voting as a class, are entitled to elect up
to four members of a seven member Board of Directors and are also entitled
to vote as a class on other significant corporate actions. Pursuant to the
terms of proxies granted to Richter, 95.0% of the Series A Preferred may be
voted by Richter as of the date of this table. The proxies are effective
until such time that less than 500,000 shares of Series A Preferred remain
outstanding. See note 4 below.
(3) Includes 178,750 shares of Series A Preferred held by Mr. Richter. Also
includes 1,200 shares of Common Stock held by spouse's IRA. Also includes
550,000 of Series A Preferred and 617,975 shares of Common Stock held by
RIC. Also includes an additional 321,250 shares of Series A Preferred as to
which RIC holds voting authority via proxy (see note 2 above). Mr. Richter
holds a controlling interest in RIC. Mr. Richter and RIC have the same
address.
(4) Includes 321,250 shares of Series A Preferred as to which Richter holds
voting authority via proxy (see note 2 and 3 above) because Richter would
not have voting or investment control of the converted Common Stock issued
upon conversion of such shares of Series A Preferred.
(5) 34,375 shares of Series A Preferred, held by a partnership controlled by
Mr. Aufzien, are subject to a voting proxy granted to RIC. It also includes
30,000 options for shares of Common Stock exercisable immediately.
(6) Mr. Blum, Sr. is the father of Kenneth L. Blum, Jr. and Robin Cohn; see
note 7 below. Mr. Blum disclaims beneficial ownership of shares held by Mr.
Blum, Jr. and Ms. Cohn.
(7) Includes 127,167 shares held jointly with spouse. See note 6 above.
(8) Includes 5,000 options for shares of Common Stock exercisable immediately.

PROPOSAL 1

ELECTION OF DIRECTORS

NOMINEES

Five persons have been nominated for election at the 2001 Annual Meeting as
directors for terms expiring at the year 2002 Annual Meeting and until their
successors have been duly elected and qualified. Each of the nominees currently
is a director of the Company. Officers are elected annually and serve at the
pleasure of the Board of Directors.

UNLESS OTHERWISE INSTRUCTED, THE PROXY HOLDERS WILL VOTE THE PROXIES
RECEIVED BY THEM FOR THE ELECTION OF EACH OF THE COMPANY'S CLASS I NOMINEES
LISTED BELOW, EXCEPT FOR THOSE PROXIES WHICH WITHHOLD SUCH AUTHORITY. If any of
the nominees shall be unable or unwilling to serve as a director, it is intended
that the proxy will be voted for the election of such other person or persons as
the Company's management may recommend in the place of such nominee. The
management believes each nominee will be a candidate to serve as a director.

CLASS I DIRECTORS:

Your proxy will be voted as specified thereon and, in the absence of
contrary instruction, will be voted for the election of the following Class I
directors: Kenneth L. Blum, Sr. and Kenneth L. Blum, Jr. Such directors will
serve until the next annual meeting of stockholders and until their respective
successors are elected and qualified. Information with regard to the nominees is
set forth below:

KENNETH L. BLUM, SR., 74, has served as Chairman and a Director of the
Company since June 1993, has been the Company's Chief Executive Officer since
December 1993, and was its President from June 1993 to October 1994. Since 1990,
Mr. Blum has been a management consultant to a variety of companies, including
American Business Information Systems, Inc., a high-volume laser printing
company and computer service bureau. Mr. Blum is a director of Avesis
Incorporated, which markets and administers discount benefit programs. Mr. Blum
is the father of the Company's President, Kenneth L. Blum, Jr. Mr. Blum controls
K.A.B., Inc., a Florida corporation ("K.A.B."), which has a Management Agreement
with the Company. See "Certain Transactions."

KENNETH L. BLUM, JR., 37, has served as Secretary of the Company since
March 1994, as Vice President from May 1994 to October 1994, as President since
October 1994, and as a director since October 1998. Mr. Blum is also President
of American Business Information Systems, Inc., a high-volume laser printing
company and computer service bureau. Mr. Blum is the son of the Company's
Chairman and Chief Executive Officer.

CLASS II DIRECTORS:

Richter Investment Corp. ("RIC"), acting in its capacity as holder of a
proxy granted by certain holders of Series A Preferred, has at the present time
agreed to a five member Board of Directors and has selected Messrs. William L.
Richter, Alan L. Aufzien, and Thomas J. Volpe (the "Class II Directors") as the
nominees to the Board of the Series A Preferred. By virtue of this proxy and the
Series A Preferred owned or controlled by its affiliates as of the Record Date,
RIC will vote 95.1% of the outstanding Series A Preferred. RIC has indicated its
intent to vote its proxy in favor of such Class II nominees, thus ensuring their
election. These nominees have been approved by the Company's Board of Directors.

WILLIAM L. RICHTER, 58, has been a director of the Company since November
1989 and has served previously as a director from 1983 to 1985. Mr. Richter was
Co-Chairman of the Company from November 1989 to June 1993 and has been Vice
Chairman since June 1993. For the past ten years, Mr. Richter has been President
of Richter Investment Corp., an asset management and merchant banking firm. Mr.
Richter has been a Senior Managing Director of Cerberus Capital Management, L.P.
(or its predecessor organization) since its founding in late 1992. Mr. Richter
is a Director and Co-Chairman of Avesis Incorporated, which markets and
administers discount benefit programs.

ALAN L. AUFZIEN, 71, has served as a Director of the Company since November
1989. Mr. Aufzien is also a partner in the Norall Organization, a private
investment company, since 1987. Since 1983, he has also been the president and a
director of New York Harbour Associates, Inc. (a real estate development firm).
From 1986 to 1996, Mr. Aufzien was the Chairman of Meadowlands Basketball
Association (New Jersey Nets) and currently serves as a director of that
organization. Mr. Aufzien is also a director of First Real Estate Trust of New
Jersey.

THOMAS J. VOLPE, 66, has served as a Director of the Company since July
2000. Until his retirement in February 2001, Mr. Volpe served as the Senior Vice
President of Financial Operations at The Interpublic Group of Companies, Inc. He
served in this capacity from March 1986 through February 2001. Prior to his
employment at The Interpublic Group of Companies, Mr. Volpe was employed at the
Colgate Palmolive Company as the Vice President and Treasurer. He currently
serves as a director of Industry Leaders Fund, where he serves as an independent
trustee for a mutual fund, American Technical Ceramics and Paragon Trade Brands.

MANAGEMENT SERVICES AGREEMENT. Effective June 30, 1993, the Company entered
into a Management Agreement (the "Management Agreement") with K.A.B., pursuant
to which K.A.B. agreed to manage substantially all aspects of the Company's
business, subject to certain limitations and the direction of the Company's
Board of Directors. The Management Agreement was amended and extended as of
April 1, 1996 and most recently amended in January 1999 to provide for a
$300,000 annual fee and reimbursement of expenses. See "Certain Transactions."

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Under the securities laws of the United States, the Company's directors,
its executive officers, and any persons holding more than 10% of the Company's
Common Stock are required to report their initial ownership of the Company's
Common Stock and any subsequent changes in that ownership to the Securities and
Exchange Commission. Specific due dates for these reports have been established,
and the Company is required to disclose any failure to file by these dates. The
Company believes that all of these filing requirements were satisfied during the
fiscal year ended March 31, 2001. In making these disclosures, the Company has
relied solely on written representations of its directors and executive officers
and copies of the reports that they have filed with the Commission.

MEETINGS AND COMMITTEES

The Board of Directors of the Company held a total of two meetings during
the fiscal year ended March 31, 2001. During the fiscal year ended March 31,
2001, no director attended fewer than 75% of the aggregate of all meetings of
the Board of Directors and the committees, if any, upon which such director
served. The Company's audit committee, which consists of Mr. Richter, Mr.
Aufzien and Mr. Volpe and functions as an overseer of the Company's financial
reporting process and internal controls, met once to review the fiscal year
ended March 31, 2001. The members of the Audit Committee meet the independence
requirements of Rule 4200(a)(15) of the NASD Listing Standards. The Audit
Committee has adopted a written charter. The Company has no standing nominating
or compensation committee.

REPORT OF THE AUDIT COMMITTEE

The Audit Committee of the Board of Directors oversees and monitors the
participation of the Company's management and independent auditors throughout
the financial reporting process. In connection with its function to oversee and
monitor the financial reporting process of the Company, the Audit Committee has
done the following;

* reviewed and discussed the audited financial statements for the fiscal
year ended March 31, 2001 with the Company's management;

* discussed with Grant Thornton LLP, the Company's independent auditors,
those matters required to be discussed by SAS 61 (Codification of
Statements on Auditing Standards, AU ss.380); and

* received the written disclosure and the letter from Grant Thornton LLP
required by Independence Standards Board Standard No. 1 (Independence
Discussion with Audit Committees) and has discussed with Grant
Thornton its independence.

Based on the foregoing, the Audit Committee recommended to the Board of
Directors that the audited financial statements be included in the Company's
annual report on Form 10-KSB for the fiscal year ended March 31, 2001.

AUDIT COMMITTEE

WILLIAM L. RICHTER
ALAN L. AUFZIEN
THOMAS J. VOLPE

EXECUTIVE COMPENSATION

SUMMARY COMPENSATION TABLE

The following table and related notes set forth information regarding the
compensation awarded to, earned by or paid to the Company's Chief Executive
Officer for services rendered to the Company during the fiscal years ended March
31, 1999, 2000 and 2001. No other executive officer who was serving as an
executive officer during fiscal 2001 received salary and bonus which aggregated
at least $100,000 for services rendered to the Company during the fiscal year
ended March 31, 2001.

LONG-TERM COMPENSATION
----------------------
ANNUAL COMPENSATION AWARDS
------------------- ----------------------
SECURITIES UNDERLYING
NAME AND PRINCIPAL POSITION YEAR SALARY OPTIONS/SARS(#)
--------------------------- ---- ------ ---------------

Kenneth L. Blum, Sr., CEO (1) 2001 $300,000 -- (2)
2000 300,000 -- (2)
1999 262,500 -- (2)

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(1) Mr. Blum became Chief Executive Officer of the Company in connection with
the Management Agreement between the Company and K.A.B., effective June 30,
1993. Mr. Blum does not receive cash compensation directly from the
Company. K.A.B. receives cash compensation pursuant to the Management
Agreement of $300,000 per year ($250,000 per year prior to January 1, 1999)
plus expense reimbursements ($10,014 in the year ended March 31, 2001). The
amounts indicated in the table represent compensation received by K.A.B.
pursuant to the Management Agreement. Mr. Blum is the sole stockholder of
K.A.B. See "Certain Transactions - Management Agreement with K.A.B., Inc.
and Related Transactions - Management Agreement."
(2) During the year ended March 31, 1994, K.A.B. received options for the
purchase of 2,250,000 shares of the Company's Common Stock in connection
with the Management Agreement. Also effective on that date, K.A.B.
transferred the Options to certain related parties. K.A.B. transferred the
options to certain related parties and during the year ended March 31,
1995, the Board of Directors approved the vesting of 1,000,000 of these
options at an exercise price of $1.00 per share. Effective July 20, 1995
the exercise price of the balance of the options was set by the Board of
Directors at $1.15 per share, with vesting, subject to continued
employment, on July 1, 2002, or earlier subject to satisfaction of
performance targets. As a result of the Company's financial performance for
the fiscal year ended March 31, 1999, the Company met the performance
targets, and the balance of the options became fully vested as of March 31,
1999. The Company repurchased 500,000 of these options in fiscal year 2000,
and 957,721 of these options in fiscal year 2001, and the balance of
617,279 were exercised in fiscal year 2001. See "Certain Transactions -
Management Agreement with K.A.B., Inc. and Related Transactions - Stock
Option Grant."

OPTION/SAR GRANTS IN LAST FISCAL YEAR

No stock options or SARs were granted to the executive officer named in the
Summary Compensation Table during the last fiscal year. See "Certain
Transactions - Management Agreement with K.A.B., Inc. and Related Transactions -
Stock Option Grant."

AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUE TABLE

No executive officer named in the Summary Compensation Table held or
exercised options at the end of the last fiscal year. See "Certain Transactions
- Management Agreement with K.A.B., Inc. and Related Transactions - Stock Option
Grant."

COMPENSATION OF DIRECTORS

Currently, directors of the Company who also serve as officers of the
Company and outside directors receive no cash compensation in connection with
the services they render as directors. (Officers, however, receive compensation
in their capacity as officers as described above.) Directors are reimbursed for
expenses incurred in connection with their service on the Board of Directors. In
1999, the Company's Board of Directors approved the payment to William L.
Richter of consulting fees of $30,000 per year beginning April 1, 1999 and paid
$30,000 in fiscal year 2001. The fees were assigned to Richter Investment Corp.

CERTAIN TRANSACTIONS

MANAGEMENT AGREEMENTS WITH K.A.B., INC. AND RELATED TRANSACTIONS

MANAGEMENT AGREEMENT. Effective June 30, 1993, the Company entered into a
Management Agreement (the "Management Agreement") with K.A.B. pursuant to which
K.A.B. agreed to provide management consulting with respect to substantially all
aspects of the Company's business, subject to certain limitations and the
direction of the Company's Board of Directors. K.A.B. is controlled by Kenneth
L. Blum, Sr. who is Chairman and Chief Executive Officer of the Company.
Effective January 1, 1999, the Management Agreement provides for a payment to
K.A.B. of $300,000 per year and reimbursement of expenses and options for the
purchase of up to 2,250,000 shares of the Company's Common Stock, as described
below. The Management Agreement had an original term of five years, and the term
was extended for an additional five years on April 1, 1996 and again on January
19, 2000, thereby extending the term of the Management Agreement to June 30,
2008. The Management Agreement is terminable by the Company for cause, as
defined.

The Management Agreement includes certain representations, warranties and
limitations on solicitation by K.A.B. of customers and employees of the Company
during the term of the Management Agreement and for two years thereafter. The
Management Agreement also requires that K.A.B. hold in confidence the Company's
confidential information. Mr. Blum, Sr., K.A.B. and their affiliates are
involved in various business ventures in addition to the activities on behalf of
the Company required by the Management Agreement. Participation in such other
ventures may detract from efforts on behalf of the Company.

STOCK OPTION GRANT. Effective June 30, 1993, the Company issued five-year
options (the "Options") to K.A.B. for the purchase of up to 2,250,000 shares of
the Company's Common Stock. The Options originally vested at prices ranging from
$1.00 to $1.30 contingent upon achievement of a combination of profitability and
stock price targets. Effective October 19, 1994, the Board of Directors approved
the vesting of 1,000,000 Options at an exercise price of $1.00 per share and
provided that the balance of the Options (an aggregate of 1,250,000 Options)
(the "Unvested Options") would vest at $1.30 on April 1, 1998 subject to
continued retention of K.A.B.'s services pursuant to the Management Agreement.

Effective July 20, 1995, the Board of Directors provided that the exercise
price of the Unvested Options would be $1.15 per share irrespective of the
circumstances under which the Options vest. The actions of the Board of
Directors were predicated upon the Board's view of the Company's performance
relative to the original vesting criteria and other relevant considerations. As
a result of the Company's financial performance for the fiscal year ended March
31, 1999, the Unvested Options fully vested on March 31, 1999.

On July 24, 2000, William L. Richter, Richter and Kenneth L. Blum, Jr.
exercised 30,000, 45,000, and 100,000 options, respectively. On September 21,
2000, the Board authorized the repurchase of, and the Company entered into an
agreement to repurchase, 449,449 options from Mr. Kenneth L. Blum, Jr. and
508,272 options from Alan Cohn for an aggregate price of $1,234,560. The
repurchase has been included in the consolidated statement of earnings for the
year ended March 31, 2001. On September 21, 2000, Kenneth L. Blum and Alan Cohn
exercised their remaining 617,279 options at $1.00, and the Company received
$617,279.

On November 2, 2000, the Company's 2000 Stock Option Plan was approved by
the Company's stockholders pursuant to which the Board of Directors of the
Company may grant stock options to provide incentives to outside directors of
the Company. Accordingly, in November 2000, the Board authorized and the Company
granted to Alan Aufzien and Thomas Volpe, the Company's Directors, options to
purchase 30,000 and 5,000 shares, respectively, of the Company's Common Stock at
$1.64. The Company is planning to grant Alan Aufzien and Thomas Volpe options to
purchase 5,000 shares of the Company's Common Stock on an annual basis while
they continue to serve as directors after the annual meeting. The fair value of
each option grant is estimated on the date of grant, using the Black Scholes
options pricing model with the following weighted-average assumptions used for
grants issued in 2001: risk free interest rate of 6.4%; expected volatility of
48.5%; and expected lives of 7 years.

REGISTRATION RIGHTS AGREEMENT. The Company entered into a Registration
Rights Agreement (the "Registration Rights Agreement") effective June 30, 1993
with K.A.B., Mr. Blum, Jr. and Alan S. Cohn. Mr. Blum, Sr. is the father of Mr.
Blum, Jr., and the father-in-law of Mr. Cohn. The Registration Rights Agreement
provides up to three demand registrations with respect to the Shares and the
shares issuable pursuant to the Options ("Registrable Securities"). The first
demand registration is exercisable at the request of holders of at least 250,000
Registrable Securities after a fiscal year in which Profits are at least
$250,000, provided that the Stock Price is at least $2.00 at the time of the
request. The second demand registration is exercisable at the request of holders
of at least 600,000 Registrable Securities after at least 1,000,000 Options have
become exercisable. The third demand registration is exercisable at the request
of holders of at least 1,000,000 Registrable Securities after all of the Options
have become exercisable. Holders of the Company's Series A Preferred Stock have
the right to participate in the above demand registrations on a pro rata basis.
The Registration Rights Agreement also provides piggyback registration rights
with respect to registrations in which other selling stockholders are
participating. The Company is obligated to pay the offering expenses of each
such registration, except for the selling stockholders' pro rata portion of
underwriting discounts and commissions. No precise prediction can be made of the
effect, if any, that the availability of shares pursuant to registrations under
the Registration Rights Agreement will have on the market price prevailing from
time to time. Nevertheless, sales of substantial amounts of the Common Stock
pursuant to such registrations could adversely affect prevailing market prices.

INVESTMENT BANKING SERVICES. The Company has retained RIC, an affiliate of
William L. Richter (a director of the Company), to serve as exclusive financial
advisor for the Company. The Management Agreement and related transactions with
K.A.B. were structured and negotiated for the Company by RIC, which received
cash consideration of $15,000 and five-year warrants (the "Warrants") to
acquire: (i) 20,000 shares of the Company's Common Stock currently exercisable
at $.80 per share (which have been exercised); and (ii) 135,000 shares of the
Company's Common Stock exercisable on the same basis as is applicable to the
Options, as described above. RIC is also entitled to receive a fee equal to 6%
of the cash received by the Company upon any exercise of the Options (which have
also been exercised). The shares of Common Stock issuable pursuant to the
Warrants are entitled to piggyback registration rights with respect to any
registration in which the Shares or the Common Stock issuable pursuant to the
Options are included. RIC assigned warrants for the purchase of 62,000 shares of
the Company's Common Stock to Mr. Richter out of the Warrants. Mr. Richter and
his firm have provided and expect to continue to provide substantial investment
banking services for Mr. Blum and various of his affiliated entities. To that
extent, RIC may be deemed to have had a conflict of interest with respect to its
efforts on behalf of the Company in effecting the Management Agreement and
related agreements with K.A.B. The Company's Board of Directors took into
account the potential conflict of interest issues referred to above in
structuring and entering into the investment banking agreement with RIC and
believes that such agreement was desirable and in the best interests of the
Company notwithstanding such possibility.

For its role of financial advisor, RIC's fees will be based upon
transactions completed, as defined in the Agreement. RIC received $47,912 for
its role in connection with the September 2000 exercise of options held by
K.A.B. for the year ended March 31, 2001.

OTHER

Through November 19, 1999, the Company leased a portion of its corporate
offices under the terms of a month-to-month operating lease with American
Business Information Systems, Inc. ("ABIS"), a related party of K.A.B. The
Company paid $0 for the year ended March 31, 2001, to ABIS under this agreement,
and $51,038 for printing expenses to ABIS. On November 1, 1999, the Company
entered into a lease agreement with K.A., a related party of K.A.B., to lease
approximately 9,100 square feet of executive office space, which expires on
October 31, 2006. The Company paid K.A. $114,087 for the year ended March 31,
2001.

Effective January 1, 1995, the Company entered into a five-year agreement
with National Computer Services, Inc. ("NCS," which merged with ABIS in January
1996) to develop computer software and related documentation. During the year
ended March 31, 1999, ABIS received $1,175 pursuant to this agreement. Kenneth
L. Blum, Jr. was the sole stockholder and an executive officer of NCS. On
January 19, 2000, the Board of Directors authorized expenditures to ABIS
totaling $250,000 for the development of a centralized software reporting
package to be used by the Company's franchisees. The Company paid $4,940 and
$177,255 for the years ended March 31, 2000 and 2001, respectively, to ABIS
under this arrangement.

Effective March 20, 1995, the Company retained RIC as its exclusive
financial advisor. RIC's fees under this arrangement are payable only upon
completion of defined transactions and, in such event, are calculated upon the
basis of a percentage of the transaction value. The agreement is terminable by
the Company upon 90 days notice, provided that RIC is entitled to receive
certain fees for two years following termination in the event a transaction is
concluded involving an entity introduced to the Company by RIC.

As of April 1, 1999, RIC receives an annual consulting fee of $30,000. In
the opinion of management, the terms of the Company's arrangements with RIC,
K.A.B., and ABIS taken as a whole are at least as favorable to the Company as
could be obtained from third parties.

AUDIT MATTERS

Grant Thornton LLP, Certified public Accountants, served as the Company's
independent auditors for the year ended March 31, 2001. The Company has been
advised by Grant Thornton LLP that none of its members have any financial
interest in the corporation. In addition to performing customary audit services,
Grant Thornton LLP assisted the corporation with preparation of their federal
and state tax returns, and provided assistance in connection with regulatory
matters, charging the Company for such services at its customary hourly billing
rates. These non-audit services were approved by the corporation's Board of
Directors after due consideration of the effect of the performance thereof on
the independence of the auditors and after the conclusion by the Company's Board
of Directors that there was no effect on the independence of the auditors. The
Board of Directors has engaged Grant Thornton LLP as the corporation's
independent auditors for the year ending March 31, 2002. Grant Thornton LLP's
representatives are not expected to be present at the annual meeting.

Pursuant to disclosure rules adopted by the SEC regarding independent public
accountants, in the fiscal year ended March 31, 2001, Grant Thornton LLP billed
the Company for the following professional services:

AUDIT FEES

The aggregate fees billed for professional services rendered by Grant
Thornton LLP for the audit of the Company's annual consolidated financial
statements for the year ended March 31, 2001 and the SAS 71 quarterly reviews of
the condensed financial statements was $64,950.

FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES

There were no fees billed for information technology services rendered by
Grant Thornton LLP during the year ended March 31, 2001.

ALL OTHER FEES

The aggregate fees billed for all non-audit services including fees for
financial consulting and tax-related services rendered by Grant Thornton LLP
during the year ended March 31, 2001 totaled $20,685.

The Board of Directors considered whether the services provided under other
non-audit services are compatible with maintaining the auditor's independence.

OTHER MATTERS

The Company is unaware of any other matters that are to be presented for
action at the meeting. Should any other matter come before the meeting, however,
the persons named in the enclosed proxy will have discretionary authority to
vote all proxies with respect to such matter in accordance with their judgment.

FINANCIAL INFORMATION

Enclosed with this Proxy Statement are the Company's 2001 Annual Report to
Stockholders and a copy of the Company's Report on Form 10-KSB for the year
ended March 31, 2001 which includes the Company's audited financial statements
and financial statement schedules and "Management's Discussion and Analysis of
Financial Condition and Results of Operations."

STOCKHOLDER PROPOSALS

Proposals intended to be presented at the 2002 Annual Meeting of
Stockholders must be received by the Company by June 17, 2002 to be considered
for inclusion in the Company's proxy materials relating to that meeting. Notice
of stockholder proposals for presentation at the 2002 Annual Meeting, but which
are not going to be presented to the Company for inclusion in the proxy
materials, will be considered untimely after August 30, 2002 and will not be
considered at the next annual meeting.

RENT-A-WRECK OF AMERICA, INC.

October 15, 2001 KENNETH L. BLUM, SR.
CHAIRMAN AND CHIEF EXECUTIVE OFFICER

PLEASE DATE, SIGN AND MAIL YOUR
PROXY CARD BACK AS SOON AS POSSIBLE!

ANNUAL MEETING OF STOCKHOLDERS
RENT-A-WRECK OF AMERICA, INC.

NOVEMBER 20, 2001

PLEASE DETACH AND MAIL IN THE ENVELOPE PROVIDED

[X] PLEASE MARK YOUR
VOTES AS IN THIS
EXAMPLE

VOTE FOR all nominees WITHHOLD
listed to the right except as AUTHORITY
indicated to the contrary to vote for
below (if any) all nominees

1. ELECTION [ ] [ ] Nominees: 2. In their discretion, to vote upon
OF CLASS II William L. Richter such other business as may properly come
DIRECTORS: Alan Aufzien before the Annual Meeting or any
Thomas Volpe adjournment thereof.

THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS
(Instructions: To withhold your vote for any DIRECTED BY THE UNDERSIGNED STOCKHOLDER. IF NO
individual nominee, write the nominee's name in the space below.) DIRECTION IS INDICATED, THIS PROXY WILL BE VOTED
FOR THE ABOVE NOMINEES, AS RECOMMENDED BY THE BOARD
___________________________ OF DIRECTORS.

____________________________ ____________________________ ____________________________ ______________________, 2001
Stockholder Name(s): Signature Signature, if held jointly Date
Please Print

Note: Please sign exactly as name appears on your stock certificate. When shares
are held by joint tenants, both should sign. When signing as an attorney,
executor, administrator, trustee or guardian, please give full title as such. If
a corporation, please give full corporate name and indicate that execution is by
president or other authorized officer. If a partnership, please sign in
partnership name by authorized person.

RENT-A-WRECK OF AMERICA, INC.
10324 SOUTH DOLFIELD ROAD
OWINGS MILLS, MARYLAND 21117

----------

THIS PROXY IS SOLICITED ON
BEHALF OF THE BOARD OF DIRECTORS

The undersigned hereby acknowledges receipt of the Notice of Annual Meeting and
revoking all prior proxies, hereby appoints William L. Richter, as proxy, with
the full power to appoint his substitute, and hereby authorizes him to represent
and to vote, as designated on the reverse side of this proxy card, all the
shares of Preferred Stock of Rent-A-Wreck of America, Inc., a Delaware
corporation (the "Company") held of record by the undersigned on October 5, 2001
at the Annual Meeting of Stockholders to be held on November 20, 2001, and at
any adjournment or postponement thereof.

(PLEASE DATE AND SIGN ON REVERSE SIDE)

PLEASE DATE, SIGN AND MAIL YOUR
PROXY CARD BACK AS SOON AS POSSIBLE!

ANNUAL MEETING OF STOCKHOLDERS
RENT-A-WRECK OF AMERICA, INC.

NOVEMBER 20, 2001

* PLEASE DETACH AND MAIL IN THE ENVELOPE PROVIDED *

[X] PLEASE MARK YOUR
VOTES AS IN THIS
EXAMPLE

VOTE FOR all nominees WITHHOLD
listed to the right except as AUTHORITY
indicated to the contrary to vote for
below (if any) all nominees

1. ELECTION [ ] [ ] Nominees: 2. In their discretion, to vote upon
OF CLASS I Kenneth L. Blum, Jr. such other business as may properly come
DIRECTORS: Kenneth L. Blum, Sr. before the Annual Meeting or any
adjournment thereof.

____________________________ ____________________________ ____________________________ ______________________, 2001
Stockholder Name(s): Signature Signature, if held jointly Date
Please Print

RENT-A-WRECK OF AMERICA, INC.
10324 SOUTH DOLFIELD ROAD
OWINGS MILLS, MARYLAND 21117

----------

THIS PROXY IS SOLICITED ON
BEHALF OF THE BOARD OF DIRECTORS

The undersigned hereby acknowledges receipt of the Notice of Annual Meeting and
revoking all prior proxies, hereby appoints Kenneth L. Blum, Sr., and Kenneth L.
Blum, Jr., as proxy, with the full power to appoint their substitute, and hereby
authorizes them to represent and to vote, as designated on the reverse side of
this proxy card, all the shares of Common Stock of Rent-A-Wreck of America,
Inc., a Delaware corporation (the "Company") held of record by the undersigned
on October 5, 2001 at the Annual Meeting of Stockholders to be held on November
20, 2001, and at any adjournment or postponement thereof.

(PLEASE DATE AND SIGN ON REVERSE SIDE)