SECURITIES AND EXCHANGE COMMISSION
                      WASHINGTON, DC 20549

                          FORM 10-QSB

     [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
                SECURITIES EXCHANGE ACT OF 1934

          For the quarterly period ended June 30, 2004

     [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
                SECURITIES EXCHANGE ACT OF 1934

    For the transition period from            to


                 Commission file number 0-8161


                         DIONICS, INC.
(Exact name of Small Business Issuer as Specified in its Charter)


Delaware                                               11-2166744
(State or Other Jurisdiction                     (I.R.S. Employer
of Incorporation or                                Identification
Organization)                                             Number)

                       65 Rushmore Street
                    Westbury, New York 11590
            (Address of Principal Executive Offices)

                         (516) 997-7474
        (Issuer's Telephone Number, Including Area Code)

Check  whether  the Issuer (1) filed all reports required  to  be
filed by Section 13 or 15(d) of the Exchange Act during the  past
12  months  (or  for such shorter period that the Registrant  was
required to file such reports), and (2) has been subject to  such
filing requirements for the past 90 days.

                  Yes   [  X   ] No   [      ]

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

    Common, $.01 par value per share: 4,956,178 outstanding
        as of August 1, 2004 (excluding treasury shares)



                   FORWARD-LOOKING STATEMENTS

     This Form 10-QSB contains certain forward-looking statements
and  information that reflect the expectations of  Dionics,  Inc.
(the  "Company") about its future operating results,  performance
and    opportunities   that   involve   substantial   risks   and
uncertainties.   When  used  in  this  Form  10-QSB,  the   words
"anticipate",   "believe",  "estimate",  "plan",   "intend"   and
"expect" and similar expressions, as they relate to Dionics, Inc.
for  its management are intended to identify such forward-looking
statements.   These  forward-looking  statements  are  based   on
information currently available to the Company and are subject to
a  number  of risks, uncertainties, and other factors that  could
cause  the  Company's actual results, performance, prospects  and
opportunities  to differ materially from those expressed  in,  or
implied  by, these forward-looking statements.  Certain of  these
factors   are   discussed   under  the  caption  "Forward-Looking
Statements" in  Part I, Item 1 "Description of Business"  of  the
Company's  Annual  Report  on Form  10-KSB  for  the  year  ended
December 31,  2003.  Except as required by the Federal Securities
Law,  the  Company does not undertake any obligation  to  release
publicly  any  revisions  to  any forward-looking  statements  to
reflect  events or circumstances after the date of this Form  10-
QSB or for any other reason.



                PART I - FINANCIAL INFORMATION

                         DIONICS, INC.


                 Index to Financial Information
                   Period Ended June 30, 2004



     Item
                                                     Page

     Item 1 - Financial Statements:

     Introductory Comments                             3

     Condensed Balance Sheet                           4

     Condensed Statement of Operations                 6

     Statement of Cash Flows                           8

     Notes to Financial Statements                     9


     Item 2 - Management's Discussion and
              Analysis or Plan of Operation           17


     Item 3 - Controls and Procedures                 18



                         DIONICS, INC.


                         June 30, 2004


     The financial information herein is unaudited.  However,  in

the   opinion  of  management,  such  information  reflects   all

adjustments  (consisting  only  of  normal  recurring   accruals)

necessary to a fair presentation of the results of operations for

the  periods  being reported.  Additionally, it should  be  noted

that  the  accompanying  condensed financial  statements  do  not

purport  to be complete disclosures in conformity with  generally

accepted accounting principles.

     The  results of operations for the six months ended June 30,

2004  are not necessarily indicative of the results of operations

for the full fiscal year ending December 31, 2004.

     These  condensed  statements should be read  in  conjunction

with  the  Company's  financial statements  for  the  year  ended

December 31, 2003.




                          DIONICS, INC.

                          BALANCE SHEETS



                                          JUNE 30,      DECEMBER 31,
                                             2004            2003

                                         (UNAUDITED)       (AUDITED)


                         A S S E T S


CURRENT ASSETS:
  Cash                                   $  163,700      $   13,300
  Accounts Receivable Trade
    (Less Estimated Doubtful
    Accounts of $7,300 in 2004 and
    2003 (Note 2)                           124,900          54,400
  Inventory - (Notes 2 and 3)               291,600         368,500
  Prepaid Expenses and Other
    Current Assets                           12,100          24,300
             Total Current Assets           592,300         460,500


PROPERTY, PLANT AND
  EQUIPMENT - (Note 2)
    (At Cost Less Accumulated
      Depreciation of $1,697,200
      in 2004 and $1,690,500 in
      2003)                                  67,300          70,800

DEPOSITS AND OTHER ASSETS - (Notes 2 and 5)  30,900          39,700



     Total                               $  690,500      $  571,000




All amounts have been rounded to the nearest $100.

See Independent Auditor's Report.

The accompanying notes are an integral part of this statement.



                          DIONICS, INC.

                          BALANCE SHEET

                                                JUNE 30,     DECEMBER 31,
                                                  2004           2003

                                               (UNAUDITED)     (AUDITED)

                      L I A B I L I T I E S

CURRENT LIABILITIES:
  Current Portion of Long-Term
    Debt - (Note 5)                            $   10,000     $   42,400
  Accounts Payable                                 70,800        137,200
  Accrued Expenses                                 63,900         36,300

     Total Current Liabilities                    144,700        215,900


Long-Term Debt Less Current
  Maturities - (Note 5)                           667,100        674,800
Deferred Compensation Payable -
  (Note 4)                                        301,000        501,000


     Total Liabilities                          1,112,800      1,391,700

CONVERTIBLE PROMISSORY NOTES PAYABLE - (Note 8)   105,000            -0-

COMMITMENT (Note 10)

                SHAREHOLDERS' EQUITY (DEFICIENCY)

Common Shares - $.01 Par Value
  Authorized 5,000,000 Shares
    Issued 4,956,178 Shares in 2004
    and    3,848,222 in 2003 - (Notes 7 and 8)     51,100         38,400
Additional Paid-in Capital                      1,577,200      1,522,800
(Deficit)                                      (1,935,000)    (2,161,300)

                                                 (306,700)      (600,100)

Less: Treasury Stock at Cost
  164,544 Shares in 2004 and
  164,544 Shares in 2003                         (220,600)      (220,600)

     Total Shareholders' (Deficiency) Equity     (527,300)      (820,700)


      Total                                    $  690,500     $  571,000




All amounts have been rounded to the nearest $100.

See Independent Auditor's Report.

The accompanying notes are an integral part of this statement.


                          DIONICS, INC.

                CONDENSED STATEMENTS OF OPERATIONS


                                                  THREE MONTHS ENDED
                                                         JUNE 30,
                                                  2004           2003
                                               (UNAUDITED)    (UNAUDITED)

SALES                                            $  313,900 $  262,600

COSTS AND EXPENSES:
  Cost of Sales (Including Research and
    Development Costs)                              210,400    167,400

  Selling, General and
    Administrative Expenses                          99,400     99,000


     Total Costs and Expenses                       309,800    266,400


NET INCOME (LOSS) FROM OPERATIONS                     4,100     (3,800)


DIVIDENDS AND OTHER INCOME                            1,300       (700)

FORGIVENESS OF DEFERRED COMPENSATION                200,000        -0-


                                                    205,400     (4,500)
OTHER DEDUCTIONS:
  Interest Expense                                    1,900     10,500

NET INCOME (LOSS) FOR THE PERIOD BEFORE
  INCOME TAXES                                      203,500    (15,000)

INCOME TAXES - Note 8                                   -0-        -0-

NET INCOME (LOSS) FOR THE PERIOD                 $  203,500   $(15,000)

NET INCOME (LOSS) PER SHARE
  Basic - Before Forgiveness of Deferred
           Compensation                          $    .0007   $     -
         After Forgiveness of Deferred
           Compensation                          $   .04106   $(.00407)


  Diluted - Note 7                               $   .04095   $     -

Average Number of Shares
  Outstanding Used in Computation
  of Per Share Net Income
    Primary                                       4,956,178  3,683,678

    Diluted    - Note 7                           4,969,435         -



All amounts have been rounded to the nearest $100.

See Independent Auditor's Report.

The accompanying notes are integral part of this statement




                            DIONICS, INC.

                  CONDENSED STATEMENT OF OPERATIONS



                                                  SIX MONTHS ENDED
                                                     JUNE 30,
                                                2004           2003
                                             (UNAUDITED)    (UNAUDITED)

SALES                                         $  680,400    $  425,700


COST AND EXPENSES:
  Cost of Sales (Including
    Research and Development Costs)              459,600       327,400

  Selling, General and Administrative
    Expenses                                     185,500       185,800


     Total Costs and Expenses                    645,100       513,200



NET INCOME (LOSS) FROM OPERATIONS                 35,300       (87,500)


DIVIDENDS AND OTHER INCOME                         1,300           500

FORGIVENESS OF DEFERRED COMPENSATION             200,000           -0-


                                                 236,600       (87,000)

OTHER DEDUCTIONS
  Interest Expense                                 9,500        21,800

NET INCOME (LOSS) FOR THE PERIOD BEFORE
  INCOME TAXES                                   227,100      (108,800)


INCOME TAXES                                         800           800


NET INCOME (LOSS) FOR THE PERIOD              $  226,300    $ (109,600)


NET INCOME (LOSS) PER SHARE -
  Basic - Before Forgiveness of
            Deferred Compensation             $  .005306    $  (.02975)

         After Forgiveness of
            Deferred Compensation             $   .04516    $

  Diluted - Note 7                            $   .04554    $


Average Number of Shares
  Outstanding Used in Computation
  of Per Share Income -
    Basic                                      4,956,178     3,683,678


    Diluted - Note 7                           4,969,435



All amounts have been rounded to the nearest $100.

See Independent Auditor's Report.

The accompanying notes are integral part of this statement.


                            DIONICS, INC.

                       STATEMENT OF CASH FLOWS

<TABLE>
<CAPTION>


                                                            SIX MONTHS ENDED
                                                                 JUNE 30,
                                                             2004         2003
                                                         (UNAUDITED)  (UNAUDITED)
CASH FLOWS FROM OPERATING ACTIVITIES:

<S>                                                     <C>           <C>

  Net Income (Loss)                                     $  226,300    $ (109,600)

    Less: Noncash transaction (see below)                 (200,000)          -0-
  Adjustment to Reconcile Net Income to Net Cash
    Provided by (Used for) Operating Activities:
      Depreciation and Amortization                          3,600         3,600
  Changes in Operating Assets and Liabilities:
    (Increase) Decrease in Accounts Receivable             (70,500)        5,900
    Decrease (Increase) in Inventory                        76,900       (25,000)
    Decrease in Prepaid Expenses and
     Other Current Assets                                   12,200         4,300
    Decrease (Increase) in Deposits and Other Assets         8,700         1,500
    (Decrease) Increase in Accounts Payable                (66,400)      (27,700)
    Increase in Accrued Expenses                            27,600        27,100


     Net Cash Provided by (Used In)
       Operating Activities                                 18,400      (119,900)



CASH FLOWS (USED FOR) INVESTING ACTIVITIES:
  Purchase of Equipment                                        -0-       (10,400)


CASH FLOWS PROVIDED BY (USED IN)
  FINANCING ACTIVITIES:
    Proceeds from Sale of Capital Stock                     67,100           -0-
    (Repayment) of Debt                                    (39,600)      (63,300)
    Equipment Leasing Obligations                             (500)        9,400
    SBA Loan                                                   -0-       255,800
    Convertible Promissory Notes Payable                   105,000           -0-

NET INCREASE IN CASH                                       150,400        71,600


CASH - Beginning of Period                                  13,300        28,200


CASH - End of Period                                    $  163,700    $   99,800


</TABLE>



Summary of Significant Noncash Transaction:

During the six months ended June 30, 2004, the Company's
executive officer forgave $200,000 of deferred compensation
owed to him.



All amounts have been rounded to the nearest $100.

See Independent Auditor's Report.

The accompanying notes are integral part of this statement.




                          DIONICS, INC.

                  NOTES TO FINANCIAL STATEMENTS

               JUNE 30, 2004 AND DECEMBER 31, 2003





NOTE 1 -  BUSINESS:

The Company designs, manufactures and sells silicon semiconductor
electronic products, as individual discrete components, as multi-
component integrated circuits and as multicomponent hybrid
circuits.


NOTE 2 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Going Concern Opinion

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern.

As shown in the financial statements, the Company realized net income of
$237,600 for the six months ended June 30, 2004 and had incurred substantial
net losses for each of the
past two years.  At June 30, 2004 total liabilities exceeded total assets by
$527,300.

In the opinion of management, had the market value of the Company's real
estate property, rather than its greatly depreciated book value been
included with the Company's assets, then the Company's total assets would
have exceeded total Company liabilities by approximately $420,600.

In view of these matters, realization of a major portion of the assets in
the accompanying balance sheet is dependent upon continued operations of the
Company, which in turn is dependent upon the Company's ability to meet its
financing requirements, and the success of its future operations.
Management believes that actions presently being taken to revise the
Company's operating and financial requirements provide the opportunity for
the Company to continue as a going concern.  See note 7 projected changes in
securities.

Basis of Accounting

Assets, liabilities, revenues and expenses are recognized on the accrual
basis of  accounting.

Cash and Cash Equivalents

The Company considers money market funds to be cash equivalents.

Merchandise Inventory

Inventory is stated at the lower of cost (which represents cost of materials
and  manufacturing costs on a first-in, first-out basis) or market.



                            DIONICS, INC.

                    NOTES TO FINANCIAL STATEMENTS

                 JUNE 30, 2004 AND DECEMBER 31, 2003




NOTE 2 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (Continued)

Research and Development

Research and development costs are charged to operations as incurred.
Management estimates research and development expenses to have been
approximately $30,000 in 2003 and 2002 respectively.


Property, Plant and Equipment

Property, Plant and Equipment is stated at cost, less accumulated
depreciation and amortization.  Expenditures for renewals and improvements
that significantly extend the  useful lives of assets are capitalized for
all assets; depreciation is provided over the estimated useful lives of the
individual asset, using the straight- line method.  The following asset
lives are in effect:

               Machine and Equipment         8 Years
               Testing Equipment             8 Years
               Furniture and Fixtures        10 Years
               Building Improvements         10 Years
               Building                      25 Years


Deferred Compensation Plan

Future payments required under a plan of deferred compensation adopted in
1987, and revised in 2000, as well as interest accrued thereon have been
charged to operations over the period of expected service.  (See Note 4).


Bad Debts

The Company maintained an allowance for doubtful accounts of $7,300 in 2004
and 2003.



                            DIONICS, INC.

                    NOTES TO FINANCIAL STATEMENTS

                 JUNE 30, 2004 AND DECEMBER 31, 2003





NOTE 2 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (Continued)

Deferred Mortgage Costs

Costs related to the Wachovia Small Business Capital Mortgage are being
amortized as follows:

            Costs        $35,800 360 Months Starting 1/l/1999


Major Customers:

In 2003 approximately $158,000 (18.35%), $128,000 (14.86%) and $52,000
(6.04%) of the Company's revenues were from its three largest customers.
Accounts receivable from these customers approximated $23,000 at December
31, 2003.

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 amounts reported in the financial statements and
related notes to financial statements.  Changes in such estimates may affect
amounts reported in future periods.



NOTE 3 -  INVENTORY:

Inventories are stated at the lower of cost (which represents cost of
materials and manufacturing costs on a first-in, first-out basis) or market,
and are comprised of the following:

                                       June 30,       December 31,
                                         2004             2003
                                     (Unaudited)        (Audited)
          Finished Goods               $ 42,300          $ 76,700
          Work-in-Process               193,400           216,000

          Raw Materials                  31,700            42,700
          Manufacturing Supplies         24,200            33,100

                 Total                 $291,600          $368,500





                            DIONICS, INC.

                    NOTES TO FINANCIAL STATEMENTS

                 JUNE 30, 2004 AND DECEMBER 31, 2003



NOTE 4 -  DEFERRED COMPENSATION PAYABLE:

In 1987 the Company entered into an agreement, amended in 1997 and 1999,
which provides for a 72 month schedule of payments to its chief executive
officer.

In connection with the refinancing of the Wachovia Small Business Capital
(see Note 5) a modified deferred compensation payment schedule commencing
January 1, 1999 was agreed to by the Company and its chief executive
officer.

The Company executed a mortgage subordinate to the existing first mortgage
(see note 5) secured by land and building at 65 Rushmore Street, Westbury,
New York in favor of the chief executive officer to insure amounts due him
on the deferred compensation agreement.

A new 72-month schedule consists of a 24-month period of reduced consecutive
monthly payments, to be followed by an 18-month period of no payments except
for monthly interest. At the end of the 42nd month, the total of the delayed
payments becomes due followed by 30 months of principal and interest
payments.

Notwithstanding the above schedule for payments, other than a life insurance
policy to cover death benefits, the Company has not specifically designated
funds with which to meet these payment requirements.  In view of its
continuing total indebtedness as well as its need for operating capital,
there can be no assurance that the Company will be able to satisfy the terms
of this new agreement in full or in part.  Should such unfavorable
circumstances occur, the terms of the agreement may have to be renegotiated
to match the Company's then-current financial circumstances.

Under the standby agreement of the SBA Loan (see Note 5) the chief Executive
will take no action on the deferred compensation unless authorized by the
lender. (See Note 2) The previously mentioned life insurance policy had a
cash surrender value at June 30, 2004 of $122,700 and is shown net of loans
of $121,300 under other assets.

An investment agreement was entered into with the Company on May 18, 2004.
Pursuant to this agreement the executive officer forgave $200,000 of amounts
due to him under the compensation agreement

The executive officer also agreed to postpone any and all remaining payments
due him under the deferred compensation agreement for a period of 5 years
starting May 18, 2004.






                            DIONICS, INC.

                    NOTES TO FINANCIAL STATEMENTS

                 JUNE 30, 2004 AND DECEMBER 31, 2003





                                              June 30,      December 31,
                                                2004         2003
NOTE 5 -  LOANS PAYABLE -

          First Mortgage Loan:

          A new loan agreement was entered into
          between Dionics, Inc. and Wachovia
          Small Business Capital effective
          12/31/1998.

          The loan in the principal amount of
          $384,685 requires 360 monthly self-
          liquidating payments.  Interest is
          calculated on the unpaid principal
          balance at an initial rate of 8.23%
          per annum.  The interest rate on the
          loan is variable depending on an
          independent index related to the
          yield of United States Treasury
          Notes.  This rate change will occur
          once every 60 months.  Effective
          April 1, 2004 the interest rate
          changed to 6.16% per annum              $364,000    $368,000

          $358,232 of the above proceeds were
          used to satisfy the balance of the
          Mortgage due D.A.N. Joint Venture
          in full.

          Term Loans:

          Term Loan A - Due D.A.N. Joint Venture       -0-      22,000

          Term Loan C - Due D.A.N. Joint Venture.

          Both Term Loans due to D.A.N. Joint
          Venture were paid in full March
          10, 2004.                                    -0-      13,000












                            DIONICS, INC.

                    NOTES TO FINANCIAL STATEMENTS

                 JUNE 30, 2004 AND DECEMBER 31, 2003


                                              June 30,      December 31,
                                                2004         2003
NOTE 5 -  LOANS PAYABLE - (Continued)

          SBA Loan.

          On October 20, 2003 an SBA Loan
          in the amount of $305,800 was
          approved                                 305,800     305,800

          Payment Terms

          A) Interest will accrue at the rate
          of 4.000% per annum; installment
          payments, including principal and
          interest, of $1,570 monthly, will
          begin 25 months from the date of the
          promissory note.  The balance of
          principal and interest will be
          payable 30 years from the date of the
          promissory Note.

          B) Each payment will be applied first
          to interest accrued to the date of
          receipt of each payment, and the
          balance, if any, will be applied to
          principal.

          C) Interest will accrue only on funds
          actually advanced from the date(s) of
          each advance, but in no case sooner
          than 24 months from the date of the
          promissory Note

          Collateral.

          Dionics, Inc. will provide the
          following collateral:

          A) Deed of Trust/Mortgage on real
          estate located at 65 Rushmore Street
          Westbury, New York 11590.  Said Deed
          of Trust/Mortgage to be subject only
          to the following:

          1. Trust Deed/Mortgage held by
          Wachovia Small Business Capital
          with a balance of $364,000 and
          $368,000 as of June 30, 2004 and
          December 31, 2003 respectively.





                            DIONICS, INC.

                    NOTES TO FINANCIAL STATEMENTS

                 JUNE 30, 2004 AND DECEMBER 31, 2003




                                              June 30,      December 31,
                                                2004         2003
NOTE 5 -  LOANS PAYABLE - (Continued)

          SBA Loan.

          Equipment Lease

          A 60 month equipment lease was entered
          into between the Company and Marlin
          Leasing Corp. for a Sharp Copying
          Machine.  The lease term was for
          an initial term of 60 monthly
          payments of $170.                       7,300        8,400

          Total Loan Payable                    677,100      717,200

          Less: Amount due within one year       10,000       42,400

               Long-Term Portion               $667,100     $674,800



NOTE 6 -  COLLATERALIZED ASSETS -

The Wachovia Small Business Capital and the SBA Loans are secured by a First
Mortgage and a Second Mortgage respectively on the Company's Westbury
Property.


NOTE 7 -  STOCK OPTION PLAN AND WARRANTS

In September 1997, the Board of Directors of the Company adopted the 1997
Incentive Stock Option Plan (the "1997 Plan") for employees of the Company
to purchase up to 250,000 shares of common Stock of the Company.  Options
granted under the 1997 plan are "incentive stock options" as defined in
Section 422 of the Internal Revenue Code.  Any stock options granted under
the 1997 Plan shall be granted at no less than 100% of the fair market value
of the Common Stock of the Company at the time of the grant.  As of December
31, 2003, options to acquire 192,500 shares of Common Stock have been
granted under the 1997 Plan which includes (i) 120,000 options originally
granted on September 11, 1997 and repriced on February 21, 2003 in order to
reduce the exercise price from $.38 to $.10 per share and (ii) 68,500
additional options granted on February 21, 2003 with an exercise price of
$.10 per share and (iii) 4,000 additional options granted on April 8, 2003
with an exercise price of $.20 per share.  As of December 31, 2003, 57,500
options were available for future grant.





                            DIONICS, INC.

                    NOTES TO FINANCIAL STATEMENTS

                 JUNE 30, 2004 AND DECEMBER 31, 2003



NOTE 7 -  STOCK OPTION PLAN AND WARRANTS - (Continued)


Of such options, options to acquire 20,000 shares have lapsed as a result
of certain employees having left the employ of the Company, leaving options
to acquire 172,500 share outstanding (the "Outstanding Options"). In May
2004, the Company issued under the 2002 Stock Compensation Plan 172,5000
restricted shares of Common Stock to 15 employees equal to the number of
options held by such employees which shares were issued in place of and
in cancellation for all of the Outstanding Options.  All of such shares are
being held in escrow by the Company and will be released to each of the
employees one year from issuance provided such employee is still employed by
the Company.


During the quarter ended June 30, 2004, the Company agreed to issue a
five-year option to a newly retained employee to acquire up to 105,000
shares of Common Stock at $0.15 per share.  In addition, during the quarter
ended June 30, 2004, the Company agreed to issued three-year warrants to two
persons to acquire up to 5,000 shares each at $0.l5 per share.



NOTE 8 -  CONVERTIBLE PROMISSORY NOTES PAYABLE -

The Company issued convertible promissory notes in the amount of $55,000 to
one investor and in the amount of $50,000 to the executive officer.
These notes will automatically convert into 1,100,000 and 1,000,000 common
shares respectively upon the Company effecting the capitalization amendment
to increase the authorized shares of the Company.

Unless earlier converted into shares of Common Stock of the Company the
entire principal balance of these notes shall be due and payable six
(6)months from the date of the notes.

The Automatic Conversion Event, which automatically triggers the conversion
of their Notes into Common Stock, will be deemed to have occurred on the
date the Company, or any successor thereto, effects an increase in the
authorized capitalization of the Common stock to a level sufficient to allow
the subsequent shares to be issued to the Holder.





                            DIONICS, INC.

                    NOTES TO FINANCIAL STATEMENTS

                 JUNE 30, 2004 AND DECEMBER 31, 2003





NOTE 9 -  INCOME TAXES:

As of December 31, 2003 the Company had an available federal operating loss
carry forward of $1,366,200.  This net operating loss originated in 1992,
2001, 2002 and 2003 may be  carried forward and expires as follows:

               Year of Origin   Amount      Carry Forward
                                            Expires In

                    1992      $  115,200          2007

                    2001         373,000          2021

                    2002         603,000          2022

                    2003         275,000          2023

                              $1,366,200


NOTE 10 - COMMITMENT

a)   The Company has an agreement with its chief executive officer to pay to
his widow or estate for a period of five (5) years following his death an
amount per year equal to the annual salary being earned by him at the time
of his death, provided that he was in the  employ of the Company at the time
of his death.  Such arrangements had previously been funded by life
insurance policies owned by the Company on his life, but currently remains
unfunded.

b)   A director of the Company executed an Investment Agreement pursuant to
which he will be entitled to acquire 200,000 shares of Common Stock for
$10,000 upon the Company effecting the Capitalization Amendment.










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

LIQUIDITY AND CAPITAL RESOURCES

       During  the  Second  Quarter  of  2004,  many  significant
activities took place with regard to the Company's financial  and
corporate  structure. The Company finalized negotiations  with  a
new  investor,  and brought into the corporate fold  a  total  of
$160,000  of new funding. Of that total, $110,000 came  from  the
new  investor, Alan Gelband Company, Inc. and, as required by the
terms of its Investment Agreement with the Company, an additional
$50,000  came from the Company's president, Bernard  L.  Kravitz.
Mr.  Kravitz  also forgave a $200,000 portion of debt  which  the
Company  owed him as part of his Deferred Compensation Agreement.
The  new  $160,000 capital input permitted the  payment  of  many
overdue Accounts Payable and resulted in the establishment  of  a
modest  cash reserve. As a further consequence of the new outside
investment, an associate of the Alan Gelband Company, Mr. Kenneth
Levy, joined the Board of Directors. The Company also sought  and
successfully  gained re-listing of its shares  on  the  Over  The
Counter  (OTC) Bulletin Board. Later in the period,  the  Company
also  submitted  to  shareholders a Consent request  which,  just
having  been approved, increases the number of Authorized  Common
Shares  from  5.0 million to 50 million, authorizes  one  million
Preferred Shares, and also increases by 250,000 shares the number
available  for employee Incentive Stock Options. The Company  was
also  able, during the Second Quarter, to secure the services  of
Mr.William T. Ryan, formerly the LED Product Manager for  Philips
Lighting, as vice-President for Business Development at  Dionics,
Inc.  This  whirlwind  of  corporate and  financial  activity  is
obviously indicative of a company in transition, and indeed it is
Management's  present  goal  to reposition  the  Company  at  the
cutting edge of the burgeoning LED-based lighting market. We  are
pleased to report that, in the midst of this whirlwind,   in  the
"eye of the hurricane," so to speak, the Company also managed  to
carry on what passes for normal operational activities.

      At June 30th, 2004, Working Capital stood at $ 447,600,  up
from $244,600 at December 31, 2003.

RESULTS OF OPERATIONS

      Sales  volume  in  the First Six-Months  of  2004  rose  to
$680,400, an increase of almost 60% from the $425,700 recorded in
the  same  period  of 2003. Due to the considerable  increase  in
current  Sales  volume,  most  cost elements  showed  substantial
percentage  improvements over those in the same period  of  2003.
Gross  Profit Margin increased to 32.5% of Sales in  the  current
First-Half, as compared to 23.1% in the First-Half of 2003, while
Selling, General and Administrative Expenses dropped to 27.3%  of
Sales  as opposed to 43.6% in the same period last year.  Results
of Operations showed a  $35,300 Profit in the First-Half of 2004,
as  compared to a Loss of $87,500 in the First-Half of 2003.  Net
Income for the period also benefited greatly from a special  one-
time  Debt  Forgiveness event of $200,000, leading to a favorable
comparison  with  a Net Income of $226,300 in the  First-Half  of
2004 versus a Net Loss of $109,600 in the same period last year.

       For   the  Three-Months  ending  June  30th,  the  Company
registered  Sales volume of $313,900 as compared to  $262,600  in
the same period last year, an increase of almost 20%. There was a
Net  Income  from Operations of $4,100 in the current  period  as
compared  to  a  Net Loss of $3,800 last year. Factoring  in  the
special  $200,000 Debt Forgiveness event, there was a Net  Income
for  the  period of $203,500 as compared to a Net Loss of $15,000
last year.

      With immediate assistance from the new funds that were made
available,  the  Company  was able to regain  current  status  on
almost  all  its overdue Accounts Payable. The Company  was  also
able  to  develop  initial prototypes for  several  major  growth
opportunities in the newly chosen target-market for  its  patent-
pending  LED-based  Silicon  Light  Chips.  Management  is   also
exploring  the establishment of working relationships with  other
companies in that field, preparing itself for what it sees as  an
eventual  transition toward these newer, more  lucrative  future-
markets.  In spite of now being in the midst of the traditionally
slow  Third Quarter, and still suffering from the recent  limited
economic  visibility, Management is highly  focused  "across  the
valley" on this exciting new aspect of the lighting industry.

      Finances for Dionics, Inc. can still be correctly labeled a
"high-wire act," but recent favorable events have established  at
least  a  modestly functional safety net for us.  Near-term,  our
combined  Management goals will be to both weave a still stronger
financial  safety  net, and also create such a  vigorous  future-
oriented  marketing  thrust that the safety  net  will  become  a
financial war-chest.

     THE PRECEDING TEXT CONTAINS FORWARD-LOOKING STATEMENTS WHICH
REFLECT   MANAGEMENT'S  BEST  JUDGMENT  OF  CURRENTLY   AVAILABLE
INFORMATION.  SHOULD CERTAIN ASSUMPTIONS FAIL TO MATERIALIZE,  OR
UNEXPECTED  ADVERSE  EVENTS  OCCUR, THE  COMPANY  MAY  NOT  REACH
MANAGEMENT'S GOALS.



Item 3.   Controls and Procedures.

     The   Company's   Chief  Executive  Officer  and   Principal
Financial Officer has reviewed the Company's disclosure  controls
and  procedures  as  of  the end of the period  covered  by  this
report.   Based upon this review, such officer believes that  the
Company's  disclosure controls and procedures  are  effective  in
timely  alerting  him  to  material information  required  to  be
included  in this report. There have been no significant  changes
in internal control over financial reporting that occurred during
the  fiscal  quarter covered by this report that have  materially
affected,  or  are  reasonably likely to materially  affect,  the
Company's internal control over financial reporting.






                   PART II - OTHER INFORMATION

Item 1.  Legal Proceedings.

     There are no material pending legal proceedings to which the
Company is a party or to which any of its property is subject.

Item 2.  Changes in Securities.

      In  May  2004,  the  Company  entered  into  an  Investment
Agreement with Alan Gelband ("Gelband") pursuant to which  up  to
2,200,000  shares of Common Stock will be issued in consideration
for   an   investment  of  $110,000  (the  "Gelband  Agreement").
Pursuant to the terms thereof, the Company received from  Gelband
the  initial installment of $55,000 in May 2004 and delivered  to
Gelband  1,100,000 shares and, in June 2004, received the balance
of  $55,000  pursuant to which convertible promissory notes  have
been  issued  which  will  automatically convert  into  1,100,000
shares  upon the Company effecting an increase in the  number  of
its  authorized  shares  of  Common  Stock  (the  "Capitalization
Amendment").   Pursuant  to  and  as  required  by  the   Gelband
Agreement, the Company entered into an Investment Agreement  with
Bernard  Kravitz,  the  Company's President,  pursuant  to  which
Bernard  Kravitz agreed to make an investment of $50,000  in  the
Company  in  consideration for which he  will  receive  1,000,000
shares   and  a  three-year  warrant  to  acquire  an  additional
1,000,000 shares exercisable at $.05 per share.  Pursuant to  the
terms  thereof, in June 2004, the Company received the investment
from  Mr.  Kravitz of $50,000 and issued a convertible promissory
note  which will automatically convert into 1,000,000 shares upon
the Company effecting the Capitalization Amendment.  In addition,
contemporaneously with the execution of the foregoing agreements,
and  as required by the Gelband Agreement, Kenneth Levy became  a
director  of  the  Company and executed an  Investment  Agreement
pursuant to which Levy will be entitled to acquire 200,000 shares
of  Common  Stock  for  $10,000 upon the  Company  effecting  the
Capitalization Amendment.

     In 2002, the Company granted options to employees to acquire
an aggregate of 192,500 shares of Common Stock which options were
granted  under  the 1997 Incentive Stock Option  Plan.   Of  such
options, options to acquire 20,000 shares have lapsed as a result
of  certain  employees  having left the employ  of  the  Company,
leaving  options  to  acquire  172,500  shares  outstanding  (the
"Outstanding  Options").  In May 2004, the Company  issued  under
the  2002  Stock Compensation Plan 172,500 restricted  shares  of
Common Stock to 15 employees equal to the number of options  held
by  such  employees which shares were issued in place of  and  in
cancellation  for all of the Outstanding Options.   All  of  such
shares  are  being  held in escrow by the  Company  and  will  be
released to each of the employees one year from issuance provided
such employee is still employed by the Company.

      During the quarter ended June 30, 2004, the Company  agreed
to  issue  a  five-year  option to a newly retained  employee  to
acquire up to 105,000 shares of Common Stock at $.0.15 per share.
In  addition, during the quarter ended June 30, 2004, the Company
agreed to issue three-year warrants to two persons to acquire  up
to 5,000 shares each at $0.15 per share.

     All of the foregoing securities were issued in reliance upon
the  exemption from registration pursuant to Section 4(2) of  the
Securities  Act  of 1933, as amended, for  "transactions  by  the
issuer not involving any public offering".

Item 3.  Defaults Upon Senior Securities.

          None.


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

          None.

Item 5.  Other Information.

          None.

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

          (a)  Exhibits.

     31.1 Certification of Chief Executive Officer pursuant to
     Section 302 of the Sarbanes-Oxley  Act of 2002 (Rules 13a-14
     and 15d-14 of the Exchange Act)
     31.2 Certification of Principal Financial Officer pursuant
     to Section 302 of the Sarbanes-Oxley    Act of 2002 (Rules
     13a-14 and 15d-14 of the Exchange Act)
     32.1 Certification pursuant to Section 906 of the Sarbanes-
     Oxley Act of 2002 (18 U.S.C. 1350)

          (b)  Reports on Form 8-K.

     Listed  below are reports on Form 8-K filed during  the
     fiscal quarter ended June 30, 2004.

     Form 8-K (date of report: May 24, 2004); Items reported -
     Item 5 and 7 (transaction with Alan Gelband); no financial
     statements filed.





                           SIGNATURES

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


                                   DIONICS, INC.
                                   (Registrant)


Dated: August 16, 2004         By: /s/ Bernard Kravitz
                                   Bernard Kravitz, President


Dated: August 16, 2004         By: /s/ Bernard Kravitz
                                   Bernard   Kravitz,   Principal
                                   Financial Officer