**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**





_____________________





FORM
      10-QSB





QUARTERLY
      REPORT UNDER SECTION 13 OR 15(d)


SECURITIES
      EXCHANGE ACT OF 1934





**FOR
      THE QUARTER ENDED APRIL 30, 2006**





Commission
      file number: 0-13301





**RF
      INDUSTRIES, LTD.**


(Exact
      name of registrant as specified in its charter)







Nevada
            
            88-0168936(State
                of Incorporation)
            
            (I.R.S.
                Employer Identification No.)





7610
                Miramar Road, Bldg. 6000, San Diego, California
            92126-4202(Address
                of principal executive offices)
            (Zip
                Code)





(858)
      549-6340   FAX
      (858)
      549-6345


(Issuer’s
      telephone and fax numbers, including area code)





Securities
      registered pursuant to Section 12(b) of the Act: None





Check
      whether the issuer (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 filing requirements for the past 90 days.


Yes
      [X]
      No [  ]





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





State
      the
      number of shares outstanding of each of the issuer’s classes of common stock at
      the latest practicable date. As of June 9, 2006, the registrant had 3,209,484
      shares of Common Stock, $.01 par value, issued.





Transitional
      Small Business Disclosure Format (check one): Yes [  ] No [X]







1




**Part
      I. FINANCIAL INFORMATION**





**Item
      1: Financial Statements**







**RF
      INDUSTRIES, LTD.**


**CONDENSED
      BALANCE SHEETS**


**(Unaudited)**





**ASSETS**
            
            
            **April
                30,**
              **2006**
            
            
            **October
                31,**
              **2005****CURRENT
                ASSETS**Cash
                and cash equivalents
            
            $
            3,580,114
            
            $
            4,507,219Investments
                in available-for-sale securities
            
            
            2,644,300Trade
                accounts receivable, net of allowance for doubtful accounts of $22,101
                and
                $14,898
            
            
            1,917,745
            
            
            1,890,700Notes
                receivable
            
            
            
            
            
            2,500Inventories
            
            
            4,002,842
            
            
            4,180,500Income
                tax refund receivable
            
            
            26,731
            
            
            306,131Other
                current assets
            
            
            160,619
            
            
            97,356Deferred
                tax assets
            
            
            123,000
            
            
            136,000**TOTAL
                CURRENT ASSETS**
            
            
            12,455,351
            
            
            11,120,406**EQUIPMENT
                AND FURNISHINGS**Equipment
                and tooling
            
            
            1,604,667
            
            
            1,543,120Furniture
                and office equipment
            
            
            370,420
            
            
            364,0631,975,087
            
            
            1,907,183Less
                accumulated depreciation
            
            
            1,558,937
            
            
            1,441,448**TOTAL**
            
            
            416,150
            
            
            465,735Goodwill
            
            
            200,848
            
            
            200,848Amortizable
                intangible asset
            
            
            93,333
            
            
            113,333Notes
                receivable from related parties
            
            
            
            
            
            29,750Note
                receivable from stockholder
            
            
            66,980
            
            
            66,980Other
                assets
            
            
            28,087
            
            
            28,087**TOTAL
                ASSETS**
            
            **$**
            **13,260,749**
            
            **$**
            **12,025,139**





2


**Item
      1: Financial Statements** (continued)








**RF
      INDUSTRIES, LTD.**


**CONDENSED
      BALANCE SHEETS**


**(Unaudited)**





**April
                30,**
              **2006**
            
            **October
                31,**
              **2005****LIABILITIES
                AND**
              **STOCKHOLDERS’
                EQUITY****CURRENT
                LIABILITIES**Accounts
                payable
            
            $
            509,594
            
            $
            334,749Accrued
                expenses
            
            
            415,621
            
            
            377,986**TOTAL
                CURRENT LIABILITIES**
            
            
            925,215
            
            
            712,735Deferred
                tax liabilities
            
            
            106,000
            
            
            106,000**TOTAL
                LIABILITIES**
            
            
            1,031,215
            
            
            818,735**COMMITMENTS
                AND CONTINGENCIES****STOCKHOLDERS’
                EQUITY**Common
                stock - authorized 10,000,000 shares of $0.01 par value; 3,209,484
                and
                3,082,521 shares issued and outstanding
            
            
            32,095
            
            
            30,825Additional
                paid-in capital
            
            
            4,217,648
            
            
            3,872,983Accumulated
                other comprehensive income - net unrealized gain on available-for-sale
                securities
              Retained
                earnings
            
            
            17,310
              7,962,481
            
            
            7,302,596**TOTAL
                STOCKHOLDERS’ EQUITY**
            
            
            12,229,534
            
            
            11,206,404**TOTAL
                LIABILITIES AND STOCKHOLDERS’ EQUITY**
            
            **$**
            **13,260,749**
            
            **$**
            **12,025,139**


























See
      Notes
      to Condensed Unaudited Financial Statements





3


**Item
      1: Financial Statements** (continued)







**RF
      INDUSTRIES, LTD.**


**CONDENSED
      STATEMENTS OF INCOME**


**(Unaudited)**









Three
                Months Ended April 30
            Six
                Months Ended April 302006
            
            
            2005
            
            
            2006
            
            
            2005Net
                sales
            
            $
            3,769,320
            
            $
            3,577,922
            
            $
            7,144,232
            
            $
            6,446,024Cost
                of sales
            
            
            1,977,478
            
            
            2,018,866
            
            
            3,791,821
            
            
            3,469,311Gross
                profit
            
            
            1,791,842
            
            
            1,559,056
            
            
            3,352,411
            
            
            2,976,713Operating
                expenses:Engineering
            
            
            130,817
            
            
            123,403
            
            
            280,163
            
            
            260,643Selling
                and general
            
            
            1,029,744
            
            
            1,169,255
            
            
            2,050,146
            
            
            2,128,055Totals
            
            
            1,160,561
            
            
            1,292,658
            
            
            2,330,309
            
            
            2,388,698Operating
                income
            
            
            631,281
            
            
            266,398
            
            
            1,022,102
            
            
            588,015Other
                income - interest
            
            
            33,071
            
            
            21,868
            
            
            106,083
            
            
            38,336Income
                before provision for income taxes
            
            
            664,352
            
            
            288,266
            
            
            1,128,185
            
            
            626,351Provision
                for income taxes
            
            
            269,800
            
            
            125,150
            
            
            468,300
            
            
            256,750**Net
                income**
            
            $
            394,552
            
            $
            163,116
            
            $
            659,885
            
            $
            369,601Basic
                earnings per share
            
            $
            0.12
            
            $
            0.05
            
            $
            0.21
            
            $
            0.12Diluted
                earnings per share
            
            $
            0.11
            
            $
            0.04
            
            $
            0.18
            
            $
            0.10Basic
                weighted average shares outstanding
            
            
            3,202,405
            
            
            3,046,960
            
            
            3,151,169
            
            
            3,027,543Diluted
                weighted average shares outstanding
            
            
            3,708,624
            
            
            3,807,808
            
            
            3,678,841
            
            
            3,822,499














See
      Notes
      to Condensed Unaudited Financial Statements





4


**Item
      1: Financial Statements** (continued)








**RF
      INDUSTRIES, LTD.**


**CONDENSED
      STATEMENTS OF CASH FLOWS**


**SIX
      MONTHS ENDED APRIL 30**


**(Unaudited)**





**2006**
            
            
            **2005**OPERATING
                ACTIVITIES:Net
                income
            
            $
            659,885
            
            $
            369,601Adjustments
                to reconcile net income to net cash provided by (used in) operating
                activities:Provision
                for bad debts
            
            
            11,140
            
            
            11,224Depreciation
                and amortization
            
            
            137,488
            
            
            104,677Income
                tax benefit on non-qualified stock options
            
            
            188,900
            
            
            75,200Changes
                in operating assets and liabilities:Trade
                accounts receivable
            
            
            (38,185
            )
            
            (539,216
            )Inventories
            
            
            177,658
            
            
            (142,919
            )Income
                tax refund receivable
            
            
            279,400
            
            
            (72,152
            )Other
                current assets
            
            
            (63,263
            )
            
            (10,379
            )Other
                assets
            
            
            
            
            
            (7,920
            )Accounts
                payable
            
            
            174,845
            
            
            301,362Accrued
                expenses
            
            
            37,635
            
            
            (89,806
            )Net
                cash provided by (used in) operating activities
            
            
            1,565,503
            
            
            (328
            )INVESTING
                ACTIVITIES:Purchase
                of available-for-sale securities
              Capital
                expenditures
            
            
            (2,613,990
              (67,903
            )
              )
            
            (38,699
            )Collection
                of notes receivable
            
            
            2,500
            
            
            9,500Collection
                of notes receivable from related parties
            
            
            29,750Net
                cash used in investing activities
            
            
            (2,649,643
            )
            
            (29,199
            )FINANCING
                ACTIVITIES - exercise of stock options
            
            
            157,035
            
            
            97,028Net
                increase (decrease) in cash and cash equivalents
            
            
            (927,105
            )
            
            67,501Cash
                and cash equivalents at the beginning of the period
            
            
            4,507,219
            
            
            4,497,322Cash
                and cash equivalents at the end of the period
            
            $
            3,580,114
            
            $
            4,564,823Supplemental
                disclosure of non-cash investing activities-
              Effect
                of net increase in fair value of available-for-sale
              securities,
                net of deferred income taxes of $13,000
            
            $
            17,310




















See
      Notes
      to Condensed Unaudited Financial Statements





5


**RF
      INDUSTRIES, LTD.**


**NOTES
      TO CONDENSED UNAUDITED FINANCIAL STATEMENTS**





**Note
      1 - Unaudited interim financial statements**





The
      accompanying unaudited condensed financial statements have been prepared in
      conformity with accounting principles generally accepted in the United States
      of
      America for interim financial information and with the instructions to Form
      10-QSB. Accordingly, they do not include all of the information and footnotes
      required by accounting principles generally accepted in the United States of
      America for complete financial statements. In the opinion of management, all
      adjustments have been included in order to make the information not misleading.
      Information included in the balance sheet, as of October 31, 2005 has been
      derived from, and certain terms used herein are defined in, the audited
      financial statements of the Company as of October 31, 2005 included in the
      Company’s Annual Report on Form 10-KSB for the year ended October 31, 2005 that
      was previously filed with the Securities and Exchange Commission. Operating
      results for the three and six month periods ended April 30, 2006, are not
      necessarily indicative of the results that may be expected for the year ending
      October 31, 2006. The unaudited condensed financial statements should be read
      in
      conjunction with the financial statements and footnotes thereto included in
      the
      Company’s Annual Report on Form 10-KSB for the year ended October 31,
      2005.





Certain
      amounts in the 2005 unaudited condensed financial statements have been
      reclassified to conform to the 2006 presentation.





**Note
      2 - Investments**





Pursuant
      to Statement of Financial Accounting Standards No. 115, “Accounting for Certain
      Investments in Debt and Equity Securities, “ the Company’s investments in U.S.
      Treasury Bills were classified as available-for-sale securities and,
      accordingly, were valued at fair value at the end of each period. If there
      is
      any other than temporary decline in fair value, the cost basis of the individual
      security would have been written down to fair value via a charge to earnings.
      Net unrealized holding gains on these investments as of April 30, 2006 were
      $17,310, net of deferred income taxes of $13,000.





**Note
      3 - Components of inventory**





Inventories,
      consisting of materials, labor and manufacturing overhead, are stated at the
      lower of cost or market. Cost has been determined using the weighted average
      cost method.





April
                30,
              2006
            
            
            October
                31,
              2005Raw
                materials and supplies
            
            $
            1,159,007
            
            $
            845,313Work
                in process
            
            
            19,124
            
            
            63,242Finished
                goods
            
            
            2,900,322
            
            
            3,318,293Inventory
                reserve
            
            
            (75,611
            )
            
            (46,348
            )Total
            
            $
            4,002,842
            
            $
            4,180,500





Purchases
      of connector products from two major vendors in the six month period ended
      April
      30, 2006, represented 35% and 13% compared to 22% and 18% of the total inventory
      purchases for the same period in fiscal year 2005. The Company has arrangements
      with these vendors to purchase product based on purchase orders periodically
      issued by the Company.




6





**Note
      4 - Earnings per share**





Basic
      earnings per share is computed by dividing net income by the weighted average
      number of common shares outstanding during the period. Diluted earnings per
      share is computed by dividing net income by the weighted average number of
      common shares outstanding increased by the effects of assuming that other
      potentially dilutive securities (such as stock options) outstanding during
      the
      period had been exercised and the treasury stock method had been applied. During
      the three and six months ended April 30, 2006, the effects of the assumed
      exercise of options to purchase 77,366 and 59,866 shares, respectively, of
      the
      Company’s common stock were not included in the computation of diluted per share
      amounts because they were anti-dilutive for that purpose. During the three
      and
      six months ended April 30, 2005, all options were considered dilutive and
      included in the calculation of diluted earnings per share.





The
      following table summarizes the computation of basic and diluted weighted average
      shares:




Three
                Months Ended April 30
            Six
                Months Ended April 302006
            
            
            2005
            
            
            2006
            
            
            2005Weighted
                average shares outstanding for basic net earnings per
                share
            
            
            3,202,405
            
            
            3,046,960
            
            
            3,151,169
            
            
            3,027,543Add
                effects of potentially dilutive securities-assumed exercise of stock
                options
            
            
            506,219
            
            
            760,848
            
            
            527,672
            
            
            794,956Weighted
                average shares for diluted net earnings per share
            
            
            3,708,624
            
            
            3,807,808
            
            
            3,678,841
            
            
            3,822,499





**Note
      5 - Stock Option Plan**




During
      the three month period ended April 30, 2006, no stock options were granted
      and
      42,950 stock options with a weighted average share price of $0.52 were
      exercised. For the six month period ended April 30, 2006, 17,500 options were
      granted and 126,963 stock options with a weighted average share price of $1.24
      were exercised.




The
      Company continues to measure compensation cost related to stock options issued
      to employees using the intrinsic value method of accounting prescribed by
      Accounting Principles Board Opinion No. 25 (“APB 25”), “Accounting for Stock
      Issued to Employees.” The Company has adopted the disclosure-only provisions of
      Statement of Financial Accounting Standards No. 123 (“SFAS 123”), “Accounting
      for Stock-Based Compensation,” as amended by Statement of Financial Accounting
      Standards No. 148 (“SFAS 148”), “Accounting for Stock-Based Compensation -
      Transaction Disclosure.” Accordingly, no earned or unearned compensation cost
      was recognized in the accompanying condensed financial statements for the stock
      options granted by the Company to its employees since all of those options
      have
      been granted at exercise prices that equaled or exceeded the market value at
      the
      date of grant. The Company’s historical net income and earnings per common share
      and pro forma net income and earnings per share assuming compensation cost
      had
      been determined based on the fair value at the grant date for all awards by
      the
      Company consistent with the provisions of SFAS 123 are set forth
      below:




7




Three
                Months Ended April 30
            Six
                Months Ended April 302006
            
            
            2005
            
            
            2006
            
            
            2005Net
                income - as reported
            
            $
            394,552
            
            $
            163,116
            
            $
            659,885
            
            $
            369,601Deduct
                total stock-based employee compensation expense determined under
                fair
                value-based method for all awards, net of tax effects
            
            
            (41,321
            )
            
            (52,201
            )
            
            (76,565
            )
            
            (104,402
            )Net
                income - pro forma
            
            $
            353,231
            
            $
            110,915
            
            $
            583,320
            
            $
            265,199Basic
                earnings per share - as reported
            
            $
            0.12
            
            $
            0.05
            
            $
            0.21
            
            $
            0.12Basic
                earnings per share - pro forma
            
            $
            0.11
            
            $
            0.04
            
            $
            0.19
            
            $
            0.09Diluted
                earnings per share - as reported
            
            $
            0.11
            
            $
            0.04
            
            $
            0.18
            
            $
            0.10Diluted
                earnings per share - pro forma
            
            $
            0.10
            
            $
            0.03
            
            $
            0.16
            
            $
            0.07








**Note
      6 - Concentration of Credit Risk**





One
      customer accounted for approximately 20% and 16% of the Company’s net sales for
      the three and six month periods ended April 30, 2006, respectively, and 14%
      and
      15% for the comparable periods in 2005. Although this customer has been an
      on-going major customer of the Company during the past five years, the written
      agreement with this customer does not have any minimum purchase obligations
      and
      the customer could stop buying the Company’s products at any time for any
      reason. A reduction, delay or cancellation of orders from this customer or
      the
      loss of this customer could significantly reduce the Company’s revenues and
      profits. The Company cannot provide assurance that this customer or any of
      its
      current customers will continue to place orders, that orders by existing
      customers will continue at current or historical levels or that the Company
      will
      be able to obtain orders from new customers.





**Note
      7 - Geographical Information**





The
      Company attributes sales to geographic areas based on the location of the
      customers. The following table presents the sales of the Company by geographic
      area for the three and six month periods ended April 30, 2006 and
      2005:




8




Three
                Months Ended April 30
            Six
                Months Ended April 302006
            
            
            2005
            
            
            2006
            
            
            2005United
                States
            
            $
            3,402,094
            
            
            3,301,299
            
            
            6,415,812
            
            
            5,835,138Foreign
                countries
            
            
            367,226
            
            
            276,623
            
            
            728,420
            
            
            610,886$
            3,769,320
            
            
            3,577,922
            
            
            7,144,232
            
            
            6,446,024








**Item
      2:**  **Management’s
      discussion and analysis of financial condition and results of
      operations**





This
      report contains forward-looking statements. These statements relate to future
      events or the Company’s future financial performance. In some cases, you can
      identify forward-looking statements by terminology such as “may,” “will,”
“should,” “except,” “plan,” “anticipate,” “believe,” “estimate,” “predict,”
“potential” or “continue,” the negative of such terms or other comparable
      terminology. These statements are only predictions. Actual events or results
      may
      differ materially.





Although
      the Company believes that the expectations reflected in the forward-looking
      statements are reasonable, the Company cannot guarantee future results, levels
      of activity, performance or achievements. Moreover, neither the Company, nor
      any
      other person, assumes responsibility for the accuracy and completeness of the
      forward-looking statements. The Company is under no obligation to update any
      of
      the forward-looking statements after the filing of this Quarterly Report on
      Form
      10-QSB to conform such statements to actual results or to changes in its
      expectations.





The
      following discussion should be read in conjunction with the Company’s financial
      statements and the related notes and other financial information appearing
      elsewhere in this Form 10-QSB. Readers are also urged to carefully review and
      consider the various disclosures made by the Company which attempt to advise
      interested parties of the factors which affect the Company’s business, including
      without limitation the disclosures made under the caption “Management’s
      Discussion and Analysis of Financial Condition and Results of Operations,” under
      the caption “Risk Factors,” and the audited financial statements and related
      notes included in the Company’s Annual Report filed on Form 10-KSB for the year
      ended October 31, 2005 and other reports and filings made with the Securities
      and Exchange Commission.





**Critical
      Accounting Policies**





The
      financial statements of RF Industries are prepared in conformity with accounting
      principles generally accepted in the United States of America (“GAAP”). The
      preparation of these financial statements requires our management to make
      estimates and assumptions about future events that affect the amounts reported
      in the financial statements and related notes. Future events and their effects
      cannot be determined with absolute certainty. Therefore, the determination
      of
      estimates requires the exercise of judgment. . The Company believes the
      following critical accounting policies affect its more significant judgments
      and
      estimates used in the preparation of financial statements. The Company’s
      significant accounting policies are summarized in Note 1 to the financial
      statements contained in its Annual Report on Form 10-KSB filed for the fiscal
      year ended October 31, 2005.





*Investments:*





Pursuant
      to Statement of Financial Accounting Standards No. 115, “Accounting for Certain
      Investments in Debt and Equity Securities, “ the Company’s investments in U.S.
      Treasury Bills and government bonds were classified as available-for-sale
      securities and, accordingly, were valued at fair value at the end of each
      period. If there is any other than temporary decline in fair value, the cost
      basis of the individual security would have been written down to fair value
      via
      a charge to earnings. Unrealized holding gains and losses as of April 30, 2006
      were $17,310, net of deferred income taxes of $13,000.




9




**Executive
      Overview**





RF
      Industries markets connectors and cables to numerous industries for use in
      thousands of products, primarily for the wireless marketplace. In addition,
      to a
      limited extent, the Company also markets wireless products that incorporate
      connectors and cables. In the past, RF Industries has reported results of
      operations in three segments that, in general terms, defined the primary
      markets. However, since sales of connectors and cable assemblies represent
      over
      89% of the Company’s net sales during the three and six months ended April 30,
      2006, and since the operations of all of the Company’s smaller business units
      effectively operate as subunits of the Company’s principal business unit, the
      Company does not report the results of these other, smaller business units
      as
      separate business segments.





**Liquidity
      and Capital Resources**





Management
      believes that existing current assets and the amount of cash it anticipates
      it
      will generate from current operations will be sufficient to fund the anticipated
      liquidity and capital resource needs of the Company for at least twelve months.
      The Company does not, however, currently have any commercial banking
      arrangements providing for loans, credit facilities or similar matters should
      the Company need to obtain additional capital. Management’s beliefs that its
      existing assets and the cash expected to be generated from operations will
      be
      sufficient during the current fiscal year are based on the
      following:





§
            As
                of April 30, 2006, the amount of cash and cash equivalents was equal
                to
                $3,580,114 in the aggregate as well as $2,644,300 in investments
                in
                available-for-sale securities.





§
            As
                of April 30, 2006, the Company had $12,455,351 in current assets,
                and
                $925,215 in current liabilities.





§
            As
                of April 30, 2006, the Company had no outstanding indebtedness (other
                than
                accounts payable and accrued
                expenses).





The
      Company does not believe it will need material additional capital equipment
      in
      the next twelve months. In the past, the Company has financed some of its
      equipment and furnishings requirements through capital leases. No additional
      capital equipment purchases have been currently identified that would require
      significant additional leasing or capital expenditures during the next twelve
      months. Management also believes that based on the Company’s current financial
      condition, the absence of outstanding bank debt and recent operating results,
      the Company would be able to obtain bank loans to finance its expansion, if
      necessary, although there can be no assurance any bank loan would be obtainable
      or, if obtained, would be on favorable terms or conditions.





The
      Company recognized net income of $659,885 for the six months ended April 30,
      2006 and realized cash flow of $1,565,503 from its operating activities.
      Contributing to the amount of net cash provided by operations were depreciation
      and income tax benefit for non-qualifed stock options and decreases in
      inventories and income tax refund receivable, and an increase in accounts
      payable.





Trade
      accounts receivable (net of allowances for doubtful accounts) at April 30,
      2006
      increased by $27,045 to $1,917,745 compared to the October 31, 2005 balance
      of
      $1,890,700.





Inventories
      at April 30, 2006 decreased 4%, or $177,658 to $4,002,842 compared to $4,180,500
      on October 31, 2005 due to increased sales of 5% for the quarter compared
      to the same period last year. The Company considers its ability to fill customer
      orders on a short notice to be an important aspect of its marketing strategy,
      accordingly the Company normally will increase its inventory levels in future
      periods as sales continue to rise.





10




The
      Company’s cash and cash equivalent position was reduced due to investments in
      available-for-sale securities in six month Treasury Bills and government bonds
      and an increase in other current assets, including prepaid expenses and
      deposits, of $63,263 to $160,619 as of April 30, 2006, from $97,356 on
      October 31, 2005. This increase is in prepaid expenses and deposits was
      primarily due to annual payments made in the quarter for all the Company’s
      business insurances and worker’s compensation premiums.





Accounts
      payable at April 30, 2006 increased $174,845 to $509,594 from $334,749 on
      October 31, 2005 primarily due to the late arrival of inventory receipts during
      the quarter from its overseas suppliers.





Net
      cash
      used in investing activities was $2,649,643 for the six months ended April
      30,
      2006 as a result of purchases in available-for-sale securities with a value
      of
      $2,613,990, and $67,903 of capital expenditures reduced by a $2,500 payment
      on
      notes receivable and a $29,750 payment on notes receivable from related parties.





Net
      cash
      provided by financing activities was $157,035 for the six months ended April
      30,
      2006, and was attributable to proceeds received from the exercise of stock
      options.





As
      of
      April 30, 2006, the Company had a total of $3,580,114 of cash and cash
      equivalents compared to $4,507,219 as of October 31, 2005. The Company realized
      $1,565,503 in cash provided by operating activities, together with the use
      of
      cash of $2,649,643 for investing activities in Treasury Bills and other
      government securities and an increase in cash of $157,035 from financing
      activities resulted in the Company’s overall cash and cash equivalent position
      decreasing by $927,105 during the six month period.





**Results
      Of Operations**





**Three
      Months 2006 vs. Three Months 2005**





Net
      sales
      in the current fiscal quarter ended April 30, 2006, increased 5%, or $191,398
      to
      $3,769,320 from $3,577,922 in the comparable fiscal quarter in the prior year,
      due to increased demand for the Company’s connector, cable assembly and
      Bioconnect products plus additional revenues of $119,000 generated from the
      Worswick division acquired by the Company in September 2005. The increase in
      sales reflects a general increase in demand for wireless connectors and cable
      products. The Company believes this increase is due, in part, to the continued
      growth in some sectors of the telecommunication industries and the continuing
      overall market increase in the demand for wireless products plus additional
      order demand for its Bioconnect products.





The
      Company’s gross profit as a percentage of sales increased 4% from 44% to 48%
      during the current fiscal quarter compared to the same fiscal quarter last
      year.
      The increase in gross margins during the current quarter resulted from improved
      labor and overhead costs efficiencies in its Bioconnect division and a decrease
      in its net costs in benefits for all divisions from the comparable period in
      2005 due to employees assuming more of their dependent insurance coverage costs.
      The Company’s four smaller divisions usually have significantly lower gross
      margins than the RF Connector and Cable Assembly division. Although the
      connector and cable assembly products net sales increased by $127,000 they
      decreased as a percentage of the total Company’s net sales (81% compared to 84%
      in the same period for the prior year) due to increases in sales in other
      divisions. Gross margin increased by .5% for the connector and cable assembly
      products while both sales and gross margins also increased in the other
      divisions in the current period.





Engineering
      expenses increased 6%, or $7,414, to $130,817 from $123,403 in the comparable
      quarter of the prior year due to development costs for new product enhancements.
      Engineering expenses fluctuate based on design engineering expenses incurred
      by
      the Company at the request of its customers.




11





Selling
      and general expenses decreased 12% or $139,511 to $1,029,744 from $1,169,255
      in
      the comparable quarter of the prior fiscal year. Selling and general expenses
      decreased in the second quarter of the current fiscal year due primarily to
      the
      reduced expense for implementing and maintaining its Sarbanes Oxley Act of
      2002
      compliance program compared to last year in which the Company absorbed one-time
      costs of $185,000 for the same period in the prior year. The decrease in
      Sarbanes Oxley Act expenses was partially offset by increases in administrative
      expense for audit costs plus amortization of intangible assets and the salaries
      of the additional personnel retained to improve the Company’s reporting systems.
      As a result of increased sales and reduced selling and general administrative
      expenses, as a percentage of sales, the selling and general expenses for the
      current period decreased by 6% to 27% from 33% in the same period in the prior
      year.





Other
      income for the second quarter of 2006 increased $11,203 over the same period
      in
      the prior year due to higher investment interest income.





**Six
      Months 2006 vs. Six Months 2005**





Net
      sales
      in the six months ended April 30, 2006 increased 11% or $698,208 to $7,144,232
      from $6,446,024 in the comparable period in the prior year due to increased
      demand for the Company’s connector, cable assembly, Bioconnect and wireless
      products. The increase in sales reflects a general increase in demand for
      wireless connectors and cable products as well as increased demand for
      Bioconnect products. In addition, Worswick Industries, which was owned and
      in
      operation during the entire six months ended April 30, 2006 but not owned in
      the
      comparable six month period of the prior year, contributed $252,808 to net
      sales
      during the current six month period.





The
      Company’s gross profits as a percentage of sales increased to 47% from 46%
      during the first six months of fiscal 2006 compared to the same period in fiscal
      2005. The increase in gross margins during the period resulted from a
      combination of higher sales of $393,000 and a .5% increase in gross margin
      in
      its connector, cable assembly and wireless operations and from higher sales
      of
      $164,000 and a 4% increase in gross margins in its Bioconnect
      products.





Engineering
      expenses for the first six months of fiscal 2006 increased 7%, or $19,520,
      to
      $280,163 from $260,643 in the comparable period of the prior year due to
      development costs for new product enhancements.





Selling
      and general expenses decreased 4% or $77,909 to $2,050,146 from $2,128,055
      in
      the comparable period of the prior fiscal year. The $77,909 decrease in selling
      and general expenses is attributed to no Sarbanes-Oxley Act compliance expenses
      being incurred during the period offset by additional expenses related to
      additional personnel, amortization, insurance and auditing costs plus general
      increases in other costs.





Other
      income for the first six months of fiscal 2006 increased $67,747 over the same
      period in the prior year due to more cash available for investments and a higher
      rate of return on those investments.





**Risk
      Factors**





Investors
      should carefully consider the risks described below and in the Company’s Annual
      Report on Form 10-KSB for the fiscal year ended October 31, 2005. The risks
      and
      uncertainties described below and in the Annual Report are not the only ones
      facing the Company. If any of the following risks actually occur, the Company’s
      business, financial condition or results of operations could be materially
      adversely affected.





Dependence
      On RF Connector and Cable Assembly Products





Of
      the
      Company’s five operating divisions, the three RF Connector and Cable Assembly
      product divisions account for approximately 83% of the Company’s net sales for
      the fiscal year ended October 31, 2005, and approximately 89% of net sales
      during the three and six months ended April 30, 2006. The Company expects the
      RF
      Connector and Cable Assembly products will continue to account for the majority
      of the Company’s revenues for the near future. Accordingly, an adverse change in
      the operations of the RF Connector and Cable Assembly divisions could materially
      adversely affect the Company’s business, operating results and financial
      condition. Factors that could adversely affect the RF Connector and Cable
      Assembly divisions are described below.






12





The
      Company Depends On Third-Party Contract Manufacturers For Substantially All
      Of
      Its Connector Manufacturing Needs.





Substantially
      all of the Company’s RF Connector and Cable Assembly products are manufactured
      by third-party contract manufacturers. The Company relies on them to procure
      components for RF Connector and Cable Assembly and in certain cases to design,
      assemble and test its products on a timely and cost-efficient basis. If the
      Company’s contract manufacturers are unable to complete design work on a timely
      basis, the Company will experience delays in product development and its ability
      to compete may be harmed. In addition, because some of the Company’s
      manufacturers have manufacturing facilities in Taiwan and Korea, their ability
      to provide the Company with adequate supplies of high-quality products on a
      timely and cost-efficient basis is subject to a number of additional risks
      and
      uncertainties, including earthquakes and other natural disasters and political,
      social and economic instability. If the Company’s manufacturers are unable to
      provide it with adequate supplies of high-quality products on a timely and
      cost-efficient basis, the Company’s operations would be disrupted and its net
      revenue and profitability would suffer. Moreover, if the Company’s third-party
      contract manufacturers cannot consistently produce high-quality products that
      are free of defects, the Company may experience a higher rate of product
      returns, which would also reduce its profitability and may harm the Company’s
      reputation and brand.





The
      Company does not currently have any agreements with any of its contract
      manufacturers, and such manufacturers could stop manufacturing products for
      the
      Company at any time. Although the Company believes that it could locate
      alternate contract manufacturers if any of its manufacturers terminated their
      business, the Company’s operations could be impacted until alternate
      manufacturers are found.





The
      Company’s Dependence On Third-Party Manufacturers Increases The Risk That It
      Will Not Have An Adequate Supply Of Products Or That Its Product Costs Will
      Be
      Higher Than Expected.





The
      risks
      associated with the Company’s dependence upon third parties that develop and
      manufacture and assemble the Company’s products include:





§  reduced
      control over delivery schedules and quality;





§  risks
      of
      inadequate manufacturing yields and excessive costs;





§  the
      potential lack of adequate capacity during periods of excess demand;
      and





§  potential
      increases in prices.





These
      risks may lead to increased costs or delay product delivery, which would harm
      the Company’s profitability and customer relationships.





Dependence
      Upon Independent Distributors To Sell And Market The Company’s
      Products





The
      Company’s sales efforts are primarily conducted through independent
      distributors. Sales through independent distributors accounted for approximately
      62% of the net sales of the Company for the fiscal year ended October 31, 2005,
      and approximately 65% for the three and six months ended April 30, 2006.
      Although the Company has entered into written agreements with most of the
      distributors, the agreements are nonexclusive and generally may be terminated
      by
      either party upon 30-60 days written notice. The Company’s distributors are not
      within the control of the Company, are not obligated to purchase products from
      the Company, and may also sell other lines of products. There can be no
      assurance that these distributors will continue their current relationships
      with
      the Company or that they will not give higher priority to the sale of other
      products, which could include products of competitors. A reduction in sales
      efforts or discontinuance of sales of the Company’s products by its distributors
      would lead to reduced sales and could materially adversely affect the Company’s
      financial condition, results of operations and business. Selling through
      indirect channels such as distributors may limit the Company’s contact with its
      ultimate customers and the Company’s ability to assure customer
      satisfaction.




13





Dependence
      On Principal Customer





One
      customer accounted for approximately 15% of the net sales of the Company’s RF
      Connector and Cable Assembly division for the fiscal year ended October 31,
      2005
      and 16% and 19% of net sales for the three and six months ended April 30, 2006,
      respectively. Although this customer has been an on-going major customer of
      the
      Company during the past five years, the
      Company does have a written distributor agreement with this customer. However,
      this customer does not have any minimum purchase obligations and could stop
      buying the Company’s products at any time. Accordingly,
      the Company’s largest customer could stop buying the Company’s products at any
      time. A reduction, delay or cancellation of orders from this customer or the
      loss of this customer could significantly reduce the Company’s revenues and
      profits. The Company cannot provide assurance that this customer or any of
      its
      current customers will continue to place orders, that orders by existing
      customers will continue at current or historical levels or that the Company
      will
      be able to obtain orders from new customers.





Certain
      Of The Company’s Markets Are Subject to Rapid Technological Change, So The
      Company’s Success In These Markets Depends On Its Ability To Develop And
      Introduce New Products.





Although
      most of the Company’s products have a stable market and are only gradually
      phased out, certain of the new and emerging markets, such as the wireless
      digital transmission markets, are characterized by:





§  rapidly
      changing technologies;





§  evolving
      and competing industry standards;





§  short
      product life cycles;





§  changing
      customer needs;





§  emerging
      competition;





§  frequent
      new product introductions and enhancements; and





§  rapid
      product obsolescence.





To
      develop new products for the connector and wireless digital transmission
      markets, the Company must develop, gain access to and use new technologies
      in a
      cost-effective and timely manner. In addition, the Company must maintain close
      working relationship with key customers in order to develop new products that
      meet customers’ changing needs. The Company also must respond to changing
      industry standards and technological changes on a timely and cost-effective
      basis.





Products
      for connector applications are based on industry standards that are continually
      evolving. The Company’s ability to compete in the future will depend on its
      ability to identify and ensure compliance with these evolving industry
      standards. If the Company is not successful in developing or using new
      technologies or in developing new products or product enhancements, its future
      revenues may be materially affected. The Company’s attempt to keep up with
      technological advances may require substantial time and expense.






14





The
      Markets In Which The Company Competes Are Highly Competitive.





The
      markets in which the Company operates are highly competitive and the Company
      expects that competition will increase in these markets. In particular, the
      connector and communications markets in which the Company’s products are sold
      are intensely competitive. Because the Company does not own any proprietary
      property that can be used to distinguish the Company from its competitors,
      the
      Company’s ability to compete successfully in these markets depends on a number
      of factors, including:





§ success
      in subcontracting the design and manufacture of existing and new products that
      implement new technologies;





§ product
      quality;





§ reliability;





§ customer
      support;





§ time-to-market;





§ price;





§ market
      acceptance of competitors’ products; and





§ general
      economic conditions.





In
      addition, the Company’s competitors or customers may offer enhancements to their
      existing products or offer new products based on new technologies, industry
      standards or customer requirements that have the potential to replace or provide
      lower-cost or higher performance alternatives to the Company’s products. The
      introduction of enhancements or new products by the Company’s competitors could
      render its existing and future products obsolete or unmarketable.





Many
      of
      the Company’s competitors have significantly greater financial and other
      resources. In certain circumstances, the Company’s customers or potential
      customers have internal manufacturing capabilities with which the Company may
      compete.





If
      The
      Industries Into Which The Company Sells Its Products Experience Recession Or
      Other Cyclical Effects Impacting The Budgets Of Its Customers, The Company’s
      Operating Results Could Be Negatively Impacted.





The
      primary customers for the Company’s coaxial connectors are in the connector and
      communications industries. Any significant downturn in the Company’s customers’
markets, in particular, or in general economic conditions that result in the
      cut
      back of budgets would likely result in a reduction in demand for the Company’s
      products and services and could harm the Company’s business. Historically, the
      communications industry has been cyclical, affected by both economic conditions
      and industry-specific cycles. Depressed general economic conditions and cyclical
      downturns in the communications industry have each had an adverse effect on
      sales of communications equipment, OEMs and their suppliers, including the
      Company. No assurance can be given that the connector industry will not
      experience a material downturn in the near future. Any cyclical downturn in
      the
      connector and/or communications industry could have a material adverse effect
      on
      the Company.





The
      Company May Make Future Acquisitions That Will Involve Numerous
      Risks.





Since
      August 2004, the Company has purchased the operations of two smaller businesses
      (Aviel Electronics in Las Vegas, Nevada, August 2004, and Worswick Industries,
      Inc. in San Diego, California, September 2005). The
      Company periodically may make acquisitions of other companies that could expand
      the Company’s product line or customer base. The risks involved with both the
      recent acquisitions and with any possible future acquisitions
      include:




15




§ diversion
      of management’s attention;





§ the
          affect on the Company’s financial statements of the amortization of acquired
          intangible assets;





§ the
      cost
      associated with acquisitions and the integration of acquired operations; and





§ the
      assumption of unknown liabilities, or other unanticipated events or
      circumstances.





Any
      of
      these risks could materially harm the Company’s business, financial condition
      and results of operations. There can be no assurance that any business that
      the
      Company acquires will achieve anticipated revenues or operating results.





International
      Sales And Operations





Sales
      to
      customers located outside the United States, either directly or through U.S.
      and
      foreign distributors, accounted for approximately 10% of net sales during the
      three and six months ended April 30, 2006, and approximately 8% and 9 % for
      the
      comparable periods in 2005. However, the $117,534 increase in foreign sales
      for
      the six months ended April 30, 2006 was due to increased cooperative
      advertising, primarily in Mexico. International revenues are subject to a number
      of risks, including:





§ longer
      accounts receivable payment cycles;





§ difficulty
      in enforcing agreements and in collecting accounts receivable;





§ tariffs
      and other restrictions on foreign trade;





§ economic
      and political instability; and





§ the
      burdens of complying with a wide variety of foreign laws.





The
      Company’s foreign sales are also affected by general economic conditions in its
      international markets. A prolonged economic downturn in its foreign markets
      could have a material adverse effect on the Company’s business. There can be no
      assurance that the factors described above will not have an adverse material
      effect on the Company’s future international revenues and, consequently, on the
      financial condition, results of operations and business of the
      Company.





Since
      sales made to foreign customers or foreign distributors have historically been
      in U.S. dollars, the Company has not been exposed to the risks of foreign
      currency fluctuations. However, if the Company in the future is required to
      accept sales denominated in the currencies of the countries where sales are
      made, the Company thereafter may also be exposed to currency fluctuation risks.





Changes
      In Stock Option Accounting Rules May Adversely Affect Our Reported Operating
      Results, Our Stock Price, And Our Ability To Attract And Retain
      Employees





In
      the
      first quarter of the fiscal year ending October 31, 2007 the Company will be
      required, under the new rules of the Financial Accounting Standards Board,
      to
      adopt SFAS
      No.
      123(R), "Share-Based Payment" to
      record
      all stock-based employee compensation as an expense. The new rules apply to
      stock option grants, as well as a wide range of other share-based compensation
      arrangements. As a small company with limited financial resources, the Company
      has depended upon compensating its officers, directors, and employees with
      such
      stock based compensation awards in the past in order to limit its cash
      expenditures and to attract and retain officers, directors, and employees.
      Accordingly, if the Company continues to grant stock options or other
      stock-based compensation awards to its officers, directors, and employees,
      its
      future earnings, if any, will be reduced (or our future losses will be
      increased) by the expenses recorded for those grants. Since the Company is
      a
      small company, the expenses it may have to record as a result of future options
      grants may be significant and may materially negatively affect its reported
      financial results. The adverse effects that the new accounting rules may have
      on
      the Company’s future financial statements, should it continue to rely heavily on
      stock-based compensation, may reduce the Company’s stock price and make it more
      difficult for it to attract new investors.




16





The
      Company Has No Exclusive Intellectual Property Rights In The Technology Employed
      In Its Products, Which May Limit the Company’s Ability To
      Compete.





The
      Company does not hold any United States or foreign patents and does not have
      any
      patents pending. In addition, the Company does not have any other exclusive
      intellectual property rights in the technology employed in its products. The
      Company does not actively seek to protect its rights in the technology that
      it
      develops or that the Company’s third-party contract manufacturers develop. In
      addition, these parties share the technologies with other parties, including
      some of the Company’s competitors. Accordingly, competitors can and do sell the
      same products as the Company, and the Company cannot prevent or restrict such
      competition.





Volatility
      of Stock Trading Prices





In
      the
      past several years the market price of the Company’s common stock has varied
      greatly, and the volume of the Company’s common stock traded has fluctuated
      greatly as well. These fluctuations often occur independently of the Company’s
      performance or any announcements by the Company. Factors that may result in
      such
      fluctuations include:





§
            any
                shortfall in revenues or net income from revenues or net income expected
                by securities analysts





§
            fluctuations
                in the Company’s financial results or the results of other connector and
                communications-related companies, including those of the Company’s direct
                competitors





§
            changes
                in analysts’ estimates of the Company’s financial performance, the
                financial performance of the Company’s competitors, or the financial
                performance of connector and communications-related public companies
                in
                general





§
            general
                conditions in the connector and communications
                industries





§
            changes
                in the Company’s revenue growth rates or the growth rates of the Company’s
                competitors





§
            sales
                of large blocks of the Company’s common
                stock





§
            conditions
                in the financial markets in general





In
      addition, the stock market may from time to time experience extreme price and
      volume fluctuations, which may be unrelated to the operating performance of
      any
      specific company. Accordingly, the market prices of the Company’s common stock
      may be expected to experience significant fluctuations in the future.





17


**Item
      3.**  **Controls
      and Procedures**




The
      Company maintains disclosure controls and procedures that are designed to ensure
      that information required to be disclosed in our Exchange Act reports is
      recorded, processed, summarized and reported within the time periods specified
      in the Securities and Exchange Commission’s rules and forms and that such
      information is accumulated and communicated to this company’s management,
      including our Chief Executive Officer and Chief Financial Officer, as
      appropriate, to allow for timely decisions regarding required disclosure. In
      designing and evaluating the disclosure controls and procedures, management
      recognizes that any controls and procedures, no matter how well designed and
      operated, can provide only reasonable assurance of achieving the desired control
      objectives, and management is required to apply its judgment in evaluating
      the
      cost-benefit relationship of possible controls and procedures.




As
      required by Securities and Exchange Commission Rule 13a-15(b), we carried out
      an
      evaluation, under the supervision and with the participation of the Company’s
      management, including our Chief Executive Officer and the Company’s Chief
      Financial Officer, of the effectiveness of the design and operation of our
      disclosure controls and procedures as of the end of the quarter covered by
      this
      report. Based on the foregoing, our Chief Executive Officer and Chief Financial
      Officer concluded that our disclosure controls and procedures are effective
      in
      ensuring that the information required to be disclosed in our reports filed
      or
      submitted under the Exchange Act is recorded, processed, summarized and reported
      within the time periods specified in the Securities and Exchange Commission
      rules and forms.




During
      the quarter ended April 30, 2006, the Company has continued actions to improve
      the Company’s internal controls over financial reporting, including the
      following:





·
            Hired
                a degreed Director of Accounting with experience with accounting
                principles generally accepted in the United States and Section 404
                of the
                Sarbanes-Oxley Act of 2002.





·
            Implemented
                additional review and continued enhancement of internal control policies
                and procedures in bringing the Company’s controls and procedures into
                compliance with accounting principles generally accepted in the United
                States and Section 404 of the Sarbanes-Oxley Act of 2002 within the
                time
                frame required under the Act.





**Part
      II. OTHER INFORMATION**





**Item
      6. Exhibits**




ExhibitNumber31.1:
            Certification
                of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
                Act of 2002.31.2:
            Certification
                of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
                Act of 2002.32.1:
            Certification
                of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as
                adopted
                pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.32.2:
            Certification
                of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as
                adopted
                pursuant to Section 906 of the Sarbanes-Oxley Act of
                2002.





18





**SIGNATURES**





In
      accordance with 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.




RF
                INDUSTRIES, LTD.Dated:
                June 14, 2006
            By:/s/
                Howard F.
                Hill
              Howard
                F. Hill, President
              Chief
                Executive OfficerDated:
                June 14, 2006
            By:/s/Victor
                H.
                Powers
              Victor
                H. Powers
              Chief
                Financial Officer











19