SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549
                                   FORM 10-QSB

 [x] Quarterly  report under Section 13 or 15(d) of the Securities  Exchange Act
     of 1934. For the quarterly period ended September 30, 2006.


 [_] Transition  report under Section 13 or 15(d) of the  Securities  Exchange
     Act of 1934.

     For the transition period from              to


                         Commission File Number: 0-28666


                         AMERICAN BIO MEDICA CORPORATION
        -----------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)


                               New York 14-1702188
       -------------------------------------------------------------------
                (State or other jurisdiction of (I.R.S. Employer
               incorporation or organization) Identification No.)


                   122 Smith Road, Kinderhook, New York 12106
                   -------------------------------------------
                    (Address of principal executive offices)


                                  800-227-1243
                           ---------------------------
                           (Issuer's telephone number)


      Check  whether the issuer:  (1) filed all reports  required to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 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 [ ]

     State the number of shares  outstanding of each of the issuer's  classes of
common equity as of the latest practicable date:

     21,459,768 Common Shares as of November 13, 2006



     Transitional Small Business Disclosure Format: Yes [ ] No [X]


<PAGE>



                                     PART I
                              FINANCIAL INFORMATION
                         American Bio Medica Corporation
                                 Balance Sheets

<TABLE>
<CAPTION>
                                                              September 30,   December 31,
                                                                  2006           2005
                                                              (Unaudited)
                                                              ------------    ------------
<S>                                                           <C>             <C>
                               Assets
Current assets:
      Cash and cash equivalents                               $    906,000    $    446,000
      Accounts receivable, net of allowance of $105,000
       at both September 30, 2006 and December 31, 2005          1,425,000       1,370,000
      Inventory-net of reserve for slow moving and
        obsolete inventory of $250,000 at both September
        30,  2006 and December 31, 2005                          3,977,000       4,444,000
      Prepaid and other current assets                             248,000         109,000
                                                              ------------    ------------

Total current assets                                             6,556,000       6,369,000

Property, plant and equipment, net                               1,606,000       1,562,000
Other assets                                                        57,000           7,000
                                                              ------------    ------------

Total assets                                                  $  8,219,000    $  7,938,000
                                                              ============    ============

                Liabilities and Stockholders' Equity

Current liabilities:
      Accounts payable                                        $  1,059,000    $  1,380,000
      Accrued liabilities                                          297,000         130,000
      Wages payable                                                213,000         177,000
      Line of credit                                               103,000
      Current portion of mortgages and notes payable                23,000          36,000
      Current portion of unearned grant                             10,000          10,000
      Current portion of sublicense                                 50,000
      Other liabilities                                             29,000
                                                              ------------    ------------

 Total current liabilities                                       1,784,000       1,733,000

  Long term portion of mortgages and notes payable                 575,000         592,000
  Long term portion of unearned grant                               60,000          60,000
  Other long term liabilities                                       50,000
                                                              ------------    ------------

 Total liabilities                                               2,469,000       2,385,000
                                                              ------------    ------------

Stockholders' equity:
    Preferred stock; par value $.01 per share; 5,000,000
     shares authorized; none issued and outstanding
    Common stock; par value $.01 per share;
     50,000,000 shares authorized; 21,459,768 and
     21,359,768 shares issued and outstanding at
     September 30, 2006 and December 31, 2005, respectively        215,000         214,000
Additional paid-in capital                                      18,958,000      18,853,000
Accumulated deficit                                            (13,423,000)    (13,514,000)
                                                              ------------    ------------

Total stockholders' equity                                       5,750,000       5,553,000
                                                              ------------    ------------

Total liabilities and stockholders' equity                    $  8,219,000    $  7,938,000
                                                              ============    ============
</TABLE>


The accompanying notes are an integral part of the financial statements



                                       2
<PAGE>


                         American Bio Medica Corporation
                            Statements of Operations
                                   (Unaudited)


                                                   For The Nine Months Ended
                                                         September 30,
                                                 ----------------------------
                                                     2006            2005
                                                 ------------    ------------

Net sales                                        $ 10,657,000    $ 10,315,000
Cost of goods sold                                  5,567,000       5,244,000
                                                 ------------    ------------
Gross profit                                        5,090,000       5,071,000
                                                 ------------    ------------

Operating expenses:
    Research and development                          456,000         520,000
    Selling and marketing                           2,273,000       2,540,000
    General and administrative                      2,217,000       1,788,000
                                                 ------------    ------------
                                                    4,946,000       4,848,000
                                                 ------------    ------------
Operating income                                      144,000         223,000
                                                 ------------    ------------

Other income (expense):
   Other income                                                         5,000
   Interest income                                      3,000           3,000
   Interest expense                                   (50,000)        (42,000)
                                                 ------------    ------------
                                                      (47,000)        (34,000)
                                                 ------------    ------------
Income before provision for income taxes               97,000         189,000
Income taxes                                            5,000           6,000
                                                 ------------    ------------
Net income                                       $     92,000    $    183,000
                                                 ============    ============

Basic and diluted income per common share        $       0.00    $       0.01
                                                 ============    ============

 Weighted average shares outstanding                     --
    basic                                          21,483,150      21,293,010
 Dilutive effect of stock options and warrants        104,565          64,514
                                                 ------------    ------------
 Weighted average shares outstanding -
    diluted                                        21,587,715      21,357,524
                                                 ============    ============

The accompanying notes are an integral part of the financial statements



                                       3
<PAGE>


                         American Bio Medica Corporation
                            Statements of Operations
                                   (Unaudited)


                                                  For The Three Months Ended
                                                        September 30,
                                                 ----------------------------
                                                     2006           2005
                                                 ------------    ------------

Net sales                                        $  3,564,000    $  3,570,000
Cost of goods sold                                  1,890,000       1,906,000
                                                 ------------    ------------
Gross profit                                        1,674,000       1,664,000
                                                 ------------    ------------

Operating expenses:
    Research and development                          145,000         188,000
    Selling and marketing                             811,000         859,000
    General and administrative                        722,000         642,000
                                                 ------------    ------------
                                                    1,678,000       1,689,000
                                                 ------------    ------------
Operating loss                                         (4,000)        (25,000)
                                                 ------------    ------------

Other income (expense):
   Interest income                                      2,000           1,000
   Interest expense                                   (14,000)        (15,000)
                                                 ------------    ------------
                                                      (12,000)        (14,000)
                                                 ------------    ------------
Loss before provision for income taxes                (16,000)        (39,000)
Income taxes
                                                 ------------    ------------
Net loss                                         $    (16,000)   $    (39,000)
                                                 ============    ============

Basic and diluted income per common share        $       0.00    $       0.00
                                                 ============    ============

 Weighted average shares outstanding                     --
    basic                                          21,459,768      21,309,225
 Dilutive effect of stock options and warrants         70,246          35,413
                                                 ------------    ------------
 Weighted average shares outstanding -
    diluted                                        21,530,014      21,344,638
                                                 ============    ============


The accompanying notes are an integral part of the financial statements



                                       4
<PAGE>

                         American Bio Medica Corporation
                            Statements of Cash Flows
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                              For The Nine Months Ended
                                                                   September 30,
                                                               ----------------------
                                                                 2006         2005
                                                               ---------    ---------
<S>                                                            <C>          <C>
Cash flows from operating activities:
 Net income                                                    $  92,000    $ 183,000
  Adjustments to reconcile net income to cash:
     Depreciation                                                279,000      281,000
     Provision for doubtful accounts
     Non cash compensation expense                                21,000
     Changes in:
       Accounts receivable                                       (54,000)    (494,000)
       Inventory                                                 473,000      232,000
       Prepaid and other current assets                          (90,000)     (20,000)
       Accounts payable                                         (324,000)    (413,000)
       Accrued liabilities                                       170,000       43,000
       Other liabilities                                          29,000
       Unearned Grant                                                          (5,000)
       Wages payable                                              36,000       50,000
                                                               ---------    ---------
         Net cash (used in)/provided by operating activities     632,000     (143,000)
                                                               ---------    ---------

Cash flows from investing activities:
  Purchase of property, plant and equipment                     (334,000)    (125,000)
                                                               ---------    ---------
         Net cash used in investing activities                  (334,000)    (125,000)
                                                               ---------    ---------

Cash flows from financing activities:
  Proceeds from exercise of warrants                                           3,000
  Proceeds from exercise of options                               85,000
  Debt payments                                                  (26,000)     (57,000)
  Proceeds from line of credit                                   103,000       78,000
  Proceeds from grant                                                          25,000
                                                               ---------    ---------
         Net cash provided by financing activities               162,000       49,000
                                                               ---------    ---------

Net increase / (decrease) in cash and cash equivalents           460,000     (219,000)
Cash and cash equivalents - beginning of period                  446,000      995,000
                                                               ---------    ---------

Cash and cash equivalents - end of period                      $ 906,000    $ 776,000
                                                               =========    =========

Supplemental disclosures of cash flow information
      Cash paid during period for interest                     $  50,000    $  40,000
      Issuance of note payable for purchase of equipment                    $  85,000
</TABLE>

The accompanying notes are an integral part of the financial statements


                                       5
<PAGE>

Notes to financial statements (unaudited)

                               September 30, 2006

Note A - Basis of Reporting

         The accompanying  unaudited financial  statements have been prepared in
accordance 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,  such
statements  include all adjustments,  which are considered  necessary for a fair
presentation of the financial  position of American Bio Medica  Corporation (the
"Company" or "ABMC") at September 30, 2006,  and the results of its  operations,
and cash flows for the nine-month and  three-month  periods ended  September 30,
2006 and 2005.  The results of operations  for the  nine-month  and  three-month
periods ended September 30, 2006 are not necessarily indicative of the operating
results  for  the  full  year.  These  financial  statements  should  be read in
conjunction  with  the  Company's  audited  financial   statements  and  related
disclosures  for the year ended December 31, 2005 included in the Company's Form
10-KSB.

         During the year ended  December  31, 2005,  the Company  incurred a net
loss of  $376,000  from net  sales  of  $13,015,000,  and had net  cash  used in
operating  activities  of $372,000.  During the nine months ended  September 30,
2006, the Company earned a net income of $92,000 from net sales of  $10,657,000.
The Company had net cash  provided by operating  activities  of $632,000 for the
first nine months of 2006  primarily as a result of net income and reductions in
inventory.  During the first nine months of 2006, the Company  continued to take
steps to improve its  financial  prospects  including  focusing on research  and
development and selling and marketing.

         The Company's  continued  existence is dependent upon several  factors,
including  its  ability to raise  revenue  levels and reduce  costs to  generate
positive cash flows, and to sell additional shares of the Company's common stock
to fund operations, if necessary.


NEW ACCOUNTING STANDARDS

         In  December  2004,  the  FASB  issued  FAS  No.  123  (revised  2004),
"Share-Based Payment", ("FAS No. 123(R)"), which amends FAS No. 123, "Accounting
for Stock-Based  Compensation",  and supersedes APB Opinion No. 25,  "Accounting
for Stock Issued to Employees".  FAS No. 123(R) requires compensation expense to
be recognized for all  share-based  payments made to employees based on the fair
value  of the  award at the  date of  grant,  eliminating  the  intrinsic  value
alternative allowed by FAS No. 123. Generally,  the approach to determining fair
value under the  original  pronouncement  has not  changed.  However,  there are
revisions to the  accounting  guidelines  established,  such as  accounting  for
forfeitures,  which will change our  accounting  for  stock-based  awards in the
future.

         FAS No.  123(R) must be adopted in the first  interim or annual  period
beginning after December 15, 2005. The statement  allows  companies to adopt its
provisions using either of the following transition alternatives:

         (i) The modified  prospective method,  which results in the recognition
         of  compensation  expense using FAS 123(R) for all  share-based  awards
         granted after the effective date and the  recognition  of  compensation
         expense using FAS 123 for all  previously  granted  share-based  awards
         that remain unvested at the effective date; or


         (ii) The modified  retrospective  method, which results in applying the
         modified  prospective method and restating prior periods by recognizing
         the  financial  statement  impact of  share-based  payments in a manner
         consistent with the pro forma  disclosure  requirements of FAS No. 123.
         The modified  retrospective  method may be applied to all prior periods
         presented  or  previously  reported  interim  periods  of the  year  of
         adoption.



                                       6
<PAGE>

         ABMC  adopted  FAS No.  123(R) on January  1, 2006  using the  modified
prospective method.  Because we previously accounted for share-based payments to
our employees using the intrinsic  value method,  our results of operations have
not included the recognition of  compensation  expense for the issuance of stock
option awards.  The Company  accelerated  the vesting of all  outstanding  stock
options to December 14, 2005. Options granted to two employees during the second
quarter of 2006 were accounted for in accordance with FAS No. 123(R).

         FAS No. 123(R) also  requires the benefits of tax  deductions in excess
of recognized  compensation cost to be reported as a financing cash flow, rather
than as an  operating  cash flow as  required  under  current  literature.  This
requirement  may reduce our net  operating  cash  inflows and  increase  our net
financing cash flows in periods after  adoption.  The impact that this change in
reporting  will have on future periods cannot be determined at this time because
the benefit  recognized is dependent upon  attributes  that vary for each option
exercise.

         In May 2005, the FASB issued FAS No. 154. "Accounting Changes and Error
Corrections"  which  replaced  APB  Opinion  No.  20 and FASB  Statement  No. 3,
"Reporting Accounting Changes in Interim Financial Statements",  and changes the
requirements  for the  accounting  for and  reporting of a change in  accounting
principle.  This  statement  shall  be  effective  for  accounting  changes  and
corrections  of errors made in fiscal years  beginning  after December 15, 2005.
FAS No. 154  requires  retrospective  application  to prior  periods'  financial
statements of changes in accounting  principle,  unless it is  impracticable  to
determine  either the  period-specific  effects or the cumulative  effect of the
change. This Statement defines retrospective application as the application of a
different  accounting principle to prior accounting periods as if that principle
had  always  been  used or as the  adjustment  of  previously  issued  financial
statements  to  reflect  a change  in the  reporting  entity.  FAS No.  154 also
requires that a change in  depreciation,  amortization,  or depletion method for
long-lived,  non-financial  assets be  accounted  for as a change in  accounting
estimate  effected by a change in  accounting  principle.  The Company  does not
believe that the adoption of FAS No. 154 will have a  significant  effect on its
financial statements.

         In   September   2006  the  FASB   issued  FAS  No.  157  "Fair   Value
Measurements".  FAS No. 157 defines  fair  value,  establishes  a framework  for
measuring fair value in generally  accepted  accounting  principles  (GAAP), and
expands disclosures about fair value  measurements.  This Statement is effective
for financial  statements  issued for fiscal years  beginning after November 15,
2007,  and interim  periods within those fiscal years.  This  Statement  applies
under  other  accounting  pronouncements  that  require  or  permit  fair  value
measurements,   the  FASB  having  previously   concluded  in  those  accounting
pronouncements   that  fair  value  is  the  relevant   measurement   attribute.
Accordingly,  this Statement  does not require any new fair value  measurements.
However,  for some  entities,  the  application  of this  Statement  will change
current  practice.  The Company does not have any fair value  requirements  from
other  pronouncements and does not believe that the adoption of FAS No. 157 will
have a significant effect on its financial statements.


Note B - Net Income Per Common Share

         Basic net income or loss per share is  calculated  by dividing  the net
income or loss by the  weighted  average  number of  outstanding  common  shares
during the period.  Diluted net income or loss per share  includes  the weighted
average dilutive effect of stock options and warrants.

         Potential common shares outstanding as of September 30, 2006 and 2005:

                                       September 30,        September 30,
                                            2006               2005
                                            ----               ----

                       Warrants           550,000             2,243,420
                       Options          3,993,080             4,278,080



                                       7
<PAGE>

         For the three  months and nine  months  ended  September  30,  2006 the
number of securities  not included in the diluted EPS,  because the effect would
have been  anti-dilutive,  were  3,481,080 and 3,401,080  respectively.  For the
three months and nine months ended  September  30, 2005 the number of securities
not  included  in  the  diluted   EPS,   because  the  effect  would  have  been
anti-dilutive, were 5,783,000 and 4,884,500 respectively.

         ABMC  adopted  FAS  123(R)  (see  "New  Accounting   Standards"  above)
effective  January  1,  2006.  FAS 123(R)  requires  compensation  expense to be
recognized  for all  share-based  payments  made to employees  based on the fair
value  of the  award at the  date of  grant,  eliminating  the  intrinsic  value
alternative  allowed  by FAS No.  123.  The  following  pro  forma  information,
presented  for 2005,  gives  effect to fair value of the  options on the date of
grant  using  the   Black-Scholes   option-pricing   model  with  the  following
assumptions:  dividend yield of 0%, volatility of 75% to 77%, risk free interest
rates  ranging  from  4.26% to 4.91%,  and an  expected  life of 10  years.  The
pro-forma net income represents nine months  amortization of expense  associated
with the option grants.


                                           Nine months ended   Nine months ended
                                             September 30,       September 30,
                                                 2006                 2005
                                           -------------------------------------

         Net Income/(loss):
               As reported                     $   92,000       $   183,000
               Pro forma                       $   92,000       $  (478,000)
         Basic income/(loss) per share
              As reported                      $      .00       $       .01
              Pro forma                        $      .00       $      (.02)
         Diluted income/(loss) per share
               As reported                     $      .00       $       .01
               Pro forma                       $      .00       $      (.02)

Note C - Litigation

         The  Company has been named in legal  proceedings  in  connection  with
matters that arose  during the normal  course of its  business,  and that in the
Company's opinion are not material.  While the ultimate result of any litigation
cannot be determined,  it is management's  opinion based upon  consultation with
counsel, that it has adequately provided for losses that may be incurred related
to these claims. If the Company is unsuccessful in defending any or all of these
claims, resulting financial losses could have an adverse effect on the financial
position, results of operations and cash flows of the Company.

Note D - Reclassifications

         Certain  items  have  been  reclassified  to  conform  to  the  current
presentation.

Note E - Line of Credit

         On October 5, 2006,  the Company was notified  that the maximum  amount
available  under its line of credit with First  Niagara  Financial  Group,  Inc.
("FNFG") was increased from $350,000 to $875,000.  The maximum available line of
$875,000  is not to exceed 70% of  accounts  receivable  less than 60 days.  The
purpose of the line of credit is to provide working  capital.  The interest rate
is .25% above the FNFG prime rate. The Company is required to maintain net worth
(stockholder's  equity) greater than $5 million and working capital greater than
$4 million.  Further the Company is required to maintain a minimum  Debt Service
Coverage  ratio  of not less  than  1.2:1.0  measured  at each  fiscal  year end
beginning  December 31,  2006.  Debt  Service  Coverage  Ratio is defined as Net
Operating Income divided by Annual principal and interest  payments on all loans
relating to subject  property.  There is no  requirement  for  repayment  of all
principal  annually on this line of credit.  The amount outstanding on this line
of credit at September 30, 2006 was $72,000.



                                       8
<PAGE>

         The Company obtained an additional line of credit from FNFG for $75,000
during the first quarter of 2006.  The line of credit is to be used  exclusively
for payments on a sublicense  agreement entered into during the first quarter of
2006.  The interest  rate is .50% above the FNFG prime rate and principal may be
repaid at any time and borrowed  again as needed.  There is no  requirement  for
repayment of all principal  annually on this line of credit. The Company intends
to repay the funds drawn down on this line within one year to allow borrowing of
additional   amounts  related  to  future  payments  due  under  the  Sublicense
Agreement.  The amount  outstanding on this line of credit at September 30, 2006
was $31,000.

Note F -Sublicense Agreement

         On  February  28,  2006,  the  Company  entered  into  a  non-exclusive
Sublicense  Agreement (the "Agreement")  related to certain patents to allow the
Company to expand its contract manufacturing  operations.  Under this Agreement,
the Company is committed to pay a non-refundable fee of $175,000 over the course
of 2 years,  of which  $75,000 was paid in the first  quarter of 2006.  The next
payment of $50,000 is scheduled for the first quarter of 2007. The Company would
also be required to pay  royalties  for products the Company  manufactures  that
fall within the scope of these  patents.  The Company has not  manufactured  any
products that fall within the scope of these patents, and therefore,  no royalty
payments are currently required.

Note G - Integrated Bio Technology Agreement

         On March 29, 2006,  the Company  entered into a royalty  agreement with
Integrated Bio Technology  Corporation ("IBC"). IBC is the owner of the RSV test
and   previously   purchased  the  tests  from  the  Company,   via  a  contract
manufacturing  agreement,  for resale to IBC's  distributor.  As of December 31,
2005, IBC had outstanding amounts due to ABMC totaling  approximately  $119,000.
To address this outstanding  balance,  and to streamline the delivery of product
to IBC's distributor, the Company agreed to work directly with IBC's distributor
to receive orders,  manufacture product and execute all invoicing and collection
directly from the distributor. Effective January 1, 2006, the Company will pay a
royalty  equal to 20% of total sales to IBC.  The  Company  will pay only 25% of
royalties  earned during the first two years,  with the remaining 75% applied to
amounts  currently owed to ABMC by IBC. If the entire amount receivable from IBC
is not earned  through  royalties  during the first two years of the term of the
royalty Agreement,  all payments to IBC will cease until the full amount owed to
the Company is satisfied. During the first nine months of 2006 ABMC manufactured
and sold  approximately  $444,000  of the RSV  tests to IBC's  distributor.  The
royalties  earned on these  sales were  approximately  $89,000.  During the nine
months  ended  September  30, 2006 ABMC  reduced  the  amounts  owed from IBC by
$67,000,   from   $119,000  to  $52,000  and  made   payments  to  IBC  totaling
approximately $22,000.

Note H - Stock Option Grants

         In June 2006, the Company's  Board of Directors  granted a stock option
to purchase  72,000 shares of the Company's  common stock to the Company's Chief
Financial  Officer,  and an option to  purchase  3,000  shares of the  Company's
common stock to an employee in the Company's  R&D  division.  Both option grants
have exercise prices of $1.05 (the closing price of the Company's  common shares
on the date of grant) and vest 100% on the one-year  anniversary  of the date of
the grant. In accordance with FAS 123(R) (see "New Accounting  Standards"),  the
Company will recognize $63,347 in non-cash compensation expense related to these
grants over the next twelve months. Included in the three months and nine months
ended  September 30, 2006 is $16,000 and $21,000 of this  non-cash  compensation
expense respectively.


                                       9
<PAGE>


Item 2. Management's Discussion and Analysis or Plan of Operation

         MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2006 AND 2005

         The following  discussion of the Company's  financial condition and the
results  of  operations  should  be  read  in  conjunction  with  the  Financial
Statements and Notes thereto appearing elsewhere in this document.

         The Private  Securities  Litigation  Reform Act of 1995 provides a safe
harbor for forward-looking  statements. In order to comply with the terms of the
safe harbor, the Company notes that in addition to the description of historical
facts contained herein, this report contains certain forward-looking  statements
that involve risks and uncertainties as detailed herein and from time to time in
the Company's  other filings with the  Securities  and Exchange  Commission  and
elsewhere.  Such statements are based on management's  current  expectations and
are subject to a number of factors and  uncertainties,  which could cause actual
results  to  differ  materially  from  those  described  in the  forward-looking
statements.  These factors include, among others: (a) the Company's fluctuations
in  sales  and  operating  results;  (b)  risks  associated  with  international
business;  (c)  regulatory,  competitive  and  contractual  risks;  (d)  product
development  risks;  and (e)  the  ability  to  achieve  strategic  initiatives,
including  but not limited to the  ability to achieve  sales  growth  across the
business  segments  through a combination of enhanced sales force, new products,
and customer service.

Critical accounting policies

         During  the nine  months  ended  September  30,  2006,  except  for the
adoption  of FAS  123(R),  there were no  significant  changes to the  Company's
critical accounting policies,  which are included in the Company's Annual Report
on Form 10-KSB for the year ended December 31, 2005.

         The results of  operations  for the three  months and nine months ended
September 30, 2005 are the results reported in the Company's Quarterly Report on
Form  10QSB-A  filed  February  24, 2006 with the U.S.  Securities  and Exchange
Commission.

Results of operations  for the nine months ended  September 30, 2006 as compared
to the nine months ended September 30, 2005

         Net sales were $10,657,000 for the nine months ended September 30, 2006
as compared to  $10,315,000  for the nine months ended  September  30, 2005,  an
increase of $342,000 or 3.3%.  Increases  in sales of the  Company's  Rapid Drug
Screen(R) InCup(R), Oralstat(R) oral fluid test, and Rapid TOX(TM) (the cassette
product introduced by the Company in late 2005) sales, and increases in contract
manufacturing  were offset by a decrease in non-InCup(R) Rapid Drug Screen (RDS)
sales  during the first nine months of 2006,  compared to the same period a year
ago.  The  company  believes  that  some of the RDS  attrition  is a  result  of
customers  ordering  the InCup  (and/or the Rapid TOX rather  than the RDS.  The
Company  anticipates  continued  growth in sales of the Rapid TOX  product as it
gains market acceptance and penetrates new markets. The Company also anticipates
continued  growth in its  Oralstat  oral fluid test and  contract  manufacturing
operations.

         During the nine months ended September 30, 2006, the Company  continued
its extensive  program to market and distribute urine and oral fluid based point
of collection tests for drug of abuse. The Company also continued  marketing its
Rapid Reader(TM),  the first all inclusive drug screen  interpretation  and data
management system cleared by the Food and Drug Administration  ("FDA"). Sales of
the Rapid Reader total  $35,450  through nine months ended  September  30, 2006.
There were no sales of the Rapid Reader in the nine months ended  September  30,
2005.

         In the first  nine  months of 2006,  the  Company  filed  three  510(k)
marketing  applications  with  the  FDA.  One  related  to  a  drug  screen  for
Buprenorphine,  one for the Company's Rapid TOX cassette product and one related
to a new detection level for the Company's drug screen for cocaine. In May 2006,
the Company received 510(k) clearance from the FDA for its Rapid TOX product and
in September 2006, the Company  received  510(k)  clearance from the FDA for the
new detection  level for the Company's drug screen for cocaine.  In August 2006,
the  Company  received  510(k)  clearance  from the FDA for its drug  screen for
Buprenorphine.



                                       10
<PAGE>

         The  Company  continued  its  contract  manufacturing   operations  for
unaffiliated  third parties during the first nine months of 2006. The Company is
evaluating   several  other  requests  for  contract   manufacturing   including
incorporation   of  the  Company's  drugs  of  abuse  tests  into  another  test
manufactured  by an unrelated  third party that is used in hospitals,  emergency
rooms and clinics,  and development of variations of the Company's  current oral
fluid product to meet specific market demands in Europe.  Contract manufacturing
sales for the nine months ended September 30, 2006totaled $554,000,  compared to
$167,000 for the same period in 2005.

         During  the  third  quarter  of  2006,  one of the  Company's  contract
manufacturing  customers notified the Company that the customer had entered into
a royalty agreement with a developer and a distributor,  to share in the profits
of sales of an already FDA cleared HIV test. The Company had been developing and
manufacturing an HIV test for this customer.  As of the date of this report, the
Company does not know whether it will  continue to be the contract  manufacturer
of this HIV test.  Year to date 2006 sales of this HIV test  represent less than
1% of total  sales and 6.7% of  contract  manufacturing  sales.  The  Company is
currently  evaluating  the viability of continuing  development  and seeking FDA
clearance   autonomously  while  seeking  distribution  channels  through  other
contract manufacturing customers or other sources that may become available.

         Cost of goods sold for the nine  months  ended  September  30, 2006 was
$5,567,000 or 52.2% of net sales as compared to $5,244,000 or 50.8% of net sales
for the nine months ended September 30, 2005. The increase in cost of goods sold
is due to increases  in the cost of labor in  manufacturing,  stemming  from the
greater  diversity and  complexity of new products.  While the cost of labor and
overhead rose in 2006 compared to a year ago, the cost of materials has remained
relatively  consistent as the Company continues its efforts to control the costs
to produce its products. Increased price pressure in the marketplace has limited
the Company's ability to recover  manufacturing cost increases while maintaining
market share. The Company continues to evaluate all aspects of its manufacturing
and assembly  processes  to identify any areas of cost savings to improve  gross
margins.

         Operating  expenses  increased  2.0% to  $4,946,000  in the first  nine
months of 2006,  compared to  $4,848,000 in the same period in 2005. An increase
of $429,000 in general and  administrative  expense was offset by  decreases  of
$64,000 and  $267,000  in research  and  development  and selling and  marketing
expense  respectively.  The increase in general and  administrative  expense was
primarily related to increases in investor relations expense and royalty expense
as well as increases in salaries and wages.  Operating  expenses  decreased from
47.0% of net sales in the first nine months of 2005 to 46.4% for the same period
in 2006.

Research and development

         Research  and  development  ("R&D")  expenses for the nine months ended
September 30, 2006 were $456,000, or 4.3%, of net sales compared to $520,000, or
5.1%, of net sales for the nine months ended September 30, 2005. The decrease in
expense is primarily due to decreases in salaries and wages and supplies, offset
by an increase in FDA compliance, depreciation and maintenance costs. Management
continues its overall strategy to: focus on new product  development to meet the
changing needs of the point of collection drug of abuse testing market; increase
its  contract  manufacturing  operations;  and develop  new uses of  immunoassay
lateral flow technology.

Selling and marketing expense

         Selling and marketing expense was $2,273,000, or 21.3%, of net sales in
the first nine months of 2006.  This  represents  a decrease of  $267,000,  from
$2,540,000 or 24.6% of net sales in the same nine months in 2005.  This decrease
is primarily  attributable to reductions in commissions  expense stemming from a
restructuring  of the  commission  plan in 2006,  savings  in travel  and travel
related  expenses and  decreases in expenses  relating  trade shows and samples.
These savings were offset by increases in consulting fees,  outside service fees
and postage.  The increase in postage  expense  represents  postage in excess of
amounts  received from  customers  for shipping and handling and was  previously
reported as general and administrative  expense in 2005. During 2006 the Company
implemented  new  internal  reporting of this expense in more detail to evaluate
its impact on the business and specifically on each of the sales divisions. This
reporting was not available in 2005. The Company's  sales strategy  continues to
focus on increasing direct sales through its sales force.



                                       11
<PAGE>

General and administrative expense

         General and  administrative  (G&A)  expense was $429,000  higher in the
first nine  months of 2006 than the same  period in 2005.  Total G&A expense for
the nine months ended September 30, 2006 was $2,217,000,  or 20.8%, of net sales
compared to $1,788,000, or 17.3%, of net sales in the first nine months of 2005.
Expenses  totaling  $316,000 for  investor  relations  and royalty  expense were
primarily  responsible for the increase.  The investor relations expense relates
to a contract signed in 2005 with an investor  relations firm. The contract with
this firm was for one year and it expired in  September  2006.  The  Company has
extended  this  contract on a month to month basis with no change to the monthly
fee. Royalty expense relates to the agreement entered into with IBC (see note G)
and the sublicense  agreement entered into during the first quarter of this year
(see note F). Also  affecting  G&A expense in the first nine months of 2006 were
increases in salaries and wages,  license and patent fees,  accounting  fees and
outside service fees in the Company's quality assurance  department.  Offsetting
these  increases  were  savings in  insurance  costs  resulting  from changes in
insurance  carriers during the fourth quarter of 2005 and first quarter of 2006,
state and local taxes, and warehouse costs resulting from a reclassification  of
postage expense for customer orders in excess of amounts received from customers
for shipping and handling to selling and marketing expense.

Results of operations for the three months ended  September 30, 2006 as compared
to the three months ended September 30, 2005

         Net sales were $3,564,000 for the three months ended September 30, 2006
as compared  to  $3,570,000  for the three  months  ended  September  30,  2005,
representing a decrease of $6,000, or 0.2%. Direct sales accounted for 71.7%, or
$2,557,000,  of sales for the third quarter compared to $2,700,000,  or 75.6%, a
year ago. Telemarketing,  international and other sales contributed $942,000, or
26.4%, of the net sales for the third quarter of 2006, compared to $821,000,  or
23.0%, of the net sales for the same period in 2005. Also  contributing to sales
in the third  quarter of 2006 was contract  manufacturing  sales of $66,000,  or
1.9%, and $48,000, or 1.3%, during the same period in 2005.

         During the three months ended September 30, 2006, the Company continued
its extensive  program to market and distribute their urine and oral fluid based
point of  collection  tests  for  drug of  abuse.  The  Company  also  continued
marketing its Rapid Reader,  the first all inclusive drug screen  interpretation
and data management system cleared by the FDA.

         The  Company  continued  its  contract  manufacturing   operations  for
unaffiliated  third  parties  during  the  third  quarter  of 2006.  Development
continued on the  production  of a point of  collection  test for HIV,  which is
currently being evaluated by the FDA. This  development  continued until late in
the  third  quarter  of 2006.  During  the  third  quarter  of 2006,  one of the
Company's  contract  manufacturing  customers  notified  the  Company  that  the
customer  had  entered  into  a  royalty   agreement  with  a  developer  and  a
distributor,  to share in the  profits of sales of an already  FDA  cleared  HIV
test.  The Company had been  developing and  manufacturing  an HIV test for this
customer.  As of the date of this  report,  the Company does not know whether it
will  continue to be the contract  manufacturer  of this HIV test.  Year to date
2006 sales of this HIV test  represent  less than 1% of total  sales and 6.7% of
contract  manufacturing sales. The Company is currently evaluating the viability
of continuing  development and seeking FDA clearance  autonomously while seeking
distribution  channels through other contract  manufacturing  customers or other
sources that may become available.  The Company is also evaluating several other
requests for contract  manufacturing  including  incorporation  of the Company's
drugs of abuse tests into another test  manufactured by an unrelated third party
that is used in  hospitals,  emergency  rooms and clinics,  and  development  of
variations of the Company's  current oral fluid product to meet specific  market
demands in Europe.



                                       12
<PAGE>

        Cost of goods sold for the three  months  ended  September  30, 2006 was
$1,890,000,  or 53.0%, of net sales as compared to $1,906,000,  or 53.4%, of net
sales for the three months ended September 30, 2005. Cost of goods sold includes
some increases in the cost of labor in manufacturing,  stemming from the greater
diversity  and  complexity  of new  products,  and the disposal of some obsolete
inventory  components  during the third  quarter in both years  While there have
been slight increases in the cost of labor and overhead, materials have remained
relatively consistent and the Company continues its efforts to control the costs
to produce its products. Increased price pressure in the marketplace has limited
the Company's ability to recover  manufacturing cost increases while maintaining
market share. The Company continues to evaluate all aspects of its manufacturing
and assembly  processes  to identify any areas of cost savings to improve  gross
margins.

         Operating  expenses  decreased  $11,000,  or 0.7%, to $1,678,000 in the
third quarter of 2006,  compared to $1,689,000 in the same period in 2005.  This
is  attributable  to increases  in G&A expense of $80,000,  offset by savings in
selling and marketing expenses of $48,000 and R&D expenses of $43,000.

Research and development

         R&D  expenses  for the  three  months  ended  September  30,  2006 were
$145,000,  or 4.1%, of net sales compared to $188,000, or 5.3%, of net sales for
the three months ended  September 30, 2005. The decrease in expense is primarily
due to a decrease in salaries and wage expense  resulting  from the departure of
an R&D manager in late 2005,  as well as  decreases  in  spending  on  supplies,
consulting, and travel offset by an increase in depreciation.  The primary focus
of the R&D group in the third quarter of 2006 was refining  modifications to the
Company's products,  including  OralStat,  and preparing these modifications for
production and sale.  Management continues its overall strategy to: focus on new
product  development to meet the changing needs of the point of collection  drug
of abuse testing market;  respond to requests from other contract  manufacturing
inquiries; and develop new uses of immunoassay lateral flow technology.

Selling and marketing expense

        Selling and marketing  expense was $811,000,  or 22.8%,  of net sales in
the third quarter of 2006, a decrease of $48,000,  from $859,000,  or 24.1%,  of
net  sales  in the same  three  months  in  2005.  This  decrease  is  primarily
attributable  to  the  reductions  in  commissions   expense  resulting  from  a
restructuring  of the commission  plan in 2006, as well as decreases in salaries
and travel and travel related spending. These decreases were offset by increases
in systems costs as well as increases in postage expense resulting from a change
to internal reporting that the Company implemented in 2006. The new reporting of
this  expense is done in more  detail to  evaluate  its impact on the  business;
specifically  on each of the Company's sales  divisions.  This reporting was not
available in 2005.  The primary focus of spending in selling and marketing is to
increase  coverage  through  direct sales in the  marketplace  coordinated  with
telemarketing efforts through an in-house sales group.

General and administrative expense

         General and  administrative  expense  increased by $80,000 in the third
quarter of 2006  compared to the same  period in 2005.  Total G&A expense in the
third quarter of 2006 was $722,000, or 20.3%, of net sales compared to $642,000,
or 18.0%, of net sales in the three months ended  September 30, 2005.  Primarily
responsible  for the increase in G&A expense in the third  quarter of 2006 is an
increase in investor relations expense related to the Company's contract with an
investor relations firm, which began in September 2005.and non-cash compensation
relating to options issued to two employees  during the second quarter (See Note
H-Stock Option Grants) of 2006. Increases in royalty and sublicense fees related
to agreements executed in the first quarter of 2006 (see notes F and G), patents
and license fees,  accounting fees and salaries and wages were offset by savings
in director fees and expenses, outside service fees, postage and insurance.




                                       13
<PAGE>


LIQUIDITY AND CAPITAL RESOURCES AS OF SEPTEMBER 30, 2006

         The Company's cash requirements  depend on numerous factors,  including
product  development  activities,  ability to penetrate the direct sales market,
market  acceptance  of its new products,  and effective  management of inventory
levels in response to sales forecasts. The Company expects to devote substantial
capital  resources to continue  its product  development,  expand  manufacturing
capacity,  and support its direct sales efforts.  The Company will examine other
growth  opportunities  including strategic alliances and expects such activities
will be funded from existing cash and cash  equivalents,  issuance of additional
equity or debt securities or additional  borrowings  subject to market and other
conditions.  The Company  believes  that its  current  cash  balances,  and cash
generated from future  operations  will be sufficient to fund operations for the
next twelve months. If cash generated from operations is insufficient to satisfy
the Company's working capital and capital expenditure requirements,  the Company
may  be  required  to  sell  additional   equity  or  obtain  additional  credit
facilities.  There is no assurance that such financing will be available or that
the Company will be able to complete financing on satisfactory terms, if at all.

         Management   believes  that  research  and  development,   selling  and
marketing  and  general  and  administrative  costs may  increase as the Company
continues  its  investment  in  long  term  growth  and  creates  the  necessary
infrastructure  to:  achieve its worldwide  drug test marketing and sales goals,
continue  its  penetration  of the direct  sales  market,  support  research and
development projects and leverage new product initiatives.  However,  management
has  implemented  programs  to control the rate of increase of these costs to be
consistent with the expected sales growth rate of the Company.

         The Company has working  capital of  $4,812,000  at September  30, 2006
compared to working  capital of $4,636,000 at December 31, 2005. The Company has
historically satisfied its net working capital requirements,  if needed, through
cash  generated by proceeds from private  placements of equity  securities  with
institutional  investors. The Company has never paid any dividends on its common
shares and anticipates  that all future  earnings,  if any, will be retained for
use in the  Company's  business  and it does  not  anticipate  paying  any  cash
dividends.

         Net cash  provided by  operating  activities  was $632,000 for the nine
months  ended  September  30,  2006  compared  to net  cash  used  in  operating
activities  of $143,000 for the nine months ended  September  30, 2005.  The net
cash provided by operating  activities  for the nine months ended  September 30,
2006 resulted  primarily  from net income and decreases in inventory,  offset by
reductions in accounts payable and prepaid expenses.

         Net cash used in investing  activities was $334,000 for the nine months
ended  September 30, 2006  compared to net cash used in investing  activities of
$125,000 for the nine months ended September 30, 2005. The net cash used in both
years was for investment in property plant and equipment.  Included in cash used
in  2006 is  $270,000  representing  50% of the  cost  of  automation  equipment
purchased for use in the Company's New Jersey manufacturing  facility.  Delivery
of the new equipment is expected during the fourth quarter of 2006 at which time
the  remaining  50% of the  purchase  price will  become due and  payable.  This
investment is for machinery that will be used to assemble the Rapid TOX cassette
product and in preparation for significant growth in demand forecasted for 2007.
The cash used in 2005 was  specifically for costs associated with the completion
of the additional laboratory facilities and equipment purchases in the Company's
New Jersey facility and additional  equipment purchases for new hires. Cash used
in 2005 was for equipment purchases.

         Net cash  provided by  financing  activities  was $162,000 for the nine
months ended  September 30, 2006 consisting of proceeds from the Company's lines
of credit and $85,000 from the exercise of 100,000 options by an employee in the
second quarter of 2006.  Net cash provided by financing  activities in the first
nine  months  of 2005 was  $49,000  resulting  from the  exercise  of  warrants,
proceeds  from the  Company's  line of credit and  proceeds  of  $25,000  from a
Columbia  County Economic  Development  Grant offset by payments on mortgage and
notes payable.



                                       14
<PAGE>

         The  Company  has  available  two lines of credit  with  First  Niagara
Financial Group, Inc.  ("FNFG").  The first line has a maximum available line of
$875,000, not to exceed 70% of accounts receivable less than 60 days for general
operating  use. The interest rate is .25% above the FNFG prime rate. The Company
is required to maintain net worth (stockholder's equity) greater than $5 million
and working capital greater than $4 million.  Further the Company is required to
maintain a minimum Debt Service Coverage ratio of not less than 1.2:1.0 measured
at each fiscal year end beginning December 31, 2006. Debt Service Coverage Ratio
is defined as Net  Operating  Income  divided by Annual  principal  and interest
payments on all loans relating to subject property.  There is no requirement for
repayment  of all  principal  annually  on  this  line  of  credit.  The  amount
outstanding on this line of credit was $72,000 at September 30, 2006 and $78,000
at September 30, 2005.  The second line of credit was obtained  during the first
quarter of 2006 for the  limited  purpose of paying  amounts  associated  with a
sublicense  agreement  executed  during  the first  quarter.  This line is for a
maximum of $75,000  with an interest  rate of .50% above the FNFG prime rate and
the  Company  is not  required  to pay  the  principal  down to $0  during  each
twelve-month  period. The amount outstanding on this line of credit at September
30, 2006 was $31,000.

         At September  30, 2006,  the Company had cash and cash  equivalents  of
$906,000.

         The  Company's  primary  short-term  capital and working  capital needs
relate to continued  support of its research and development  programs,  opening
new distribution opportunities,  focusing sales efforts on segments of the drugs
of abuse  testing  market  that will yield high  volume  sales,  increasing  its
manufacturing  and  production  capabilities,  establishing  adequate  inventory
levels to support  expected sales and instituting  controls  necessary to comply
with  financial   disclosure   controls  as   necessitated   by  new  regulatory
requirements.


ITEM 3. CONTROLS AND PROCEDURES

         As of the end of the period covered by this report, American Bio Medica
Corporation  carried  out an  evaluation,  under  the  supervision  and with the
participation of the Chief Financial Officer and the Chief Executive Officer, to
evaluate the effectiveness of the disclosure controls and procedures (as defined
in Rule  13a-15(e)  under  the  Securities  Exchange  Act of  1934,  as  amended
("Exchange Act")). Based on that evaluation, the Chief Financial Officer and the
Chief  Executive  Officer have concluded that American Bio Medica  Corporation's
disclosure  controls and  procedures as of the date of this report are effective
for  recording,  processing,  summarizing,  and  reporting  information  that is
required to be disclosed in their  reports  under the Exchange  Act, as amended,
within the time periods  specified in the Securities  and Exchange  Commission's
rules and forms.  Additionally,  based upon this most recent evaluation, we have
concluded that there were no significant  changes in internal  controls or other
factors that have  materially  affected or are likely to  materially  affect the
Company's internal control over financial reporting during the period covered by
this report.




                                       15
<PAGE>



                                     PART II

                                OTHER INFORMATION


Item 1. Legal Proceedings:


      See "Note C - Litigation" in the Notes to Financial Statements included in
      this report for a description  of pending legal  proceedings  in which the
      Company is a party.

Item 2. Changes in Securities

      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


                  31.1     Rule   13a-14(a)/15d-14(a)   Certification  of  Chief
                           Executive Officer

                  31.2     Rule   13a-14(a)/15d-14(a)   Certification  of  Chief
                           Financial Officer


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



                                       16
<PAGE>

SIGNATURES



     In accordance with the requirements of the Exchange Act, the registrant has
caused this report to be signed on its behalf by the undersigned  thereunto duly
authorized.




                                         AMERICAN BIO MEDICA CORPORATION
                                         (Registrant)

                                         By: /s/Keith E. Palmer
                                         --------------------------------------
                                         EVP of Finance, Chief Financial Officer
                                         and Treasurer (Principal Accounting
                                         Officer and duly authorized Officer)


Dated: November 13, 2006



                                       17