UNITED STATES
                  SECURITIES AND EXCHANGE COMMISSION
                        Washington, DC   20549

                              FORM 10-QSB

(Mark One)

XX  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
--- ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2005

    TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
---  ACT OF 1934 FOR THE TRANSITION PERIOD FROM _______ TO ______.

    Commission file number        000-27503
                             ____________________


                      DYNASIL CORPORATION OF AMERICA

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


          New Jersey                            22-1734088
        --------------             -------------------------------
  (State or other jurisdiction        (IRS Employer Identification No.)
     of incorporation)


               385 Cooper Road, West Berlin, New Jersey, 08091

        ----------------------------------------------------------
                 (Address of principal executive offices)

                             (856) 767-4600
            --------------------------------------------------
            (Registrant'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  XX      No
    ----         ----

The Company had 3,748,898 shares of common stock, par value
$.0005 per share, outstanding as of May 9, 2005.


                                       1
<PAGE>
            DYNASIL CORPORATION OF AMERICA AND SUBSIDIARIES
                                INDEX



PAGE
PART 1.   FINANCIAL INFORMATION
----

  ITEM 1.   FINANCIAL STATEMENTS

            DYNASIL CORPORATION OF AMERICA AND SUBSIDIARIES
            -----------------------------------------------

             CONSOLIDATED BALANCE SHEETS AS OF
             MARCH 31, 2005 AND SEPTEMBER 30, 2004               3

             CONSOLIDATED STATEMENTS OF OPERATIONS FOR
             THE SIX MONTHS ENDED MARCH 31, 2005 AND 2004        4

             CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX
             MONTHS ENDED MARCH 31, 2005 AND 2004                5

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS          6


   ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS                9

   ITEM 3.   CONTROLS AND PROCEDURES                            13


PART II.  OTHER INFORMATION                                     13

   ITEM 1.   LEGAL PROCEEDINGS                                  13

   ITEM 2.   CHANGES IN SECURITIES                              13

   ITEM 3.   DEFAULTS ON SENIOR SECURITIES                      13

   ITEM 4.   SUBMISSION OF MATTERS
             TO A VOTE OF SECURITY HOLDERS                      13

   ITEM 5.   OTHER INFORMATION                                  13

   ITEM 6    EXHIBITS AND REPORTS ON FORM 8-K                   14

      SIGNATURES                                                14

                                     2
<PAGE>
DYNASIL CORPORATION OF AMERICA AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
UNAUDITED)
                                     ASSETS

<TABLE>
<S>                                                      <C><C>
                                          March 31
September 30
                                            2005                 2004
                                         ----------           ----------

Current assets
   Cash and cash equivalents             $ 412,839            $ 254,908
   Accounts receivable                     770,692              309,276
   Inventory                               861,132              369,813
   Other current assets                    123,773               16,656
                                         ----------          ----------
        Total current assets             2,168,436              950,653

Property, Plant and Equipment, net         777,365              419,718

Other Assets
        Deferred financing costs            18,595                3,321
        Intangibles                         78,414                    0
                                         ----------          ----------
            Total Other Assets              97,009                3,321
                                         ----------          ----------
        Total Assets                    $3,042,810           $1,373,692
                                         ==========          ==========


                 LIABILITIES AND STOCKHOLDERS' EQUITY


Current Liabilities
   Note payable to bank- Line of credit    $250,000            $      0
   Current portion - long-term debt         155,746             120,000
   Accounts payable                         313,029             184,214
   Accrued expenses                         331,261             114,959
                                         ----------          ----------
        Total current liabilities         1,050,036             419,173

Long-term Debt, net                         714,454             488,889

Stockholders' Equity
   Common Stock, $.0005 par value,
    25,000,000 shares authorized,
    4,553,538 and 4,050,180 shares
    issued, 3,743,378 and 3,240,020
    shares outstanding                        2,277              2,025
        Preferred Stock,
         $1 per share,
         Series A 10% Cumulative,           690,000                  0
         Convertible. 700,000 shares
         authorized, issued and
         outstanding

   Additional paid in capital             1,343,421           1,239,736
   Retained earnings                        228,964             210,211
                                         ----------          ----------
                                          2,264,662           1,451,972

   Less 810,160 shares
     in treasury - at cost                 (986,342)           (986,342)
                                         ----------          ----------
         Total stockholders' equity       1,278,320             465,630
                                         ----------          ----------
        Total Liabilities and
         Stockholders' Equity            $3,042,810          $1,373,692
                                         ==========          ==========
</TABLE>

                                     3
<PAGE>
DYNASIL CORPORATION OF AMERICA AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)


<TABLE>
<S>                                <C>                          <C>
                                     Three Months Ended          Six Months Ended
                                        March 31                    March  31
                                     2005          2004            2005          2004
                                   ----------    ---------       ----------   ---------
Sales                             $1,097,026    $  594,469       $1,878,212  $1,216,963
Cost of Sales                        816,113       457,361        1,396,799     919,907
                                   ----------    ---------       ----------   ---------
Gross profit                         280,913       137,108          481,413     297,056
Selling, general and administrative  256,977       175,923          443,698     354,502
                                   ----------    ---------       ----------   ---------
Income (Loss) from Operations         23,936     ( 38,815)           37,715    ( 57,446)

Other income (expense)
     Interest expense - net          (11,259)    (  8,058)          (18,962)   ( 15,459)
                                   ----------    ---------       ----------   ---------
Income (Loss) before Income Taxes     12,677      (46,873)           18,753    ( 81,783)

Income Tax                                 0            0                 0           0
                                   ----------    ---------       ----------   ---------
Net income (loss)                    $12,677     ($46,873)           18,753    ($72,905)
                                   ==========    =========       ==========   ==========

Net income (loss) per share
  Basic                                $0.00    (   $0.02)            $0.01    ( $0.03)
  Diluted                              $0.00    (   $0.02)            $0.00    ( $0.03)

Weighted average shares outstanding  3,522,410   2,238,830         3,454,382    2,238,542

</TABLE>

                                     4
<PAGE>
DYNASIL CORPORATION OF AMERICA AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)

<TABLE>
<S>                                                    <C>                     <C>
                                                            Six Months Ended
                                                                 March 31
                                                           2005                  2004
                                                        ----------           -----------
Cash flows from operating activities:
    Net income (loss)                                  $   18,753              ($72,905)
    Adjustments to reconcile net income (loss)
     to net cash provided by (used in)
      operating activities:
       Depreciation                                        74,215                78,750
       Amortization expense                                 1,999                 1,704
       Allowance for doubtful accounts                      4,496                   -0-
       (Increase) decrease in:
         Accounts receivable                             (155,451)             (119,806)
         Inventories                                      (62,448)               43,853
         Prepaid expenses and other current assets         (9,595)              ( 1,443)
         Other assets                                                             3,925
       Increase (decrease) in:
         Accounts payable                                  52,632                66,171
         Accrued expenses                                  89,678              (  6,715)
                                                        ---------            ----------
Net cash provided by (used in)
  operating activities                                     14,279              (  6,466)
                                                        ---------            ----------
----------
Cash flows from investing activities:
     Acquisition of property, plant and equipment         (21,287)                  -0-
     Cash paid for acquisition of
        Optometrics LLC assets                           (700,000)                  -0-
     Cash for acquisition costs to date                   (67,976)                  -0-
                                                        ---------            ----------
Net cash provided by (used in)investing activities       (789,263)                  -0-
                                                        ---------            ----------
Cash flows from financing activities:
   Issuance of common stock                                35,538                  260
   Issuance of preferred stock                            690,000                  -0-
   Proceeds from short-term debt                          102,143                  -0-
   Proceeds from long-term debt                           183,106                  -0-
   Payments on long-term debt                             (60,599)            ( 92,040)
   Deferred financing costs incurred                      (17,273)                 -0-
                                                        ---------            ----------
Net cash provided by (used in)
   financing activities                                   932,915             ( 91,780)
                                                        ---------            ----------
Net increase(decrease) in cash                            157,931             ( 98,246)
Cash - beginning of period                                254,908              323,321
                                                        ---------            ----------
Cash - end of period                                    $ 412,839            $ 225,075
                                                        =========            ===========
</TABLE>

Supplemental Disclosure of cash flow information:
  Non-cash investing and financing activities:
    Acquisition of Optometrics LLC
       Fair market value of current assets acquired            $ 918,067
       Property, plant and equipment                             410,575
       Intangibles                                                78,414
       Fair market value of liabilities assumed                 (529,110)
       Acquisition costs incurred                               (109,546)
       Issuance of 300,000 common stock shares to sellers        (68,400)

     Net Cash paid for Optometrics LLC                          $ 700,000

                              5
<PAGE>

Supplemental Disclosures of Cash Flow Information (continued):

The Company issued 700,000 shares of preferred stock, valued  at
$1.00  per  share, and received cash of $700,000.   The  Company
incurred  stock issuance costs of $10,000 for a net proceeds  of
$690,000, of which $600,000 was used to fund the acquisition  of
Optometrics, LLC.

In  connection  with  the acquisition of Optometrics,  LLC,  the
Company also obtained total debt proceeds of $550,000, of  which
$100,000  funded the balance of the cash payment to the sellers,
$67,976  funded the acquisition costs,  $264,751  paid  off  the
debt  of  Optometrics, LLC,  $17,273 paid the deferred financing
fees,   and  $100,000  was  used  for  general  working  capital
purposes.


DYNASIL CORPORATION OF AMERICA
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

Note 1 - Basis of Presentation

     The consolidated balance sheet as of September 30, 2004 was
audited and appears in the Form 10-KSB previously filed by the
Company.  The consolidated balance sheet as of March 31, 2005
and the consolidated statements of operations and cash flows for
the three months and six months ended March 31, 2005 and 2004,
and the related information contained in these notes have been
prepared by management without audit.  In the opinion of
management, all adjustments (which include only normal recurring
items) necessary to present fairly the financial position,
results of operations and cash flows in conformity with
generally accepted accounting principles as of March 31, 2005
and for all periods presented have been made.  Interim operating
results are not necessarily indicative of operating results for
a full year.

     On March 8, 2005, Dynasil Corporation of America acquired
the operating assets and assumed certain liabilities of
Optometrics LLC, a worldwide supplier of optical components.
The assets acquired from Optometrics LLC will be operated under
the Optometrics Corporation name.  The financial statements in
this report include the Optometrics Corporation results of
operations from March 9, 2005 through March 31, 2005.

     Certain information and note disclosures normally included
in the Company's annual financial statements prepared in
accordance with generally accepted accounting principles have
been condensed or omitted.  It is suggested that these condensed
consolidated financial statements be read in conjunction with
the financial statements and notes thereto included in the
Company's September 30, 2004 Annual Report on Form 10-KSB
previously filed by the Company with the Securities and Exchange
Commission.

Note 2 - Business Acquisition

On  March 8, 2005, the Company, through its newly formed  wholly
owned   subsidiary,  Optometrics  Corporation,   completed   its
acquisition  of substantially all of the assets of  Optometrics,
LLC,  a  worldwide supplier of optical components  for  a  total
purchase  price of $877,946. Cash of $700,000 was  paid  by  the
Company  and 300,000 shares of the Company's common  stock  were
issued to the former owners of Optometrics, LLC, valued at $0.23
per  share,  or  $68,400.   Acquisition costs of  $109,546  were
incurred.   The  business  acquisition was  recorded  under  the
purchase   method  of  accounting  which  requires   the   total
consideration   be   allocated  to  the  assets   acquired   and
liabilities assumed based on their fair values.

The  fair  value of tangible and intangible assets acquired  and
liabilities  assumed  were established based  on  the  unaudited
March  8,  2005 balance sheet of Optometrics, LLC,  as  well  as
certain assumptions made regarding fair values.

                                    6
<PAGE>
The  excess of the purchase price over the fair value of the net
assets  acquired will be allocated to goodwill.  The preliminary
purchase price allocation is not yet finalized, and as such, for
purposes  of these interim financial statements, the  excess  is
classified as intangibles.  The Company expects to finalize  the
allocation within the third quarter of fiscal 2005.  The results
of  operations of Optometrics Corporation has been  included  in
the  consolidated financial statements from March 9,  2005,  the
date  of  acquisition.  The preliminary allocation  of  purchase
price as of March 9, 2005 is summarized below:

     Cash and cash equivalents                  $   50,585
     Accounts receivable                           310,461
     Inventories                                   428,871
     Prepaid expenses and other current assets     128,150
     Property and equipment                        410,575
     Intangibles                                    78,414
     Current liabilities assumed                  (242,449)
     Long-term debt liabilities assumed           (286,661)
     Total purchase price                         $877,946

Note 3 - Debt

On  March  8,  2005, the Company entered into credit  agreements
totaling  $700,000  with Citizens Bank in  connection  with  the
acquisition  of Optometrics, LLC of which the initial  borrowing
was  $550,000.  The terms of the Credit Agreements  provide  the
Company  with  a  $300,000 term loan (the  "Term  Loan")  and  a
$400,000  revolving credit facility (the "Line of Credit").  The
proceeds  have  been  used to payoff  the  debt  of  the  former
Optometrics  LLC,  to  fund  the acquisition,  and  for  general
working  capital purposes.  Borrowings under the line of  credit
bear  interest at a variable rate equal to Citizens Bank's prime
rate  plus  0.5%. Initial borrowing on the Line  of  Credit  was
$250,000.  Outstanding borrowings under the  Term  Loan  require
monthly  payments  of  $5,834.78 over a  five  year  term  which
started March 9 and ends March 2011 at a fixed interest rate  of
6.25%.  As part of the credit agreement, the Company is required
to  comply  with  certain financial covenants measured  annually
regarding  the  liabilities to equity  ratio  and  debt  service
coverage  for  Optometrics Corporation. The performance  of  the
obligations  is secured by the assets of Optometrics Corporation
with  a corporate guarantee by the Company and a second lien  on
the Company's New Jersey assets excluding the real estate.


Note 4 - Convertible Preferred Stock

On  March 8, 2005, the Company completed a private placement  of
700,000  shares of Series A 10% Cumulative Convertible preferred
stock  for cash proceeds of $700,000.  The stock was sold  at  a
price of $1.00 per share. Total expenses for the stock placement
were  $10,000.  Each share of preferred stock carries a 10%  per
annum  cumulative dividend payable quarterly and is  convertible
to 2.2222 shares of common stock at any time by holders, subject
to  adjustment for certain subsequent sales of common  stock  or
securities  convertible into or exchangeable for  common  stock,
and  is  callable  starting March 9, 2007 by the  Company  at  a
redemption  price of $1.00 per share.  Proceeds from  the  stock
sale were used to acquire the assets of Optometrics LLC and  for
working capital.


Note 5 - Inventories

     Inventories are stated at the lower of average cost or
market.  Cost is determined using the first-in, first-out (FIFO)
method.  Inventories consist primarily of raw materials, work-in-
process and finished goods.  The Company evaluates inventory
levels and expected usage on a periodic basis and records
adjustments for impairments as required.


                                    7
<PAGE>

Inventories consisted of the following:
                                March 31, 2005     September 30, 2004
                              -----------------    ------------------
     Raw Materials                 $282,933            $148,278
     Work-in-Process                314,079             114,170
     Finished Goods                 264,120             107,365
                                    -------             -------
                                   $861,132            $369,813
                                    =======             =======
Note 6 - Net Income Per Share

     Basic net income per share is computed using the weighted
average number of common shares outstanding. The dilutive
effects of potential common shares outstanding are included in
diluted net earnings per share. For periods with a net loss,
diluted net earnings per share exclude the impact of potential
common shares since they would have resulted in an antidilutive
effect.


Note 7 - Stock Based Compensation

     The Company has adopted the disclosure provisions of SFAS
No. 148 and continues to account for stock-based compensation
using the intrinsic value method. Accordingly, no compensation
cost has been recognized in the financial statements for stock
options issued to employees since the options were granted at
the quoted market price or higher on the date of grant. Stock
options granted to consultants and other non-employees are
reported at fair value in accordance with SFAS No. 123. The pro
forma disclosures of net loss and net loss per common share
required by SFAS No. 123 are shown below.

                                         Six months ended
                                    March 31, 2005  March 31, 2004
                                     -----------     -------------
     Net income (loss), as reported      $ 18,753     ( $  72,905)

     Add: Stock-based employee
     compensation expense included
     in reported net income                  -0-              -0-

     Less: Total stock-based employee
     compensation expense determined
     under fair value based method
     for all options                        (153)             -0-
                                     -----------     -------------
     Pro forma net profit (loss)      $   18,600       (  $72,905)
                                     ===========      ===========

     Actual net profit (loss)
     per common share                   $    0.01       ($  0.03)

     Pro forma net profit (loss)
     per common share                   $    0.01       ($  0.03)


     During the six months ended March 31, 2005, 433,459 stock
options were granted at prices ranging from $0.40 to $0.65 per
share and no options were exercised. During the six months ended
March 31, 2004, no stock options were granted or exercised. The
Company cancelled 45,000 and 132,000 options during the six
months ended March 31, 2005 and 2004, respectively.
Compensation expenses relating to non-employee stock options
granted during the six months ended March 31, 2005 and 2004 were
$-0-.  During the six months ended March 31, 2005, The Company
issued 158,360 shares of common stock valued at $0.14 to $0.45
per share to the Board of Directors in satisfaction of accrued
and 2005 directors' fees totaling $25,217.

                                8
<PAGE>

ITEM 2.     MANAGEMENT DISCUSSION AND ANALYSIS OR PLAN OF
OPERATION

Overview

     On March 8, 2005, Dynasil Corporation of America acquired
the operating assets and assumed certain liabilities of
Optometrics LLC, a worldwide supplier of optical components
including diffraction gratings, lenses, thin film filters, laser
optics, monochromators, and specialized optical systems.  The
assets acquired from Optometrics LLC will be operated under the
Optometrics Corporation name.  The financial statements in this
report include the Optometrics results of operations for the 23
day period from March 9, 2005 through March 31, 2005.  The
results from time periods previous to March 9, 2005 do not
include Optometrics results.  For calendar year 2004,
Optometrics LLC had revenues of $3.06 Million, EBITDA of
$379,966, and net income before taxes of $257,610.  The
Optometrics assets were purchased for $700,000 in cash, 300,000
shares of Dynasil common stock valued at $68,400, and repayment
of Optometrics LLC loans totaling $264,750. The acquisition was
funded by $700,000 of proceeds from a private placement by the
Company of 700,000 shares of a new series of convertible
preferred stock as well as bank loans. The Optometrics
acquisition is expected to double Dynasil's revenues and
significantly enhance profitability.

     Revenues for the 2nd quarter ended March 31, 2005 were
$1,097,026, an increase of 85% over revenues of $594,469 for the
quarter ended March 31, 2004. Revenues for the six months ended
March 31, 2005 were $1,878,212, an increase of 54% over the six
months ended March 31, 2004. The net profit for the quarter
ended March 31, 2005 was $12,677, or less than $0.01 per share,
compared with a net loss of $46,873, or a negative $.02 per
share, for the quarter ended March 31, 2004.  The net profit for
the six months ended March 31, 2005 was $18,753, or $0.01 per
share, compared with a net loss of $72,905, or a loss of $0.03
per share for the six months ended March 31, 2004.  The Company
continues to focus on management's strategy of profitable growth
from its optical materials business and by pursuing
acquisitions.


Results of Operations

          Revenues for the three months ended March 31, 2005
were $1,097,026, an increase of 85% over revenues of $594,469
for the three months ended March 31,2004. Revenues for the six-
months ended March 31, 2005 were $1,878,212 an increase of 54%
over revenues of $1,216,963 for the six-months ended March
31,2004. Excluding Optometrics results, revenues were up 48% for
the quarter ended March 31, 2005 versus the same quarter in
2004. Management believes that the revenue improvement comes
from improved economic conditions in the Company's markets
combined with aggressive pricing to win several high volume jobs
and active pursuit of new business.  The addition of new optical
glasses to our product line in 2004 contributed to increased
sales.  Additionally, the 23 days of sales for Optometrics
Corporation contributed to the increase in sales.

     Cost of sales for the three months ended March 31, 2005 was
$816,113, or 74.4% of sales, an increase of $358,752 over the
three months ended March 31, 2004 of $457,361, or 76.9% of
sales. Cost of sales for the six-months ended March 31, 2005 was
$1,396,799, or 74.4% of sales, an increase of $476,892 over the
six-months ended March 31, 2004 of $919,907 or 75.6% of sales.
The slight decrease in cost of sales as a percentage of sales
resulted from higher manufacturing volumes and higher
Optometrics margins that partially offset the pricing used to
win two high volume jobs.  The higher cost of sales in dollars
comes from higher sales volume and the addition of Optometrics.

                                9
<PAGE>


     Gross profit for the three months ended March 31, 2005 was
$280,913, or 25.6% of sales, an increase of $143,805 over the
three months ended March 31, 2004 of $137,108, or 23.1% of
sales. Gross profit for the six months ended March 31, 2005 was
$481,413, or 25.6% of sales, an increase of $184,357 over the
six months ended March 31, 2004 of $297,056, or 24.4% of sales.

     Selling, general and administrative ("SG&A") expenses for
the three months ended March 31, 2005 were $256,977 or 23.4% of
sales, an increase of $81,054 over the three months ended March
31, 2004 of $175,923, or 29.6% of sales. SG&A expenses for the
six months ended March 31, 2005 were $443,698, or 23.6% of
sales, an increase of $89,196 over the six months ended March
31, 2004 of $354,502, or 29.1% of sales.  The largest increase
in SG&A dollars came from the addition of Optometrics
Corporation.  The year to date SG&A expenses as a percentage of
sales decreased from 29.6% in 2004 to 23.4% in 2005. The
combination of Dynasil and Optometrics selling efforts is
expected to further improve the sales and marketing efficiency
for both companies. Mr. Craig T. Dunham joined The Company to
replace Mr. John Kane as President and CEO effective October 1,
2004.  Mr. Kane left The Company in early December and the
management transition added costs estimated at $32,400 for the
six month period. Mr. Francis Ciancarelli replaced Mr. Paul
Roehrenbeck as Vice President of Sales and Marketing late in the
second quarter and the transition added $15,000 of extra cost.
Mr. Ciancarelli brings 17 years of sales and marketing
leadership experience from Precision Electronic Glass which
serves a similar customer base and we are very pleased to have
him join the Company.

     Net interest expense for the three months ended March 31,
2005 was $11,259, an increase of $3,201 over the three months
ended March 31, 2004 of $8,058. Interest expense for the six
months ended March 31, 2005 was $18,962, an increase of $3,503
over the six months ended March 31, 2004 of $15,459. The
increase in interest expense is primarily related to the
additional interest payments resulting from the indebtedness
incurred in connection with the Optometrics acquisition and the
higher prime rate which impacts the Company's variable interest
rate payments.

     Net income for the three months ended March 31, 2005 was
$12,677, or less than $.01 in basic earnings per share, an
increase of $59,550 over the net loss for the three months ended
March 31, 2004 of $46,873, or $.02 in basic loss per share. Net
income for the six months ended March 31, 2005 was $18,753, or
$.01 in basic earnings per share, an increase of $91,658 over
the six months ended March 31, 2004 of net loss of $72,905, or
$.03 in basic loss per share. Management is pleased to complete
a second profitable quarter for the Company (excluding
Optometrics) after several challenging years.  Optometrics is
expected to contribute significant additional profitability to
the Company.

     The Company had no provisions for income taxes for the
quarters ended March 31, 2005 and 2004.  As of September 30,
2004, the Company had approximately $1,200,000 of net operating
loss carryforwards to offset future income for federal tax
purposes expiring in various years through 2020. In addition,
the Company has approximately $620,000 of net operating loss
carryforwards to offset certain future New Jersey taxable
income, expiring in various years through 2012.



Liquidity and Capital Resources

     Cash increased by $157,931 for the six months ended March
31,2005. The primary sources of cash were the net proceeds from
the preferred stock issuance of $690,000 plus new bank debt
financing obtained in connection with the Optometrics
acquisition. The primary use of cash was for the Optometrics
acquisition. On March 8, 2005, two loans with Citizens Bank were
completed as

                               10
<PAGE>

part of the Optometrics acquisition.  Both loans are secured by
the assets of Optometrics Corporation and guaranteed by the
Company, which guaranty is itself secured by a second lien on
the Company's assets excluding real estate.  The financing
included a $300,000 term loan for five years at a 6.25% fixed
interest rate.  A line of credit with maximum borrowing of
$400,000 was completed with initial borrowing of $250,000 at
Citizens Bank's prime rate plus 0.5%.

     The Company believes that its current cash and cash
equivalent balances, along with the net cash generated by
operations, are sufficient to meet its anticipated cash needs
for working capital for at least the next 12 months. There are
currently no plans for any major capital expenditures in the
next six to nine months. Any major business expansion or
acquisition likely will require the Company to seek additional
debt or equity financing.



Optometrics Acquisition

     Management was pleased that the acquisition of Optometrics
LLC closed on March 8, 2005. Optometrics LLC now operates as
Optometrics Corporation, a wholly owned subsidiary of The
Company.  The transaction occurred as planned with Dynasil's
purchase of the assets of Optometrics LLC, entry into a long
term facility lease and entry into employment agreements with
the two principals of Optometrics LLC. With regret, we
acknowledge the passing of Mr. Frank Denton, one of the two
principals of Optometrics LLC.  Mr. Denton was in the process of
reducing his work schedule before his passing and Management is
confident that the Company has the resources to continue to
operate effectively.  As planned, Ms. Laura Lunardo became Chief
Financial Officer of the Company and Chief Operating Officer of
Optometrics Corporation effective March 9, 2005.  Ms. Lunardo
had been leading the day to day operations of Optometrics for
some time and her long term financial experience brings needed
CFO leadership skills to the Company.

Critical Accounting Policies and Estimates
      There  have  been  no  material changes  in  our  critical
accounting  policies  or  critical  accounting  estimates  since
September  30,  2004, nor have we adopted an  accounting  policy
that  has  or  will  have a material impact on our  consolidated
financial  statements.  For further discussion of our accounting
policies  see  Footnote  1 " Summary of  Significant  Accounting
Policies" in this Quarterly Report on Form 10-QSB and the  Notes
to  Consolidated  Financial Statements in our Annual  Report  on
Form 10-KSB for the fiscal year ended September 30, 2004.
      The  accounting policies that reflect our more significant
estimates,  judgments and assumptions and which we  believe  are
the  most  critical to aid in fully understanding and evaluating
our reported financial results include the following:

Revenue Recognition
      Revenue  from sales of products is recognized at the  time
title and the risks and rewards of ownership pass. This is  when
the  products are shipped per customers' instructions, the sales
price  is fixed and determinable, and collections are reasonably
assured.

Valuation of Long-Lived Assets
      We assess the recoverability of long-lived assets whenever
we  determine  that events or changes in circumstances  indicate
that   their  carrying  amount  may  not  be  recoverable.   Our
assessment  is primarily based upon our estimate of future  cash
flows  associated  with these assets. These  valuations  contain
certain
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<PAGE>

assumptions  concerning  estimated future  revenues  and  future
expenses.  We  have determined that there is  no  indication  of
impairment  of any of our assets. However, should our  operating
results deteriorate, we may determine that some portion  of  our
long-lived assets are impaired. Such determination could  result
in  non-cash charges to income that could materially affect  our
financial position or results of operations for that period.
Estimating Allowances for Doubtful Accounts Receivable
      We perform ongoing credit evaluations of our customers and
adjust  credit  limits  based  upon  payment  history  and   the
customer's  current  credit worthiness,  as  determined  by  our
review  of  their  current credit information.  We  continuously
monitor collections and payments from our customers and maintain
a   provision  for  estimated  credit  losses  based  upon   our
historical  experience  and  any  specific  customer  collection
issues  that  we have identified. While such credit losses  have
historically  been  minimal, within  our  expectations  and  the
provisions  established,  we  cannot  guarantee  that  we   will
continue to experience the same credit loss rates that  we  have
in  the past. A significant change in the liquidity or financial
position  of  any  of  our significant customers  could  have  a
material  adverse effect on the collectibility of  our  accounts
receivable and our future operating results.
Valuation of Deferred Tax Assets
      We  regularly evaluate our ability to recover the reported
amount of our deferred income taxes considering several factors,
including  our  estimate  of  the  likelihood  of  The   Company
generating sufficient taxable income in future years during  the
period  over which temporary differences reverse. The  Company's
deferred tax assets are currently fully reserved.

Recent Accounting Pronouncements

     There were no accounting pronouncements issued since the
date of the Company's most recent Form 10-QSB filing.


Forward-Looking Statements

     The statements contained in this Quarterly Report on Form
10-QSB which are not historical facts, including, but not
limited to, certain statements found under the captions "Results
of Operations", "Liquidity and Capital Resources" and
"Optometrics Acquisition" above, are forward-looking statements
that involve a number of risks and uncertainties. The actual
results of the future events described in such forward-looking
statements could differ materially from those stated in such
forward-looking statements. Among the factors that could cause
actual results to differ materially are the risks and
uncertainties discussed in this Quarterly Report on Form 10-QSB,
including, without limitation, the portions of such reports
under the captions referenced above, and the uncertainties set
forth from time to time described in this and the Company's
other filings with the Securities and Exchange Commission, and
other public statements. Such risks and uncertainties include,
without limitation, seasonality, interest in the Company's
products, customer acceptance of new products, general economic
conditions, market trends, costs and availability of raw
materials and management information systems, competition,
litigation, need for additional financing, the effect of
governmental regulation and other matters. The Company disclaims
any intention or obligation to update any forward-looking
statements, whether as a result of new information, future
events or otherwise.

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<PAGE>


ITEM 3    CONTROLS AND PROCEDURES

      Based  on  his most recent informal evaluation, which  was
completed during the period covered within this Form 10-QSB, the
Company's   President/chief  executive  officer   believes   the
Company's  disclosure  controls and procedures  (as  defined  in
Exchange  Act Rule 13a-14 and 15d-14) are effective. There  were
not  any  significant changes in the Company's internal controls
or no other facts that could significantly affect these controls
subsequent  to  the  date  of  this  evaluation,  including  any
corrective  actions with regard to significant deficiencies  and
material weaknesses. The Company is presently unable to  provide
segregation  of  duties within itself as  a  means  of  internal
control.  As  a  result,  the Company is  presently  relying  on
overriding management reviews, and assistance from its board  of
directors  and  Audit Committee in providing  short-term  review
procedures until such time as additional funding is provided  to
hire  additional  executives  to  segregate  duties  within  the
Company.


PART II

OTHER INFORMATION
------------------

ITEM 1    LEGAL PROCEEDINGS

    NONE

ITEM 2    CHANGES IN SECURITIES

    On March 8, 2005, the Company sold 700,000 shares of a
Series A 10% Cumulative Convertible Preferred Stock for $700,000
in a private placement.  Each share was sold for $1 and is
convertible to 2.2222 shares of common stock at any time by the
holders.  See the Company's 8K report dated March 14, 2005 for
additional information.

ITEM 3    DEFAULTS ON SENIOR SECURITIES

    NONE

ITEM 4    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

    NONE



ITEM 5    OTHER INFORMATION

     The information presented in Items 1 and 2 of Part I of
this Report is incorporated herein by reference. On May 13,
2005, the Company issued a press release announcing its
financial results for its second quarter ending March 31, 2005.
A copy of this press release is attached as Exhibit 99 to this
Report on Form 10-QSB.  This information is being furnished
pursuant to Item 5 of Part II of Form 10-QSB and shall not be
deemed to be "filed" for the purposes of Section 18 of the
Securities Exchange Act of 1934, as amended (the "Exchange
Act"), or otherwise subject to the liabilities of that Section,
nor shall it be deemed incorporated by reference in any filing
under the Securities Act of 1933, as amended, or the Exchange
Act, except as shall be expressly set forth by specific
reference in such a filing.


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<PAGE>




ITEM 6    EXHIBITS AND REPORTS ON FORM 8-K


    (a)  Exhibits and index of Exhibits

     31.1(a) and (b) Rule 13a-14(a)/15d-14(a) Certifications
     pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

     32.1 Section 1350 Certification pursuant to Section 906 of
     the Sarbanes-Oxley Act of 2002 (furnished but not filed for
     purposes of the Securities Exchange Act of 1934)

     3.06 Restated Certificate of Incorporation of Dynasil
     Corporation of America dated May 6, 2005.

     10.10 Employment Agreement of Laura Lunardo effective March
     8, 2005.

     10.11 Accepted Employment offer of Francis Ciancarelli
     dated March 28, 2005.

     10.12 Loan Agreement dated March 8, 2005 with Citizen's
     Bank for a $400,000 revolving line of credit.

     10.13 Note dated March 8, 2005 with Citizen's Bank for a
     $300,000 term loan.

     99.1 Press release, dated May 13, 2005, issued by Dynasil
     Corporation of America announcing its financial results for
     the second quarter ending March 31, 2005.


     (b) Reports on Form 8-K

       -    On 3/14/05, a current report for Items 2 and 3 for the
          completion of the Optometrics registration and sale of Preferred
          Stock.


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.


DYNASIL CORPORATION OF AMERICA


BY:     /s/ Craig T. Dunham        DATED:    May 14, 2005
 --------------------------------- --------------------
          Craig T. Dunham,
          President and CEO

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