##### Table of Contents

2007

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UNITED STATES

SECURITIES AND
EXCHANGE COMMISSION

Washington, D.C. 20549



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FORM 10-Q



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|x | Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|- | ---------------------------------------------------------------------------------------

For the quarterly period ended September 30, 2007



| ̈ | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|- | ----------------------------------------------------------------------------------------

for the transition period from  to

Commission file number 1-14105



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AVALON HOLDINGS CORPORATION

(Exact name of registrant as specified in its charter)



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|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Ohio                                                           |  | 34-1863889                          
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification No.)



|                                         |  |           
|---------------------------------------- |  | ----------
|One American Way, Warren, Ohio           |  | 44484-5555
|(Address of principal executive offices) |  | (Zip Code)

Registrants telephone number, including area code: (330) 856-8800



---

Indicate by a check mark whether the registrant
(1) has filed all reports required to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days.    Yes  x    No ̈

Indicate by a check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated
filer. See definition of accelerated filer and large accelerated filer in Rule 12b-2 of the Exchange Act. (Check one):

Large
accelerated filer ̈Accelerated filer ̈Non-accelerated filer  x

Indicate by a
check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    Yes ̈No  x

The registrant had 3,190,786 shares of its Class A Common Stock
and 612,545 shares of its Class B Common Stock outstanding as of November 9, 2007.



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##### Table of Contents

AVALON HOLDINGS CORPORATION AND SUBSIDIARIES

INDEX



|                                                                                                                            |  |      |  | 
|--------------------------------------------------------------------------------------------------------------------------- |  | ---- |  | 
|                                                                                                                            |  | Page
|PART I. FINANCIAL INFORMATION                                                                                               |  |     
|                                                                                                                            | 
|Item 1. Financial Statements                                                                                                |  |     
|                                                                                                                            | 
|Condensed Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2007 and 2006 (Unaudited) |  | 3   
|                                                                                                                            | 
|Condensed Consolidated Balance Sheets at September 30, 2007 (Unaudited) and December 31, 2006                               |  | 4   
|                                                                                                                            | 
|Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2007 and 2006 (Unaudited)           |  | 5   
|                                                                                                                            | 
|Notes to Condensed Consolidated Financial Statements (Unaudited)                                                            |  | 6   
|                                                                                                                            | 
|Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations                               |  | 10  
|                                                                                                                            | 
|Item 3. Quantitative and Qualitative Disclosures about Market Risk                                                          |  | 16  
|                                                                                                                            | 
|Item 4. Controls and Procedures                                                                                             |  | 16  
|                                                                                                                            | 
|PART II. OTHER INFORMATION                                                                                                  |  |     
|                                                                                                                            | 
|Item 1. Legal Proceedings                                                                                                   |  | 17  
|                                                                                                                            | 
|Item 2. Changes in Securities and Use of Proceeds                                                                           |  | 17  
|                                                                                                                            | 
|Item 3. Defaults upon Senior Securities                                                                                     |  | 17  
|                                                                                                                            | 
|Item 4. Submission of Matters to a Vote of Security Holders                                                                 |  | 17  
|                                                                                                                            | 
|Item 5. Other Information                                                                                                   |  | 17  
|                                                                                                                            | 
|Item 6. Exhibits and Reports on Form 8-K                                                                                    |  | 17  
|                                                                                                                            | 
|SIGNATURE                                                                                                                   |  | 18  



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##### Table of Contents

PART I.
FINANCIAL INFORMATION



|ITEM 1. | FINANCIAL STATEMENTS
|------- | --------------------

AVALON HOLDINGS CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements of Operations (Unaudited)

(in thousands, except per share amounts)



|                                                                  |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|----------------------------------------------------------------- |  | ------------------------------- | ------ | - | ------------------------------ | - | ------ | ---- |  | - | ------ | - |  | - | ------ | -
|                                                                  |  | Three Months EndedSeptember 30, |        |   | Nine Months EndedSeptember 30, |  
|                                                                  |  | 2007                            |        |   | 2006                           |   |        | 2007 |  |   | 2006   |  
|Net operating revenues                                            |  | $                               | 12,139 |   |                                | $ | 11,130 |      |  | $ | 34,983 |   |  | $ | 29,284 |  
|Costs and expenses:                                               |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|Costs of operations                                               |  |                                 | 10,158 |   |                                |   | 9,211  |      |  |   | 29,325 |   |  |   | 24,549 |  
|Selling, general and administrative expenses                      |  |                                 | 1,543  |   |                                |   | 1,633  |      |  |   | 4,911  |   |  |   | 4,709  |  
|                                                                  |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|Operating income from continuing operations                       |  |                                 | 438    |   |                                |   | 286    |      |  |   | 747    |   |  |   | 26     |  
|                                                                  |  |                                 |        |  
|Other income (expense):                                           |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|Interest expense                                                  |  |                                 | (3     | ) |                                |   | (4     | )    |  |   | (12    | ) |  |   | (11    | )
|Interest income                                                   |  |                                 | 94     |   |                                |   | 173    |      |  |   | 379    |   |  |   | 437    |  
|Other income, net                                                 |  |                                 | 45     |   |                                |   | 48     |      |  |   | 65     |   |  |   | 170    |  
|                                                                  |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|Income from continuing operations before income taxes             |  |                                 | 574    |   |                                |   | 503    |      |  |   | 1,179  |   |  |   | 622    |  
|Provision for income taxes                                        |  |                                 | 27     |   |                                |   |       |      |  |   | 30     |   |  |   |       |  
|                                                                  |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|Income from continuing operations                                 |  |                                 | 547    |   |                                |   | 503    |      |  |   | 1,149  |   |  |   | 622    |  
|                                                                  |  |                                 |        |  
|Discontinued operations:                                          |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|(Loss) income from discontinued operations before income taxes    |  |                                 |       |   |                                |   | (2     | )    |  |   | 113    |   |  |   | 362    |  
|Provision (benefit) for income taxes                              |  |                                 |       |   |                                |   |       |      |  |   |       |   |  |   |       |  
|                                                                  |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|(Loss) income from discontinued operations                        |  |                                 |       |   |                                |   | (2     | )    |  |   | 113    |   |  |   | 362    |  
|                                                                  |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|Net income                                                        |  | $                               | 547    |   |                                | $ | 501    |      |  | $ | 1,262  |   |  | $ | 984    |  
|                                                                  |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|Net income per share from continuing operations (Note 2)          |  | $                               | .14    |   |                                | $ | .13    |      |  | $ | .30    |   |  | $ | .16    |  
|                                                                  |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|Net income (loss) per share from discontinued operations (Note 2) |  | $                               |       |   |                                | $ |       |      |  | $ | .03    |   |  | $ | .10    |  
|                                                                  |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|Net income per share (Note 2)                                     |  | $                               | .14    |   |                                | $ | .13    |      |  | $ | .33    |   |  | $ | .26    |  
|                                                                  |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|Weighted average shares outstanding (Note 2)                      |  |                                 | 3,803  |   |                                |   | 3,803  |      |  |   | 3,803  |   |  |   | 3,803  |  
|                                                                  |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  

See accompanying notes to condensed consolidated financial statements.



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AVALON HOLDINGS CORPORATION AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(in thousands, except per share amounts)



|                                                                                                                      |  |                   |         |   |                  |   |         |  
|--------------------------------------------------------------------------------------------------------------------- |  | ----------------- | ------- | - | ---------------- | - | ------- | -
|                                                                                                                      |  | September 30,2007 |         |   | December 31,2006 |  
|                                                                                                                      |  | (Unaudited)       |         |   |                  |  
|Assets:                                                                                                               |  |                   |         |   |                  |   |         |  
|Current Assets:                                                                                                       |  |                   |         |   |                  |   |         |  
|Cash and cash equivalents                                                                                             |  | $                 | 6,741   |   |                  | $ | 13,251  |  
|Accounts receivable, net                                                                                              |  |                   | 7,902   |   |                  |   | 7,672   |  
|Prepaid expenses                                                                                                      |  |                   | 308     |   |                  |   | 223     |  
|Other current assets                                                                                                  |  |                   | 369     |   |                  |   | 224     |  
|                                                                                                                      |  |                   |         |   |                  |   |         |  
|Total current assets                                                                                                  |  |                   | 15,320  |   |                  |   | 21,370  |  
|                                                                                                                      |  |                  
|Property and equipment, less accumulated depreciation and amortization of $6,411 in 2007 and $5,854 in 2006           |  |                   | 27,077  |   |                  |   | 18,696  |  
|Leased property under capital leases, less accumulated depreciation and amortization of $951 in 2007 and $698 in 2006 |  |                   | 5,675   |   |                  |   | 5,816   |  
|Other assets, net                                                                                                     |  |                   | 61      |   |                  |   | 69      |  
|                                                                                                                      |  |                   |         |   |                  |   |         |  
|Total assets                                                                                                          |  | $                 | 48,133  |   |                  | $ | 45,951  |  
|                                                                                                                      |  |                   |         |   |                  |   |         |  
|                                                                                                                      |  |                  
|Liabilities and Shareholders Equity                                                                                  |  |                   |         |   |                  |   |         |  
|Current Liabilities:                                                                                                  |  |                   |         |   |                  |   |         |  
|Current portion of obligations under capital leases                                                                   |  | $                 | 1       |   |                  | $ | 40      |  
|Accounts payable                                                                                                      |  |                   | 5,387   |   |                  |   | 4,723   |  
|Accrued payroll and other compensation                                                                                |  |                   | 700     |   |                  |   | 561     |  
|Accrued income taxes                                                                                                  |  |                   | 34      |   |                  |   | 24      |  
|Other accrued taxes                                                                                                   |  |                   | 204     |   |                  |   | 252     |  
|Other liabilities and accrued expenses                                                                                |  |                   | 2,335   |   |                  |   | 2,056   |  
|                                                                                                                      |  |                   |         |   |                  |   |         |  
|Total current liabilities                                                                                             |  |                   | 8,661   |   |                  |   | 7,656   |  
|                                                                                                                      |  |                  
|Obligations under capital leases                                                                                      |  |                   | 232     |   |                  |   | 317     |  
|                                                                                                                      |  |                  
|Shareholders Equity:                                                                                                 |  |                   |         |   |                  |   |         |  
|Class A Common Stock, $.01 par value                                                                                  |  |                   | 32      |   |                  |   | 32      |  
|Class B Common Stock, $.01 par value                                                                                  |  |                   | 6       |   |                  |   | 6       |  
|Paid-in capital                                                                                                       |  |                   | 58,096  |   |                  |   | 58,096  |  
|Accumulated deficit                                                                                                   |  |                   | (18,894 | ) |                  |   | (20,156 | )
|                                                                                                                      |  |                   |         |   |                  |   |         |  
|Total shareholders equity                                                                                            |  |                   | 39,240  |   |                  |   | 37,978  |  
|                                                                                                                      |  |                   |         |   |                  |   |         |  
|Total liabilities and shareholders equity                                                                            |  | $                 | 48,133  |   |                  | $ | 45,951  |  
|                                                                                                                      |  |                   |         |   |                  |   |         |  

See accompanying notes to condensed consolidated financial statements.



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AVALON HOLDINGS CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows (Unaudited)

(in thousands)



|                                                                                              |  |                                |        |   |      |   |        |  
|--------------------------------------------------------------------------------------------- |  | ------------------------------ | ------ | - | ---- | - | ------ | -
|                                                                                              |  | Nine Months EndedSeptember 30, |       
|                                                                                              |  | 2007                           |        |   | 2006 |  
|Operating activities:                                                                         |  |                                |        |   |      |   |        |  
|Income from continuing operations                                                             |  | $                              | 1,149  |   |      | $ | 622    |  
|Reconciliation of income from continuing operations to cash provided by operating activities: |  |                                |        |   |      |   |        |  
|Depreciation and amortization                                                                 |  |                                | 831    |   |      |   | 785    |  
|Amortization of investments                                                                   |  |                                |       |   |      |   | (15    | )
|Provision (benefit) for losses on accounts receivable                                         |  |                                | (61    | ) |      |   | 6      |  
|(Gain) loss from disposal of property and equipment                                           |  |                                | (1     | ) |      |   | 3      |  
|Change in operating assets and liabilities:                                                   |  |                                |        |   |      |   |        |  
|Accounts receivable                                                                           |  |                                | (169   | ) |      |   | (2,050 | )
|Prepaid expenses                                                                              |  |                                | (86    | ) |      |   | (125   | )
|Other current assets                                                                          |  |                                | (145   | ) |      |   | 26     |  
|Other assets                                                                                  |  |                                | 8      |   |      |   | (2     | )
|Accounts payable                                                                              |  |                                | (229   | ) |      |   | 1,071  |  
|Accrued payroll and other compensation                                                        |  |                                | 139    |   |      |   | 156    |  
|Accrued income taxes                                                                          |  |                                | 10     |   |      |   | (38    | )
|Other accrued taxes                                                                           |  |                                | (48    | ) |      |   | (60    | )
|Other liabilities and accrued expenses                                                        |  |                                | 279    |   |      |   | 48     |  
|Other noncurrent liabilities                                                                  |  |                                |       |   |      |   | (9     | )
|                                                                                              |  |                                |        |   |      |   |        |  
|Net cash provided by operating activities from continuing operations                          |  |                                | 1,677  |   |      |   | 418    |  
|Net cash provided by operating activities from discontinued operations                        |  |                                | 113    |   |      |   |       |  
|                                                                                              |  |                                |        |   |      |   |        |  
|Net cash provided by operating activities                                                     |  |                                | 1,790  |   |      |   | 418    |  
|                                                                                              |  |                                |        |   |      |   |        |  
|                                                                                              |  |                               
|Investing activities:                                                                         |  |                                |        |   |      |   |        |  
|Purchases of investment securities                                                            |  |                                |       |   |      |   | (94    | )
|Proceeds from the maturity/sale of investment securities                                      |  |                                |       |   |      |   | 4,552  |  
|Proceeds from disposal of property and equipment                                              |  |                                | 1      |   |      |   |       |  
|Capital expenditures                                                                          |  |                                | (8,291 | ) |      |   | (405   | )
|                                                                                              |  |                                |        |   |      |   |        |  
|Net cash (used in) provided by investing activities from continuing operations                |  |                                | (8,290 | ) |      |   | 4,053  |  
|Net cash provided by investing activities from discontinued operations                        |  |                                |       |   |      |   | 1,881  |  
|                                                                                              |  |                                |        |   |      |   |        |  
|Net cash (used in) provided by investing activities                                           |  |                                | (8,290 | ) |      |   | 5,934  |  
|                                                                                              |  |                                |        |   |      |   |        |  
|                                                                                              |  |                               
|Financing activities:                                                                         |  |                                |        |   |      |   |        |  
|Payments on capital lease obligations                                                         |  |                                | (10    | ) |      |   |       |  
|                                                                                              |  |                                |        |   |      |   |        |  
|Net cash used in financing activities                                                         |  |                                | (10    | ) |      |   |       |  
|                                                                                              |  |                                |        |   |      |   |        |  
|(Decrease) increase in cash and cash equivalents                                              |  |                                | (6,510 | ) |      |   | 6,352  |  
|Cash and cash equivalents at beginning of year                                                |  |                                | 13,251 |   |      |   | 7,759  |  
|                                                                                              |  |                                |        |   |      |   |        |  
|Cash and cash equivalents at end of period                                                    |  | $                              | 6,741  |   |      | $ | 14,111 |  
|                                                                                              |  |                                |        |   |      |   |        |  

Non cash investing activities:

Capital expenditures of $893 are included in accounts payable at September 30, 2007.

Non cash financing activities:

A capital lease obligation of $114 was exchanged for an operating lease in the second quarter of 2007.

See accompanying notes to condensed consolidated financial statements.



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AVALON HOLDINGS CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(Unaudited)

September 30, 2007

Note 1. Basis of Presentation

The unaudited condensed
consolidated financial statements of Avalon Holdings Corporation and subsidiaries (collectively Avalon) and related notes included herein have been prepared in accordance with the rules and regulations of the Securities and Exchange
Commission. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted consistent with such rules and regulations. The
accompanying unaudited condensed consolidated financial statements and related notes should be read in conjunction with the consolidated financial statements and related notes included in Avalons 2006 Annual Report to Shareholders.

In the opinion of management, these unaudited condensed consolidated financial statements include all adjustments, consisting of normal recurring adjustments,
necessary for a fair presentation of the financial position of Avalon as of September 30, 2007, and the results of its operations and cash flows for the interim periods presented.

The operating results for the interim periods are not necessarily indicative of the results to be expected for the full year.

Note 2. Basic Net Income (Loss) Per Share

Basic net income (loss) per share has been computed using the weighted average number of common shares
outstanding each period, which was 3,803,331. There were no common equivalent shares outstanding and therefore, diluted per share amounts are equal to basic per share amounts for the three and nine months ended September 30, 2007 and 2006.

Note 3. Comprehensive Income

Comprehensive income is
comprised of two components: net income and other comprehensive income. Comprehensive income is the change in equity during a period from transactions and other events and circumstances from non-owner sources. Comprehensive income, net of related
tax effects, is as follows (in thousands):



|                                                 |  |                                 |     |                                |   |      |  |      |       |  |   |    
|------------------------------------------------ |  | ------------------------------- | --- | ------------------------------ | - | ---- |  | ---- | ----- |  | - | ---
|                                                 |  | Three Months EndedSeptember 30, |     | Nine Months EndedSeptember 30,
|                                                 |  | 2007                            |     | 2006                           |   | 2007 |  | 2006
|Net income                                       |  | $                               | 547 |                                | $ | 501  |  | $    | 1,262 |  | $ | 984
|Unrealized gain on available-for-sale securities |  |                                 |    |                                |   | 2    |  |      |      |  |   | 10 
|                                                 |  |                                 |     |                                |   |      |  |      |       |  |   |    
|Comprehensive income                             |  | $                               | 547 |                                | $ | 503  |  | $    | 1,262 |  | $ | 994
|                                                 |  |                                 |     |                                |   |      |  |      |       |  |   |    

Note 4. Discontinued Operations

In January 2004, Avalon sold all of the fixed assets of the remediation business and discontinued the operations of the engineering and consulting business. All income and expenses relating to these operations are
included in discontinued operations.



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In the second quarter of 2007, Avalons remediation business agreed to a settlement of $115,000 from its customer
for the payment of services provided on a project in 2002. The settlement is included in discontinued operations in the Condensed Consolidated Statements of Operations for the nine months ended September 30, 2007. The monies were received in
May 2007 and are included in the Condensed Consolidated Statements of Cash Flows under the caption Net cash provided by operating activities from discontinued operations for the nine months ended September 30, 2007.

In the second quarter of 2006, Avalon determined that the remediation business was no longer obligated to pay the remaining accounts payable associated with a project
from 2001 due to a settlement reached with its customer through arbitration. Therefore, Avalon wrote off approximately $.4 million of accounts payable and such amount is included in discontinued operations in the Condensed Consolidated Statements of
Operations for the nine months ended September 30, 2006.

Concurrent with the decision to discontinue the technical environmental engineering and
consulting business, Avalon decided to sell the building associated with the technical environmental services operations. Avalon sold the building in May, 2006 and received $1.8 million which represented the selling price less the costs to sell the
building and is included in the Condensed Consolidated Statements of Cash Flows under the caption Net cash provided by investing activities from discontinued operations for the nine months ended September 30, 2006. Avalon incurred a
loss of approximately $20,000 on the sale of the building which is included in discontinued operations.

Note 5. Legal Matters

In the ordinary course of conducting its business, Avalon becomes involved in lawsuits, administrative proceedings and governmental investigations, including those
related to environmental matters. Some of these proceedings may result in fines, penalties or judgments being assessed against Avalon which, from time to time, may have an impact on its business and financial condition. Although the outcome of such
lawsuits or other proceedings cannot be predicted with certainty, Avalon does not believe that any uninsured ultimate liabilities, fines or penalties resulting from such pending proceedings, individually or in the aggregate, will have a material
adverse effect on its financial position or results of operations.

Note 6. Business Segment Information

In applying Statement of Financial Accounting Standards (SFAS) No. 131, Disclosures About Segments of an Enterprise and Related Information, Avalon
considered its operating and management structure and the types of information subject to regular review by its chief operating decision maker. On this basis, Avalons reportable segments include waste management services and golf
and related operations. Avalon accounts for intersegment net operating revenues as if the transactions were with third parties. The segment disclosures are presented on this basis for all periods presented.

Avalons primary business segment, the waste management services segment, provides hazardous and nonhazardous waste disposal brokerage and management services to
industrial, commercial, municipal and governmental customers and manages a captive landfill for an industrial customer. The golf and related operations segment includes the operations of golf courses, a travel agency and clubhouses that provide
recreational, dining and banquet facilities.



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Revenue for the golf and related operations segment consists primarily of membership dues, merchandise, and food and beverage sales. Revenue related to
membership dues are recognized proportionately over twelve months. The unrecognized or deferred revenues at September 30, 2007 and December 31, 2006 were $1.9 million and $1.7 million, respectively, and are included in the Condensed
Consolidated Balance Sheets under the caption Other liabilities and accrued expenses. Avalon does not have significant operations located outside the United States and, accordingly, geographical segment information is not presented.

For the nine months ended September 30, 2007 and 2006, no customer accounted for ten percent or more of Avalons consolidated net operating
revenues.

The accounting policies of the segments are consistent with those described for the consolidated financial statements in the summary of
significant accounting policies. Avalon measures segment profit for internal reporting purposes as income from continuing operations before taxes. Business segment information including the reconciliation of segment income before taxes to income
from continuing operations before taxes is as follows (in thousands):



|                                                       |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|------------------------------------------------------ |  | ------------------------------- | ------ | - | ------------------------------ | - | ------ | ---- |  | - | ------ | - |  | - | ------ | -
|                                                       |  | Three Months EndedSeptember 30, |        |   | Nine Months EndedSeptember 30, |  
|                                                       |  | 2007                            |        |   | 2006                           |   |        | 2007 |  |   | 2006   |  
|Net operating revenues from:                           |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|Waste management services:                             |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|External customers revenues                            |  | $                               | 9,589  |   |                                | $ | 9,036  |      |  | $ | 29,147 |   |  | $ | 24,658 |  
|Intersegment revenues                                  |  |                                 |       |   |                                |   |       |      |  |   | 12     |   |  |   |       |  
|                                                       |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|Total waste management services                        |  |                                 | 9,589  |   |                                |   | 9,036  |      |  |   | 29,159 |   |  |   | 24,658 |  
|                                                       |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|                                                       |  |                                 |        |  
|Golf and related operations:                           |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|External customers revenues                            |  |                                 | 2,550  |   |                                |   | 2,094  |      |  |   | 5,836  |   |  |   | 4,626  |  
|Intersegment revenues                                  |  |                                 | 12     |   |                                |   | 17     |      |  |   | 38     |   |  |   | 42     |  
|                                                       |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|Total golf and related operations                      |  |                                 | 2,562  |   |                                |   | 2,111  |      |  |   | 5,874  |   |  |   | 4,668  |  
|                                                       |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|                                                       |  |                                 |        |  
|Segment operating revenues                             |  |                                 | 12,151 |   |                                |   | 11,147 |      |  |   | 35,033 |   |  |   | 29,326 |  
|Intersegment eliminations                              |  |                                 | (12    | ) |                                |   | (17    | )    |  |   | (50    | ) |  |   | (42    | )
|                                                       |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|Total net operating revenues                           |  | $                               | 12,139 |   |                                | $ | 11,130 |      |  | $ | 34,983 |   |  | $ | 29,284 |  
|                                                       |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|                                                       |  |                                 |        |  
|Income (loss) from continuing operations before taxes: |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|Waste management services                              |  | $                               | 946    |   |                                | $ | 863    |      |  | $ | 2,840  |   |  | $ | 2,274  |  
|Golf and related operations                            |  |                                 | 155    |   |                                |   | 112    |      |  |   | (161   | ) |  |   | (183   | )
|                                                       |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|Segment income before taxes                            |  |                                 | 1,101  |   |                                |   | 975    |      |  |   | 2,679  |   |  |   | 2,091  |  
|Corporate interest income                              |  |                                 | 71     |   |                                |   | 149    |      |  |   | 303    |   |  |   | 365    |  
|Corporate other income, net                            |  |                                 | 3      |   |                                |   | 5      |      |  |   | 7      |   |  |   | 10     |  
|General corporate expenses                             |  |                                 | (601   | ) |                                |   | (626   | )    |  |   | (1,810 | ) |  |   | (1,844 | )
|                                                       |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|Income from continuing operations before taxes         |  | $                               | 574    |   |                                | $ | 503    |      |  | $ | 1,179  |   |  | $ | 622    |  
|                                                       |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|                                                       |  |                                 |        |  
|Interest income:                                       |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|Waste management services                              |  | $                               | 20     |   |                                | $ | 22     |      |  | $ | 66     |   |  | $ | 65     |  
|Golf and related operations                            |  |                                 | 3      |   |                                |   | 2      |      |  |   | 10     |   |  |   | 7      |  
|Corporate                                              |  |                                 | 71     |   |                                |   | 149    |      |  |   | 303    |   |  |   | 365    |  
|                                                       |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  
|Total                                                  |  | $                               | 94     |   |                                | $ | 173    |      |  | $ | 379    |   |  | $ | 437    |  
|                                                       |  |                                 |        |   |                                |   |        |      |  |   |        |   |  |   |        |  



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##### Table of Contents

|                                        |  |                   |         |   |                  |   |         |  
|--------------------------------------- |  | ----------------- | ------- | - | ---------------- | - | ------- | -
|                                        |  | September 30,2007 |         |   | December 31,2006 |  
|Identifiable assets:                    |  |                   |         |   |                  |   |         |  
|Waste management services               |  | $                 | 10,548  |   |                  | $ | 8,082   |  
|Golf and related operations             |  |                   | 30,234  |   |                  |   | 21,188  |  
|Corporate                               |  |                   | 37,251  |   |                  |   | 37,587  |  
|                                        |  |                   |         |   |                  |   |         |  
|Subtotal                                |  |                   | 78,033  |   |                  |   | 66,857  |  
|Elimination of intersegment receivables |  |                   | (29,900 | ) |                  |   | (20,906 | )
|                                        |  |                   |         |   |                  |   |         |  
|Total                                   |  | $                 | 48,133  |   |                  | $ | 45,951  |  
|                                        |  |                   |         |   |                  |   |         |  

The increase in the identifiable assets of the waste management services segment is primarily due to an increase
in intersegment transactions which are eliminated in consolidation. The increase in identifiable assets of the golf and related operations segment is primarily due to capital expenditures for the construction and renovation of the Sharon Country
Club facility.

Note 7. Recently Issued Financial Accounting Standards

Avalon adopted the provisions of Financial Accounting Standards Board (FASB) Interpretation 48 (FIN 48), Accounting for Uncertainty in Income Taxes on January 1, 2007. As required by FIN 48, which
clarifies FASB 109, Accounting for Income Taxes, Avalon recognizes the financial statement benefit of a tax position, only after determining that the relevant tax authority would be more likely than not to sustain the position following
an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the
relevant tax authority. At the adoption date, Avalon applied FIN 48 to all tax positions for which the statute of limitations remained open. The adoption of FIN 48 had no material impact on Avalons financial position or results of operations
for the first nine months of 2007 and required no adjustment to the opening balance sheet accounts as of December 31, 2006.

Avalon is subject to
income taxes in the U.S. federal and various states jurisdictions. With few exceptions, Avalon is no longer subject to U.S. federal, state and local income tax examinations by taxing authorities for the years before 2003.

Avalon recognizes any interest and penalty assessed by taxing authorities as a component of interest expense and other expense, respectively. Avalons accruals for
the payment of interest and penalties at January 1, 2007 and for the nine months ended September 30, 2007 were not material.

In September 2006,
the FASB issued SFAS No. 157, Fair Value Measurements (SFAS No. 157), which defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair
value measurements. SFAS No. 157 does not require any new measurements, but provides guidance on how to measure fair value by providing a fair value hierarchy used to classify the source of information. This statement is effective for Avalon
beginning January 1, 2008. Avalon is currently assessing the potential impact that the adoption of SFAS No. 157 will have on its financial statements.



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|ITEM 2. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|------- | -------------------------------------------------------------------------------------

The following
discussion provides information which management believes is relevant to an assessment and understanding of the operations and financial condition of Avalon Holdings Corporation and its subsidiaries. As used in this report, the term
Avalon means Avalon Holdings Corporation and its wholly owned subsidiaries, taken as a whole, unless the context indicates otherwise.

Statements included in Managements Discussion and Analysis of Financial Condition and Results of Operations which are not historical in nature are intended to be, and are hereby identified as, forward looking
statements. Avalon cautions readers that forward looking statements, including, without limitation, those relating to Avalons future business prospects, revenues, working capital, liquidity, capital needs, interest costs, and income, are
subject to certain risks and uncertainties that could cause actual results to differ materially from those indicated in the forward looking statements, due to risks and factors identified herein and from time to time in Avalons reports filed
with the Securities and Exchange Commission.

Liquidity and Capital Resources

For the first nine months of 2007, Avalon utilized existing cash and cash provided from operations to fund capital expenditures and meet operating needs.

Avalons aggregate capital expenditures in 2007 are expected to be in the range of $10.5 million to $11.5 million. Such expenditures will principally relate to the construction costs of renovating and building
additional banquet and recreational facilities at the Sharon Country Club, which was purchased in October 2006. The construction and renovation is expected to be completed in the fourth quarter of 2007. During the first nine months of 2007, capital
expenditures for Avalon totaled approximately $9.1 million which was principally related to such construction costs.

Avalon entered into a long-term
agreement with Squaw Creek Country Club to lease and operate its golf course and related facilities. The lease, which commenced November 1, 2003, has an initial term of ten (10) years with four (4) consecutive ten (10) year
renewal term options unilaterally exercisable by Avalon. Under the lease, Avalon is obligated to pay $15,000 in annual rent and make leasehold improvements of $150,000 per year. Amounts expended by Avalon for leasehold improvements during a given
year in excess of $150,000 will be carried forward and applied to future leasehold improvement obligations. Avalon has made approximately $6.6 million of leasehold improvements as of September 30, 2007. Based upon the amount of leasehold
improvements already made and leasehold improvements anticipated to be made in the future, Avalon expects to exercise all of its renewal options.

Working
capital was $6.7 million at September 30, 2007 compared with $13.7 million at December 31, 2006. The decrease is primarily due to utilizing cash for the construction and renovation of the Sharon Country Club and an increase in accounts
payable relating to such construction. Such decrease was partially offset by an increase in accounts receivable of the golf and related operations segment as a result of an increase in the membership of the Avalon Golf and Country Club.



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The increase in other liabilities and accrued expenses at September 30, 2007 compared with December 31, 2006 is
primarily due to an increase in deferred revenues relating to membership dues of the golf and related operations segment. Such deferred revenues increased from $1.7 million at December 31, 2006 to $1.9 million at September 30, 2007.

Management believes that anticipated cash provided from future operations, existing working capital, as well as Avalons ability to incur
indebtedness, will be, for the foreseeable future, sufficient to meet operating requirements and fund capital expenditure programs. Avalon does not currently have a credit facility.

Several private country clubs in the northeast Ohio area are experiencing economic difficulties. Avalon believes some of these clubs may represent an attractive investment opportunity and is giving consideration to
the possibility of acquiring one or more additional golf courses. Avalon will continue to consider acquisitions that make economic sense. Such potential acquisitions could be financed by existing working capital, secured or unsecured debt, issuance
of common stock, or issuance of a security with characteristics of both debt and equity, any of which could impact liquidity in the future.

Results of
Operations

Overall performance

Net operating
revenues in the third quarter of 2007 increased to $12.1 million compared with $11.1 million in the prior years third quarter. The increase is primarily the result of higher net operating revenues of the waste management services segment and,
to a lessor extent, an increase in the net operating revenues of the golf and related operations segment. Costs of operations increased to $10.2 million in the third quarter of 2007 compared with $9.2 million in the prior years third quarter.
The increase is primarily the result of an increase in transportation and disposal costs, which vary directly with the higher net operating revenues of the waste brokerage and management services business. Consolidated selling, general and
administrative expenses decreased to $1.5 million in the third quarter of 2007 compared with $1.6 million in the third quarter of 2006. Avalon recorded income from continuing operations of $547,000 or $.14 per share, in the third quarter of 2007
compared with $503,000 or $.13 per share, in the third quarter of 2006.

For the first nine months of 2007, net operating revenues increased to $35 million
compared with $29.3 million for the first nine months of 2006. The increase is primarily the result of higher net operating revenues of the waste management services segment and, to a lessor extent, an increase in the net operating revenues of the
golf and related operations segment. Costs of operations were $29.3 million for the first nine months of 2007 compared with $24.5 million for the first nine months of 2006. The increase is primarily the result of an increase in transportation and
disposal costs of the waste brokerage and management services business, which vary directly with net operating revenues. Consolidated selling, general and administrative expenses increased to $4.9 million for the first nine months of 2007 compared
with $4.7 million for the first nine months of 2006. Avalon recorded income from continuing operations of $1.1 million or $.30 per share, for the first nine months of 2007 compared with $.6 million or $.16 per share, for the prior year period.



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##### Table of Contents

Performance in the Third Quarter of 2007 compared with the Third Quarter of 2006

Segment performance

Segment performance should be read in conjunction
with Note 6 to the Condensed Consolidated Financial Statements.

Net operating revenues of the waste management services segment increased to $9.6 million
in the third quarter of 2007 compared with $9.0 million in the third quarter of the prior year. The increase is primarily due to an increase in the level of waste brokerage and management services provided and an increase in the volume of waste
disposed of at the captive landfill operations. Although net operating revenues increased, average gross margins decreased due to lower gross margins on certain large projects of the waste brokerage and management services business. Income from
continuing operations before taxes for the waste management services segment increased to $946,000 in the third quarter of 2007 compared with $863,000 in the third quarter of the prior year primarily as a result of a decrease in the provision for
losses on accounts receivable of the waste brokerage and management services business. Income from continuing operations before taxes of the captive landfill operations increase slightly in the third quarter of 2007 compared with the third quarter
of the prior year as a result of the increase in the volume of waste disposed.

Net operating revenues of the golf and related operations were $2.6 million
in the third quarter of 2007 compared with $2.1 million in the third quarter of the prior year. The increase in net operating revenues is primarily due to an increase in membership dues as a result of a higher average number of members in the third
quarter of 2007 compared with the third quarter of 2006 and increased cart rentals, green fees, food and beverage sales. The golf and related operations segment recorded income from continuing operations before taxes of $.2 million in the third
quarter of 2007 compared with $.1 million in the third quarter of 2006. The increase is primarily due to the increase in net operating revenues, partially offset by the additional costs associated with the Sharon Country Club, while the facility is
closed for construction and renovation.

Interest income

Interest income was $.1 million in the third quarter of 2007 compared with $.2 million in the third quarter of 2006. The decrease is primarily the result of lower average cash and cash equivalents invested during the third quarter of 2007
compared with the third quarter of the prior year.

General corporate expenses

General corporate expenses were $.6 million in both the third quarter of 2007 and 2006.

Net income

Avalon recorded net income of $.5 million in both the third quarter of 2007 and 2006. Avalons overall effective tax rate, excluding the effect of state income tax
provisions, was 0% in the third quarter of 2007 and 2006. The income tax provision in both the third quarter of 2007 and 2006 was offset by a change in the valuation allowance. A valuation allowance is provided when it is more likely than not that
deferred tax assets relating to certain federal and state loss carryforwards will not be realized. The overall effective tax rate is different than statutory rates primarily due to a change in the valuation allowance.



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##### Table of Contents

Performance in the first nine months of 2007 compared with the first nine months of 2006

Segment performance

Segment performance should be read in conjunction
with Note 6 to the Condensed Consolidated Financial Statements.

Net operating revenues of the waste management services segment increased to $29.2 million
in the first nine months of 2007 compared with $24.7 million in the first nine months of the prior year. The increase in net operating revenues is primarily the result of an increase in the level of waste brokerage and management services provided.
Net operating revenues of the captive landfill management operations also increased in the first nine months of 2007 compared with the first nine months of 2006 primarily due to an increase in the volume of waste disposed of at the landfill. Income
from continuing operations before taxes for the waste management services segment increased to $2.8 million in the first nine months of 2007 compared with $2.3 million in the first nine months of the prior year, primarily as a result of the increase
in the level of the waste brokerage and management services provided. Income from continuing operations before taxes of the captive landfill management operations increased slightly in the first nine months of 2007 compared with the first nine
months of 2006 as a result of an increase in the volume of waste disposed.

Net operating revenues of the golf and related operations segment were $5.9
million in the first nine months of 2007 compared with $4.7 million in the first nine months of the prior year. The golf courses, which are located in northeast Ohio and western Pennsylvania, were unavailable for play during the first three months
of 2007 and 2006 due to adverse weather conditions. The increase in net operating revenues is primarily due to an increase in membership dues as a result of a higher average number of members during the first nine months of 2007 compared with the
first nine months of 2006 and increased cart rentals, green fees, merchandise, food and beverage sales. The golf and related operations segment incurred a loss from continuing operations before taxes of $.2 million in both the first nine months of
2007 and 2006. Although the loss from continuing operations before taxes for the first nine months of 2007 was relatively the same as the first nine months of 2006, the results of 2007 were negatively impacted by the settlement of an employment
contract dispute and the additional costs associated with the Sharon Country Club, while the facility is closed for construction and renovation.

Interest income

Interest income was $379,000 in the first nine months of 2007 compared with $437,000 in the first nine months of 2006. The
decrease is primarily the result of a lower amount of average cash and cash equivalents invested during the first nine months of 2007 compared with the first nine months of the prior year.

General corporate expenses

General corporate expenses were $1.8
million in both the first nine months of 2007 and 2006.



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##### Table of Contents

Net income

Avalon
recorded net income of $1.3 million in the first nine months of 2007 compared with net income of $1 million in the first nine months of the prior year. Avalons overall effective tax rate, excluding the effect of state income tax provisions,
was 0% in both the first nine months of 2007 and 2006. The income tax provision for the first nine months of 2007 and 2006 were offset by a change in the valuation allowance. A valuation allowance is provided when it is more likely than not that
deferred tax assets relating to certain federal and state loss carryforwards will not be realized. The overall effective tax rate differs from statutory rates primarily due to the change in the valuation allowance.

Trends and Uncertainties

In the ordinary course of conducting its
business, Avalon becomes involved in lawsuits, administrative proceedings and governmental investigations, including those relating to environmental matters. Some of these proceedings may result in fines, penalties or judgments being assessed
against Avalon which, from time to time, may have an impact on its business and financial condition. Although the outcome of such lawsuits or other proceedings cannot be predicted with certainty, management assesses the probability of loss and
accrues a liability as appropriate. Avalon does not believe that any uninsured ultimate liabilities, fines or penalties resulting from such pending proceedings, individually or in the aggregate, will have a material adverse effect on its financial
position or results of operations.

The Board of Directors of Avalon has explored the possibility of delisting Avalons common stock by reducing the
number of shareholders of record below 300, thereby eliminating the requirements for compliance with the Sarbanes-Oxley Act (the Act). Avalon believes compliance with the requirements of the Act could be very costly. The Board of
Directors has decided not to pursue delisting at this time, but intends to review the situation again as future developments warrant.

The federal
government and numerous state and local governmental bodies are continuing to consider legislation or regulations to either restrict or impede the disposal and/or transportation of waste. A portion of Avalons waste brokerage and management
services revenues is derived from the disposal and/or transportation of out-of-state waste. Any law or regulation restricting or impeding the transportation of waste or the acceptance of out-of-state waste for disposal could have a negative effect
on Avalon.

Avalons waste disposal brokerage and management operations obtain and retain customers by providing services and identifying
cost-efficient disposal options unique to a customers needs. Consolidation within the solid waste industry has resulted in reducing the number of disposal options available to waste generators and may cause disposal pricing to increase. In
addition, consolidation has had the effect of reducing the number of competitors offering disposal alternatives which may adversely impact the future financial performance of Avalons waste disposal brokerage and management operations.

A significant portion of Avalons business is generated from waste brokerage and management services provided to customers and is not subject to
long-term contracts. In light of current economic, regulatory and competitive conditions, there can be no assurance that Avalons current customers will continue to transact business with Avalon at historical levels. Failure by Avalon to retain
its current customers or to replace lost business could adversely impact the future financial performance of Avalon.



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##### Table of Contents

Avalons captive landfill management business is dependent upon a single customer as its sole source of revenue. If
the captive landfill management business is unable to retain this customer, Avalons future financial performance could be adversely impacted.

Economic challenges throughout the industries served by Avalon have resulted in payment defaults by customers. While Avalon continuously endeavors to limit customer credit risks, customer-specific financial downturns are not controllable by
management. Significant customer payment defaults would have a material adverse impact upon Avalons future financial performance.

The Avalon Golf
and Country Club has a championship golf course and clubhouse at both the Avalon Lakes and Squaw Creek facilities. The Squaw Creek facility also has a swimming pool, tennis courts, a fitness center and dining and banquet facilities. In addition, in
October 2006 Avalon purchased the primary assets of the Sharon Country Club, which includes a golf course and clubhouse. Currently, Avalon is renovating the clubhouse and constructing additional banquet and recreational facilities. The Avalon Golf
and Country Club competes with many public courses and country clubs in the area. Although the golf courses continue to be available to the general public, the primary source of revenues is derived from the members of the Avalon Golf and Country
Club. Avalon believes that the combination of these three facilities will result in a significant increase in the number of members of the Avalon Golf and Country Club. Although there has been a continual increase in the number of members of the
Avalon Golf and Country Club, as of September 30, 2007, Avalon has not attained its membership goals. There can be no assurance as to when such increased membership will be attained and when the golf and related operations will ultimately
become profitable. Failure by Avalon to attain increased membership could adversely affect the future financial performance of Avalon.

All three of
Avalons golf course operations currently hold liquor licenses for their respective facilities. If, for some reason, any one of these facilities were to lose its liquor license, the financial performance of the golf and related operations would
be adversely affected.

Avalons operations are somewhat seasonal in nature since a significant portion of those operations are primarily conducted in
selected northeastern and midwestern states. Additionally, Avalons golf courses are located in northeast Ohio and western Pennsylvania and are significantly dependent upon weather conditions during the golf season. As a result, Avalons
financial performance is adversely affected by adverse weather conditions.

Management is currently evaluating Avalons strategic direction for the
future. While there are no specific transactions under negotiation or pending at this time, Avalon does not necessarily intend to limit itself in the future to lines of business which it has historically conducted.



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##### Table of Contents

|Item 3. | Quantitative and Qualitative Disclosures about Market Risk
|------- | ----------------------------------------------------------

Avalon does not have significant exposure to changing
interest rates. A 10% change in interest rates would have an immaterial effect on Avalons income before taxes for the next fiscal year. Avalon currently has no debt outstanding and invests primarily in Certificates of Deposit, U.S. Treasury
notes, short-term money market funds and other short-term obligations. Avalon does not undertake any specific actions to cover its exposure to interest rate risk and Avalon is not a party to any interest rate risk management transactions. Avalon
does not purchase or hold any derivative financial instruments.



|Item 4. | Controls and Procedures
|------- | -----------------------

Avalons management, including the Chief Executive Officer and Chief Financial
Officer, has conducted an evaluation of the effectiveness of disclosure controls and procedures pursuant to Exchange Act Rule 13a-14. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the disclosure
controls and procedures are effective in ensuring that all material information required to be filed in this quarterly report has been made known to them in a timely fashion. There have been no significant changes in internal controls, or in factors
that could significantly affect internal controls, subsequent to the date the Chief Executive Officer and Chief Financial Officer completed their evaluation.



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##### Table of Contents

PART II.
OTHER INFORMATION



|Item 1. | Legal Proceedings
|------- | -----------------

Reference is made to Item 3. Legal Proceedings in Avalons
Annual Report on Form 10-K for the year ended December 31, 2006 for a description of legal proceedings.



|Item 2. | Changes in Securities and Use of Proceeds
|------- | -----------------------------------------

None



|Item 3. | Defaults upon Senior Securities
|------- | -------------------------------

None



|Item 4. | Submission of Matters to a Vote of Security Holders
|------- | ---------------------------------------------------

None



|Item 5. | Other Information
|------- | -----------------

None



|Item 6. | Exhibits and Reports on Form 8-K
|------- | --------------------------------



| | (a) | Exhibits
| | --- | --------

Exhibit 31.1 Certification pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.

Exhibit 31.2 Certification pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.

Exhibit 32.1 Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.

Exhibit 32.2 Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.



| | (b) | Reports on Form 8-K
| | --- | -------------------

None



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SIGNATURE

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



|                        |  |                             |  |                                                                                                               
|----------------------- |  | --------------------------- |  | --------------------------------------------------------------------------------------------------------------
|                        |  | AVALON HOLDINGS CORPORATION
|                        |  | (Registrant)               
|                        |  |                            
|Date: November 12, 2007 |  | By:                         |  | /s/ Timothy C. Coxson                                                                                         
|                        |  |                             |  | Timothy C. Coxson,                                                                                            
|                        |  |                             |  | Chief Financial Officer and Treasurer (Principal
Financial and Accounting Officer and Duly Authorized Officer)



18