UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION
 Washington,
D.C. 20549
  FORM
10-Q
  x    
QUARTERLY REPORT UNDER SECTION
13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
  For the
quarterly period ended  April 30,
2009




or




o    
TRANSITION REPORT PURSUANT TO
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT




For the
transition period from ________ to
________




Commission
file number  0-51400




Stellar Resources
Ltd.


(Exact
name of registrant as specified in its charter)





Nevada
              98-0373867(State
      or other jurisdiction of incorporation or organization)
              (IRS
      Employer Identification No.)





375 N. Stephanie Street,
Suite 1411, Las Vegas, Nevada, 89014-1411


(Address
of principal executive offices)





(702)547-4614


(Issuer’s
telephone number)





N/A


(Former
name, former address and former fiscal year, if changed since last
report)




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





Indicate by check mark whether the
registrant is a large accelerated filer, an accelerated filer, a non-accelerated
filer or a smaller reporting company.  See the definitions of “large
accelerated filer,” “accelerated filer” and smaller reporting company” in Rule
12b-2 of the Exchange Act.




Large accelerated filer
              o
              Accelerated
      filer
              oNon- accelerated filer
              o (Do not
      check if a smaller reporting company)
              Smaller reporting
      company
              x
  Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b(2) of the Exchange Act).     x  Yes   o  No


APPLICABLE
ONLY TO ISSUERS INVOLVED IN BANKRUPTCY


PROCEEDINGS
DURING THE PRECEDING FIVE YEARS





Indicate
by check mark  whether the registrant filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the Exchange Act of 1934
subsequent to the distribution of securities under a plan confirmed by a
court.    x Yes
  o
No





APPLICABLE
ONLY TO CORPORATE ISSUERS





Indicate
the number of shares outstanding of each of the issuer’s classes of common
stock, as of the latest practicable date:





The total
number of shares of Common Stock, par value $0.001 per share, outstanding as of
June 15, 2009 is 31,060,650.











TABLE OF CONTENTS




Part  I –
      FINANCIAL
      INFORMATION
                              1Item
      1.
                              Financial
      Statements:
                              1Balance Sheets
                              2Statements of Operations
                              3Statements of Cash Flows
                              4Notes to Financial Statements
                              5Item 2.
                              Management’s
      Discussion and Analysis or Plan of Operations
                              7Item
      3.
                              Quantitative
      and Qualitative Disclosure About Market Risk
                              11Item 4.
                              Controls and Procedures
                              11Part II – OTHER INFORMATION
                              12Item
      1.
                              Legal
      Proceedings
                              12Item 1A.
                              Risk Factors.
                              12Item
      2.
                              Unregistered
      Sales of Equity Securities and Use of Proceeds
                              13Item 3.
                              Defaults Upon
      Senior Securities
                              13Item
      4.
                              Submission of
      Matters to a Vote of Security Holders
                              13Item 5.
                              Other
      Information
                              13Item
      6.
                              Exhibits
                              13SIGNATURES
                              14




















i
 Table of Contents


Part  I
– FINANCIAL
INFORMATION




Item 1.   Financial
Statements


STELLAR
RESOURCES LTD.
 (An
Exploration Stage Company)
   FINANCIAL
STATEMENTS
   APRIL
30, 2009
 (Unaudited)
 
 
 
 
 
 
 
 
 
 
  1
 Table of Contents
  STELLAR RESOURCES
LTD.
 (An
Exploration Stage Company)
 
 BALANCE SHEETS
  APRIL
      30,
                                
                                
                                JULY
      31,2009
                                
                                
                                2008(Unaudited)ASSETSCurrentCash
                                
                                $
                                19,592
                                
                                
                                $
                                -Prepaid
      expenses
                                
                                
                                131
                                
                                
                                
                                -$
                                19,723
                                
                                
                                $
                                -LIABILITIESCurrentBank
      indebtedness
                                
                                $
                                -
                                
                                
                                $
                                38Accounts
      payable and accrued liabilities
                                
                                
                                3,562
                                
                                
                                
                                4,940Notes
      payable (Note 3)
                                
                                
                                19,751
                                
                                
                                
                                22,837Due
      to related parties (Note 5)
                                
                                
                                185,793
                                
                                
                                
                                177,251209,106
                                
                                
                                
                                205,066STOCKHOLDERS’
      DEFICITCapital
      stock (Note 4)Authorized:200,000,000
      common shares with a par value of $0.001 per shareIssued
      and outstanding:31,060,650
      common shares (July 31, 2008: 28,640,196 common shares)
                                
                                
                                31,060
                                
                                
                                
                                28,640Additional
      paid-in capital
                                
                                
                                952,142
                                
                                
                                
                                914,166Deferred
      stock compensation
                                
                                
                                -
                                
                                
                                
                                (39,700
                                )Deficit
      accumulated during the exploration stage
                                
                                
                                (1,169,851
                                )
                                
                                
                                (1,101,977
                                )Accumulated
      other comprehensive loss
                                
                                
                                (2,734
                                )
                                
                                
                                (6,195
                                )(189,383
                                )
                                
                                
                                (205,066
                                )$
                                19,723
                                
                                
                                $
                                -
 
 
 
 The
accompanying notes are an integral part of these financial
statements
 2
 Table of Contents
 STELLAR RESOURCES
LTD.
 (An
Exploration Stage Company)
 
 STATEMENTS OF OPERATIONS
 (Unaudited)
  CUMULATIVE
      RESULTS OF OPERATIONS FROM APRIL 9, 1999 (INCEPTION)THREE
      MONTHS ENDED
                                          
                                          
                                          NINE
      MONTHS ENDED
                                          
                                          
                                          TOAPRIL
      30,
                                          
                                          
                                          APRIL
      30,
                                          
                                          
                                          APRIL
      30,
                                          
                                          
                                          APRIL
      30,
                                          
                                          
                                          APRIL
      30,2009
                                          
                                          
                                          2008
                                          
                                          
                                          2009
                                          
                                          
                                          2008
                                          
                                          
                                          2009ExpensesConsulting
      fees
                                          
                                          $
                                          -
                                          
                                          
                                          $
                                          -
                                          
                                          
                                          $
                                          -
                                          
                                          
                                          $
                                          -
                                          
                                          
                                          $
                                          27,780Filing
      fees
                                          
                                          
                                          1,297
                                          
                                          
                                          
                                          2,089
                                          
                                          
                                          
                                          4,425
                                          
                                          
                                          
                                          5,766
                                          
                                          
                                          
                                          36,364Foreign
      exchange loss
                                          
                                          
                                          157
                                          
                                          
                                          
                                          16
                                          
                                          
                                          
                                          426
                                          
                                          
                                          
                                          148
                                          
                                          
                                          
                                          14,372General
      and administrative
                                          
                                          
                                          298
                                          
                                          
                                          
                                          63
                                          
                                          
                                          
                                          618
                                          
                                          
                                          
                                          1,069
                                          
                                          
                                          
                                          21,971Interest
      expense
                                          
                                          
                                          87
                                          
                                          
                                          
                                          180
                                          
                                          
                                          
                                          374
                                          
                                          
                                          
                                          601
                                          
                                          
                                          
                                          15,778Investor
      relations
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          65
                                          
                                          
                                          
                                          4,577
                                          
                                          
                                          
                                          17,554Resource
      property expenditures
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          5,002
                                          
                                          
                                          
                                          150,114Professional
      fees
                                          
                                          
                                          4,511
                                          
                                          
                                          
                                          5,223
                                          
                                          
                                          
                                          20,631
                                          
                                          
                                          
                                          25,240
                                          
                                          
                                          
                                          134,283Property
      examination costs
                                          
                                          
                                          1,635
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          1,635
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          1,635Stock-based
      compensation
                                          
                                          
                                          -
                                          
                                          
                                          
                                          61,450
                                          
                                          
                                          
                                          39,700
                                          
                                          
                                          
                                          183,300
                                          
                                          
                                          
                                          750,000Net
      Loss
                                          
                                          $
                                          (7,985
                                          )
                                          
                                          $
                                          (69,021
                                          )
                                          
                                          $
                                          (67,874
                                          )
                                          
                                          $
                                          (225,703
                                          )
                                          
                                          $
                                          (1,169,851
                                          )Basic
      and Diluted Net Loss Per Common Share
                                          
                                          $
                                          (0.00
                                          )
                                          
                                          $
                                          (0.01
                                          )
                                          
                                          $
                                          (0.01
                                          )
                                          
                                          $
                                          (0.01
                                          )Weighted
      Average Number of Common Shares Outstanding – Basic and
      Diluted
                                          
                                          
                                          30,387,516
                                          
                                          
                                          
                                          28,640,196
                                          
                                          
                                          
                                          29,336,046
                                          
                                          
                                          
                                          28,640,196
 
 
 
 
 
 
 
 The
accompanying notes are an integral part of these financial
statements
 3
 Table of Contents
  STELLAR
RESOURCES LTD.
 (An
Exploration Stage Company)
 
 STATEMENTS OF CASH FLOWS
 
 CUMULATIVE
      RESULTS OF OPERATIONS FROM APRIL 9, 1999 (INCEPTION)NINE
      MONTHS ENDED
                                  
                                  
                                  TOAPRIL
      30,
                                  
                                  
                                  APRIL
      30,2009
                                  
                                  
                                  2008
                                  
                                  
                                  2009Cash
      Flows from Operating ActivitiesNet
      loss
                                  
                                  $
                                  (67,874
                                  )
                                  
                                  $
                                  (225,703
                                  )
                                  
                                  $
                                  (1,169,851
                                  )Adjustments
      to reconcile net loss to net cash used in operating
      activities:Realized
      foreign exchange losses on settlement of notes payable
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  12,523Stock-based
      compensation
                                  
                                  
                                  39,700
                                  
                                  
                                  
                                  183,300
                                  
                                  
                                  
                                  750,000Accrued
      interest
                                  
                                  
                                  375
                                  
                                  
                                  
                                  601
                                  
                                  
                                  
                                  17,767Changes
      in operating assets and liabilities:Prepaid
      expenses
                                  
                                  
                                  (131
                                  )
                                  
                                  
                                  900
                                  
                                  
                                  
                                  (131
                                  )Accounts
      payable and accrued liabilities
                                  
                                  
                                  (1,378
                                  )
                                  
                                  
                                  3,752
                                  
                                  
                                  
                                  3,562Net
      cash used in operating activities
                                  
                                  
                                  (29,308
                                  )
                                  
                                  
                                  (37,150
                                  )
                                  
                                  
                                  (386,130
                                  )Cash
      Flows from Financing ActivitiesProceeds
      from issuance of common stock
                                  
                                  
                                  40,396
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  130,629Proceeds
      from notes payable
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  89,300Advances
      from related parties
                                  
                                  
                                  8,542
                                  
                                  
                                  
                                  36,997
                                  
                                  
                                  
                                  185,793Net
      cash provided by financing activities
                                  
                                  
                                  48,938
                                  
                                  
                                  
                                  316,997
                                  
                                  
                                  
                                  405,722Net
      Increase (Decrease) in Cash
                                  
                                  
                                  19,630
                                  
                                  
                                  
                                  (153
                                  )
                                  
                                  
                                  19,592Cash
      (Bank Indebtedness), Beginning
                                  
                                  
                                  (38
                                  )
                                  
                                  
                                  159
                                  
                                  
                                  
                                  -Cash
      , Ending
                                  
                                  $
                                  19,592
                                  
                                  
                                  $
                                  6
                                  
                                  
                                  $
                                  19,592Supplemental
      Disclosures of Cash Flow Information and Non-Cash Investing and Financing
      ActivitiesCash
      interest paid
                                  
                                  $
                                  -
                                  
                                  
                                  $
                                  -
                                  
                                  
                                  $
                                  -Cash
      income taxes paid
                                  
                                  $
                                  -
                                  
                                  
                                  $
                                  -
                                  
                                  
                                  $
                                  -Common
      shares issued on settlement of notes payable and accrued
      interest
                                  
                                  $
                                  -
                                  
                                  
                                  $
                                  -
                                  
                                  
                                  $
                                  102,573
 
 
 The
accompanying notes are an integral part of these financial
statements
  4
 Table of Contents
 STELLAR
RESOURCES LTD.
 (An
Exploration Stage Company)
 
 NOTES
TO FINANCIAL STATEMENTS
 APRIL
30, 2009
 (Unaudited)
   1.
              BASIS
      OF PRESENTATION
 
 Unaudited
Interim Financial Statements
 
 The
accompanying unaudited interim financial statements have been prepared in
accordance with United States generally accepted accounting principles for
interim financial information and with the rules and regulations of the
Securities and Exchange Commission (“SEC”). They may not include all information
and footnotes required by United States generally accepted accounting principles
for complete financial statements. However, except as disclosed herein, there
has been no material changes in the information disclosed in the notes to the
financial statements for the year ended July 31, 2008 included in the Company’s
Annual Report on Form 10-KSB filed with the SEC. The interim unaudited financial
statements should be read in conjunction with those financial statements
included in the Form 10-KSB. In the opinion of management, all adjustments
considered necessary for a fair presentation, consisting solely of normal and
recurring adjustments have been made.  Operating results for the nine
months ended April 30, 2009 are not necessarily indicative of the results that
may be expected for the year ending July 31, 2009.
  2.
              RESOURCE
      PROPERTIES
 
 Chunya
      mining district of Mbeya Tanzania
 
 On
September 9, 2008, the Company entered into a Farm-In Agreement with Canafra
Mineral Exploration Corp., a Canadian private company, and Two Drums G & C
Company Limited, a Tanzanian private company, (jointly “Canafra”), whereby the
Company has the right to acquire a 50% interest in the subject mineral property
in Tanzania.  The subject property consists of three Mining and
Prospecting Licenses and the Granted Mining and Prospecting Concessions
comprising approximately 26 square kilometers, in the Chunya mining district of
Mbeya Tanzania.  The operator of the property will be
Canafra.
 
 The
funding provisions are subject to the Company receiving the Mining and
Prospecting Licenses for the subject property, which to date have not yet been
received.
 
 In order
to acquire its full interest in the subject property the Company will advance to
the operator $1,100,000 to fund exploration expenditures and provide working
capital in phased payments and also issue 4,000,000 restricted common shares to
the operator in stages as described below. The Company will earn its interest at
a vested rate of 10% based on its funding efforts until fully
funded.
  5
 Table of Contents
 STELLAR
RESOURCES LTD.
 (An
Exploration Stage Company)
 
 NOTES
TO FINANCIAL STATEMENTS
 APRIL
30, 2009
 (Unaudited)
  
 2.
              RESOURCE PROPERTIES(Continued)
 
 Chunya mining district of Mbeya
      Tanzania (Continued)
 
 CommonCash
                                    
                                    
                                    Stock
      to beConsideration
                                    
                                    
                                    IssuedPhase
      I – Conditional upon receipt of Mining andProspecting
      LicensesWithin
      30 days of execution of agreement
                                    
                                    $
                                    60,000
                                    
                                    
                                    
                                    -Within
      60 days of execution of agreement
                                    
                                    
                                    80,000
                                    
                                    
                                    
                                    -Within
      90 days of execution of agreement
                                    
                                    
                                    80,000
                                    
                                    
                                    
                                    -Within
      120 days of execution of agreement
                                    
                                    
                                    80,000
                                    
                                    
                                    
                                    -Within
      150 days of execution of agreement
                                    
                                    
                                    80,000
                                    
                                    
                                    
                                    -380,000
                                    
                                    
                                    
                                    -Phase
      II – Within 90 days of completion of Phase Iincluding
      geological work to be done by Canafra
                                    
                                    
                                    380,000
                                    
                                    
                                    
                                    2,000,000Phase
      III – Within 90 days of completion of Phase II orwithin
      a mutually agreed timeframe, includingfurther
      geological work done by Canafra
                                    
                                    
                                    340,000
                                    
                                    
                                    
                                    2,000,000$
                                    1,100,000
                                    
                                    
                                    
                                    4,000,000
 
 
 3.
              NOTES
      PAYABLE
 
 As of
April 30, 2009 the Company had received a total of $14,875 (Cdn$18,000), (July
31, 2008 -$17,586, Cdn$18,000) from unrelated third parties by way of demand
promissory notes bearing interest at the Bank of Canada prime rate plus 2%
(2.50% as of April 30, 2009).  As at April 30, 2009 $4,876 (July 31,
2008 - $5,251) of accrued interest is payable.
 
 During
the nine months ended April 30, 2009, the Company recorded foreign exchange
transaction gains of $3,461 (April 30, 2008: loss of $1,331) in connection with
these notes payable and accrued interest payable as a result of fluctuations in
the foreign exchange rate.
  4.
              CAPITAL
      STOCK
 
 On
December 19, 2008, the Company issued 801,294 common shares at $0.01 for
aggregate proceeds of $8,103.
  On March
9, 2009 the Company issued 1,619,160 common shares at $0.02 for aggregate
proceeds of $32,383.
  5.
              RELATED
      PARTY TRANSACTIONS
 
 During
the nine month period ended April 30, 2009, a former director advanced funds to
the Company totaling $8,542 (April 30, 2008 - $36,997).  At April 30,
2009, an amount of $185,793 (July 31, 2008 - $177,251) was owed to this former
director.  These advances are unsecured, non-interest bearing and have
no specific terms of repayment.


6
 Table of Contents


Item 2.   Management Discussion and Analysis or Plan of
Operations





Our
actual results could differ materially form those reflected in these
forward-looking statements as a result of certain factors that include, but are
not limited to, the risks discussed in the Section entitled “Risk
Factors”.  Please see the statements contained under the
Section entitled “Forward-Looking
Statements”.





Except
for historical information, the following Management’s Discussion and Analysis
contains forward-looking statements based upon current expectations that involve
certain risks and uncertainties.  Such forward-looking statements
include statements regarding, among other things, (a) our estimates of mineral
reserves and mineralized material, (b) our projected sales and profitability,
(c) our growth strategies, (d) anticipated trends in our industry, (e) our
future financing plans, (f) our anticipated needs for working capital, (g) our
lack of operational experience, and (h) the benefits related to ownership of our
common stock.  Forwarding-looking statements, which involve
assumptions and describe our future plans, strategies, and expectations, are
generally identifiable by use of the words “may,” “will,” “should,” “expect”
“anticipate,” “estimate,” “believe,” “intend,”or“project”or the negative of
these words or other variations on these words or comparable
terminology.  This information may involve known and unknown risks,
uncertainties, and other factors that may cause our actual results, performance,
or achievements expressed or implied by any forward-looking
statements.  These statements may be found under “Management’s Discussions and
Analysis of Financial Condition and Results of Operations” and “Business” as well as in this
Form 10-KSB generally.  Actual events or results may differ materially
from those discussed in forward-looking statements as a result of various
factors, including, without limitation, the risks outlined under “Risk Factors” and matters
described in this Form 10-Q generally.  In light of these risks and
uncertaintities, there can be no assurance that the forward-looking statements
contained in this Form 10-Q will in fact occur as projected.





At April
30, 2009, we had a working capital deficit of $189,383 and an accumulated
deficit during the exploration stage of $1,169,851.  From inception,
April 9, 1999, we have expended $134,283 on legal and audit and accounting fees;
$15,778 on interest; $150,114 on resource property expenses; $1,635 on property
examination costs; $27,780 on consulting fees; $21,030 on office expense,
$36,364 on filing fees, $17,554 on investor relations, $941 on travel and
entertaining, and $750,000 on stock-based compensation.





OVERVIEW





We have
been in the pre-exploration stage since our formation on April 9, 1999, and are
not operators of any mines nor are we engaged in any mineral production or sales
activities.  We have a minimum amount of cash and have not yet
developed any producing mines.  We have no history of any
earnings.  There is no assurance that we will be a profitable
company.  We presently operate with minimum overhead costs and need to
raise additional funds in the next 12 months, either in the forms of loans or
issuance of equity, in order to continue our operations.  We are
primarily engaged in the acquisition and exploration of resource
properties.





Pursuant
to EITF 04-2, the Company classified its mineral rights as tangible assets and
accordingly acquisition costs are capitalized as mineral property
costs.  Generally accepted accounting principles require that
long-lived assets be reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable.  In performing the review for recoverability, the Company
is to estimate the future cash flows expected to result from the use of the
asset and its eventual disposition.  If the sum of the undiscounted
expected future cash flows is less than the carrying amount of the asset,
an


7
 Table of Contents


impairment
loss is recognized.  Mineral exploration costs are expensed as
incurred until commercially mineable deposits are determined to exist within a
particular property. To date the Company has not established any proven or
probable reserves.





The
Company has adopted the provisions of SFAS No. 143 “Accounting for Asset
Retirement Obligations” which establishes standards for the initial measurement
and subsequent accounting for obligations associated with the sale, abandonment,
or other disposal of long-term tangible assets arising from the acquisition,
construction or development and for normal operations of such assets. As of
April 30, 2009, the Company does not hold any mineral properties and therefore
there is no requirement for any asset retirement obligation
provision.




We
currently do not know of any research and development activities planned for the
next 12 months.





We
currently have no plans to purchase or sell any property or significant
equipment in the next 12 months.





We do not
expect any significant changes in the number of employees over the next 12
months.




We
currently do not know of any research and development activities planned for the
next 12 months.





We
currently have no plans to purchase or sell any property or significant
equipment in the next 12 months.





We do not
expect any significant changes in the number of employees over the next 12
months.





On
December 4, 2006 Michael Rezac resigned his respective position as Chief
Financial Officer in the Company.  However, Mr. Rezac continues to
maintain his current position as Secretary of the Company.  On April
12, 2009 Ms. Kathy Whyte resigned her position as President and Chief Financial
Officer in the Company and Mr. Luigi Rispoli was appointed as President and
Chief Financial Officer of the Company.  On May 8, 2008 Mr. Lee Balak
was appointed Chief Executive Officer of the Company.





Results
of Operations for the Three Months Ended April 30, 2009





We have
not generated any revenues from operations since our incorporation on April 9,
1999 through April 30, 2009.  During the three month period ended
April 30, 2009 we incurred non-cash management fees - stock based compensation
of $nil (2008 - $61,450 as a result of the stock award granted to the president
in October 2006).  Professional fees, comprising legal, accounting and
audit costs decreased to $4511 (2008 - $5,223).  Interest expense of
$87 (2008 - $180) based on a Canadian dollar denominated loan was reduced as a
result of falling interest rates.  General and administrative expenses
amounted to $298 (2008 - $63). Property examination costs of $1,635 (2008 -
$nil) were incurred as a result of performing due diligence on potential mineral
property acquisition.  We also experienced a foreign exchange loss of
$157 (2008 – $16) as a result of foreign exchange changes during the quarter
which affected transaction not denominated in the US dollar, and filing fees
decreased to $1,297 (2008 - $2,089).





Sales and
Marketing Expenses:  We have incurred no sales and marketing expense
since the date of inception due to the fact that we are in the pre-exploration
stage of our business.





Our
activities have been financed from proceeds of shareholders, related or third
party subscriptions and loans.  We do not anticipate earning revenues
until such time as we have entered into commercial production of any mineral
claims.  We are presently in the pre-exploration stage of our business
and we can provide no assurance that we will discover commercially exploitable
levels of mineral resources on any properties, or if such resources are
discovered, that we will enter into commercial production of any
claims.


8
 Table of Contents


Net
Loss





For the
nine month ended April 30, 2009, we recorded an operating loss of $67,874,
consisting of management fee - stock based compensation $nil, filing fees of
$39,700; interest expense of $374, general and administrative expenses of $618
professional fees of $20,631, investor relations of $65,  property
examination costs of $1,635 and a loss on foreign exchange of
$426.  There can be no assurance that we will ever achieve
profitability or that revenues will be generated and sustained in the
future.  We are dependent upon obtaining additional and future
financing to pursue our exploration activities.





Liquidity
and Further Capital Resources





At April
30, 2009, we had assets of $19,723 consisting cash of $19,592 and prepaid
expenses of $131  Total stockholders’ deficit was $189,383 at April
30, 2009.  We are a pre-exploration stage company and, since
inception, have experienced significant changes in liquidity, capital resources
and shareholders’ equity.





The
Company has relied for cash on hand upon sources internally generated from
management, financing through funds made available via loans, as well as debt
financing.  As of April 30, 2009, we have  notes payable of
$14,875 (Cdn. $18,000) (July 31, 2008 - $17,586 (Cdn. $18,000) from unrelated
third parties by way of demand promissory notes bearing interest at Bank of
Canada prime rate plus 2% (2.50% as of April 30, 2009).  As of April
30, 2009, $4,876 (July 31, 2008 $5,251) of interest has been
accrued.





The
Company issued on March 9, 2009 pursuant to a non-brokered private placement
1,619,160 of its common shares for aggregate proceeds of $32,383.





The
Company issued on December 19, 2008, pursuant to a non-brokered private
placement 801,294 of its common shares for aggregate proceeds of
$8,103.





On
October 3, 2006, pursuant to two separate shares-for-debt agreements, the
company issued 1,230,876 common shares in settlement of notes payable totaling
$89,006 of principle and accrued interest of $13,567.





Under a
Restricted Stock Award agreement dated October 3, 2006, the Company
issued  6,000,000 shares of restricted stock to the former president,
Ms. Kathy Whyte, (resigned April 12, 2009).  These shares had a
vesting provision as follows: 2,100,000 shares vest immediately, 1,950,000 vest
as of October 3, 2007 and the final 1,950,000 shares vest as of October 3, 2009.
Upon termination of employment between the Company and Ms. Whyte, any stock not
previously vested would be forfeited and returned to the Company’s
treasury.  At October 31, 2009 all 6,000,000 shares had
vested.





At April
30, 2009 Ms. Kathy Whyte was owed $185,793 (July 31, 2008 –
$177,251).





On
October 20, 2006 the Company forward split its shares of common stock on a ratio
of a six (6) new shares, for each one (1) old share currently held.





As a
result of the global economic crisis and potential impact on the price of our
stock, our ability to raise capital required to meet our daily needs through
sales of our securities in secondary offerings or private placements may be
heavily impacted.  We have no agreements in place to do this at this
time.  If we fail to raise sufficient funds, our plans may change
drastically.  Even if we do raise funds for operations, there is no
assurance that we will be able to maintain operations at a level sufficient for
an investor to obtain a return on his investment in our common
stock.  Further, we may continue to be unprofitable and we may have to
delay exploration or cease our operations and liquidate our
business.


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RESOURCE
PROPERTIES





Fort
St. John Region, British Columbia





By an
agreement dated June 28, 2002 with Diamant Resources Ltd., (a company with a
former director in common) the Company acquired an option to acquire a 50%
interest in certain mineral claims located in the Fort St. John region of
British Columbia Canada.  In order to earn a 50% interest, the Company
was required to pay $3,298 (Cdn.$5,000) by June 30, 2002, $3,619 (Cdn$5,000) by
June 30, 2003 and must incur certain other property expenditures.  As
of July 31, 2007, the Company decided not to pursue this property and has
abandoned it during the fiscal  year ended July 31,
2009.  All costs associated with this property have been fully
impared.





Chunya
Mining District of Mbeya, Tanzania





On
September 9, 2008, the Company entered into a Farm-In Agreement with Canafra
Mineral Exploration Corp., a Canadian private company, and Two Drums G & C
Company Limited, a Tanzanian private company, (jointly “Canafra”), whereby the
Company has the right to acquire a 50% net profit interest in the subject
mineral property in Tanzania.  The subject property consists of three
Mining and Prospecting Licenses and the Granted Mining and Prospecting
Concessions comprising approximately 26 square kilometers, in the Chunya mining
district of Mbeya Tanzania.  The operator of the property will be
Canafra.





The
funding provisions are subject to the Company receiving the Mining and
Prospecting Licenses for the subject property, which to date have not yet been
received.





In order
to acquire its full interest in the subject property the Company will advance to
the operator $1,100,000 to fund exploration expenditures and provide working
capital in phased payments and also issue 4,000,000 restricted common shares to
the operator in stages as described below. The Company will earn its interest at
a vested rate of 10% based on its funding efforts until fully
funded.





CommonCash
                                          
                                          
                                          Stock
      to beConsideration
                                          
                                          
                                          IssuedPhase
      I – Conditional upon receipt of Mining andProspecting
      LicensesWithin
      30 days of execution of agreement
                                          
                                          $
                                          60,000
                                          
                                          
                                          
                                          -Within
      60 days of execution of agreement
                                          
                                          
                                          80,000
                                          
                                          
                                          
                                          -Within
      90 days of execution of agreement
                                          
                                          
                                          80,000
                                          
                                          
                                          
                                          -Within
      120 days of execution of agreement
                                          
                                          
                                          80,000
                                          
                                          
                                          
                                          -Within
      150 days of execution of agreement
                                          
                                          
                                          80,000
                                          
                                          
                                          
                                          -380,000
                                          
                                          
                                          
                                          -Phase
      II – Within 90 days of completion of Phase Iincluding
      geological work to be done by Canafra
                                          
                                          
                                          380,000
                                          
                                          
                                          
                                          2,000,000Phase
      III – Within 90 days of completion of Phase II orwithin
      a mutually agreed timeframe, includingfurther
      geological work done by Canafra
                                          
                                          
                                          340,000
                                          
                                          
                                          
                                          2,000,000$
                                          1,100,000
                                          
                                          
                                          
                                          4,000,000




The
Company awaits formal licensing documentation from Canafra showing that the
Mining and Prospecting Licenses  with the geographic coordinates are
100% owned by Canafra.  The delay is as a result of Canafra
experiencing certain setbacks, due to the current economic conditions, and there
can be no assurances that we will be able to obtain sufficient funding in order
to complete our obligations under the agreement.








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Investor
Relations Service Contract




The
Company has no current investor relations contracts.




Item 3.Quantative and
Qualitative Disclosure About Market Risk
  Not
applicable
  Item
4.   Controls
and Procedures


Evaluation
of Disclosure Controls and Procedures





Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting, as required by Sarbanes-Oxley (SOX) Section
404 A. Our internal control over financial reporting is a process designed under
the supervision of our Chief Executive Officer and Chief Financial Officer to
provide reasonable assurance regarding the reliability of financial reporting
and the preparation of our financial statements for external purposes in
accordance with U.S. generally accepted accounting principles.





As of
April 30, 2009, management assessed the effectiveness of our internal control
over financial reporting based on the criteria for effective internal control
over financial reporting established in Internal Control—Integrated Framework
issued by the Committee of Sponsoring Organizations of the Treadway Commission
(“COSO”) and SEC guidance on conducting such assessments.  Based on
that evaluation, they concluded that, during the period covered by this report,
such internal controls and procedures were not effective to detect the
inappropriate application of US GAAP rules as more fully described below. This
was due to deficiencies that existed in the design or operation of our internal
control over financial reporting that adversely affected our internal controls
and that may be considered to be material weaknesses, and that the scale of
operations did not warrant a more elaborate system.  For a more
complete description of issues hereto, please refer to Form 10KSB filed on
October 29, 2008 for the year ended July 31, 2008.





We
maintain disclosure controls and procedures that are designed to ensure that
information required to be disclosed in our reports filed under the Securities
Exchange Act of 1934, as amended, 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 our management, including our president and our chief financial
officer to allow for timely decisions regarding required
disclosure.





As of
April 30, 2009, the end of our third quarter covered by this report, we carried
out an evaluation, under the supervision and with the participation of our
president and chief financial officer, of the effectiveness of the design and
operation of our disclosure controls and procedures.  Based on the
foregoing, our president and chief financial officer concluded that our
disclosure controls and procedures were not effective owing to weaknesses
described in our internal control over financial reporting reported as at April
30, 2009 to provide reasonable assurance in the reliability of our financial
reports as of the end of the period covered by this quarterly
report.  Management believes that the material weaknesses set forth in
the items above did not have an affect on our financial
results.


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 Table of Contents




Inherent
limitations on effectiveness of controls





Internal
control over financial reporting has inherent limitations which include but is
not limited to the use of independent professionals for advice and guidance,
interpretation of existing and/or changing rules and principles, segregation of
management duties, scale of organization, and personnel factors. Internal
control over financial reporting is a process which involves human diligence and
compliance and is subject to lapses in judgment and breakdowns resulting from
human failures.  Internal control over financial reporting also can be
circumvented by collusion or improper management override.  Because of
its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements on a timely basis, however these inherent
limitations are known features of the financial reporting process and it is
possible to design into the process safeguards to reduce, though not eliminate,
this risk. Therefore, even those systems determined to be effective can provide
only reasonable assurance with respect to financial statement preparation and
presentation. Projections of any evaluation of effectiveness to future periods
are subject to the risk that controls may become inadequate because of changes
in conditions, or that the degree of compliance with the policies or procedures
may deteriorate.





Changes
in Internal Control over Financial Reporting





We are
committed to improving our financial organization. We will continue to monitor
and evaluate the effectiveness of our internal controls and procedures and our
internal controls over financial reporting on an ongoing basis and are committed
to taking further action and implementing additional enhancements or
improvements, as necessary and as funds allow.





There has
been no change in the Company’s internal control over financial reporting during
fiscal year 2009 that has materially affected, or is reasonably likely to
materially affect, the Company’s internal control over financial
reporting.








PART II – OTHER INFORMATION




Item 1.   Legal Proceedings





We are
not aware of any pending litigation nor do we have any reason to believe that
any such litigation exists.





Item 1A.   Risk Factors





Forward
Looking Statements. - This following information specifies certain
forward-looking statements of management of the company. Forward-looking
statements are statements that estimate the happening of future events and are
not based on historical fact.  Forward-looking statements may be
identified by the use of forward-looking terminology, such as “may”, “shall”,
“will”, “could”, “expect”, “estimate”, “anticipate”, “predict”, “probable”,
“possible”, “should”, “continue”, or similar terms, variations of those terms or
the negative of those terms.  The forward-looking statements specified
in the following information have been compiled by our management on the basis
of assumptions made by management and considered by management to be reasonable.
Our future operating results, however, are impossible to predict and no
representation, guaranty, or warranty is to be inferred from those
forward-looking statements.





The
assumptions used for purposes of the forward-looking statements specified in the
following information represent estimates of future events and are subject to
uncertainty as to possible changes in economic, legislative, industry, and other
circumstances. As a result, the identification and interpretation of data and
other information and their use in developing and selecting assumptions from and
among reasonable alternatives require the exercise of judgment. To the extent
that the assumed events do not occur, the outcome may vary substantially from
anticipated or projected results, and, accordingly, no


12
 Table of Contents


opinion
is expressed on the achievability of those forward-looking statements. No
assurance can be given that any of the assumptions relating to the
forward-looking statements specified in the following information are accurate,
and we assume no obligation to update any such forward-looking
statements.




Item 2.   Unregistered Sales of Equity Securities and Use of
Proceeds





Effective
October 20, 2006, the Company completed a forward split of its shares of common
stock at a ratio of a six (6) new shares for each one (1) old share currently
held.





On
October 3, 2006, under a restricted stock award agreement, the Company issued
6,000,000 post-split shares of restricted common stock with a fair value of
$750,000 to the Company’s President.





On
October 3, 2006, pursuant to two separate share-for-debt agreements, the Company
issued 1,230,876 post-split common shares in settlement of notes payable
amounting to $89,006 and accrued interest of $13,567.





On
December 19, 2008, the Company issued 801,294 common shares at $0.01 for
aggregate proceeds of $8,103.





On March
9, 2009 the Company issued 1,619,160 common shares at $0.02 for aggregate
proceeds of $32,383.





Stock-based compensation expense
recognized during the three months ended April 30, 2009 totaled $nil (three
months ended April 30, 2008 - $39,700).  As at April 30, 2009
the deferred stock compensation has been fully expensed and $nil (July 31, 2008
- $39,700) remaining as the unearned amount has been recorded as deferred stock
compensation.





Item 3.   Defaults Upon Senior Securities





None.





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





No
matters were submitted to a vote of the Company's shareholders during the three
months ended April 30. 2009.





Item 5.   Other Information




Reports
were filed by the Issuer January 15, 2009 and May 12, 2009
respectively.





Item 6.   Exhibits





31.1
                      Certification of Luigi Rispoli, Chief Financial
      Officer of Stellar Resources Ltd. pursuant to Section 302 of the
      Sarbanes-Oxley Act of 2002.31.2
                      Certification of Lee Balak Chief Executive
      Officer of Stellar Resources Ltd. pursuant to Section 302 of the
      Sarbanes-Oxley Act of 2002.32.1
                      Certification of Luigi Rispoli, Chief Financial
      Officer pursuant to Section 302 of the Sarbanes-Oxley Act of
      2002.32.2
                      Certification of Lee Balak, Chief Executive
      Officer pursuant to Section 302 of the Sarbanes-Oxley Act of
      2002.




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SIGNATURES





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





Dated:  June
15, 2009




STELLAR
      RESOURCES LTD.By:
                        /s/ Luigi
      RispoliLuigi
      RispoliPresident
      and Chief Financial OfficerBy:
                        /s/
      Lee BalakLee
      BalakChief
      Executive Officer







14