**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**WASHINGTON,
      D.C. 20549**





**FORM
      10-Q**





(
      MARK
      ONE )





**x**
            **QUARTERLY
                REPORT PURSUANT TO SECTION 13 OR 15( d ) OF THE SECURITIES EXCHANGE
                ACT OF
                1934**





For
                The Quarterly Period Ended September 30, 2008





or





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





For
                The Transition Period From __________________ to __________________Commission
                File Number: 2-95836-NY





**CHINA
      INDUSTRIAL WASTE MANAGEMENT, INC.**


(
      Name of
      registrant as specified in its charter )





**NEVADA**
            
            **13-3250816**(
                State or other jurisdiction of incorporation or organization)
            
            (I.R.S.
                Employer Identification No.)





**C/O
                DALIAN DONGTAI INDUSTRIAL WASTE TREATMENT CO.**
              **NO.
                1 HUAIHE WEST ROAD, E-T-D ZONE, DALIAN, CHINA**
            
            **116600**(
                Address of principal executive offices)
            
            (Zip
                Code)





**011-86-411-82595339**


(Registrant's
      telephone number, including area code)





**N/A**


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





Indicate
      by check mark 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
x 
No
o





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





Large
                accelerated filer o
            Accelerated
                filer oNon-accelerated
                filer o
              (Do
                not check if smaller reporting company)
            Smaller
                reporting company x





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act)





Yes o  No
x





Indicated
      the number of shares outstanding of each of the issuer's classes of common
      stock, as of the latest practicable date: 14,524,176 shares of common stock
      are
      issued and outstanding as of October 13, 2008.










**TABLE
      OF CONTENTS**





Page
              No.**PART
                I. - FINANCIAL INFORMATION**Item
                1.
            
            Financial
                Statements.
            
            F-1Item
                2.
            
            Management's
                Discussion and Analysis of Financial Condition and Results of Operations.
            
            2Item
                3.
            
            Quantitative
                and Qualitative Disclosures About Market Risk.
            
            6Item
                4T
            
            Controls
                and Procedures.
            
            6**PART
                II - OTHER INFORMATION**Item
                5.
            
            Other
                Information.
            
            8Item
                6.
            
            Exhibits.
            
            8





ii




**CAUTIONARY
      STATEMENT REGARDING FORWARD-LOOKING INFORMATION**





This
      report includes "forward-looking statements." You can identify these statements
      by the fact that they do not relate strictly to historical or current facts.
      These statements contain such words as "may," "project," "might," "expect,"
      "believe," "anticipate," "intend," "could," "would," "estimate," "continue,"
      or
      "pursue," or the negative or other variations thereof or comparable terminology.
      In particular, they include statements relating to, among other things, future
      actions, new projects, strategies, future performance, the outcomes of
      contingencies and our future financial results. These forward-looking statements
      are based on current expectations and projections about future events.





Readers
      are cautioned that forward-looking statements are not guarantees of future
      performance or results and involve risks and uncertainties that cannot be
      predicted or quantified and, consequently, our actual performance may differ
      materially from those expressed or implied by such forward-looking statements.
      Such risks and uncertainties include, but are not limited to, the following
      factors, as well as other factors described from time to time in our reports
      filed with the Securities and Exchange Commission (including the sections
      entitled "Risk Factors" and "Management's Discussion and Analysis of Financial
      Condition and Results of Operations" contained therein): the timing and
      magnitude of technological advances; the prospects for future acquisitions;
      the
      effects of political, economic and social uncertainties regarding the
      governmental, economic and political circumstances in the People’s Republic of
      China, the possibility that a current customer could be acquired or otherwise
      be
      affected by a future event that would diminish their waste management
      requirements; the competition in the waste management industry and the impact
      of
      such competition on pricing, revenues and margins; uncertainties surrounding
      budget reductions or changes in funding priorities of existing government
      programs and the cost of attracting and retaining highly skilled personnel;
      our
      projected sales, profitability, and cash flows; our growth strategies;
      anticipated trends in our industries; our future financing plans; and our
      anticipated needs for working capital.





Forward-looking
      statements speak only as of the date on which they are made, and, except to
      the
      extent required by federal securities laws, we undertake no obligation to update
      any forward-looking statement to reflect events or circumstances after the
      date
      on which the statement is made or to reflect the occurrence of unanticipated
      events.





**CONVENTIONS
      AND GENERAL MATTERS**





The
      official currency of the People’s Republic of China is the Chinese “Yuan” or
“Renminbi” (“yuan,” “Renminbi” or “RMB”). For the convenience of the reader,
      amounts expressed in this report as RMB have been translated into United States
      dollars (“USD$” or “$”) at the rate of USD$1.00 = RMB 7.3046 quoted by The
      People’s Bank of China (“POBC”) as of December 31, 2007; and at the rate of
      USD$1.00 = RMB 6.9989 quoted by OANDA as of September 30, 2008. OANDA is a
      Delaware corporation providing internet foreign exchange rate at www.oanda.com .
      OANDA
      is also a foreign exchange market maker. Its internet foreign exchange rate
      is
      widely used by public which is including but not limited to major international
      audit firms. The Renminbi is not freely convertible into foreign currencies
      and
      the quotation of exchange rates does not imply convertibility of Renminbi into
      U.S. Dollars or other currencies. All foreign exchange transactions take place
      either through PBOC or other banks or other market makers authorized to buy
      and
      sell foreign currencies at the exchange rates quoted by the People's Bank of
      China. No representation is made that the Renminbi or U.S. Dollar amounts
      referred to herein could have been or could be converted into U.S. Dollars
      or
      Renminbi, as the case may be, at the PBOC Rate, OANDA rate or at
      all.





The
      "Company," "we," "us," "our" and similar words refer to China Industrial Waste
      Management, Inc, its direct, wholly-owned subsidiary DonTech Waste Services,
      Inc. (“DonTech”) and DonTech’s majority owned subsidiaries, Dalian Dongtai
      Industrial Waste Treatment Co. Ltd. (“Dongtai”), Dongtai Water Recycling Co.
      Ltd. (“Dongtai Water”), Dalian Zhuorui Resource Recycling Co., Ltd. (“Zhuorui”),
      Dalian Lipp Environmental Energy Engineering & Technology Co., Ltd. (“Dalian
      Lipp”) and, prior to its dissolution in July 2007, Liaoyang Dongtai Industrial
      Waste Treatment Co., Ltd. (“Liaoyang Dongtai”). The Company is in the process of
      dissolving DonTech, which serves as a holding company for the shares of the
      Company’s operating subsidiaries.





All
      share
      and per share information contained herein has been adjusted to reflect a 1
      for
      100 share reverse stock split which occurred on May 12, 2006.











**PART
      1 - FINANCIAL INFORMATION**





**Item
      1. Financial Statements.**





**CHINA
        INDUSTRIAL WASTE MANAGEMENT, INC.**
 **CONSOLIDATED
        BALANCE SHEETS**
 
 September
                  30,
              
              December
                  31,2008
              
              2007(Unaudited)
              
              (Audited)**ASSETS**Current
                  assetsCash
                  and cash equivalents
              
              $
              5,332,934
              
              $
              3,260,307Trade
                  accounts receivable, net
              
              
              2,366,837
              
              
              594,322Other
                  receivables
              
              
              237,100
              
              
              22,453Inventory
              
              
              1,866,807
              
              
              1,332,349Advances
                  to suppliers
              
              
              269,533
              
              
              390,159Deferred
                  expense
              
              
              18,235
              
              
              42,784Total
                  current assets
              
              
              10,091,446
              
              
              5,642,374Investment
              
              
              2,789,747
              
              
              2,633,354Property,
                  plant and equipment
              
              
              5,227,587
              
              
              4,697,305Less:
                  accumulated depreciation
              
              
              (2,546,694
              )
              
              (2,055,268
              )Net
                  property, plant and equipment
              
              
              2,680,893
              
              
              2,642,037Construction
                  in progress
              
              
              12,791,631
              
              
              7,410,255Land
                  usage right, net of accumulated amortization
              
              
              1,703,778
              
              
              1,732,074Deposits
              
              
              12,246
              
              
              80,925Related
                  party receivable
              
              
              978,534
              
              
              388,796Escrow
                  account
              
              
              750,000
              
              
              -Other
                  asset
              
              
              298,283
              
              
              -**TOTAL
                  ASSETS**
              
              $
              32,096,558
              
              $
              20,529,815**LIABILITIES
                  AND STOCKHOLDERS' EQUITY**Current
                  liabilitiesAccounts
                  payable
              
              $
              1,281,890
              
              $
              279,600Short-term
                  loan
              
              
              3,355,166
              
              
              1,369,000Tax
                  payable
              
              
              125,387
              
              
              93,954Deferred
                  sales
              
              
              619,681
              
              
              667,389Accrued
                  expenses
              
              
              22,694
              
              
              7,236Related
                  party payable
              
              
              294,078
              
              
              536,362Other
                  payable
              
              
              20,919
              
              
              343,207Total
                  current liabilities
              
              
              5,719,815
              
              
              3,296,748Asset
                  retirement obligation liability
              
              
              497,152
              
              
              437,619Other
                  long-term liabilities
              
              
              1,026,389
              
              
              620,979**TOTAL
                  LIABILITIES**
              
              
              7,243,356
              
              
              4,355,346Minority
                  interest in subsidiary
              
              
              2,806,773
              
              
              2,259,595Stockholders'
                  equityPreferred
                  stock: par value $.001; 5,000,000shares
                  authorized; none issued and outstanding
              
              
              -
              
              
              -Common
                  stock: par value $.001; 95,000,000 shares authorized;14,534,175
                  and 13,220,843 shares issued and outstanding at September 30, 2008
                  andDecember
                  31, 2007, respectively
              
              
              14,534
              
              
              13,221Additional
                  paid-in capital
              
              
              5,362,324
              
              
              1,968,634Stock
                  subscription
              
              
              220,000
              
              
              -Other
                  comprehensive income
              
              
              2,102,158
              
              
              1,153,728Retained
                  earnings
              
              
              14,347,413
              
              
              10,779,291**TOTAL
                  STOCKHODERS' EQUITY**
              
              
              22,046,429
              
              
              13,914,874**TOTAL
                  LIABILITIES AND STOCKHOLDERS' EQUITY**
              
              $
              32,096,558
              
              $
              20,529,815
 
 See
        notes
        to Consolidated Financial Statements.
  F-1
  **CHINA
        INDUSTRIAL WASTE MANAGEMENT, INC.**
 **CONSOLIDATED
        STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME**
 **(Unaudited)**
 
 Three Months Ended
              
              Nine Months EndedSeptember 30,
              
              September 30,2008
              
              2007
              
              2008
              
              2007Service
                  fees
              
              $
              1,656,080
              
              $
              1,227,503
              
              $
              5,430,145
              
              $
              2,855,733Sales
                  of cupric sulfate
              
              
              423,891
              
              
              334,728
              
              
              1,804,481
              
              
              1,382,499Sales
                  of recycled commodities
              
              
              1,115,150
              
              
              762,352
              
              
              2,671,634
              
              
              2,233,586Operating
                  revenue
              
              
              3,195,121
              
              
              2,324,583
              
              
              9,906,260
              
              
              6,471,818Cost
                  of service fees
              
              
              478,550
              
              
              391,652
              
              
              1,165,466
              
              
              862,352Cost
                  of cupric sulfate
              
              
              212,132
              
              
              94,975
              
              
              737,235
              
              
              388,016Cost
                  of recycled commodities
              
              
              639,923
              
              
              269,032
              
              
              1,447,399
              
              
              868,736Costs
                  of revenue (including depreciation)
              
              
              1,330,605
              
              
              755,659
              
              
              3,350,100
              
              
              2,119,104Gross
                  profit
              
              
              1,864,516
              
              
              1,568,924
              
              
              6,556,160
              
              
              4,352,714Operating
                  expense:Selling
                  expenses
              
              
              233,783
              
              
              306,492
              
              
              648,886
              
              
              788,516General
                  and administrative expenses
              
              
              439,021
              
              
              404,766
              
              
              1,356,797
              
              
              1,201,773Total
                  operating expenses
              
              
              672,804
              
              
              711,258
              
              
              2,005,683
              
              
              1,990,289Income
                  from operations
              
              
              1,191,712
              
              
              857,666
              
              
              4,550,477
              
              
              2,362,425Other
                  income (expense):Investment
                  loss
              
              
              (5,494
              )
              
              -
              
              
              (15,946
              )
              
              -Interest
                  income
              
              
              11,441
              
              
              11,770
              
              
              17,627
              
              
              23,659Other
                  income
              
              
              1,934
              
              
              13,568
              
              
              8,388
              
              
              15,054Other
                  expense
              
              
              (168,349
              )
              
              (3,069
              )
              
              (170,010
              )
              
              (3,122
              )Total
                  other income (expense)
              
              
              (160,468
              )
              
              22,269
              
              
              (159,941
              )
              
              35,591Net
                  income from continuing operations before minority interest and
                  income
                  tax
              
              
              1,031,244
              
              
              879,935
              
              
              4,390,536
              
              
              2,398,016Income
                  tax provision
              
              
              (103,499
              )
              
              -
              
              
              (437,945
              )
              
              -Income
                  from continuing operations
              
              
              927,745
              
              
              879,935
              
              
              3,952,591
              
              
              2,398,016Discontinued
                  operation, net
              
              
              -
              
              
              (5,221
              )
              
              -
              
              
              (5,221
              )Minority
                  interest
              
              
              95,033
              
              
              61,598
              
              
              384,470
              
              
              212,775Net
                  income
              
              $
              832,712
              
              $
              813,116
              
              $
              3,568,121
              
              $
              2,180,020Foreign
                  currency translation adjustment
              
              
              202,900
              
              
              163,314
              
              
              948,408
              
              
              387,455Comprehensive
                  income
              
              $
              1,035,612
              
              $
              976,430
              
              $
              4,516,529
              
              $
              2,567,475Basic
                  weighted average shares outstanding
              
              
              13,902,510
              
              
              13,220,843
              
              
              13,392,040
              
              
              13,220,843Diluted
                  weighted average shares outstanding
              
              
              13,902,510
              
              
              13,220,843
              
              
              13,392,040
              
              
              13,220,843Basic
                  and diluted net earnings per share
              
              $
              0.06
              
              $
              0.06
              
              $
              0.27
              
              $
              0.16
 
 See
        notes
        to Consolidated Financial Statements.
  F-2
 
 **CHINA
        INDUSTRIAL WASTE MANAGEMENT, INC.**
 **CONSOLIDATED
        STATEMENTS OF CASH FLOWS**
 **(Unaudited)**
 
 For the Nine Months Ended September 30,2008
              
              2007Cash
                  flows from operating activities:Net
                  income
              
              $
              3,568,121
              
              $
              2,180,020Adjustments
                  to reconcile net income to net cashprovided
                  by operating activities:Minority
                  interest
              
              
              547,178
              
              
              212,775Depreciation
              
              
              491,426
              
              
              330,581Amortization
              
              
              28,296
              
              
              27,069Bad
                  debt allowance
              
              
              7,782
              
              
              -Stock
                  issued for services
              
              
              117,100
              
              
              12,000Accretion
                  expenses
              
              
              59,533
              
              
              21,016Loss
                  on disposal of subsidiary
              
              
              -
              
              
              5,221Loss
                  on equity investment
              
              
              (156,393
              )
              
              -Value
                  added tax credit
              
              
              (298,283
              )
              
              -Changes
                  in operating assets and liabilities:Accounts
                  receivable
              
              
              (1,780,297
              )
              
              (229,964
              )Inventory
              
              
              (534,458
              )
              
              (613,760
              )Other
                  receivables
              
              
              (214,646
              )
              
              (345,230
              )Advance
                  to suppliers
              
              
              120,626
              
              
              (9,205
              )Prepaid
                  expense
              
              
              -
              
              
              (18,144
              )Deposits
              
              
              68,679
              
              
              -Accrued
                  expense and deferred sales
              
              
              (7,701
              )
              
              452,817Accounts
                  payable
              
              
              680,002
              
              
              264,065Tax
                  payable
              
              
              31,433
              
              
              (32,826
              )Escrow
                  account
              
              
              (750,000
              )
              
              -Net
                  cash provided by operating activities
              
              
              1,978,398
              
              
              2,256,435Cash
                  flows from investing activiiesInvestment
                  in subsidiary
              
              
              -
              
              
              (2,623,370
              )Purchase
                  of property and equipment
              
              
              (530,282
              )
              
              (187,172
              )Construction
                  contracts
              
              
              (5,381,376
              )
              
              (4,697,512
              )Due
                  from related party
              
              
              (589,738
              )
              
              (28,635
              )Due
                  to related party
              
              
              (242,284
              )
              
              (480,299
              )Proceeds
                  on sale of equity investments
              
              
              -
              
              
              33,934Net
                  cash used in investing activities
              
              
              (6,743,680
              )
              
              (7,983,054
              )Cash
                  flows from financing activitiesProceeds
                  from short term loans
              
              
              3,433,235
              
              
              -Repayment
                  of shor term loans
              
              
              (1,447,069
              )
              
              -Procceds
                  from issuance of common stock
              
              
              3,277,903
              
              
              -Stock
                  subscription
              
              
              220,000
              
              
              -Subsidy
                  received from government
              
              
              405,410
              
              
              396,246Net
                  cash provided by financing activities
              
              
              5,889,479
              
              
              396,246Effect
                  of exchange rate on cash
              
              
              948,430
              
              
              149,741Net
                  increase (decrease) in cash and cash equivalents
              
              
              2,072,627
              
              
              (5,180,632
              )Cash
                  and cash equivalents, beginning of period
              
              
              3,260,307
              
              
              6,478,978Cash
                  and cash equivalents, end of period
              
              $
              5,332,934
              
              $
              1,298,346Supplemental
                  cash flow information:Cash
                  paid during the year for:Interest
              
              $
              163,140
              
              $
              -Income
                  taxes
              
              $
              -
              
              $
              -Non-cash
                  financing activities:Common
                  stock issuance cost
              
              $
              113,000
              
              $
              -
 
 See
        notes
        to Consolidated Financial Statements.
  F-3
 CHINA
        INDUSTRIAL WASTE MANAGEMENT, INC.
 NOTES
        TO
        UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 SEPTEMBER
        30, 2008
 
 The
        accompanying unaudited consolidated financial statements have been prepared
        in
        accordance with accounting principles generally accepted in the United States
        of
        America for interim financial information and with the instructions to Form
        10-Q
        and the new scaled disclosure requirements in Article 8 of Regulation S-K
        of the
        SEC. Accordingly, they do not include all of the information and footnotes
        required by accounting principles generally accepted in the United States of
        America for annual financial statements. In the opinion of management, all
        adjustments (consisting of normal recurring accruals) considered necessary
        for a
        fair presentation have been included. The accounts of the Company and all
        of its
        subsidiaries are included in the consolidated financial statements. All
        significant intercompany accounts and transactions have been eliminated in
        consolidation. The consolidated operating results for the three and nine
        months
        ended September 30, 2008 are not necessarily indicative of the results that
        may
        be expected for the year ending December 31, 2008. For further information,
        refer to the audited consolidated financial statements and footnotes thereto
        included in the Company's Form 10-K for the year ended December 31,
        2007.
 
 **1.
        Nature of operations**
 
 The
        accompanying unaudited consolidated financial statements include China
        Industrial Waste Management, Inc., a Nevada corporation (the “Company”)
        incorporated on November 12, 2003, its wholly owned subsidiary, DonTech Waste
        Services, a Delaware corporation (“DonTech”), and its indirect majority owned
        subsidiaries:
 
 •
Dongtai
        Industrial Waste Treatment Co. Ltd. (“Dongtai”)
 •
Dongtai
        Water Recycling Co. Ltd. (“Dongtai Water”)
 •
Dalian
        Zhuorui Resource Recycling Co., Ltd. (“Zhuorui”)
 •
Dalian
        Lipp Environmental Energy Engineering & Technology Co., Ltd. (“Dalian
        Lipp”)
 
 The
        Company is engaged in the collection, treatment, disposal, and recycling
        of
        industrial wastes principally in Dalian and surrounding areas in Liaoning
        Province, the People’s Republic of China (“PRC”). The Company provides
        waste disposal solutions to its more than 400 customers from facilities located
        in the Economic and Technology Development Zone, Dalian, China. In addition,
        the
        Company provides the following services to its clients:
 
 •
        Environmental protection services,
 •
        Technology consultation,
 •
        Pollution treatment services,
 •
Waste
        management design processing services,
 •
Waste
        disposal solutions,
 •
Waste
        transportation services,
 •
Onsite
        waste management services, and
 •
        Environmental pollution remediation services.
  F-4
  CHINA
        INDUSTRIAL WASTE MANAGEMENT, INC.
 NOTES
        TO
        UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 SEPTEMBER
        30, 2008
 
 The
        Company is currently participating in the operation of the following waste
        disposal and environmental protection projects:
 •
Dongtai
        Water, a build-operate-transfer project established to process polluted water
        generated by the city of Dalian. Construction of the sewage plant has been
        completed, and the project is currently in the stage of commissioning.
 •
Zhuorui
        engages in the project of plasma arc melting, separation and purification
        of
        waste catalysts, treatment of industrial wastes and comprehensive utilization
        of
        waste catalysts or similar material. The project is now in the facility
        installation stage.
 •
Dalian
        Lipp is currently conducting a project based on the Lipp tank building technique
        to generate energy by organic waste anaerobic fermentation, and industrial
        effluent treatment and municipal sewage plant.
 •
Dongtai
        Organic Waste Treatment project,
        engaged in municipal sludge treatment in Dalian. The project is now in the
        installation stage.
 
 **2.
        Basis of Presentation**
  The
        accompanying consolidated financial statements include the accounts of the
        parent entity, its wholly owned subsidiary, DonTech Waste Services Inc, its
        90%
        owned subsidiary, Dalian Dongtai Industrial Waste Treatment Co., Ltd, its
        80%
        owned subsidiary, Dongtai Water Recycling Co. Ltd, its 70% owned subsidiary,
        Dalian Zhuorui Resource Recycling Co., Ltd, and its 75% owned subsidiary,
        Dalian
        Lipp Enviromental Energy Engineering & Technology Co., Ltd.. All material
        inter-company accounts and transactions have been eliminated in the
        consolidation.
 
 The
        accompanying financial statements are prepared in accordance with accounting
        principles generally accepted in the United States of America (“US GAAP”). This
        basis differs from that used in the statutory accounts of the Company, which
        were prepared in accordance with the accounting principles and relevant
        financial regulations applicable to enterprises in the PRC. All necessary
        adjustments have been made to present the financial statements in accordance
        with US GAAP.
 
 **3.
        Summary of Significant Accounting Policies**
 
 **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 disclosure of
        contingent assets and liabilities at the date of the financial statements
        and
        the reported amounts of revenues and expenses during the reporting period.
        Actual results could differ from those estimates.
  F-5
  CHINA
        INDUSTRIAL WASTE MANAGEMENT, INC.
 NOTES
        TO
        UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 SEPTEMBER
        30, 2008
 
 **Foreign
        currency translation**
 As
        of
        September 30, 2008 and 2007, the accounts of the Company were maintained,
        and
        the consolidated financial statements were expressed in the Chinese Yuan
        Renminbi (“RMB”). Such consolidated financial statements were translated into
        U.S. dollars (“USD”) in accordance with Statement of Financial Accounting
        Standards (“SFAS”) No. 52, “Foreign Currency Translation,” with the RMB as the
        functional currency. According to the Statement, all assets and liabilities
        were
        translated at the exchange rate on the balance sheet date; stockholders’ equity
        was translated at the historical rates and the statement of operations items
        were translated at the weighted average exchange rate for the period. The
        resulting translation adjustments are reported under other comprehensive
        income
        in accordance with SFAS No. 130, “Reporting Comprehensive Income”.
 
 **Cash
        and cash equivalents**
 Cash
        and
        cash equivalents include cash on hand and cash on deposit, certificates of
        deposit and all highly liquid debt instruments with original maturities of
        three
        months or less.
 
 **Restricted
        cash**
 In
        accordance with Accounting Review Board (ARB) No. 43, Chapter 3A “Current Assets
        and Current Liabilities”, cash which is restricted as to withdrawal is
        considered a noncurrent asset. Restricted cash consists of $750,000, which
        the
        Company holds in a separate escrow account as required by a group of investors
        lead by Ancora Greater China Fund.
 
 **Accounts
        and other receivables**
 Accounts
        and other receivables are recorded at net realizable value consisting of
        the
        carrying amount less an allowance for uncollectible accounts, as needed.
        Allowance for uncollectible accounts as of September 30, 2008 and December
        31,
        2007 was $7,782 and $9,776, respectively. The Company maintains reserves
        for
        potential credit losses on accounts receivable. Management reviews the
        composition of accounts receivable and analyzes historical bad debts, customer
        concentrations, customer credit worthiness, current economic trends and changes
        in customer payment patterns to evaluate the adequacy of these reserves.
        Terms
        of the sales vary from COD through a credit term of up to nine to twelve
        months.
        Reserves are recorded primarily on a specific identification basis.
 
 **Concentration
        of credit risks**
 The
        Company is subject to concentrations of credit risk primarily from cash and
        cash
        equivalents. The Company maintains accounts with financial institutions,
        which
        at times exceeds the insured Federal Deposit Insurance Corporation limit
        of
        $100,000. The Company minimizes its credit risks associated with cash by
        periodically evaluating the credit quality of its primary financial
        institutions.
  F-6
  CHINA
        INDUSTRIAL WASTE MANAGEMENT, INC.
 NOTES
        TO
        UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 SEPTEMBER
        30, 2008
 
 **Advances
        to suppliers**
 The
        Company makes advances to certain vendors for purchase of its material or
        equipment. The advances to suppliers are interest free and
        unsecured.
 
 **Inventory**
 Inventories
        are stated at the lower of cost, as determined on a first-in, first-out basis,
        or market. Management compares the cost of inventories with the market value,
        and allowance is made for writing down the inventories to their market value,
        if
        lower.
 
 **Property,
        equipment and construction in progress**
 Property
        and equipment are stated at cost. Expenditures for maintenance and repairs
        are
        charged to earnings as incurred; additions, renewals and betterments are
        capitalized. When property and equipment are retired or otherwise disposed
        of,
        the related cost and accumulated depreciation are removed from the respective
        accounts, and any gain or loss is included in operations. Depreciation of
        property and equipment is provided using the straight-line method for
        substantially all assets with estimated lives as follows:
 
 Buildings
              
              
              30
                  YearsMachinery
              
              
              10
                  YearsVehicles
              
              
              8
                  YearsOffice
                  equipment
              
              
              5
                  Years
 
 Construction
        in progress consists of the design expenses, architect fee and cost of the
        equipment to treat waste.
 Construction
        in progress includes capitalized interest of $134,454 and $77,353 as of
        September 30, 2008 and December 31, 2007 respectively.
 
 **Landfills**
 Cost
        Basis of Landfill Assets — we capitalize various costs that we incur to make a
        landfill ready to accept waste. These costs generally include expenditures
        for
        land, permitting, excavation, liner material and installation and other
        capital infrastructure costs. The cost basis of our landfill assets also
        includes estimates of future costs associated with landfill final capping,
        closure and post-closure activities in accordance with SFAS No. 143, “Accounting
        for Asset Retirement Obligations and its Interpretations”.
 
 Interest
        accretion on final capping, closure and post-closure liabilities is recorded
        using the effective interest method and is recorded as accretion expense,
        which
        is included our consolidated statements of operations.
 
 Amortization
        of Landfill Assets — The amortizable basis of a landfill includes (i) amounts
        previously expended and capitalized; (ii) capitalized landfill final capping,
        closure and post-closure costs; (iii) projections of future purchase and
        development costs required to develop the landfill site to its remaining
        permitted and expansion capacity; and (iv) projected asset retirement costs
        related to landfill final capping, closure and post-closure
        activities.
  F-7
  CHINA
        INDUSTRIAL WASTE MANAGEMENT, INC.
 NOTES
        TO
        UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 SEPTEMBER
        30, 2008
 
 Amortization
        is recorded on a units-of-consumption basis, applying cost as a rate per
        ton.
        The rate per ton is calculated by dividing each component of the amortizable
        basis of a landfill by the number of tons needed to fill the corresponding
        asset’s airspace.
 
 Liabilities
        for landfill and environmental remediation costs are presented in the table
        below:
 
 September 30,
                2008
              
              December  31,
                2007Long-term
              
              $
              497,152
              
              
              437,619
 
 **Long-term
        investment**
 
 Invested
                  company
              
              Equity
                  acquired
              
              Balance as of
                September 30,
                2008
              
              Balance as of
                December 31,
                2007Dongtai
                  Organic
              
              
              49
              %
              
              2,789,747
              
              
              2,633,354Total
              
              
              
              
              
              2,789,747
              
              
              2,633,354
 
 Long-term
        investments are recorded under the equity method. Dongtai Organic is
        constructing and will operate a sludge treatment and disposal facility in
        Dalian, PRC, of which the investment is recorded under the equity
        method.
 
 **Impairment
        of long-lived assets**
 In
        accordance with SFAS No. 144, “Accounting for the Impairment or Disposal of
        Long-Lived Assets” (SFAS 144), such as property, plant, and equipment, and
        purchased intangibles, are reviewed for impairment whenever events or changes
        in
        circumstances indicate that the carrying amount of an asset may not be
        recoverable. Intangible assets are tested for impairment annually.
        Recoverability of assets to be held and used is measured by a comparison
        of the
        carrying amount of an asset to estimated undiscounted future cash flows expected
        to be generated by the asset. If the carrying amount of an asset exceeds
        its
        estimated future cash flows, an impairment charge is recognized by the amount
        by
        which the carrying amount of the asset exceeds the fair value of the asset.
        There were no events or changes in circumstances that necessitated a review
        of
        impairment of long lived assets as of September 30, 2008 and 2007,
        respectively.
  F-8
  CHINA
        INDUSTRIAL WASTE MANAGEMENT, INC.
 NOTES
        TO
        UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 SEPTEMBER
        30, 2008
 
 **Intangible
        assets**
 Intangible
        assets consist of “Rights to use land and build a plant” for fifty years. The
        intangible assets are amortized straight - line over fifty years. The Company
        also evaluates intangible assets for impairment, at least on an annual basis
        and
        whenever events or changes in circumstances indicate that the carrying value
        may
        not be recoverable from its estimated future cash flows. Recoverability of
        intangible assets, other long-lived assets and, goodwill is measured by
        comparing their net book value to the related projected undiscounted cash
        flows
        from these assets, considering a number of factors, including past operating
        results, budgets, economic projections, market trends and product development
        cycles. If the net book value of the asset exceeds the related undiscounted
        cash
        flows, the asset is considered impaired, and a second test is performed to
        measure the amount of impairment loss.
 
 Net
        intangible assets at September 30, 2008 and December 31, 2007 were $1,703,778
        and $1,732,074 respectively. Such assets consist entirely of a right to use
        land
        of $1,921,474, less accumulated amortization of $217,696 and $189,400
        respectively.
  **Minority
        interest**
 Minority
        interest represents the minority owners’ 10% equity interest in Dongtai, 20%
        equity interest in Dongtai Water, 30% equity interest in Zhuorui and 25%
        equity interest in Dalian Lipp.
  **Fair
        value of financial instruments**
 SFAS
        No.
        107, “Disclosures About Fair Value of Financial Instruments”, requires that the
        Company discloses estimated fair values of financial instruments. The carrying
        amounts reported in the statements of financial position for current assets
        and
        current liabilities qualifying as financial instruments are a reasonable
        estimate of fair value.
 
 **Revenue
        recognition**
 The
        Company’s revenue recognition policies are in compliance with Staff Accounting
        Bulletin (SAB) 104. Our revenues are generated from the fees we charge for
        waste
        collection, transfer, disposal and recycling services and the sale of recycled
        commodities. The fees charged for our services are generally defined in our
        service agreements and vary based on contract specific terms such as frequency
        of service, weight, volume and the general market factors influencing industry’s
        rates. We generally recognize revenue as services are performed or products
        are
        delivered.
  F-9
 
 CHINA
        INDUSTRIAL WASTE MANAGEMENT, INC.
 NOTES
        TO
        UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 SEPTEMBER
        30, 2008
 
 Deferred
        sales consist of contracts for which the fees have been collected but revenue
        has not yet been recognized in accordance with the revenue recognition policy.
        As of September 30, 2008 and December 31, 2007 deferred sales amounted to
        $619,681 and $667,389, respectively.
 
 **Advertising
        costs**
 The
        Company expenses the cost of advertising as incurred or, as appropriate,
        the
        first time the advertising takes place. Advertising costs for the three and
        nine
        months ended September 30, 2008 and 2007 were immaterial.
 
 **Stock-based
        compensation**
 In
        December 2004, the Financial Accounting Standards Board (“FASB”) issued SFAS
        No.123(R), “Share-Based Payment”, which prescribes accounting and reporting
        standards for all stock based compensation plans, including employee stock
        options, restricted stock, employee stock purchase plans and stock appreciation
        rights. SFAS No. 123(R) requires compensation expense to be recorded using
        the
        fair value method.
  **Income
        taxes**
 The
        Company utilizes SFAS No. 109, “Accounting for Income Taxes” which requires the
        recognition of deferred tax assets and liabilities for the expected future
        tax
        consequences of events that have been included in the financial statements
        or
        tax returns. Under this method, deferred income taxes are recognized for
        the tax
        consequences in future years of differences between the tax bases of assets
        and
        liabilities and their financial reporting amounts at each period end based
        on
        enacted tax laws and statutory tax rates, applicable to the periods in which
        the
        differences are expected to affect taxable income. Valuation allowances are
        established, when necessary, to reduce deferred tax assets to the amount
        expected to be realized.
  **Local
        PRC income tax**
 The
        Company is subject to the PRC Enterprise Income Tax at a rate of 30% on its
        net
        income. According to a PRC ruling, any joint venture with foreign investment
        will get special tax exempt treatment for the first two years, reduced tax
        rate
        for three years at 9%, 10% and 11% for the third, fourth and fifth
        year.
 
 **Statement
        of cash flows**
 In
        accordance with SFAS No. 95, “Statement of Cash Flows”, cash flows from the
        Company’s operations are calculated based upon the local currencies. As a
        result, amounts related to assets and liabilities reported on the statement
        of
        cash flows will not necessarily agree with changes in the corresponding balances
        on the balance sheet.
  F-10
  CHINA
        INDUSTRIAL WASTE MANAGEMENT, INC.
 NOTES
        TO
        UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 SEPTEMBER
        30, 2008
 
 **Basic
        and diluted net earnings per share**
 Earnings
        per share is calculated in accordance with SFAS No. 128, “Earnings Per Share”.
        Basic earnings per share is based upon the weighted average number of common
        shares outstanding. Diluted earnings per share is based on the assumption
        that
        all dilutive convertible shares and stock options were converted or exercised.
        Dilution is computed by applying the treasury stock method. Under this method,
        options and warrants are assumed to be exercised at the beginning of the
        period
        (or at the time of issuance, if later), and as if funds obtained thereby
        were
        used to purchase common stock at the average market price during the
        period.
 
 **Contingent
        liabilities**
 We
        estimate the amount of potential exposure we may have with respect to claims,
        assessments and litigation in accordance with SFAS No. 5, “Accounting for
        Contingencies”. We are party to pending or threatened legal proceedings covering
        a wide range of matters in various jurisdictions. It is not always possible
        to
        predict the outcome of litigation, as it is subject to many uncertainties.
        Additionally, it is not always possible for management to make a meaningful
        estimate of the potential loss or range of loss associated with such
        litigation.
 
 **Recent
        accounting pronouncements**
 *Determining
        Whether Instruments Granted in Share-Based Payment Transactions Are
        Participating Securities*
 
 In
        June 2008, FASB issued FSP Emerging Issues Task Force (“EITF”) Issue
        No. 03-6-1, “Determining Whether Instruments Granted in Share-Based Payment
        Transactions Are Participating Securities”. The FSP addresses whether
        instruments granted in share-based payment transactions are participating
        securities prior to vesting and, therefore, need to be included in the earnings
        allocation in computing earnings per share under the two-class method. The
        FSP
        affects entities that accrue dividends on share-based payment awards during
        the
        awards’ service period when the dividends do not need to be returned if the
        employees forfeit the award. This FSP is effective for fiscal years beginning
        after December 15, 2008. The Company is currently assessing the impact of
        FSP EITF 03-6-1 on its consolidated financial position and results of
        operations.
 
 *Determining
        Whether an Instrument (or an Embedded Feature) Is Indexed to an entity's
        Own
        Stock*
 
 In
        June
        2008, the FASB ratified EITF Issue No. 07-5, "Determining Whether an Instrument
        (or an Embedded Feature) Is Indexed to an Entity's Own Stock" (EITF 07-5).
        EITF
        07-5 provides that an entity should use a two step approach to evaluate whether
        an equity-linked financial instrument (or embedded feature) is indexed to
        its
        own stock, including evaluating the instrument's contingent exercise and
        settlement provisions. It also clarifies on the impact of foreign currency
        denominated strike prices and market-based employee stock option valuation
        instruments on the evaluation. EITF 07-5 is effective for fiscal years beginning
        after December 15, 2008. The Company is currently assessing the impact of
        EITF
        07-5 on its consolidated financial position and results of
        operations.
  F-11
  CHINA
        INDUSTRIAL WASTE MANAGEMENT, INC.
 NOTES
        TO
        UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 SEPTEMBER
        30, 2008
 
 *Accounting
        for Convertible Debt Instruments That May Be Settled in Cash upon Conversion
        (
        Including Partial Cash Settlement)*
 
 In
        May 2008, the FASB issued FSP Accounting Principles Board (“APB”) Opinion
        No. 14-1, “Accounting for Convertible Debt Instruments That May Be
        Settled in Cash upon Conversion (Including Partial Cash Settlement).” The FSP
        clarifies the accounting for convertible debt instruments that may be settled
        in
        cash (including partial cash settlement) upon conversion. The FSP requires
        issuers to account seperately for the liability and equity components of
        certain
        convertible debt instruments in a manner that reflects the issuer's
        nonconvertible debt (unsecured debt) borrowing rate when interest cost is
        recognized. The FSP requires bifurcation of a component of the debt,
        classification of that component in equity and the accretion of the resulting
        discount on the debt to be recognized as part of interest expense in our
        consolidated statement of operations. The FSP requires retrospective application
        to the terms of instruments as they existed for all periods presented. The
        FSP
        is effective for us as of January 1, 2009 and early adoption is not permitted.
        The Company is currently evaluating the potential impact of FSP APB 14-1
        upon
        its consolidated financial statements.
  *The
        Hierarchy of Generally Accepted Accounting Principles*
  In
        May
        2008, the FASB issued SFAS No. 162, "The Hierarchy of Generally Accepted
        Accounting Principles" (FAS No.162). SFAS No. 162 identifies the sources
        of
        accounting principles and the framework for selecting the principles used
        in the
        preparation of financial statements. SFAS No. 162 is effective 60 days following
        the SEC's approval of the Public Company Accounting Oversight Board amendments
        to AU Section 411, "The Meaning of Present Fairly in Conformity with Generally
        Accepted Accounting Principles". The implementation of this standard will
        not
        have a material impact on the Company's consolidated financial position and
        results of operations.
  *Determination
        of the Useful Life of Intangible Assets*
  In
        April
        2008, FASB issued FASB Staff Position on Financial Accounting Standard (“FSP
        FAS”) No. 142-3, “Determination of the Useful Life of Intangible Assets”, which
        amends the factors that should be considered in developing renewal or extension
        assumptions used to determine the useful life of intangible assets under
        SFAS No. 142 “Goodwill and Other Intangible Assets”.  The intent of this
        FSP is to improve the consistency between the useful life of a recognized
        intangible asset under SFAS No. 142 and the period of the expected cash flows
        used to measure the fair value of the asset under SFAS No. 141 (revised 2007)
        “Business Combinations” and other U.S. generally accepted accounting
        principles.    The Company is currently evaluating the potential
        impact of FSP FAS No. 142-3 on its consolidated financial
        statements.
  *Disclosure
        about Derivative Instruments and Hedging Activities*
  In
        March
        2008, the FASB issued SFAS No. 161, *“* Disclosure
        about Derivative Instruments and Hedging Activities *,* an
        amendment of SFAS No. 133”, (SFAS No. 161). This statement requires that
        objectives for using derivative instruments be disclosed in terms of underlying
        risk and accounting designation. The Company is required to adopt SFAS No.
        161
        on January 1, 2009. The Company is currently evaluating the potential impact
        of
        SFAS No. 161 on the Company’s consolidated financial
        statements.
  F-12
  CHINA
        INDUSTRIAL WASTE MANAGEMENT, INC.
 NOTES
        TO
        UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 SEPTEMBER
        30, 2008
  *Delay
        in Effective Date*
  In
        February 2008, the FASB issued FSP FAS No. 157-2, “Effective Date of FASB
        Statement No. 157”. This FSP delays the effective date of SFAS No. 157 for
        all nonfinancial assets and nonfinancial liabilities, except those that are
        recognized or disclosed at fair value on a recurring basis (at least annually)
        to fiscal years beginning after November 15, 2008, and interim periods
        within those fiscal years. The impact of adoption was not material to the
        Company’s consolidated financial condition or results of
        operations.
  **4.
        Inventory**
  Inventory
        at September 30, 2008 and December, 31, 2007 consists of raw materials and
        recycled commodities as Follow:
  September
                30, 2008
              
              December
                31, 2007Raw
                  materials
              
              $
              851,245
              
              $
              786,427Recycled
                  commodities
              
              
              1,015,562
              
              
              545,922$
              1,866,807
              
              $
              1,332,349
 
 **5.
        Property, plant and equipment**
 
 September
                30, 2008
              
              December
                31, 2007Land
                  and building
              
              $
              2,536,429
              
              $
              2,305,868Machinery
                  and equipment
              
              
              1,291,628
              
              
              1,242,966Office
                  equipment
              
              
              562,575
              
              
              375,433Vehicles
              
              
              836,955
              
              
              773,0385,227,587
              
              
              4,697,305Less
                  accumulated depreciation
              
              
              (2,546,694
              )
              
              (2,055,268
              )Total
                  property and equipment, net
              
              
              2,680,893
              
              
              2,642,037Construction
                  in progress
              
              
              12,791,631
              
              
              7,410,255Total
              
              $
              15,472,524
              
              $
              10,052,292
  F-13
  CHINA
        INDUSTRIAL WASTE MANAGEMENT, INC.
 NOTES
        TO
        UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 SEPTEMBER
        30, 2008
 
 **6.
        Other asset**
 
 Other
        asset in the amount of $298,283 represent for value added tax (“VAT”)
        credit.
 VAT
        is a
        turnover tax levied on all units and individuals engaged in the sale of goods,
        the provision of processing, repair and replacement services (together referred
        to as "taxable labor services") and the importation of goods to the
        PRC.
 
 The
        standard VAT rate is 17%, and a reduced rate of 13% or even 0% applies to
        certain items.
 
 PRC
        regulations categorize taxpayers as general VAT taxpayers and small-scale
        VAT
        taxpayers, depending on sales volume and the soundness of their accounting
        system. General VAT taxpayer status is not granted automatically but subject
        to
        the approval of the tax authorities.
 
 General
        VAT taxpayers with an adequate accounting system are allowed to reduce their
        VAT
        burden by crediting input VAT against Output VAT, which is demonstrated by
        a
        special VAT invoice.
 
 **7.
        Short-term loan**
 
 The
        Company entered into multiple one-year loans with accredited lenders. The
        interest rate varies from
 8.748
        %
        to 9.720%. As of September 30, 2008, the remaining balance was
        $3,355,166.
 
 **8.
        Other long-term liabilities**
 
 Other
        long term liabilities include special fund for environmental protection in
        the
        amount of $ 875,261, and obligation to pay for land usage right in the amount
        of
        $ 151,128.
 
 **9.
        Accumulated other comprehensive income**
 
 The
        components of accumulated other comprehensive income was as follow:
 
 September
                  30,
                2008
              
              December
                  31,
                2007Cumulative
                  translation adjustment of foreign currency statements
              
              $
              947,818
              
              $
              774,007
  F-14
  CHINA
        INDUSTRIAL WASTE MANAGEMENT, INC.
 NOTES
        TO
        UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 SEPTEMBER
        30, 2008
 
 **10.
        Equity**
 
 In
        April
        2008, the Company issued 50,000 shares of common stock as compensation for
        services to an investment consulting firm. The fair market value of the stock
        is
        approximately $117,000.
 
 In
        August
        2008, the Company issued 51 units, consisting of an aggregate of 1,020,000
        shares of common stock, Class A warrants to purchase an aggregate of 510,000
        shares of common stock and Class B warrants to purchase an aggregate of 510,000
        shares of common stock, to a group of institutional and accredited investors
        at
        an effective price of $3 per share. Total gross proceeds amounted to $2,780,308,
        excluding issuance cost of $279,692. Each unit consists
        of (a) 20,000 shares of common stock, (b) one Class A common stock purchase
        warrant to purchase 10,000 shares of common stock until September 30, 2011,
        at
        an exercise price of $3.50 per share, and (c) one Class B common stock purchase
        warrant to purchase 10,000 shares of common stock until September 30, 2011,
        at
        an exercise price of $4.50 per share.
 
 In
        September 2008, the Company issued 9.6665 units, consisting of an aggregate
        of
        193,333 shares of common stock, Class A Warrants to purchase an aggregate
        of
        96,667 shares of common stock and Class B Warrants to purchase an aggregate
        of
        96,667 shares of common stock, to a group of institutional and accredited
        investors at an effective price of $3 per share. Total gross proceeds amounted
        to $497,595, excluding issuance cost of $82,404.  Each
        unit consists of (a) 20,000 shares of common stock, (b) one Class A common
        stock
        purchase warrant to purchase 10,000 shares of common stock until September
        30,
        2011, at an exercise price of $3.50 per share, and (c) one Class B common
        stock
        purchase warrant to purchase 10,000 shares of common stock until September
        30,
        2011, at an exercise price of $4.50 per share.
 
 In
        September 2008, the Company issued 50,000 shares of common stock as compensation
        for services to an investor relationship company. The fair market value of
        the
        stock was approximately $113,000, and recorded as stock issuance
        cost.
 
 In
        September 2008, the Company received common stock subscription in the amount
        of
        $220,000 for issuing a total of 3.66665 units, consisting of an aggregate
        of
        73,333 shares of common stock, Class A Warrants to purchase an aggregate
        of
        36,667 shares of common stock and Class B Warrants to purchase an aggregate
        of
        36,667 shares of common stock, to a group of institutional and accredited
        investors at an effective price of $3 per share.
 
 **11.
        Commitment and contingency**
 
 On
        August
        27, 2008 and September 16, 2008, the Company issued 60.6665 units to a group
        of
        institutional and accredited investors .
        In
        connection with the sale:
  F-15
  CHINA
        INDUSTRIAL WASTE MANAGEMENT, INC.
 NOTES
        TO
        UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 SEPTEMBER
        30, 2008
 
 **·** The
        Company agreed to file a registration statement with the SEC to permit the
        investors to resell the common stock included in their units and to pay the
        investors liquidated damages at the rate of 1% of the amount of their investment
        per month, up to a maximum of 10%, to the extent the registration statement
        is
        not timely filed or diligently pursued,
 **·**The
        Company agreed to establish a board of directors, a majority of whose
        members will be “independent” within the meaning of NASDAQ Marketplace Rule
        4200(15); and $650,000 from the proceeds is being held in escrow until this
        requirement is satisfied,
 **·**The
        Company agreed to engage an accounting consultant to assist with the
        presentation and delivery of financial reports and related information; and
        $100,000 from the proceeds is being held in escrow until this requirement
        is
        satisfied,
 **·**The
        Company entered into an agreement with an investor relationship firm
        to provide consulting services for a period of one year. Under this agreement,
        the Company has agreed to pay a consulting fee equal to $9,000 per month,
        and
        issue 6,000 shares of common stock quarterly, contingent upon the occurrence
        of
        certain events described in the agreement.
 
 **12.
        Subsequent events**
 
 On
        October 14, 2008, The Company issued 5.3333 units, consisting of an aggregate
        of
        106,668 shares of common stock, Class A warrants to purchase an aggregate of
        53,334 shares of common stock and Class B warrants to purchase an aggregate
        of
        53,334 shares of common stock, to a group of institutional and accredited
        investors for gross proceeds of $320,000. Each unit consists of (a)
        20,000 shares of common stock, (b) one Class A common stock purchase warrant
        to
        purchase 10,000 shares of common stock until September 30, 2011, at an exercise
        price of $3.50 per share, and (c) one Class B common stock purchase warrant
        to
        purchase 10,000 shares of common stock until September 30, 2011, at an exercise
        price of $4.50 per share.
  F-16





**Item
                2.**
            **Management's
                Discussion and Analysis of Financial Condition and Results of Operations.**





**FORWARD-LOOKING
      INFORMATION**





Management's
      Discussion and Analysis of Financial Condition and Results of Operations
      ("MD&A") includes forward-looking statements. Readers are cautioned that
      forward-looking statements are not guarantees of future performance or results
      and involve risks and uncertainties that cannot be predicted or quantified
      and,
      consequently, our actual performance may differ materially from those expressed
      or implied by such forward-looking statements. Such risks and uncertainties
      include, but are not limited to, the following factors, as well as other factors
      described from time to time in our reports filed with the Securities and
      Exchange Commission (including the sections entitled "Risk Factors" and
      "Management's Discussion and Analysis of Financial Condition and Results of
      Operations" contained therein): the timing and magnitude of technological
      advances; the prospects for future acquisitions; the effects of political,
      economic and social uncertainties regarding the governmental, economic and
      political circumstances in the People’s Republic of China, the possibility that
      a current customer could be acquired or otherwise be affected by a future event
      that would diminish their waste management requirements; the competition in
      the
      waste management industry and the impact of such competition on pricing,
      revenues and margins; uncertainties surrounding budget reductions or changes
      in
      funding priorities of existing government programs and the cost of attracting
      and retaining highly skilled personnel; our projected sales, profitability,
      and
      cash flows; our growth strategies; anticipated trends in our industries; our
      future financing plans; and our anticipated needs for working capital.





**OVERVIEW**





Historically,
      the Company engaged in two lines of business: (a) the exploration and
      development of potential mining properties, and (b) the development, marketing
      and support of computer software products and services. In September 2004,
      the
      Company sold its computer business. Since September 2005, the Company has no
      longer been in the mining business due to its loss of all its contractual rights
      in certain mining properties in Spain.





In
      November 2005, a Delaware corporation known as China Industrial Waste
      Management, Inc. (“CIWM Delaware”) acquired 90% of the issued and outstanding
      capital stock of Dalian Dongtai Industrial Waste Treatment Co., Ltd. (“Dongtai”)
      from the shareholders of Dongtai in a reverse merger transaction in which the
      Dongtai shareholders became the owner of all of the issued and outstanding
      shares of CIWM Delaware. As a result of the reverse merger, Dongtai became
      a
      joint venture with foreign investment under the laws of the PRC, with a total
      registered and paid-in capital of $2.3 million. The exchange of shares with
      the
      Dongtai shareholders was accounted for as a reorganization between entities
      under common control with CIWM Delaware as the receiving entity, as prescribed
      by SFAS 141. The accounts of both entities were combined at their historical
      cost basis, resulting in no gain, loss, or goodwill. The combination was
      essentially a recapitalization of Dongtai.





On
      November 11, 2005, China Industrial Waste Management, Inc., a Nevada corporation
      (f/k/a Goldtech Mining Corporation) (“CIWM Nevada”) entered into an Agreement
      and Plan of Merger (the “Merger Agreement”) with CIWM Delaware and the
      shareholders of CIWM Delaware. Pursuant to the Merger Agreement, which closed
      on
      November 11, 2005, CIWM Delaware merged with and into CIWM Nevada’s wholly-owned
      Delaware subsidiary, DonTech. Pursuant to the Merger Agreement, after the
      merger, CIWM Delaware ceased to exist and DonTech was the surviving company
      (and
      the owner of 90% of the issued and outstanding capital stock of Dongtai). The
      merger of CIWM Delaware into DonTech was accounted for as a reverse acquisition
      under the purchase method of accounting since the shareholders of CIWM Delaware
      obtained control of CIWM Nevada (the Company) by virtue of the merger.
      Accordingly, the merger was recorded as a recapitalization of CIWM Delaware,
      with DonTech being treated as the continuing entity. CIWM Nevada (the Company)
      currently owns all of the issued and outstanding capital stock of DonTech,
      which
      in turn, owns 90% of the issued and outstanding capital stock of Dongtai.





Dongtai
      is engaged in the collection, treatment, disposal and recycling of industrial
      wastes principally in Dalian, China and surrounding areas in Liaoning Province,
      China. Dongtai provides waste disposal solutions to its more than 400
      customers, including large multinational corporations, from facilities located
      in the Economic and Technology Development Zone, Dalian, PRC. Dongtai treats,
      disposes of and/or recycles many types of industrial wastes, and recycled waste
      products are sold to customers as raw material to produce chemical and
      metallurgy products. In addition, Dongtai treats or disposes of industrial
      waste
      through incineration, burial or water treatment; as well as provides a range
      of
      environmental protection services to its clients. Dongtai generates revenues
      from waste collection and disposal services, as well as from sales of valuable
      products and recycled commodities.




2




In
      addition to its waste collection and disposal operations, Dongtai participates
      in the operation of the following waste disposal and environmental protection
      projects, which are expected to contribute to revenues in future periods:





l
            Dongtai
                Water Recycling Co. Ltd (“Dongtai Water”), a Build-Operate-Transfer (BOT)
                project established to process polluted water generated by the City
                of
                Dalian. Dongtai owns 80% of this project. The total investment in
                this
                project is approximately RMB 44 million (approximately $6 million).
                Construction of the sewage plant has been completed, and the project
                is
                currently under operation.





l
            Dongtai
                Organic Waste Treatment Co. Ltd. (“Dongtai Organic”), which is also a BOT
                project, engaged in municipal sludge treatment in Dalian. Dongtai
                owns a
                49% interest in Dongtai Organic, which is expected to operate for
                the next
                20 years and provide a municipal sludge treatment capacity of 600
                tons per
                day. The total investment in the project, which is in the installation
                stage, is approximately RMB 130 million (approximately $17.8 million).





l
            Dalian
                Zhuorui Resource Recycling Co., Ltd. (“Zhuorui”), which is 70% owned by
                Dongtai, engages in plasma arc melting, separation and purification
                of
                waste catalysts, treatment of industrial wastes and comprehensive
                utilization of waste catalysts or similar material. RMB 65 million
                (approximately $8.9 million). The project is now in the facility
                testing
                stage.





l
            Dalian
                Lipp Environmental Energy Engineering & Technology Co., Ltd. (“Dalian
                Lipp”), is a PRC joint venture owned 75% by Dongtai. Dalian Lipp designs,
                manufactures and installs environmental protection equipment and
                renewable
                energy equipment and provides related technical services. The project
                is
                based on the Lipp tank building technique, and is dedicated to generating
                energy by organic waste anaerobic fermentation, and industrial effluent
                treatment and municipal sewage plant.





Our
      revenues generated in first quarter 2008 were primarily attributable to fees
      from waste treatment and disposal services. We expect to experience continued
      increases in waste treatment and disposal services in fiscal 2008 in large
      part
      due to continued growth in Dalian and Liaoning Province and increasing market
      opportunities created by government environmental regulation.




In
      order
      to provide sufficient infrastructure to meet the increasing demand for waste
      treatment and disposal, an expansion project is now underway to significantly
      increase Dongtai’s capacity for waste treatment and disposal. It is anticipated
      that the total investment in this expansion project will be approximately RMB
      120 million (approximately USD$16.4 million). Groundbreaking, incinerator design
      and other facilities design for the expansion project , incinerator workshop
      construction have been completed, and an environmental impact assessment report
      has been submitted to and approved by the Ministry of Environmental Protection
      of China.





Our
      business strategy is aimed at increasing revenue and earnings through profitable
      growth and improving returns on invested capital. The components of our strategy
      include: (1) placing emphasis on the commercialization of solid waste
      treatment; (2) our expansion into municipal sewage and sludge treatment BOT
      projects; (3) managing our businesses locally with a strong operations focus
      on
      customer service; (4) entering into new geographic markets in China; and
      (5) maintaining our financial capacity and effective administrative systems
      and controls to support on-going operations and future growth. We are evaluating
      growth in our solid waste treatment operations through opportunities to
      cooperate with prominent domestic or overseas partners and attempt to integrate
      customer groups (for example, the refinery industry), to realize resource
      optimization.





We
      also
      plan to seek new BOT projects and acquire interests in existing projects, as
      we
      believe they can provide us with stable revenues and cash inflows. Furthermore,
      we believe that a well-operated BOT project will gain attention and social
      recognition from the local government and business community, which may, in
      turn, provide additional business opportunities in the Dalian metropolitan
      area.





3




**RESULTS
      OF OPERATIONS**





The
      following discussion should be read in conjunction with the consolidated
      financial statements and notes appear elsewhere in this quarterly report.





Three
      Months and Nine Months Ended September 30, 2008 Compared to the Three Months
      and
      Nine Months Ended September 30, 2007





We
      generate revenue primarily from two sources: (a) Services provided to customers
      for waste collection, transfer, recycling and disposal; and (b) Sale of recycled
      materials. We consider our collection and disposal operations, and reclamation
      of recycled materials as our core business.





*Revenues* *.*





The
      Company’s operating revenues for the three and nine months ended
      September 30, 2008 were $3,195,121and $9,906,260, compared with $2,324,583
      and $6,471,818 for the three and nine months ended September 30, 2007,
      respectively.





Three Months Ended
            
            Nine Months EndedSeptember 30,
            
            September 30,2008
            
            2007
            
            2008
            
            2007Service
                fees
            
            $
            1,656,080
            
            $
            1,227,503
            
            $
            5,430,145
            
            $
            2,855,733Sales
                of cupric sulfate
            
            
            423,891
            
            
            334,728
            
            
            1,804,481
            
            
            1,382,499Sales
                of other recycled commodities
            
            
            1,115,150
            
            
            762,352
            
            
            2,671,634
            
            
            2,233,586Total
            
            $
            3,195,121
            
            $
            2,324,583
            
            $
            9,906,260
            
            $
            6,471,818





Total
      Revenues increased by $ 3,434,442 or 53 % for the nine months ended September
      30, 2008 as compared to the nine months ended September 30,
      2007.  Revenues for the three months ended September 30, 2008
      increased by $870,538 or 37 % over the comparable period in 2007. The increases
      in revenues during the three and nine months ended September 30, 2008 over
      the
      comparable periods in 2007 resulted from an increase in the number of our
      customers for waste processing services, an increased demand for our services
      from existing customers and broadened sales network for our recycled
      commodities.





*Cost
      of Revenues* *.*





The
      Company’s cost of revenues for the three and nine months ended
      September 30, 2008 were $1,330,605 and $3,350,100 , compared with $ 755,659
      and $ 2,119,104 for the three and nine months ended September 30, 2007,
      respectively.





Three
                Months Ended
            
            Nine
                Months EndedSeptember 30,
            
            September 30,2008
            
            2007
            
            2008
            
            2007Cost
                of service fees
            
            $
            478,550
            
            $
            391,652
            
            $
            1,165,466
            
            $
            862,352Cost
                of cupric sulfate
            
            
            212,132
            
            
            94,975
            
            
            737,235
            
            
            388,016Cost
                of other recycled commodities
            
            
            639,923
            
            
            269,032
            
            
            1,447,399
            
            
            868,736Total
            
            $
            1,330,605
            
            $
            755,659
            
            $
            3,350,100
            
            $
            2,119,104





The
      cost
      of revenue for the nine months ended September 30, 2008 increased by $1,230,996
      or 58% compared to the nine months ended September 30, 2007 in response to
      the
      increase in revenue and the sharp increase of cost of raw materials.




4




*Selling
      Expenses* *.*





Total
      selling expenses for the three months ended September 30, 2008 decreased by
      24 %
      over such expenses for the three months ended September 30, 2007 and decreased
      by 18% for the nine months ended September 30, 2008 compared with the same
      period in 2007. The decreases in selling expenses were principally attributable
      to improved control over cost and expenses.





*General
      and Administrative Expenses .*





In
      comparison with the same period in 2007, the general and administrative expenses
      for the Nine months ended September 30, 2008 increased by 13%, principally
      as a
      result of expanded business and the addition of oversea expenses related to
      the
      recent financing.





*Net
      Income.*





Net
      income for the three months ended September 30, 2008 increased by $19,596 or
      2.4
      % to $832,712 from $813,116 for the three months ended September 30, 2007.
      Net
      income for the nine months ended September 30 2008 increased by $1,388,101
      or
      63.7% to $ 3,568,121 from $ 2,180,020 for the nine months ended September 30,
      2007. This increase is primarily attributable to the increase in both service
      fees and sales of recycled commodities (including sales of cupric sulfate),
      which is generated from widened customer base of the Company and to the
      tightened control over cost and expenses.





*Revision
      to Earnings Guidance.*





The
      Company now anticipates its earnings for the year ending December 31, 2008
      will
      be $4.5 million versus previously published guidance of $7.8 million. The
      revised guidance primarily results from a combination of (a) operating delays
      encountered by Zhuorui Resource Recycling Co., Ltd., the Company’s indirect
      majority-owned subsidiary which intends to engage in the recycling of waste
      catalyst to generate valuable metals and slag used in cement, (b) temporary
      disruptions in the operations of some of the Company’s customers caused by the
      Olympic Games recently held in the PRC and (c) the recent worldwide economic
      downturn and the significant decreases in the prices of recycled commodities,
      in
      light of which the Company has determined to maintain an inventory of recycled
      commodities rather than sell them at currently deflated prices.





**LIQUIDITY
      AND CAPITAL RESOURCES**





We
      have
      financed our operations and met capital expenditure requirements primarily
      through cash provided by operating activities, and bank loans.





Short-term
      loan for the nine months ended September 30, 2008 was $ 3,355,166 compared
      to
      $1,369,000 at December 31, 2007 due to additional bank borrowings to accelerate
      business expansion.





As
      of
      September 30, 2008, cash and cash equivalents of the Company increased
      $2,072,627 or 64 % from $3,260,307 to $5,332,934 compared with that of December
      31, 2007. This is attributable to increase in net cash provided by the recent
      financing activities, and proceeds from bank loans. As of September 30, 2008,
      the Company had working capital of $ 4,371,631, compared to $ 2,345,626 as
      of
      December 31, 2007.





*Cash
      Flow* *.*





September
              30,
              2008
            
            September
                30,
              2007Net
                cash provided by operating activities
            
            $
            1,978,398
            
            $
            2,256,435Net
                cash used in investing activities
            
            $
            (6,743,680
            )
            $
            (7,983,054
            )Net
                cash provided by financing activities
            
            $
            5,889,479
            
            $
            396,246





Net
      cash
      provided by operating activities totaled $1,978,398 for the nine months ended
      September 30, 2008, compared to cash provided by operations of $ 2,256,435
      for
      the nine months ended September 30, 2007; an decrease of $ 278,037 or 12 %
      over
      the same period in the previous year.




5





Net
      cash
      used in investing activities for the nine months ended September 30, 2008
      decreased by $1,239,374 or 15.5% compared to the same period in 2007. This
      is
      attributable to the decrease of spending in long term investment.





Net
      cash
      provided by financing activities for the nine months ended September 30, 2008
      increased by $5,493,233 compared to the same period in 2007, due to short term
      borrowing and proceeds from the private placement.





We
      intend
      to use our available funds as working capital and to expand and develop our
      current lines of business. We believe that our available funds will provide
      us
      with sufficient capital for at least the next twelve months; however, to the
      extent that we make acquisitions, we may require additional capital for the
      acquisition or to support the operations of the combined companies. We cannot
      provide any assurance that any required funding will be available on terms
      favorable to us.





**OFF-BALANCE
      SHEET ARRANGEMENTS**





Under
      SEC
      regulations, we are required to disclose our off-balance sheet arrangements
      that
      have or are reasonably likely to have a current or future effect on our
      financial condition, changes in financial condition, revenues or expenses,
      results of operations, liquidity, capital expenditures or capital resources
      that
      are material to investors. An off-balance sheet arrangement means a transaction,
      agreement or contractual arrangement to which any entity that is not
      consolidated with us is a party, under which we have:





l
            Any
                obligation under certain guarantee contracts;





l
            Any
                retained or contingent interest in assets transferred to an unconsolidated
                entity or similar arrangement that serves as credit, liquidity or
                market
                risk support to that entity for such assets;





l
            Any
                obligation under a contract that would be accounted for as a derivative
                instrument, except that it is both indexed to our stock and classified
                in
                stockholder’s equity in our statement of financial position; and





l
            Any
                obligation arising out of a material variable interest held by us
                in an
                unconsolidated entity that provides financing, liquidity, market
                risk or
                credit risk support to us, or engages in leasing, hedging or research
                and
                development services with us.





As
      of
      September 30, 2008, the Company has no off-balance sheet arrangements that
      have
      or are reasonably likely to have a current or future effect on our financial
      condition, changes in financial condition, revenues or expenses, results of
      operations, liquidity, capital expenditures or capital resources that is
      material to investors.




**Item
                3.**
            **Quantitative
                and Qualitative Disclosures About Market Risk**





Not
      Applicable





**Item
                4T.**
            **Controls
                and Procedures.**





Evaluation
      of Disclosure Controls and Procedures





In
      connection with the preparation of this quarterly report on Form 10-Q, an
      evaluation was carried out by the Company’s management, with the participation
      of the Company’s Chief Executive Officer and Chief Financial Officer, of the
      effectiveness of our disclosure controls and procedures [as defined in Rules
      13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (“Exchange
      Act”)] as of September 30, 2008. Disclosure controls and procedures are designed
      to ensure that information required to be disclosed in reports filed or
      submitted under the Exchange Act is recorded, processed, summarized and reported
      within the time periods specified in SEC rules and forms and that such
      information is accumulated and communicated to management, including the Chief
      Executive Officer and Chief Financial Officer, to allow timely decisions
      regarding required disclosures.




6




In
      designing and evaluating its disclosure controls and procedures, management
      recognized that disclosure controls and procedures, no matter how well conceived
      and operated, can provide only reasonable, not absolute, assurance that the
      objectives of the disclosure controls and procedures are met. Additionally,
      in
      designing disclosure controls and procedures, management necessarily was
      required to apply its judgment in evaluating the cost-benefit relationship
      of
      possible disclosure controls and procedures. The design of any disclosure
      controls and procedures also is based in part upon certain assumptions about
      the
      likelihood of future events, and there can be no assurance that any design
      will
      succeed in achieving its stated goals under all potential future conditions.





During
      the evaluation of disclosure controls and procedures as of December 31, 2007
      conducted during the preparation of the Company’s financial statements included
      in its annual report on Form 10-K, a material weakness in internal controls
      was
      identified.  As a result of this material weakness the Company’s Chief
      Executive Officer and Chief Financial Officer concluded that, as of December
      31,
      2007, our disclosure controls and procedures were not completely effective.





A
      material weakness is “a deficiency, or a combination of deficiencies (within the
      meaning of PCAOB Auditing Standard No. 5), in internal control over financial
      reporting, such that there is a reasonable possibility that a material
      misstatement of the Company’s annual or interim financial statements will not be
      prevented or detected on a timely basis.” The Company’s management had concluded
      that, as of December 31, 2007, the following material weakness existed:





l
            We
                had an insufficient familiarity with generally accepted accounting
                principles in the United States (“US GAAP”) causing us to improperly (a)
                account for landfill-related asset retirement obligations and
                consolidation of the results of operations of a subsidiary company,
                as a
                result of which we restated our financial statements as of December
                31,
                2006 and for the year then ended, and as of March 31, 2007 and for
                the
                quarter then ended and, (b) record and reconcile various financial
                statement entries including accounts receivable balances (including
                allowance for doubtful accounts), other current assets, construction
                in
                progress amounts, customer deposits, deferred revenues depreciation
                and
                amortization expenses, certain operating expenses and taxes payable,
                income and interest expense, a loss on investment, related party
                transactions; and subsidizing amounts; resulting in numerous audit
                adjustments.





Since
      January 2, 2008 we have engaged in substantial efforts to improve our internal
      control over financial reporting and disclosure controls and procedures related
      to many areas of our financial statements and disclosures. In order to remediate
      the material weakness identified as of December 31, 2007, during 2008 we have:





l
            Appointed
                a full-time Chief Financial Officer which will now allow the CEO
                to devote
                his full-time and attention to the Company’s operations and permit a CFO
                with experience in accounting matters to devote her full time and
                attention to the functions of chief financial officer.





l
            Added
                additional accounting and financial personnel with industry experience.





l
            Commenced
                the process by which we will become better informed about US GAAP.





l
            Continued
                the process of sourcing a consultant experienced in the application
                of US
                GAAP, including internal controls over financial reporting, to augment
                our
                accounting staff.





Notwithstanding
      the remedial actions we have undertaken since December 31, 2007, because of
      the
      scope of the material weakness at December 31, 2007, our management concluded
      that our disclosure controls and procedures at September 30, 2008 were not
      completely effective. Our efforts to remediate our disclosure controls and
      procedures and internal control over financial reporting are continuing and
      are
      expected to continue throughout fiscal 2008. Until such time, however, as our
      efforts remediate this weakness, there remains a risk that we will fail to
      identify weaknesses or adequately correct any identified weaknesses in our
      disclosure controls and procedures and internal control over financial
      reporting, both as they relate to the material weakness identified at December
      31, 2007 and to other possible areas.





Notwithstanding
      the existence of this material weakness in disclosure controls and procedures
      and internal control over financial reporting at September 30, 2008, we believe
      that the consolidated financial statements included elsewhere in this report
      fairly present, in all material respects, our consolidated balance sheets as
      of
      September 30, 2008 and 2007 and the related consolidated statements of
      operations, stockholders’ equity, and cash flows for the quarters ended
      September 30, 2008 and 2007 in conformity with US GAAP.




7




Changes
      in Internal Control over Financial Reporting





During
      the three months ended September 30, 2008 in connection with the remedial
      actions described earlier in this section we modified our internal control
      over
      financial reporting to incorporate additional internal controls required by
      US
      GAAP. Other than these changes, there have been no changes in our internal
      control over financial reporting during our last fiscal quarter that has
      materially affected, or is reasonably likely to materially affect, our internal
      control over financial reporting .





**PART
      II - OTHER INFORMATION**





**Item
      5. Other Information.**





For
      the
      following reasons, management has determined to revise previously announced
      earnings guidance:





·
            Due
                to obstacles encountered during test operations of Zhuorui Resource
                Recycling Co., Ltd., our indirect majority-owned subsidiary (“Zhuorui”),
                the commencement of its operations and corresponding commencement
                of
                revenue-generation were delayed. Zhuorui intends to engage in the
                recycling of waste catalyst to generate valuable metals and slag
                used in
                cement. Zhuorui is working with its professional and engineering
                team to
                resolve the problems that have caused the
                delays.





·
            The
                Olympics, a special event which took place in the PRC during August
                and
                September 2008, disrupted the operations of several of the Company’s
                customers that produce hazardous waste. While it was anticipated
                that the
                Olympics would disrupt the operations of certain customers, the delays
                have exceeded what had been anticipated. Management believes that
                operating delays attributable to the Olympics have now subsided and
                are
                not expected to recur.





·
            Consistent
                with recent worldwide economic trends, the Company has encountered
                significant decreases in the prices for recycled commodities, including
                recent price decreases of approximately 30% in the price of cupric
                sulfate, 40% in the price of copper and 50% in the price of iron.
                Because
                management believes that the price decreases are temporary and that
                the
                market prices for recycled commodities will rise, the Company has
                retained
                an inventory of recycled commodities for future sale, rather than
                sell its
                recycled commodities at what management believes are temporarily
                deflated
                prices. The Company, through its operating subsidiary, Dalian Dongtai
                Industrial Waste Treatment Co., Ltd., engages, among other things,
                in the
                sale of recycled commodities.





As
      a
      result of these events, the Company has lowered its earnings guidance for the
      year ending December 31, 2008 from its original forecast of $7.8 million to
      $4.5
      million. At this time, the Company is unable to predict whether these events
      will impact on our previously released earnings guidance for the year ending
      December 31, 2009.





**Item
      6. Exhibits.**





**Exhibit No.**
            
            **Description**31.1
            
            Rule
                13a-14(a)/ 15d-14(a) Certification of Chief Executive Officer31.2
            
            Rule
                13a-14(a)/ 15d-14(a) Certification of Chief Financial Officer32.1
            
            Section
                1350 Certification of Chief Executive Officer32.2
            
            Section
                1350 Certification of Chief Financial Officer


8


**SIGNATURES**





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




**CHINA
                INDUSTRIAL WASTE MANAGEMENT, INC.**Date:
                November 14, 2008
            By:
            /s/
                Dong JinqingDong
                Jinqing, Chief Executive Officer





Date:
                November 14, 2008
            By:
            /s/
                Guo XinGuo
                Xin, Chief Financial Officer





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**EXHIBIT
      INDEX**





**Exhibit
                No.**
            
            **Description**31.1
            
            Rule
                13a-14(a)/ 15d-14(a) Certification of Chief Executive Officer31.2
            
            Rule
                13a-14(a)/ 15d-14(a) Certification of Chief Financial Officer32.1
            
            Section
                1350 Certification of Chief Executive Officer32.2
            
            Section
                1350 Certification of Chief Financial Officer





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