We explore further the suggestion to describe a pre-and post-selected system by a two-state, which is determined by two conditions. Starting with a formal definition of a two-state Hilbert space and basic operations, we systematically recast the basics of quantum mechanics -dynamics, observables, and measurement theory -in terms of two-states as the elementary quantities. We find a simple and suggestive formulation, that "unifies" two comple- A consequence of the suggested formalism and measurement theory, is that the problem of non-locality and Lorentz non-covariance, of the usual prescription with a 'reduction', may be eliminated. We exemplify this point for the EPR experiment and for a system under successive observations.