UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                    FORM 10-Q

[X] Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange
    Act of 1934

                  For the quarterly period ended MARCH 31, 2009

[ ] Transition Report pursuant to 13 or 15(d) of the Securities Exchange Act of
    1934

                  For the transition period               to
                                         ----------------  -------------------

Commission File Number 000-21391

                          TURBODYNE TECHNOLOGIES, INC.

        (Exact name of small business issuer as specified in its charter)

 NEVADA                                                95-4699061
-------------------------------               ---------------------------------
(State or other jurisdiction of               (IRS Employer Identification No.)
incorporation or organization)

888 SEVENTH AVENUE, 17TH FLOOR, NEW YORK, NY             10106
---------------------------------------------          ----------
(Address of principal executive offices)               (Zip Code)

Issuer's telephone number, including area code:      (805) 512-9511
                                                     --------------


                                 NOT APPLICABLE
                                 --------------
           (Former name, former address and former fiscal year end, if
                           changed since last report)

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

Indicate by check mark whether the registrant has submitted electronically and
posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T (ss.232.405 of
this chapter) during the preceding 12 months (or for such shorter period that
the registrant was required to submit and post such files). [ ] Yes [ ] 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 ? Accelerated filer ? Non -accelerated filer ? (do not
check if a smaller Smaller reporting company [X ] reporting company) Indicate by
check mark whether the registrant is a shell company (as defined in Rule 12b-2
of the Exchange Act) [ ] Yes [ X ] No


State the number of shares outstanding of each of the issuer's classes of common
stock, as of the latest practicable date: 549,513,491 shares of common stock
issued and outstanding as of MAY 14, 2009.



<PAGE>




                          TURBODYNE TECHNOLOGIES, INC.
                               INDEX TO FORM 10-Q
                                 MARCH 31, 2009

                                                                        PAGE
                                                                       NUMBER

PART I -     FINANCIAL INFORMATION

Item 1.      Financial Statements:

             Consolidated Balance Sheets as of March 31, 2009 and
                  December 31, 2008                                            4

             Consolidated Statements of Operations for the three
                  month periods ended March 31, 2009 and March 31, 2008        5

             Consolidated Statements of Cash Flows for the
                  three month periods ended March 31, 2009 and March 31, 2008  6

             Notes to the Consolidated Financial Statements                    7

Item 2.      Management's Discussion and Analysis or Plan of Operations       23

Item 3.      Quantitative and Qualitative Disclosures About Market Risk       NA

Item 4.      Controls and Procedures                                          31

PART II -    OTHER INFORMATION

Item 1.      Legal Proceedings                                                32

Item 1A.     Risk Factors                                                     NA

Item 2.      Unregistered Sales of Equity Securities and Use of Proceeds      32

Item 3.      Defaults Upon Senior Securities                                  NA

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

Item 5.      Other Information                                                NA

Item 6.      Exhibits                                                         33

SIGNATURES                                                                    34




<PAGE>




PART 1 - FINANCIAL INFORMATION

ITEM 1.           FINANCIAL STATEMENTS



                                   TURBODYNE TECHNOLOGIES, INC. AND SUBSIDIARIES
                                   CONSOLIDATED FINANCIAL STATEMENTS
                                   FOR THE THREE MONTHS ENDED
                                   MARCH 31, 2009 AND 2008
                                   (UNAUDITED - EXPRESSED IN US DOLLARS)


<PAGE>
<TABLE>
<CAPTION>


================================================================================

                                   TURBODYNE TECHNOLOGIES, INC. AND SUBSIDIARIES
                                                     CONSOLIDATED BALANCE SHEETS
                                                       (EXPRESSED IN US DOLLARS)



                                                                  MARCH 31         DECEMBER 31
                                                                   2009                2008
-----------------------------------------------------------------------------------------------
ASSETS                                                          (UNAUDITED)
CURRENT
<S>                                                          <C>              <C>
   Cash                                                      $          20    $          68
                                                             ----------------------------------

        TOTAL CURRENT ASSETS                                            20               68
PROPERTY AND EQUIPMENT, net                                         16,327           17,829
                                                             ----------------------------------

TOTAL ASSETS                                                 $      16,347    $      17,897
===============================================================================================
LIABILITIES AND STOCKHOLDERS' DEFICIT

LIABILITIES

CURRENT
   Accounts payable                                          $   1,964,528    $   1,869,757
   Accrued liabilities                                             341,000          320,000
   Provision for lawsuit settlements (Note 4)                    5,441,621        5,345,113
   Loans payable (Note 3)                                          518,864          508,227
                                                             ----------------------------------

        TOTAL CURRENT LIABILITIES                                8,266,013        8,043,097

DEFERRED LICENSING FEE                                             269,274          274,830
                                                             ----------------------------------

        TOTAL LIABILITIES                                    $   8,535,287    $   8,317,927
                                                             ----------------------------------

STOCKHOLDERS' DEFICIT
   Share Capital (Note 2)
       Authorized
              1,000,000 preferred shares, par value $0.001
           1,000,000,000 common shares, par value $0.001
       Issued
            12,675 preferred shares                                     12               12
          549,513,491 common shares                                549,514          549,514
   Treasury stock, at cost (5,278,580 shares)                   (1,963,612)      (1,963,612)
   Additional paid-in capital                                  127,905,641      127,897,291
   Other comprehensive income -
       Foreign exchange translation gain                            35,119           35,119
   Accumulated deficit                                        (135,045,614)    (134,818,354)
                                                             ----------------------------------

        TOTAL STOCKHOLDERS' DEFICIT                             (8,518,940)      (8,300,030)
                                                             ----------------------------------

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT                  $      16,347    $      17,897
===============================================================================================



         The accompanying notes are an integral part of these unaudited
                       consolidated financial statements.
</TABLE>


                                      -4-
<PAGE>

<TABLE>
<CAPTION>


================================================================================

                                   TURBODYNE TECHNOLOGIES, INC. AND SUBSIDIARIES
                                           CONSOLIDATED STATEMENTS OF OPERATIONS
                                           (UNAUDITED - EXPRESSED IN US DOLLARS)

FOR THE THREE-MONTH PERIODS ENDED MARCH 31                           2009              2008
------------------------------------------------------------------------------------------------


<S>                                                         <C>                 <C>
LICENSING FEES                                              $          5,556    $          5,556
                                                            ------------------------------------

EXPENSES
    Selling, general and administrative                               98,098             255,848
    Research and development                                          25,808             110,558
    Litigation                                                        96,508              82,065
    Depreciation and amortization                                      1,502                 890
                                                            ------------------------------------

       TOTAL EXPENSES                                                221,916             449,361
                                                            ------------------------------------

LOSS FROM OPERATIONS                                                (216,360)           (443,805)

OTHER INCOME (EXPENSE)
   Interest expense                                                   (9,300)            (22,030)
   Amortization of discount on convertible notes (Note 3)               --              (240,194)
   Debt conversion expense (Note 3)                                     --              (426,857)
                                                            ------------------------------------

NET LOSS BEFORE TAXES                                               (225,660)         (1,132,886)

Income tax expense                                                    (1,600)             (1,600)
                                                            ------------------------------------

NET LOSS FOR THE PERIOD                                     $       (227,260)   $     (1,134,486)
================================================================================================

NET LOSS PER COMMON SHARE - BASIC AND DILUTED               $          (0.00)   $          (0.00)
================================================================================================

WEIGHTED AVERAGE SHARES - BASIC AND DILUTED                      549,513,491         383,241,566
================================================================================================



         The accompanying notes are an integral part of these unaudited
                       consolidated financial statements.
</TABLE>


                                      -5-
<PAGE>

<TABLE>
<CAPTION>

================================================================================

                                   TURBODYNE TECHNOLOGIES, INC. AND SUBSIDIARIES
                                           CONSOLIDATED STATEMENTS OF CASH FLOWS
                                           (UNAUDITED - EXPRESSED IN US DOLLARS)


FOR THE THREE-MONTH PERIODS ENDED MARCH 31                            2009            2008
---------------------------------------------------------------------------------------------

OPERATING ACTIVITIES
<S>                                                                <C>            <C>
   Net loss for the period                                         $  (227,260)   $(1,134,486)
   Adjustments to reconcile net loss to net
   cash provided by (used in) operating activities:
      Amortization of deferred licensing fees                           (5,556)        (5,556)
      Depreciation and amortization                                      1,502            890
      Amortization of discount on convertible debt (Note 3)               --          240,194
      Stock for services                                                 2,000        180,000
      Debt conversion expense (Note 3)                                    --          426,857
      Warrant compensation  (Note 2)                                     7,688         54,600
   (Increase) decrease in operating assets
       Prepaid expenses and other current assets                          --             --
   Increase (decrease) in operating liabilities
       Accounts payable                                                 94,771        (20,801)
       Accrued liabilities and provision for lawsuit settlements       126,807        132,070
                                                                   --------------------------
          Net cash used in operating activities                            (48)      (126,232)
                                                                   --------------------------

FINANCING ACTIVITIES
   Notes Payable                                                          --          123,500
                                                                   --------------------------
          Net cash provided by financing activities                       --          123,500
                                                                   --------------------------

NET INCREASE (DECREASE) IN CASH                                            (48)        (2,732)

CASH, beginning of  period                                                  68          2,786
                                                                   --------------------------
CASH, end of period                                                $        20    $        54
=============================================================================================
SUPPLEMENTARY DISCLOSURE OF NON-CASH INFORMATION
BENEFICIAL CONVERSION FEATURE OF CONVERTIBLE DEBT                  $      --      $    54,198
VALUE OF WARRANTS ISSUED WITH CONVERTIBLE DEBT                            --           24,198
CONVERSION OF INTEREST AND NOTES PAYABLE TO COMMON STOCK                  --          359,494
=============================================================================================








         The accompanying notes are an integral part of these unaudited
                       consolidated financial statements.
</TABLE>



                                      -6-
<PAGE>


--------------------------------------------------------------------------------

                                   TURBODYNE TECHNOLOGIES, INC. AND SUBSIDIARIES
                                  NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                                           (Unaudited - Expressed in US Dollars)

MARCH 31, 2009 AND 2008
--------------------------------------------------------------------------------


1.   NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     NATURE OF BUSINESS

     Turbodyne Technologies, Inc., a Nevada corporation, and its subsidiaries
     (the "Company") engineer, develop and market products designed to enhance
     performance and reduce emissions of internal combustion engines.

     The Company's operations have been financed principally through a
     combination of private and public sales of equity and debt securities. If
     the Company is unable to raise equity capital or generate revenue to meet
     its working capital needs, it may have to cease operating and seek relief
     under appropriate statutes. These consolidated financial statements have
     been prepared on the basis that the Company will be able to continue as a
     going concern and realize its assets and satisfy its liabilities and
     commitments in the normal course of business and do not reflect any
     adjustment which would be necessary if the Company is unable to continue as
     a going concern.

     GOING CONCERN

     The accompanying consolidated financial statements have been prepared
     assuming that the Company will continue as a going concern. The Company
     has suffered net operating losses in recent periods, has an accumulated
     deficit of $135,045,614 at March 31, 2009 and a total capital deficit of
     $8,518,940 at March 31, 2009. It has used most of its available cash in
     its operating activities in recent years, has a significant working
     capital deficiency and is subject to lawsuits brought against it by other
     parties. These matters raise substantial doubt about the Company's
     ability to continue as a going concern.

     BASIS OF PRESENTATION

     The interim financial statements included herein, presented in accordance
     with United States generally accepted accounting principles and stated in
     US dollars, have been prepared by the Company, without audit, pursuant to
     the rules and regulations of the Securities and Exchange Commission and
     with the instruction to Form 10 and Rule 8-03 of Regulation S-X. Certain
     information and footnote disclosures normally included in financial
     statements prepared in accordance with generally accepted accounting
     principles have been condensed or omitted pursuant to such rules and
     regulations, although the Company believes that the disclosures are
     adequate to make the information presented not misleading.

     These financial statements reflect all adjustments, consisting of normal
     recurring adjustments, which in the opinion of management are necessary
     for fair presentation of the information contained therein. It is
     suggested that these interim financial statements be read in conjunction
     with the audited financial statements of the Company for the years ended
     December 31, 2008 and 2007 included in the Company's 10-K Annual Report.
     The Company follows the same accounting policies in the preparation of
     interim reports.

     Results of operations for the interim periods are not indicative of annual
     results.

                                      -7-
<PAGE>


--------------------------------------------------------------------------------

                                   TURBODYNE TECHNOLOGIES, INC. AND SUBSIDIARIES
                                      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
                                           (UNAUDITED - EXPRESSED IN US DOLLARS)

MARCH 31, 2009 AND 2008
--------------------------------------------------------------------------------


1.   NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -
     CONTINUED

     PRINCIPLES OF CONSOLIDATION

     The accompanying consolidated financial statements, stated in United States
     dollars, include the accounts of Turbodyne Technologies, Inc. and its
     wholly-owned subsidiaries, Turbodyne Systems, Inc., Turbodyne Germany Ltd.,
     Electronic Boosting Systems, Inc. and Pacific Baja Light Metals Corp.
     ("Pacific Baja"). All intercompany accounts and transactions have been
     eliminated on consolidation.

     DEPRECIATION AND AMORTIZATION

     Depreciation and amortization of property and equipment is computed using
     the straight-line method over estimated useful lives as follows:

                 Computers and measurement equipment             - 3 years
                 Machinery and equipment                         - 7 to 15 years
                 Furniture and fixtures                          - 5 to 10 years

     VALUATION OF LONG-LIVED ASSETS

     The Company periodically reviews the carrying value of long-lived assets
     for indications of impairment in value and recognizes impairment of
     long-lived assets in the event the net book value of such assets exceeds
     the estimated undiscounted future cash flows attributable to such assets.
     Long-lived assets to be disposed of by sale are to be measured at the
     lower of carrying amount or fair value less cost of sale whether reported
     in continuing operations or in discontinued operations. No impairment was
     required to be recognized during 2009 and 2008.

     FAIR VALUE MEASUREMENTS

      In January 1, 2008, SFAS No. 157 (SFAS 157), FAIR VALUE MEASUREMENTS
     became effective for the Company. SFAS 157 relates to financial assets
     and financial liabilities. In February 2008, the FASB issued FASB Staff
     Position (FSP) No. FAS 157-2, EFFECTIVE DATE OF FASB STATEMENT NO. 157,
     which delayed the effective date of SFAS 157 for all nonfinancial assets
     and nonfinancial liabilities, except those that are recognized or
     disclosed at fair value in the financial statements on at least an annual
     basis, until January 1, 2009 for calendar year-end entities.


                                      -8-
<PAGE>



--------------------------------------------------------------------------------

                                   TURBODYNE TECHNOLOGIES, INC. AND SUBSIDIARIES
                                      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
                                           (UNAUDITED - EXPRESSED IN US DOLLARS)

MARCH 31, 2009 AND 2008
--------------------------------------------------------------------------------


1.   NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -
     CONTINUED

     FAIR VALUE MEASUREMENTS - CONTINUED

     SFAS 157 defines fair value, establishes a framework for measuring fair
     value in accounting principles generally accepted in the United States of
     America (GAAP), and expands disclosures about fair value measurements.
     The provisions of this standard apply to other accounting pronouncements
     that require or permit fair value measurements and are to be applied
     prospectively with limited exceptions. FSP FAS 157-1 amends SFAS 157 to
     exclude from the scope of SFAS 157 certain leasing transactions accounted
     for under Statement of Financial Accounting Standards No. 13, "Accounting
     for Leases." FSP FAS 157-2 amends SFAS 157 to defer the effective date of
     SFAS 157 for all non-financial assets and non-financial liabilities
     except those that are recognized or disclosed at fair value in the
     financial statements on a recurring basis to fiscal years beginning after
     November 15, 2008. In addition, effective for the third quarter of 2008,
     the Company adopted FASB Staff Position 157-3 "Determining the Fair Value
     of a Financial Asset When the Market for That Asset Is Not Active" ("FSP
     FAS 157-3"). FSP FAS 157-3 clarifies the application of SFAS 157 to
     financial instruments in an inactive market. The adoption of SFAS 157 and
     FSP FAS 157-3 did not have an impact on the Company's financial
     statements.


     Effective January 1, 2008, Statement of Financial Accounting Standards
     No. 159, "The Fair Value Option for Financial Assets and Financial
     Liabilities" ("SFAS 159"). SFAS 159 permits entities to choose to measure
     many financial instruments and certain other items at fair value. The
     adoption of SFAS 159 did not have an impact on the Company's financial
     statements.

     RECOGNITION OF REVENUE

     License fee revenue is recognized over the term of the license agreement.
     During the year ended December 31, 2003, $400,000 in license fees were
     deferred and are being amortized over 18 years. As a result, for the
     quarter ended March 31, 2009 $5,556 ($5,556 in 2008) of licensing fees
     was recognized as income.

     EARNINGS (LOSS) PER SHARE

     Earnings (loss) per share is computed in accordance with SFAS No. 128,
     "Earnings Per Share". Basic earnings (loss) per share is calculated by
     dividing the net income (loss) available to common stockholders by the
     weighted average number of shares outstanding during the year. Diluted
     earnings per share reflect the potential dilution of securities that
     could share in earnings of an entity. In a loss year, dilutive common
     equivalent shares are excluded from the loss per share calculation as the
     effect would be anti-dilutive.


                                      -9-
<PAGE>


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                                   TURBODYNE TECHNOLOGIES, INC. AND SUBSIDIARIES
                                      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
                                           (UNAUDITED - EXPRESSED IN US DOLLARS)

MARCH 31, 2009 AND 2008
--------------------------------------------------------------------------------


1.   NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -
     CONTINUED

     EARNINGS (LOSS) PER SHARE - CONTINUED

     For the quarter ended March 31, 2009, 12,675 preferred shares convertible
     into 1,267,500 shares of common stock and options and warrants to
     purchase 17,799,000 and 45,294,988 shares of common stock, convertible
     notes to purchase 28,155,158 shares of common stock were outstanding
     during the quarter. The weighted average cumulative equivalent shares of
     549,513,491 were included in the denominator for 2009 computation of
     diluted earnings (loss) per share. No other adjustments were made for
     purposes of per share calculations.

     USE OF ESTIMATES

     The preparation of financial statements in conformity with generally
     accepted accounting principles requires management to make estimates and
     assumptions that affect the reported amounts of assets and liabilities
     and the disclosure of contingent assets and liabilities at the date of
     the financial statements and the reported amounts of revenue and expenses
     during the reporting period. Actual results could differ from those
     estimates.

     STOCK-BASED COMPENSATION

     The Company accounts for stock-based compensation under the fair value
     method in accordance with Statement of Financial Accounting Standards
     No.123 (revised 2004), "Share Based Payment" "SFAS 123(R)". SFAS No. 123R
     requires the Company to establish assumptions and estimates of the
     weighted-average fair value of stock options granted, as well as using a
     valuation model to calculate the fair value of stock-based awards. The
     Company uses the Black-Scholes option-pricing model to determine the
     fair-value of stock-based awards. All options are amortized over the
     requisite service periods of the awards, which are generally the vesting
     periods.

     RESEARCH AND DEVELOPMENT

     Research and development costs related to present and future products are
     charged to operations in the period incurred. Previously, research
     prototypes were sold and proceeds reflected by reductions in our research
     and development costs. As new technology pre-production manufacturing
     units are produced and related non-recurring engineer services are
     delivered we will recognize the sales proceeds as revenue.


                                      -10-
<PAGE>


--------------------------------------------------------------------------------

                                   TURBODYNE TECHNOLOGIES, INC. AND SUBSIDIARIES
                                      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
                                           (UNAUDITED - EXPRESSED IN US DOLLARS)

MARCH 31, 2009 AND 2008
--------------------------------------------------------------------------------


1.   NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -
     CONTINUED

     INCOME TAXES

     The Company accounts for income taxes under the asset and liability
     method of accounting for income taxes, which recognizes deferred tax
     assets and liabilities for the estimated future tax consequences
     attributable to differences between the financial statement carrying
     amounts of existing assets and liabilities and their respective tax
     bases. Deferred tax assets and liabilities are measured using enacted tax
     rates in effect for the years in which those temporary differences are
     expected to be recovered or settled. The effect on deferred tax assets
     and liabilities of a change in tax rates is recognized in income in the
     period that includes the enactment date. The components of the deferred
     tax assets and liabilities are classified as current and non-current
     based on their characteristics. The components of the deferred tax assets
     and liabilities are classified as current and non-current based on their
     characteristics. A valuation allowance is provided for certain deferred
     tax assets if it is more likely than not that the Company will not
     realize tax assets through future operations.

     LEGAL FEES

     The Company expenses legal fees in connection with litigation as incurred.

     COMPREHENSIVE INCOME

     The Company has adopted SFAS No. 130, "Reporting Comprehensive Income".
     SFAS No. 130 establishes standards to measure all changes in equity that
     result from transactions and other economic events other than transactions
     with owners. Comprehensive income is the total of net earnings (loss) and
     all other non-owner changes in equity. Except for net earnings (loss) and
     foreign currency translation adjustments, the Company does not have any
     transactions and other economic events that qualify as comprehensive income
     as defined under SFAS No. 130. As foreign currency translation adjustments
     were immaterial to the Company's consolidated financial statements, net
     earnings (loss) approximated comprehensive income for the quarter ended
     March 31, 2009 and 2008.


                                      -11-
<PAGE>


------------------------------------------------------------------------------

                                   TURBODYNE TECHNOLOGIES, INC. AND SUBSIDIARIES
                                      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
                                           (UNAUDITED - EXPRESSED IN US DOLLARS)

MARCH 31, 2009 AND 2008
------------------------------------------------------------------------------


1.   NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -
     CONTINUED

     NEW ACCOUNTING PRONOUNCEMENTS

     In December 2007, the FASB issued Statement No. 141R, "Business
     Combinations" ("SFAS 141R"). SFAS 141R revises the principles and
     requirements for how the acquirer recognizes and measures in its financial
     statements the identifiable assets acquired, the liabilities assumed, any
     non controlling interest in the acquiree, and the goodwill acquired in a
     business combination or gain from a bargain purchase. SFAS 141R also
     revises the principles and requirements for how the acquirer determines
     what information to disclose to enable users of the financial statements to
     evaluate the nature and financial effects of the business combination. This
     statement is effective for the Company beginning January 1, 2009 and has no
     impact on its financial statements.

     In December 2007, the FASB issued Statement No. 160, "Non controlling
     Interest in Consolidated Financial Statements -- an amendment of ARB No.
     51" ("SFAS 160"). SFAS 160 amends ARB No. 51 to establish accounting and
     reporting standards for the non controlling interest in a subsidiary and
     for the deconsolidation of a subsidiary. This statement is effective for
     the Company beginning January 1, 2009 and has no impact on its financial
     statements.

     In March 2008, the FASB issued Statement No. 161, "Disclosures about
     Derivative Instruments and Hedging Activities" ("SFAS 161"). SFAS 161
     requires companies with derivative instruments to disclose information that
     should enable financial-statement users to understand how and why a company
     uses derivative instruments, how derivative instruments and related hedged
     items are accounted for under FASB Statement No. 133 "Accounting for
     Derivative Instruments and Hedging Activities" and how derivative
     instruments and related hedged items affect a company's financial position,
     financial performance and cash flows. This statement is effective for the
     Company beginning January 1, 2009 and has no impact on its financial
     statements.


     In April 2009, the FASB issued FSP FAS 107-1 and Accounting Principles
     Board (APB) 28-1, Interim Disclosures about Fair Value of Financial
     Instruments. The FSP amends SFAS No. 107 "Disclosures about Fair Value of
     Financial Instruments" to require an entity to provide disclosures about
     fair value of financial instruments in interim financial information. This
     FSP is to be applied prospectively and is effective for interim and annual
     periods ending after June 15, 2009 with early adoption permitted for
     periods ending after March 15, 2009. The Company will include the required
     disclosures in its quarter ending June 30, 2009


                                      -12-
<PAGE>




--------------------------------------------------------------------------------

                                   TURBODYNE TECHNOLOGIES, INC. AND SUBSIDIARIES
                                      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
                                           (UNAUDITED - EXPRESSED IN US DOLLARS)

MARCH 31, 2009 AND 2008
--------------------------------------------------------------------------------


1.   NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -
     CONTINUED

     NEW ACCOUNTING PRONOUNCEMENTS

     In April 2009, the FASB issued FSP FAS 141(R)-1, ACCOUNTING FOR ASSETS
     ACQUIRED AND LIABILITIES ASSUMED IN A BUSINESS COMBINATION THAT ARISE
     FROM CONTINGENCIES. This FSP requires that assets acquired and
     liabilities assumed in a business combination that arise from
     contingencies be recognized at fair value if fair value can be reasonably
     estimated. If fair value cannot be reasonably estimated, the asset or
     liability would generally be recognized in accordance with SFAS No. 5,
     "Accounting for Contingencies" and FASB Interpretation No. 14,
     "Reasonable Estimation of the Amount of a Loss". Further, the FASB
     removed the subsequent accounting guidance for assets and liabilities
     arising from contingencies from SFAS No. 141(R). The requirements of this
     FSP carry forward without significant revision the guidance on
     contingencies of SFAS No. 141, "Business Combinations", which was
     superseded by SFAS No. 141(R) (see previous paragraph). The FSP also
     eliminates the requirement to disclose an estimate of the range of
     possible outcomes of recognized contingencies at the acquisition date.
     For unrecognized contingencies, the FASB requires that entities include
     only the disclosures required by SFAS No. 5. This FSP was adopted
     effective January 1, 2009. There was no impact upon adoption, and its
     effects on future periods will depend on the nature and significance of
     business combinations subject to this statement.

     In April 2008, the FASB issued FSP FAS 142-3, Determination of the Useful
     Life of Intangible Assets. The FSP states that in developing assumptions
     about renewal or extension options used to determine the useful life of
     an intangible asset, an entity needs to consider its own historical
     experience adjusted for entity-specific factors. In the absence of that
     experience, an entity shall consider the assumptions that market
     participants would use about renewal or extension options. This FSP is to
     be applied to intangible assets acquired after January 1, 2009. The
     adoption of this FSP did not have an impact on the Company's financial
     statements.


                                      -13-
<PAGE>



--------------------------------------------------------------------------------

                                   TURBODYNE TECHNOLOGIES, INC. AND SUBSIDIARIES
                                      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
                                           (UNAUDITED - EXPRESSED IN US DOLLARS)

MARCH 31, 2009 AND 2008
--------------------------------------------------------------------------------


2.   SHARE CAPITAL

     Transactions not disclosed elsewhere in these consolidated interim
     financial statements are as follows:

     a)   Authorized Capital
          At the Annual General Meeting held on June 30, 2004, the shareholders
          approved an increase of authorized capital to 1,000,000,000 common
          shares.

          In 2003, 150,000 of the 1 million preferred shares were designated as
          Series X preferred shares. These shares have a par value of $0.001 per
          share with each share being convertible into 100 common shares at the
          discretion of the holder. As of March 31, 2009, 12,675 of Series X
          preferred shares convertible into 1,267,500 common shares are
          outstanding.

          In addition to outstanding shares of common stock, options and
          warrants described in these notes; additional shares are issuable in
          connection with the change of control transaction in September 2005 in
          the event the Company issues any securities directly or indirectly
          related to pre-merger events.

     b)   During the three months ended March 31, 2009 the Company did not issue
          any shares.

          During the three months ended March 31, 2008 the Company issued
          54,123,194 shares of common stock, 48,123,194 for conversion of notes
          and interest payable and 6,000,000 for payment of services.

     c)   Stock Options

          The determination of fair value of share-based payment awards to
          employees, directors and non-employees on the date of grant using the
          Black-Scholes model is affected by the Company's stock price as well
          as assumptions regarding a number of highly complex and subjective
          variables. These variables include, but are not limited to the
          expected stock price volatility over the term of the awards, and
          actual and projected employee stock option exercise behaviours.
          Management has used historical data to estimate forfeitures. The
          risk-free rate is based on U.S. Treasury rates in effect during the
          corresponding period of grant. The expected volatility is based on the
          historical volatility of the Company's stock price.


                                      -14-
<PAGE>


  ------------------------------------------------------------------------------

                                   TURBODYNE TECHNOLOGIES, INC. AND SUBSIDIARIES
                                      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
                                           (UNAUDITED - EXPRESSED IN US DOLLARS)

  MARCH 31, 2009 AND 2008
  ------------------------------------------------------------------------------


2.   SHARE CAPITAL - CONTINUED


     c)   Stock Options - Continued


          GRANT OF STOCK OPTIONS TO NON-EMPLOYEES FOR SERVICES

          During 2006 and 2007, we granted warrants to purchase 78,200,000
          shares of our common stock to various consultants that we deemed
          essential to our operations. Details of the consultant warrants for
          the quarter ended March 31, 2009 are as follows:

              Total consultant warrants granted                  78,200,000
              Vested prior to January 1, 2009                   (22,805,549)
              Vested January through March 31, 2009              (1,369,439)
              Cancelled January through December 2008           (22,044,436)
                                                               -------------
              Warrants not vested                                31,980,576
                                                               =============

          During the three months ended March 31, 2009 the Company using the
          Black-Scholes model recorded $7,688 ($54,600 in 2008) of compensation
          expense, relating to the vesting of stock warrants previously issued
          to non-employees for services. The non cash warrant expense is
          allocated with $5,880 ($35,181 in 2008) to general and administrative
          expenses and $1,808 ($18,484 in 2008) to research and development.

          The estimated fair value of warrants issued to non-employees during
          the three months ended March 31, 2009 ranged from $0.0032 to $0.0062.
          Assumptions used to value the warrants: expected dividend yield Nil%;
          expected volatility of 113.23% and 125.53%; risk-free interest rate of
          2.27%, 2.28% and 2.69% and an expected life of 7 years.

     d)   Stock Purchase Warrants

          At March 31, 2009 the Company had 45,294,988 share purchase warrants
          outstanding and exercisable. These warrants were issued in connection
          with private placements, non-employee compensation and other means of
          financing. The holders of these warrants are entitled to receive one
          share of common stock of the Company for one warrant exercised. The
          warrants have exercise prices ranging from $0.0117 to $0.04 per share
          with a weighted average exercise price of $0.016 per share and
          expiration dates between 2011 and 2016. Details of share purchase
          warrants for the quarter ended March 31, 2009 are as follows:


                                      -15-
<PAGE>


--------------------------------------------------------------------------------

                                   TURBODYNE TECHNOLOGIES, INC. AND SUBSIDIARIES
                                  NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                                           (UNAUDITED - EXPRESSED IN US DOLLARS)

  MARCH 31, 2009 AND 2008
--------------------------------------------------------------------------------


2.   SHARE CAPITAL - CONTINUED

<TABLE>
<CAPTION>

                                    INVESTORS        EMPLOYEES & CONSULTANTS        TOTAL
                            ------------------------------------------------------------------------

                                          WEIGHTED                WEIGHTED                WEIGHTED
                                           AVERAGE                 AVERAGE                 AVERAGE
                                          EXERCISE                 EXERCISE                EXERCISE
                              WARRANTS     PRICE      WARRANTS      PRICE      WARRANTS     PRICE
                            ------------------------------------------------------------------------

<S>                         <C>          <C>         <C>          <C>         <C>          <C>
Outstanding at beginning    21,120,000   $   0.02    22,805,549   $   0.01    43,925,549   $   0.02
of period

Vested                            --     $   0.02     1,369,439   $   0.01     1,369,439   $   0.01
                            ----------               ----------               ----------

Warrants outstanding and
exercisable at end of
period                      21,120,000   $   0.02    24,174,988   $   0.01    45,294,988   $   0.02
                            ==========               ==========               ==========
Weighted average fair
value of warrants
granted during
the period                        --                               --     $         0.01   $   0.01
                            =======================================================================
</TABLE>


          At March 31, 2009, the following is a summary of share purchase
          warrants outstanding and exercisable:

                                                  Weighted-
                                                   Average        Weighted
                                                  Remaining        Average
                                                  Contractual      Exercise
          Exercise Price           Number         Life (Years)       Price
          ----------------------------------------------------------------------

             $0.01              23,341,660           5.43             $0.01
          $0.025 - 0.04         21,953,328           3.46              0.02
                               ------------


                                45,294,988           4.47             $0.02
                               ============

--------------------------------------------------------------------------------


3.   LOANS PAYABLE

                                                       March 31,   December 31,
                                                         2009          2008
                                                      --------------------------

         Unsecured, non-interest bearing
         loan payable, due on
         demand from stockholders
         and other parties                             $138,600    $138,600

         Note payable, 5% per annum
         (see note 5)                                    51,479      50,905

         Convertible notes payable                      328,785     318,722
                                                      --------------------------

         Total Loans Payable                           $518,864    $508,227
                                                      ==========================


                                      -16-
<PAGE>

<TABLE>
<CAPTION>

--------------------------------------------------------------------------------

                                   TURBODYNE TECHNOLOGIES, INC. AND SUBSIDIARIES
                                  NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                                           (UNAUDITED - EXPRESSED IN US DOLLARS)

  MARCH 31, 2009 AND 2008
--------------------------------------------------------------------------------


3.   LOANS PAYABLE - CONTINUED

     As of March 31, 2009, convertible notes consist of:

                                  Issued         Issued     Issued           Issued        Issued         Issued
                                 through        from         from            from            From          From
                                   Sept      Nov 06 to     Mar 07 to       Sep 07 to      Jan 08 to      Apr 08 to
                                   2006         Feb 07       Aug 07         Dec 07          Mar 08         Jun 08        Total
                               ----------------------------------------------------------------------------------------------------
<S>                     <C>                <C>               <C>               <C>           <C>       <C>           <C>
Proceeds from issuances of
convertible debt               $   615,000   $    95,000    $   441,000    $   200,000    $   100,000    $   200,000    $ 1,651,000

Less: Debt conversions            (530,000)      (95,000)      (441,000)      (200,000)      (100,000)          --       (1,366,000)
                               ----------------------------------------------------------------------------------------------------

                                    85,000          --             --             --             --          200,000        285,000
                               ----------------------------------------------------------------------------------------------------

Discount on convertible debt

   Value allocated to
      warrants                      88,144         8,041        118,485         51,035         24,198         48,052        337,955

   Beneficial conversion
      feature                      521,756        86,959        322,515        148,965         54,198         68,052      1,202,445
                               -----------------------------------------------------------------------------------------------------

                                   609,900        95,000        441,000        200,000         78,396        116,104      1,540,400
   Accumulated amortization
      of value allocated to
      warrants                     (88,144)       (8,041)      (118,485)       (51,035)       (24,198)       (48,052)      (337,955)

   Accumulated amortization
      of beneficial conversion
      feature                     (521,756)      (86,959)      (322,515)      (148,965)       (54,198)       (68,052)    (1,202,445)
                               ----------------------------------------------------------------------------------------------------

                                      --             --             --             --            --             --             --
                               ----------------------------------------------------------------------------------------------------

   Accrued Interest                 12,885          --             --             --             --           30,900         43,785
                               ----------------------------------------------------------------------------------------------------


Net Convertible Debt           $    97,885   $      --      $      --      $      --      $      --      $   230,900    $   328,785
                               ====================================================================================================

                                Lower of
                                 70% of
Original conversion price       market or       $0.005          $0.020         $0.020        $0.020         $0.020           --
                                  $0.025

Modified conversion price         $0.005          N/A             N/A            N/A           N/A            N/A            --

Interest rate                       5%            5%              5%             18%           18%            18%            --

Maturity from date of issuance   1 year         1 year          1 year        6 months      6 months        6 months         --



Warrants issued                 12,300,000     1,900,000      8,820,000      4,000,000      2,000,000      4,000,000     33,020,000


Warrants exercised             (11,900,000)         --             --             --             --             --      (11,900,000)
                               ----------------------------------------------------------------------------------------------------

Warrants remaining                 400,000     1,900,000      8,820,000      6,000,000      2,000,000      4,000,000     21,120,000
                               ----------------------------------------------------------------------------------------------------


Market value of warrants
at date of issuance              $ 150,884       $48,863       $398,872       $140,612        $41,498        $69,572

Assumptions for Black-Scholes
valuation of warrants

     Original exercise price      $  0.025     $   0.025         $0.020         $0.020         $0.020         $0.020


     Modified exercise price      $  0.010        N/A            N/A             N/A             N/A            N/A
     Term                         5 years     5 years          5 years         5 years         5 years        5 years
                                    146% -      153% -          112% -         112% -
     Volatility rate                151%        155%            155%           155%             109%            107%
                                   4.61% -      4.45% -         4.46% -        2.93% -
     Risk free interest rate        5.02%       4.69%           5.01%          5.01%           2.93%           1.90%

</TABLE>


                                      -17-
<PAGE>

                                   TURBODYNE TECHNOLOGIES, INC. AND SUBSIDIARIES
                                  NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                                           (UNAUDITED - EXPRESSED IN US DOLLARS)

MARCH 31, 2009 AND 2008
--------------------------------------------------------------------------------


3.   LOANS PAYABLE - CONTINUED

     For the quarter ended March 31, 2009 the Company did not issue any new
     convertible notes.


     For the years ended December 31, 2008, 2007 and 2006, the Company issued
     $300,000, $691,000 and $660,000, respectively, of convertible notes. All of
     the convertible notes were issued with detachable warrants to purchase
     6,000,000, 13,820,000, and 13,200,000 shares of the Company's common stock,
     respectively. In recording the transaction, the Company allocated the value
     of the proceeds to the convertible notes and the warrants based on their
     relative fair values. Fair value of the warrants was determined using the
     Black-Scholes valuation model. It was also determined that the convertible
     notes contained a beneficial conversion feature since the fair market value
     of the common stock issuable upon the conversion of the notes exceeded the
     value allocated to the notes.

     The value of the beneficial conversion feature and the value of the
     warrants have been recorded as a discount to convertible notes and are
     being amortized over the term of the notes using the straight-line method.
     For the years ended December 31, 2008 and 2007, amortization of the
     discount was $447,728 and $864,485, respectively. As of December 31, 2008
     and 2007, the remaining balance of the beneficial conversion feature was
     $-0- and $199,726, and detachable warrants was $-0- and $53,501,
     respectively.

     In September 2006, the Company offered to decrease the note conversion
     price to $0.005 per share if the note holders exercised their warrants at
     the reduced exercise price of $0.010 by September 30, 2006. 11,900,000 of
     the warrants were exercised. In consideration for the reduction of
     conversion price, the maturity of the notes extended for another year.

     The modification of conversion terms was substantial such that it was
     considered an extinguishment of debt. Accordingly, the unamortized discount
     on convertible notes was written off and included in total amortization for
     2006. Conversion of notes in 2008 and 2007 also resulted in the write off
     of the corresponding unamortized discount.

     In addition, as a result of the inducement to exercise the warrants and to
     convert the notes, the Company recognized an expense of $1,247,657 and
     $988,686 for the years ended December 31, 2008 and 2007, respectively, with
     a corresponding increase in additional paid in capital.

     In February 2007, the Company changed the per share conversion price from
     $0.005 to $0.020 for new lenders. The notes, issued prior to September 1,
     2007, bear interest at 5% and mature within one year from date of issuance.
     The notes, issued after September 1, 2007, bear interest at 18% and mature
     within six months from date of issuance. The warrants are to purchase the
     Company's common stock at $0.025 per share expiring in five years. ------
--------------------------------------------------------------------------------

                                      -18-
<PAGE>



--------------------------------------------------------------------------------

                                   TURBODYNE TECHNOLOGIES, INC. AND SUBSIDIARIES
                                  NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                                           (UNAUDITED - EXPRESSED IN US DOLLARS)

MARCH 31, 2009 AND 2006
--------------------------------------------------------------------------------


4.   COMMITMENTS AND CONTINGENCIES

     The Company is party to various legal claims and lawsuits that have arisen
     in the normal course of business. There have been no material changes in
     the status of these matters since the issuance of the most recent audited
     annual financial statements.

     LITIGATION

     a)   TST, Inc.

          In March 2000, TST, Inc. ("TST"), a vendor to a subsidiary of Pacific
          Baja (Note 4(b)) filed an action against the Company alleging that in
          order to induce TST to extend credit to a subsidiary of Pacific Baja,
          the Company executed guarantees in favor of TST. TST alleged that the
          subsidiary defaulted on the credit facility and that the Company is
          liable as guarantor.

          Agreed to the immediate entry of judgment against the Company in the
          amount of $2,068,078 plus interest from the date of entry at the rate
          of 10% per annum. The amount of this judgment would immediately
          increase by any amount that TST is compelled by judgment or court
          order or settlement to return as a preferential transfer in connection
          with the bankruptcy proceedings of Pacific Baja; and

          TST cannot execute on its judgment until Turbodyne either: (a) files a
          voluntary bankruptcy case; (b) is the subject of an involuntary case;
          or (c) effects an assignment for the benefit of creditors.

          Any proceeds received by TST or its president from the sale of the
          issued shares will be automatically applied as a credit against the
          amount of the judgment against the Company in favor of TST. Prior to
          March 31, 2004, 147,000 shares issued in connection with the TST
          settlement had been sold which have reduced the provision for lawsuit
          settlement by $23,345.

     At March 31, 2009, the Company has included $4,039,836 ($3,943,328 in 2008)
     in regard to this matter in provision for lawsuit settlements. It was
     determined that TST received payment in preference to other creditors
     before Pacific Baja filed its Chapter 11 petition in bankruptcy. TST and
     Pacific Baja settled the preference payment issue with TST paying $20,000
     to Pacific Baja and TST relinquishing the right to receive $63,000
     therefore; $83,000 has also been included in the provision for lawsuit
     settlements.

                                      ------------------- ----------------------
                                       March 31, 2009       December 31, 2008
                                      ------------------- ----------------------

           Settlement amount                  $2,068,079             $2,068,079
                                               1,912,102             $1,815,594
           Interest
                                                 $83,000                $83,000
           Preference payment
                                               ($23,345)              ($23,345)
           Proceeds of stock sale
                                      ------------------- ----------------------

           Total                              $4,039,836             $3,943,328

--------------------------------------------------------------------------------

                                      -19-
<PAGE>

  ------------------------------------------------------------------------------

                                   TURBODYNE TECHNOLOGIES, INC. AND SUBSIDIARIES
                                  NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                                           (UNAUDITED - EXPRESSED IN US DOLLARS)

MARCH 31, 2009 AND 2008
  ------------------------------------------------------------------------------


4.   COMMITMENTS AND CONTINGENCIES - LITIGATION CONTINUED

     b)   Pacific Baja Bankruptcy

          In July 1999, a major creditor of the Company's wholly-owned major
          subsidiary, Pacific Baja, began collection activities against Pacific
          Baja which threatened Pacific Baja's banking relationship with, and
          source of financing from, Wells Fargo Bank. As a result, Pacific Baja
          and its subsidiaries commenced Chapter 11 bankruptcy proceedings on
          September 30, 1999.

          In September 2001, the Pacific Baja Liquidating Trust (the "Trust")
          commenced action against us in the aforesaid Bankruptcy Court. The
          Trust was established under the Pacific Baja bankruptcy proceedings
          for the benefit of the unsecured creditors of Pacific Baja. The
          Company vigorously contested the Complaint until April 22, 2005 when
          the Company entered into a stipulation for entry of judgment and
          assignment in the Pacific Baja bankruptcy proceedings for $500,000 to
          be issued in common stock or cash or a combination. Additionally the
          Company assigned to the bankruptcy Trust the rights to $9,500,000
          claims under any applicable directors and officers liability insurance
          policies. The bankruptcy Trust also agreed to a covenant not to
          execute against the Company regardless of the outcome of the insurance
          claims.

          The Company has completed the assignment of its insurance claims, but
          has not completed the cash/stock payment that was to be paid to the
          Trust by December 9, 2005. We are negotiating with the Trustee
          regarding this default.

     c)   Former Director

          A former director of Turbodyne, Erwin Kramer (the "Plaintiff"),
          represented by his attorney Claus Schmidt, a former attorney of
          Turbodyne at the time of the alleged claim, filed a legal action in
          Germany against Turbodyne, our non-operating subsidiary Turbodyne
          Europe GmbH ("Turbodyne GmbH"), and ex-employees of Turbodyne GmbH,
          Peter Kitzinski and Marcus Kumbrick (collectively the "Defendants"),
          with the Regional Frankfurt court (the "German Court") in September,
          2004. The Plaintiff claims damages of Euro 245,620 plus 5% interest
          per annum against the Defendants in respect of actions taken by the
          Defendants while employed with Turbodyne GmbH.

          On September 9, 2004, the German Court, on a motion by the Defendants
          to the suit, dismissed the Plaintiff's claims against Peter Kitzinski
          and Marcus Kumbrick, and ordered that Turbodyne's patents in Munich be
          attached pending the resolution of the Plaintiff's claim against
          Turbodyne and Turbodyne GmbH. On June 13, 2005 the Court in Frankfurt
          dismissed the claim. The Plaintiff filed an appeal against this
          judgment with the Higher Regional Court in Frankfurt.

          The Plaintiff's attorney, Claus Schmidt, also filed similar suits on
          behalf of Frank Walter and Herbert Taeuber. The German courts are
          indicating that all three suits need to be filed in the United States
          not Germany. Presently the suits have not been filed in the United
          States. We vigorously dispute this claim and have retained German
          counsel to defend it and seek its dismissal. At March 31, 2009, the
          Company has included $405,785 in regard to this matter in the
          provision for lawsuit settlements.



                                      -20-
<PAGE>

--------------------------------------------------------------------------------

                                   TURBODYNE TECHNOLOGIES, INC. AND SUBSIDIARIES
                                  NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                                           (UNAUDITED - EXPRESSED IN US DOLLARS)

MARCH 31, 2009 AND 2006
--------------------------------------------------------------------------------


4.   COMMITMENTS AND CONTINGENCIES - CONTINUED

     d)   Crescent Fund, LLC


          A former consultant brought an action against the Company in the
          Supreme Court of the State of New York for the County of New York for
          an action entitled CRESCENT FUND, LLC v TURBODYNE TECHNOLOGIES, INC.
          The action sought $300,000 damages based upon claims for alleged
          breaches of contract and covenants of good faith and fair dealing
          allegedly arising because the Company failed to give plaintiff an
          opinion to sell the 5,000,000 shares of the Company's common stock
          received for services. The Company in the action sought the return of
          such shares and damages based upon plaintiff's breach and fraud based
          upon the failure to perform any of the duties and obligations required
          of it under the aforesaid contract which was fraudulently induced. The
          Company did not anticipate any liability and therefore did not include
          an amount in the provision for lawsuit settlements. The action has
          been settled pursuant to which the plaintiff retained a majority of
          the shares and released the Company from all liability with any
          payments.

     e)   Other

          The Company is currently involved in various collection claims and
          other legal actions. It is not possible at this time to predict the
          outcome of the legal actions.


5.   RELATED PARTY TRANSACTIONS

          Aspatuck Holdings Ltd. and another entity affiliated with Jason Meyers
          have advanced an aggregate of $ 46,000 to the Company plus related
          interest expense of $5,479 for 2009 and $4,904 for 2008. The advances
          are repayable on demand and bear interest at 5 % per annum. See Note 3
          Loan Payable. As of March 31, 2009 and December 31, 2008 the Company
          also owes Aspatuck Holdings Ltd consulting fees of $375,227 and
          $344,827, respectively, for the services of Jason Meyers. The Company
          has included these consulting fees in accounts payable in the balance
          sheet. The Company has included $30,000 of consulting compensation in
          the general and administrative expense for the quarters ended March
          31, 2009 and 2008. The Company also included $4,523 and $21,988 of non
          cash warrant expense for the quarter ended March 31, 2009 and 2008
          respectively.

          John Adams, co-CEO has advanced an aggregate of $35,000 in convertible
          notes as a private investor. The notes were due in November 2006 and
          July 2007 but remain unpaid as of March 31, 2009 and December 31,
          2008, with total outstanding balance of $40,543 and $40,106,
          respectively, which includes accrued interest of $5,543 and $5,106,
          respectively. The Company recorded $2,000 and $8,667 general and
          administrative expense for the stock compensation to be issued to John
          Adams for the quarter ended March 31, 2009 and 2008, respectively.

                                      -21-
<PAGE>



--------------------------------------------------------------------------------

                                   TURBODYNE TECHNOLOGIES, INC. AND SUBSIDIARIES
                                  NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                                           (UNAUDITED - EXPRESSED IN US DOLLARS)

MARCH 31, 2009 AND 2006
--------------------------------------------------------------------------------


5.   RELATED PARTY TRANSACTIONS - CONTINUED

     As of March 31, 2009 and December 31, 2008 the Company owes Debi Kokinos,
     CFO consulting fees of $61,210 and $41,830, respectively. The Company has
     included these consulting fees in accounts payable in the balance sheet.
     The Company has included $19,380 of consulting compensation in the general
     and administrative expense for the quarters ended March 31, 2009 and 2008.
     The company also included $1,357 and $6,597of non cash warrant expense for
     the quarter ended March 31, 2009 and 2008 respectively.


6.   SUBSEQUENT EVENTS

     Subsequent to March 31, 2009, the Board of Directors approved additional
     convertible notes at a purchase price of $100,000 per unit with detachable
     warrants to purchase 2,000,000 shares of the Company's common stock. The
     Convertible Notes have a two year maturity with 12% annual interest rate
     payable at maturity or at the time of conversion. The Note may be converted
     at any time after issuance until the note is paid in full. The conversion
     price is at a price equal to $.01 ("Conversion Price"); provided that
     Conversion shall be subject to a minimum conversion amount of $10,000, or
     if less, the remaining Outstanding Obligation. The warrants will have an
     exercise price of $.01 and a 5 year expiration date.

     Subsequent to March 31, 2009, the Company issued a $100,000 convertible
     note with the above terms. The convertible note was issued with detachable
     warrants to purchase 2,000,000 shares of the Company's common stock.


                                      -22-
<PAGE>




ITEM 2.           MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS


FORWARD LOOKING STATEMENTS

The information in this discussion contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. These
forward-looking statements involve risks and uncertainties, including statements
regarding the Company's capital needs, business strategy and expectations. Any
statements contained herein that are not statements of historical facts may be
deemed to be forward-looking statements. In some cases, you can identify
forward-looking statements by terminology such as "may", "will", "should",
"expect", "plan", "intend", "anticipate", "believe", "estimate", "predict",
"potential" or "continue", the negative of such terms or other comparable
terminology. Actual events or results may differ materially. In evaluating these
statements, you should consider various factors, including the risks outlined in
the Risk Factors section below, and, from time to time, in other reports the
Company files with the SEC. These factors may cause the Company's actual results
to differ materially from any forward-looking statement. The Company disclaims
any obligation to publicly update these statements, or disclose any difference
between its actual results and those reflected in these statements. The
information constitutes forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995.

As used in this Quarterly Report on Form 10-Q, the terms "we", "us", "our",
"Turbodyne" and "our company" mean Turbodyne Technologies, Inc., unless
otherwise indicated. All dollar amounts in this Quarterly Report on Form 10-Q
are in U.S. dollars unless otherwise stated.

We are an engineering Company and have been engaged, for over ten years, in the
design and development of forced-air induction (air-charging) technologies that
improve the performance of gas and diesel internal combustion engines. Optimum
performance of an internal combustion engine requires a proper ratio of fuel to
air. Power available from the engine is reduced when a portion of the fuel is
not used. In a wide range of gas and diesel engines additional air is needed to
achieve an optimal result. Traditional engineered solutions for this problem use
belts or exhaust gas (superchargers or turbochargers) to supply additional air
to an engine. Turbodyne, instead, uses electric motors to supply additional air.
Because an electric motor can be engaged more quickly, compared to the
mechanical delays inherent in a belt or exhaust gas device, Turbodyne's products
under development are designed to reduce this `turbolag' and otherwise adds to
the effectiveness of gas and diesel engines used in automotive, heavy vehicle,
marine, and other internal combustion installations.

                                      -23-
<PAGE>


RESULTS OF OPERATIONS
                                     -------------------------------------------

                                              First Quarter Ended March 31
                                     -------------------------------------------
                                                                   Percentage
                                        2009           2008          Increase
                                                                    (Decrease)
                                     -------------------------------------------
Total Revenue                        $     5,556    $     5,556            Nil
Operating Expenses                   ($  221,916)   ($  449,361)           (51%)
Net Loss from Operations             ($  216,360)   ($  443,805)           (51%)
Other expense and income tax         ($   10,900)   ($  690,681)           (98%)
                                     ===========    ===========    ===========
Net Loss                             ($  227,260)   ($1,134,486)           (80%)
                                     ===========    ===========    ===========


NET REVENUE

                                           -------------------------------------

                                                 First Quarter Ended March 31
                                           -------------------------------------
                                                                      Percentage
                                            2009            2008        Increase
                                           -------------------------------------

License Fee                                $5,556           $5,556           Nil
                                           ======           ======           ===

We had no revenue in 2009 other than recognition of amortized license fees.
During the year ended December 31, 2003, $400,000 in license fees were deferred
and amortized over 18 years. As a result, for each of the quarters ended March
31, 2009 and 2008, $5,556 of licensing fees was recognized as income. Our
continued net losses from operations reflect our continued operating expenses
and our inability to generate revenues. We believe that we will not be able to
generate any significant revenues from TurboPac(TM)/TurboFlow(TM) until we
complete our production models and enter into commercial arrangements.



COST OF SALES

We had no sales in 2009 and 2008; therefore we did not have any costs of sales
during any portion of these years


                                      -24-
<PAGE>


OPERATING EXPENSES

Due to a lack of funds we reduced our operations in the first quarter of 2009 so
that operating expenses decreased from the comparable period in 2008 by 51%. The
primary components of our operating expenses are outlined in the table below:

                                               First Quarter Ended March 31
                                          --------------------------------------
                                                                     Percentage
                                           2009            2008        Increase
                                                                     (Decrease)

General and Administrative Expenses       $98,098        $255,848      (62%)
Research and Development Expenses         $25,808        $110,558      (77%)
Litigation Expenses                       $96,508         $82,065       18%

GENERAL AND ADMINISTRATIVE EXPENSES

General and administrative costs included management compensation and overhead
and included non cash warrant and stock compensation expense amount of $5,880
and $2,000 ($35,795 and $8,667 in 2008) respectively. (Financial Statement Note
2)

RESEARCH AND DEVELOPMENT

The decrease in research and development costs in 2008 is due to decreased
spending for limited development operations due to a lack of funding and the
decrease in the non cash warrant expense amount of $1,808 compared to $18,805 in
2008 as a result of the termination of certain consulting agreements and the
decrease in the per share price of the Company's common stock. (Financial
Statement Note 2). Our research and development costs related to present and
future products are charged to operations in the period incurred. Our research
and development activities during 2009 are associated with the development of
our TurboPac.

LITIGATION EXPENSE

The litigation expense is the accrued interest relating to the TST, Inc.
settlement as discussed in Financial Statement Note 4.


                                      -25-
<PAGE>


COMPENSATION EXPENSE

GRANT OF STOCK OPTIONS TO NON-EMPLOYEES FOR SERVICES

During 2006 and 2007, we granted warrants to purchase 78,200,000 shares of our
common stock to various consultants that we deemed essential to our operations.
Details of the consultant warrants for the year ended December 31, 2008 are as
follows:

        Total consultant warrants granted                       78,200,000
        Vested prior to January 1, 2009                       (22,805,549)
        Vested January through March 31, 2009                  (1,369,439)
        Cancelled January through December 2008               (22,044,436)
                                                            ---------------
        Warrants not vested                                     31,980,576
                                                            ===============

During the three months ended March 31, 2009 the Company using the Black-Scholes
model recorded $7,688 ($54,600 in 2008) of compensation expense, relating to the
vesting of stock warrants previously issued to non-employees for services. The
non cash warrant expense is allocated with $5,880 ($35,181 in 2008) to general
and administrative expenses and $1,808 ($18,484 in 2008) to research and
development.

OTHER INCOME (EXPENSE) AND INCOME TAX
                                     -------------------------------------------
                                                Quarter Ending March 31
                                     -------------------------------------------
                                                                    Percentage
                                        2009            2008         Increase
                                                                    (Decrease)
                                     -------------------------------------------
Other Expenses
Interest Expense                      ($9,300)       ($22,030)       (58%)
Amortization of Discount on
  Convertible Notes                     $-0-         ($240,194)      (100%)
Inducement Expense                      $-0-         ($426,857)      (100%)
Income Tax                            ($1,600)        ($1,600)        Nil
                                     -------------------------------------------
Total Other Expenses                 ($10,900)       ($690,681)      (98%)
                                     ===========================================

The Company continues to negotiate with our creditors and trade debt holders on
settlement of accounts payable from periods prior to the current management
assuming operation of the Company. When achieved, this is represented as a debt
relief of accounts payable.

The Company had other expenses for the quarter ending March 31, 2009 of $9,300
compared to $690,681 in 2008. As indicated above, the reduction resulted from a
reduction in the amortization of discounts on convertible notes and value of
detachable warrants and related debt conversion expenses (Financial Statement
Note 3).


                                      -26-
<PAGE>


NET INCOME / LOSS

Our net loss for the quarter ended March 31 2009 decreased to $227,260 from net
loss of $1,134,486) for the quarter ended March 31, 2008, representing a
decrease of 80%. The decrease is directly related limited activity due to a lack
of funds and a significant decrease in expenses from the amortization of
discounts on convertible notes and value of detachable warrants and for related
debt conversion expenses.


FINANCIAL CONDITION


CASH AND WORKING CAPITAL

<TABLE>
<CAPTION>
<S>     <C>    <C>    <C>    <C>    <C>    <C>

                              ------------------------------------- -------------------------
                                 March 31, 2009  December 31, 2008         Percentage
                                                                     Increase / (Decrease)
                              ------------------------------------- -------------------------
Current Assets                              $20                $68           (71%)
Current Liabilities                ($8,266,013)       ($8,043,097)             3%
                              ----------------- ------------------ -------------------------
Working Capital Deficit            ($8,265,993)       ($8,043,029)             3%
                              ===================================== =========================
</TABLE>


The increase to our working capital deficit was primarily attributable to an
increase in accounts payable and an increase in provision for lawsuit
settlements as discussed below.


LIABILITIES

<TABLE>
<CAPTION>
<S>     <C>    <C>    <C>    <C>    <C>    <C>

                                        ---------------- ------------------- ----------------------
                                         March 31, 2009   December 31, 2008         Percentage
                                                                               Increase/ (Decrease)
                                        ---------------- ------------------- ----------------------

Provisions for Lawsuit Settlements           $5,441,621          $5,345,113             2%
Accounts Payable                             $1,964,528          $1,869,757             5%
Accrued Liabilities                            $341,000            $320,000             7%
Short-Term Loans                               $518,864            $508,227             2%
</TABLE>


The increase in provision for lawsuits is due to accrued interest on outstanding
judgments. Accounts payable increased due to a lack of funds to pay creditors.
Short-term loans increased due to interest expense.

We continue to negotiate with our creditors for the payment of our accounts
payable and accrued liabilities. Payment of these liabilities is contingent on
new funding being received that would enable us to make payments to the
creditors. Our ability to continue our operations may also be conditional upon
the forbearance of our creditors.

Included in short-term loans at March 31, 2009 are unsecured, non-interest
bearing advances of $138,600 that we anticipate will be converted into shares of
our common stock.

                                      -27-
<PAGE>



CASH FLOWS
                                                       -------------------------
                                                               At March 31,
                                                       -------------------------
                                                         2009             2008
                                                         ----             ----
Net Cash provided by (used in) Operating Activities     ($48)       ($126,232)
Net Cash provided by (used in) Financing Activities         -         $123,500
Net Increase (Decrease) in Cash During Period           ($48)         ($2,732)


CASH USED IN OPERATING ACTIVITIES

The decrease in cash used in operating activities was due to the limited amount
of funds available compared to 2008.


FINANCING REQUIREMENTS

We will require additional financing if we are to continue as a going concern
and to finance our business operations. While we have obtained some financing in
2008 we need substantially more capital to complete development and continue our
business. There is no assurance that we will be able to raise the required
additional capital. In the event that we are unable to raise additional
financing on acceptable terms, then we may have to cease operating and seek
relief under appropriate statutes. Accordingly, there is substantial doubt about
our ability to continue as a going concern.

We believe, however that recent technical developments provide the Company with
potential for substantial growth but this will require investment. There is no
assurance that we will obtain sufficient funding or otherwise be able to achieve
our goals.




                                      -28-
<PAGE>


CRITICAL ACCOUNTING POLICIES


STOCK BASED COMPENSATION

The Company accounts for stock-based compensation under the fair value method in
accordance with Statement of Financial Accounting Standards No.123 (revised
2004), "Share Based Payment" "SFAS 123(R)". SFAS No. 123R requires the Company
to establish assumptions and estimates of the weighted-average fair value of
stock options granted, as well as using a valuation model to calculate the fair
value of stock-based awards. The Company uses the Black-Scholes option-pricing
model to determine the fair-value of stock-based awards. All options are
amortized over the requisite service periods of the awards, which are generally
the vesting periods.



NEW ACCOUNTING PRONOUNCEMENTS

In December 2007, the FASB issued Statement No. 141R, "Business Combinations"
("SFAS 141R"). SFAS 141R revises the principles and requirements for how the
acquirer recognizes and measures in its financial statements the identifiable
assets acquired, the liabilities assumed, any non controlling interest in the
acquiree, and the goodwill acquired in a business combination or gain from a
bargain purchase. SFAS 141R also revises the principles and requirements for how
the acquirer determines what information to disclose to enable users of the
financial statements to evaluate the nature and financial effects of the
business combination. This pronouncement will be effective for the Company on
January 1, 2009. The Company is currently evaluating the impact, if any, that
SFAS 141R will have on its financial position or results of operations. This
statement is effective for the Company beginning January 1, 2009 and has no
impact on its financial statements.

In December 2007, the FASB issued Statement No. 160, "Non controlling Interest
in Consolidated Financial Statements -- an amendment of ARB No. 51" ("SFAS
160"). SFAS 160 amends ARB No. 51 to establish accounting and reporting
standards for the non controlling interest in a subsidiary and for the
deconsolidation of a subsidiary. This pronouncement will be effective for the
Company on January 1, 2009. The Company is currently evaluating the impact, if
any, that SFAS 160 will have on its financial position or results of operations.
This statement is effective for the Company beginning January 1, 2009 and has no
impact on its financial statements.


In March 2008, the FASB issued Statement No. 161, "Disclosures about Derivative
Instruments and Hedging Activities" ("SFAS 161"). SFAS 161 requires companies
with derivative instruments to disclose information that should enable
financial-statement users to understand how and why a company uses derivative
instruments, how derivative instruments and related hedged items are accounted
for under FASB Statement No. 133 "Accounting for Derivative Instruments and
Hedging Activities" and how derivative instruments and related hedged items
affect a company's financial position, financial performance and cash flows.
SFAS 161 is effective for financial statements issued for fiscal years and
interim periods beginning after November 15, 2008. The Company is currently
evaluating the impact, if any, that SFAS 161 will have on our financial position
or results of operations. This statement is effective for the Company beginning
January 1, 2009 and has no impact on its financial statements.

                                      -29-
<PAGE>



In April 2009, the FASB issued FSP FAS 107-1 and Accounting Principles Board
(APB) 28-1, Interim Disclosures about Fair Value of Financial Instruments. The
FSP amends SFAS No. 107 "Disclosures about Fair Value of Financial Instruments"
to require an entity to provide disclosures about fair value of financial
instruments in interim financial information. This FSP is to be applied
prospectively and is effective for interim and annual periods ending after June
15, 2009 with early adoption permitted for periods ending after March 15, 2009.
The Company will include the required disclosures in its quarter ending June 30,
2009

In April 2009, the FASB issued FSP FAS 141(R)-1, ACCOUNTING FOR ASSETS ACQUIRED
AND LIABILITIES ASSUMED IN A BUSINESS COMBINATION THAT ARISE FROM CONTINGENCIES.
This FSP requires that assets acquired and liabilities assumed in a business
combination that arise from contingencies be recognized at fair value if fair
value can be reasonably estimated. If fair value cannot be reasonably estimated,
the asset or liability would generally be recognized in accordance with SFAS No.
5, "Accounting for Contingencies" and FASB Interpretation No. 14, "Reasonable
Estimation of the Amount of a Loss". Further, the FASB removed the subsequent
accounting guidance for assets and liabilities arising from contingencies from
SFAS No. 141(R). The requirements of this FSP carry forward without significant
revision the guidance on contingencies of SFAS No. 141, "Business Combinations",
which was superseded by SFAS No. 141(R) (see previous paragraph). The FSP also
eliminates the requirement to disclose an estimate of the range of possible
outcomes of recognized contingencies at the acquisition date. For unrecognized
contingencies, the FASB requires that entities include only the disclosures
required by SFAS No. 5. This FSP was adopted effective January 1, 2009. There
was no impact upon adoption, and its effects on future periods will depend on
the nature and significance of business combinations subject to this statement.

In April 2008, the FASB issued FSP FAS 142-3, Determination of the Useful Life
of Intangible Assets. The FSP states that in developing assumptions about
renewal or extension options used to determine the useful life of an intangible
asset, an entity needs to consider its own historical experience adjusted for
entity-specific factors. In the absence of that experience, an entity shall
consider the assumptions that market participants would use about renewal or
extension options. This FSP is to be applied to intangible assets acquired after
January 1, 2009. The adoption of this FSP did not have an impact on the
Company's financial statements.



                                      -30-
<PAGE>



ITEM 4.           CONTROLS AND PROCEDURES.


EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

As required by Rule 13a-15 under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), the Company's Chief Executive Officer and its Chief
Financial Officer reviewed and evaluated the effectiveness of the Company's
disclosure controls and procedures (as defined in Exchange Act Rule
13a-15(e)).These controls are designed to ensure that material information the
Company must disclose in its reports filed or submitted under the Exchange Act
is recorded, processed, summarized and reported on a timely basis. These
officers have concluded, based on that evaluation, that as of such date, the
Company's disclosure controls and procedures were effective at a reasonable
assurance level for a Company with substantially no activities and no personnel.
The Company believes it must devise new procedures as it increases its activity
and its personnel.


MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Our management is responsible for establishing and maintaining adequate internal
control over financial reporting, as such term is defined in Exchange Act Rule
13a-15(f). As required by Rule 13a-15 under the Exchange Act the Company's Chief
Executive Officer and its Chief Financial Officer assessed the effectiveness of
our internal control over financial reporting as of December 31, 2008. In making
its assessment of internal control over financial reporting, management used the
criteria described in Internal Control -- Integrated Framework issued by the
Committee of Sponsoring Organizations of the Treadway Commission.

Based on this assessment management identified a material weaknesses in the
Company's internal controls over financial reporting due in a significant part
to the pervasive effect of the lack of resources, specifically the limited
number of personnel involved in the financial reporting including the number of
persons that are appropriately qualified in the areas of U.S. GAAP and SEC
reporting. These limitations include an inability to segregate functions.
Because of this weakness there is a possibility that a material misstatement of
the annual financial statements would not have been prevented or detected.
Nevertheless the Company's Chief Executive Officer and Chief Financial Officer
believed that for the limited operations of the Company internal controls over
financial reporting were adequate to provide reasonable assurance of the
accuracy of the Company's financial statements at year end. The adverse effect
of the material weakness over internal controls, however, will become magnified
if the Company increases operations.

Due to the complexity of the accounting for the convertible notes with
detachable warrants, there were material additional adjustments made to our
annual financial statements prior to their publication in this report as well as
interim financial statements after filing. In management's view, this was not
the result of a material weakness in internal control but due to the complexity
of the accounting rules and their interpretations affecting transactions of this
nature.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

There were no changes in our internal control over financial reporting that
occurred during our most recent fiscal quarter that have materially affected, or
are reasonably likely to materially affect, our internal control over financial
reporting.


                                      -31-
<PAGE>


PART II - OTHER INFORMATION


ITEM 1.  LEGAL PROCEEDINGS

NONE



ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

There were no securities issued in the quarter ended March 31, 2009



                                      -32-
<PAGE>

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

EXHIBITS


  EXHIBIT
  NUMBER     DESCRIPTION OF EXHIBIT

   31.1   Certification of Chief Executive Officer pursuant to Section 302 of
          the Sarbanes-Oxley Act of 2002.

   31.2   Certification of Chief Financial Officer pursuant to Section 302 of
          the Sarbanes-Oxley Act of 2002.

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

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

--------------------------------------------------------------------------------



                                      -33-
<PAGE>






In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934,
the registrant has caused this registration statement to be signed on its behalf
by the undersigned, thereunto duly authorized.


                                                    TURBODYNE TECHNOLOGIES, INC.


Signature                    TITLE                               DATE
                             -----                               ----

/s/ Jason Meyers             Co-Chief Executive Officer,          May 15, 2009
________________________     Director
Jason Meyers


/s/ Debi Kokinos             Chief Financial Officer             May 15, 2009
_________________________    and Chief Accounting Officer
Debi Kokinos







                                      -34-