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


                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                   FORM 10-QSB


                   Quarterly Report under Section 13 or 15 (d)
                     of the Securities Exchange Act of 1934


                  For the Quarterly Period Ended June 30, 2006


                         Commission File Number 0-13839



                            CAS MEDICAL SYSTEMS, INC.

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


            Delaware                                           06-1123096
-------------------------------                             ----------------
(State or other jurisdiction of                             (I.R.S. employer
 incorporation or organization)                            identification no.)


              44 East Industrial Road, Branford, Connecticut 06405
              ----------------------------------------------------
                    (Address of principal executive offices)


                                 (203) 488-6056
                                 --------------
                (Issuer's telephone number, including area code)


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

Indicate by check mark whether the registrant is a shell company (as defined in
rule 12b-2 of the Exchange Act). Yes [ ] No [X]

State the number of shares outstanding of each of the issuer's classes of common
stock, as of the latest practicable date: Common Stock, $.004 par value
10,468,857 shares as of August 8, 2006.

Transitional Small Business Disclosure Format (check one):   Yes [ ]  No [X]
================================================================================
<PAGE>

                                      INDEX

PART 1       Financial Information                                      Page No.
------       ---------------------                                      --------

  Item 1     Financial Statements

             Condensed Consolidated Balance Sheets as of June 30, 2006
             and December 31, 2005                                           3

             Condensed Consolidated Statements of Income for the Three
             and Six Months Ended June 30, 2006 and 2005                     5

             Condensed Consolidated Statements of Cash Flow for the Six
             Months Ended June 30, 2006 and 2005                             6

             Notes to Condensed Consolidated Financial Statements            7

  Item 2     Management's Discussion and Analysis of Financial Condition
             and Results of Operations                                      11

  Item 3     Controls and Procedures                                        14

PART II      Other Information
-------      -----------------

  Item 4     Submission of Matters to a Vote of Security Holders            15

  Item 6     Exhibits                                                       15

  Signatures                                                                16


                                        2
<PAGE>

                         PART I - FINANCIAL INFORMATION
                         ------------------------------

ITEM 1. FINANCIAL STATEMENTS
----------------------------

                            CAS Medical Systems, Inc.

                      Condensed Consolidated Balance Sheets
                      -------------------------------------

                                   (Unaudited)


Assets
------                                             June 30,      December 31,
                                                     2006            2005
                                                 ------------    ------------

Current Assets:
         Cash and cash equivalents               $  1,203,142    $  1,892,584
         Accounts receivable, net of allowance      4,093,533       3,218,963
         Inventories                                6,049,338       5,592,807
         Deferred income taxes                        248,963         318,262
         Other current assets                         475,654         494,182
                                                 ------------    ------------

Total current assets                               12,070,630      11,516,798
                                                 ------------    ------------

Property and Equipment:
         Land and improvements                        535,000         535,000
         Buildings and improvements                 1,611,181       1,584,159
         Machinery and equipment                    4,054,969       3,698,457
                                                 ------------    ------------
                                                    6,201,150       5,817,616

         Accumulated depreciation                  (3,297,516)     (3,080,160)
                                                 ------------    ------------

         Property and equipment, net                2,903,634       2,737,456
                                                 ------------    ------------


Intangible and other assets, net                      416,196         360,186

Goodwill                                            3,379,021       3,079,021

Deferred income taxes                                 257,148         224,620
                                                 ------------    ------------

Total assets                                     $ 19,026,629    $ 17,918,081
                                                 ============    ============


                                        3
<PAGE>

                            CAS Medical Systems, Inc.

                      Condensed Consolidated Balance Sheets
                      -------------------------------------
                                   (Unaudited)

Liabilities And Stockholders' Equity
------------------------------------                 June 30,      December 31,
                                                       2006            2005
                                                   ------------    ------------

Current Liabilities:
     Current portion of long-term debt             $    591,554    $    574,115
     Notes payable                                      173,173         206,359
     Accounts payable                                 2,429,130       2,167,396
     Income taxes payable                               259,538          18,999
     Accrued expenses                                 1,156,888       1,068,035
                                                   ------------    ------------

           Total current liabilities                  4,610,283       4,034,904

Long-term debt, less current portion                  4,115,698       4,416,202

Retirement benefit obligation                           174,793         349,567


Stockholders' Equity:
     Common stock, $.004 par value per share,
       40,000,000 shares authorized, 10,464,336
       and 10,113,860 shares issued at June 30,
       2006 and December 31, 2005, respectively,
       including shares held in treasury                 41,858          40,456
     Additional paid-in capital                       3,692,860       3,176,911
     Common stock held in treasury, at cost -
       86,000 shares                                   (101,480)       (101,480)
     Retained earnings                                6,492,617       6,001,521
                                                   ------------    ------------

     Total stockholders' equity                      10,125,855       9,117,408
                                                   ------------    ------------

     Total liabilities and stockholders' equity    $ 19,026,629    $ 17,918,081
                                                   ============    ============


See accompanying notes.

                                        4
<PAGE>

                            CAS Medical Systems, Inc.

                   Condensed Consolidated Statements of Income
                   -------------------------------------------
                                   (Unaudited)

<TABLE><CAPTION>
                                                            Three Months Ended           Six Months Ended
                                                                 June 30,                    June 30,
                                                            2006          2005          2006          2005
                                                        -----------   -----------   -----------   -----------
<S>                                                     <C>           <C>           <C>           <C>
REVENUES:                                               $ 8,029,256   $ 5,882,755   $15,585,941   $10,831,266

Operating Expenses:
     Cost of product sales                                4,564,210     3,262,918     9,168,447     5,966,108
     Research and development                               628,255       282,574     1,233,131       535,304
     Selling, general and administrative                  2,181,600     1,726,754     4,195,082     3,198,993
                                                        -----------   -----------   -----------   -----------

     Operating income                                       655,191       610,509       989,281     1,130,861

     Interest expense                                        63,340        33,796       127,710        36,741
                                                        -----------   -----------   -----------   -----------

     Income before income taxes                             591,851       576,713       861,571     1,094,120

Income Taxes                                                241,010       195,180       370,475       360,680
                                                        -----------   -----------   -----------   -----------

     NET INCOME                                         $   350,841   $   381,533   $   491,096   $   733,440
                                                        ===========   ===========   ===========   ===========

Weighted average number of common shares outstanding:

     Basic                                               10,353,306     9,908,087    10,301,124     9,898,875
                                                        ===========   ===========   ===========   ===========

     Diluted                                             12,043,121    11,567,912    12,116,176    11,512,587
                                                        ===========   ===========   ===========   ===========

Earnings per common share:

     Basic                                              $      0.03   $      0.04   $      0.05   $      0.07
                                                        ===========   ===========   ===========   ===========
     Diluted                                            $      0.03   $      0.03   $      0.04   $      0.06
                                                        ===========   ===========   ===========   ===========
</TABLE>


See accompanying notes.

                                        5
<PAGE>

                            CAS Medical Systems, Inc.

                 Condensed Consolidated Statements of Cash Flow
                 ----------------------------------------------
                                   (Unaudited)
<TABLE><CAPTION>
                                                                         Six Months Ended
                                                                              June 30,
                                                                        2006           2005
                                                                    -----------    -----------
<S>                                                                 <C>            <C>
OPERATING ACTIVITIES:
     Net Income                                                     $   491,096    $   733,440
     Adjustments to reconcile net income
     to net cash used by operating activities:
         Depreciation and amortization                                  248,410        239,919
         Provision for doubtful accounts                                  9,546           --
         Deferred income taxes                                           36,771         16,107
         Non-cash stock compensation charges                            201,167           --
         Changes in operating assets and liabilities:
              Accounts receivable                                      (884,116)      (306,971)
              Inventories                                              (456,531)      (788,856)
              Other current assets                                       18,528        139,844
              Retirement benefit obligation                            (174,774)        40,571
              Accounts payable, income taxes and accrued expenses       291,126       (555,840)
                                                                    -----------    -----------
         Net cash used by operating activities                         (218,777)       (54,693)
                                                                    -----------    -----------

INVESTING ACTIVITIES:
      Purchase of property and equipment                               (383,534)      (438,561)
      Purchase of intangible assets                                     (87,064)       (84,473)
      Business acquisition, net of cash of $250,060                        --       (4,111,721)
                                                                    -----------    -----------
      Net cash used by investing activities                            (470,598)    (4,634,755)
                                                                    -----------    -----------

FINANCING ACTIVITIES:
     Repayments of notes payable                                       (220,974)          --
     Proceeds from notes payable                                        187,788           --
     Repayments of long-term debt                                      (283,065)       (30,821)
     Proceeds from long-term debt agreement                                --        4,200,000
     Proceeds from issuance of common stock                             316,184         52,843
                                                                    -----------    -----------
     Net cash (used by) provided by financing activities                    (67)     4,222,022
                                                                    -----------    -----------

     Change in cash and cash equivalents                               (689,442)      (467,426)

     Cash and Cash Equivalents, beginning of period                   1,892,584      1,973,452
                                                                    -----------    -----------

     Cash and Cash Equivalents, end of period                       $ 1,203,142    $ 1,506,026
                                                                    -----------    -----------

     Supplemental Disclosures of Cash Flow Information:

        Cash paid during the period for interest, net               $   108,380    $    31,255
        Cash paid during the period for income taxes, net           $   112,650    $   678,191
</TABLE>

See accompanying notes.

                                        6
<PAGE>

                            CAS Medical Systems, Inc.
              Notes to Condensed Consolidated Financial Statements
                                   (Unaudited)

                                  June 30, 2006

(1) The Company

     CAS Medical Systems, Inc. ("CAS") and its wholly-owned subsidiary,
Statcorp, Inc. ("Statcorp") operate as one reportable business segment.
Together, CAS and Statcorp (collectively, the "Company") develop, manufacture
and distribute diagnostic equipment and medical products for use in the
healthcare and medical industry. These products - specifically blood pressure
measurement technology, vital signs measurement equipment, cardio-respiratory
monitoring equipment and supplies for neonatal intensive care - are sold by the
Company through its own sales force, via distributors and pursuant to original
equipment manufacturer agreements both internationally and in the United States.
The Company has several other products in various stages of development that it
believes will add to and complement its current product lines.

(2) Basis of Presentation

     The financial statements included herein have been prepared, without audit,
pursuant to the rules and regulations of the Securities and Exchange Commission.
Certain information and disclosures included in financial statements prepared in
accordance with accounting principles generally accepted in the United States of
America have been condensed or omitted pursuant to such rules and regulations.
These condensed consolidated financial statements should be read in conjunction
with the consolidated financial statements and notes thereto included in the
Company's Annual Report filed on Form 10-KSB for the year ended December 31,
2005. The condensed consolidated balance sheet as of December 31, 2005 was
derived from the audited financial statements for the year then ended.

     In the opinion of the Company's management, all adjustments necessary to
present fairly the financial position of the Company and the results of its
operations and its cash flows have been included in the accompanying financial
statements. The results of operations for interim periods are not necessarily
indicative of the expected results for the full year.

(3) Acquisition

     On May 15, 2005, CAS purchased of all of the outstanding capital stock of
Statcorp, Inc. Statcorp develops, assembles and sells liquid infusion devices,
blood pressure cuffs, and blood transfusion filters for worldwide use in the
medical industry. During the quarter ended June 30, 2006, the Company recognized
a purchase price adjustment of $300,000 based on Statcorp's achieved sales level
for the 12 months following the acquisition. The adjustment has been accrued
with a charge to goodwill and will be funded in the third quarter of 2006. For
further information, please refer to the Notes to Consolidated Financial
Statements included in the Company's Annual Report on Form 10-KSB for the year
ended December 31, 2005.

     The following unaudited pro forma summary financial information presents
the consolidated results of operations of the Company as if the acquisition of
Statcorp had occurred as of the beginning of the period presented. The pro forma
results are shown for illustrative purposes only and do not purport to be
indicative of the results of the Company that would have been reported had the
acquisition actually occurred on the first day of the period presented or
indicative of results that may occur in the future.

                                        7
<PAGE>

                                     Three Months Ended        Six Months Ended
                                       June 30, 2005            June 30, 2005
                                     ------------------        ----------------

     Net Revenues                        $ 6,841,300             $13,623,800

     Net income                          $   478,400             $   901,900

     Per share:
          Basic                             $ 0.05                  $ 0.09
          Diluted                           $ 0.04                  $ 0.08


(4) Inventories

    Inventories consisted of:

                                        June 30, 2006         December 31, 2005
                                        -------------         -----------------

     Raw materials                       $ 4,514,281             $ 4,452,407
     Work-in-process                          73,879                     --
     Finished goods                        1,461,178               1,140,400
                                         -----------             -----------
                                         $ 6,049,338             $ 5,592,807
                                         ===========             ===========


(5) Warranty Costs

     The Company warranties its products for up to three years. To date, such
costs have not been material to its financial statements.

(6) Post-Retirement Health Benefit Plan

     The Company's post-retirement health benefit plan (the "Plan") became
effective January 2002 for qualifying employees who met certain age and length
of service requirements. The Plan was modified during February 2005 to
significantly reduce the Company's future funding requirements. Effective
September 1, 2005, plan participants were required to share fifty percent of the
premiums for benefit costs. As of December 1, 2005, the Plan was also amended to
allow only those participants retired and receiving benefits as of that date to
remain eligible to receive future benefits under the Plan. In addition, the
Company also advised those participants that it would no longer provide benefits
after December 31, 2006. In connection therewith, the Company recognized a
curtailment gain of $400,739 during the fourth quarter of 2005.

     The accrued post-retirement benefit plan obligation of $349,567 at December
31, 2005 was comprised of (1) unrecognized prior service cost credits of
$195,921 applicable to current retirees receiving benefits, (2) an unrecognized
net gain of $145,710 and (3) benefit obligations of $7,936. The previously
unrecognized amounts are being amortized to the date coverage expires of
December 31, 2006, As such, the Company recognized income of $85,354 and
$170,708, respectively, during the three and six months ended June 30, 2006.
Expenses of $8,852 and $53,734, respectively, were recognized during the three
and six months ended June 30, 2005.

     Benefit payments in 2006 are expected to approximate $8,000. No further
benefit payments will be made after that date.

                                        8
<PAGE>

     Components of the net periodic benefit (income) cost of the Company's
post-retirement health benefit plan follows:
<TABLE><CAPTION>

                                                     Three Months Ended          Six Months Ended
                                                          June 30,                    June 30,
                                                      2006        2005           2006         2005
                                                   ---------    --------      ---------    ---------
<S>                                                <C>          <C>           <C>          <C>
     Service cost                                  $       0    $   9,980     $       0    $  26,616
     Interest cost                                        54        7,444           108       19,706
     Prior service cost                              (48,980)      (8,258)      (97,960)       7,832
     Amortization of gain                            (36,428)        (314)      (72,856)        (420)
                                                   ---------    ---------     ---------    ---------
     Net periodic benefit (income) cost            $ (85,354)   $   8,852     $(170,708)   $  53,734
                                                   =========    =========     =========    =========
</TABLE>

(7) Earnings per Common Share

     A summary of the denominators used to compute basic and diluted earnings
per share follow:
<TABLE><CAPTION>

                                                     Three Months Ended          Six Months Ended
                                                           June 30,                   June 30,
                                                      2006         2005          2006         2005
                                                   ----------   ----------    ----------   ----------
<S>                                                <C>          <C>           <C>          <C>
     Weighted average shares outstanding -
       Used to compute basic earnings per share    10,353,306    9,908,087    10,301,124    9,898,875

     Dilutive effect of warrants and options        1,689,815    1,659,825     1,815,052    1,613,712
                                                   ----------   ----------    ----------   ----------

     Weighted average shares of dilutive
       securities - used to compute
       diluted earnings per share                  12,043,121   11,567,912    12,116,176   11,512,587
                                                   ==========   ==========    ==========   ==========
</TABLE>

(8) Stock-Based Compensation

     Effective, January 1, 2006, the Company adopted Financial Accounting
Standards Board Statement No. 123 (Revised 2004) - SHARE-BASED PAYMENT ("FAS
123R") using the modified-prospective method transition alternative. Under this
method, compensation cost is recognized for all share-based equity payments
granted, modified or settled after January 1, 2006, as well as for any unvested
equity awards that were granted prior thereto. Compensation cost for unvested
awards granted prior to January 1, 2006 is recognized using the same estimate of
the grant-date fair value and the same attribution method used to determine the
pro forma disclosures under FAS 123, ACCOUNTING FOR STOCK-BASED COMPENSATION.

     Prior to January 1, 2006, the Company accounted for its stock options under
the recognition and measurement principles of Accounting Principles Board (APB)
Opinion No. 25 "Accounting for Stock Issued to Employees", and related
interpretations. No stock-based compensation cost was recognized in operations
since all options granted had an exercise price equal to the market value of the
underlying common stock on the date of grant. The effect of adopting FAS 123R
was to increase compensation cost and reduce reported net income by $67,495 and
$201,167 for the three and six-months ended June 30, 2006.

     As of June 30, 2006, the unrecognized stock-based compensation cost related
to non-vested stock awards was $307,000. Such amount, reduced for forfeiture
related estimates, will be recognized in operations over a weighted average
period of 0.66 years.

                                        9
<PAGE>

     The following table summarizes the Company's stock option information as
of, and for the six-month period ended June 30, 2006:
<TABLE><CAPTION>
                                                                       Aggregate     Weighted-Average
                                        Option     Weighted-Average    Intrinsic     Contractual Life
                                        Shares      Exercise Price      Value(1)    Remaining in Years
                                      -----------------------------------------------------------------
<S>                                    <C>              <C>              <C>               <C>
Outstanding at December 31, 2005       803,575          $ 1.73
Granted at fair value                   10,000            9.49
Exercised                             (129,475)           1.05
Cancelled                              (40,000)           4.26
                                       -------
Outstanding at June 30, 2006           644,100            1.83           $ 3.63             7.30
                                       =======
Exercisable at June 30, 2006           510,350            1.43             4.02             6.87
                                       =======
</TABLE>

(1) The intrinsic value of a stock option is the amount by which the current
market value of the underlying stock exceeds the option exercise price.

     The exercise period for all outstanding stock options may not exceed ten
years from the date of grant. Stock options granted to employees and
non-employee directors vest ratably over two years from the grant date. The
Company attributes stock-based compensation cost to operations using the
straight-line method over the applicable vesting period.

     The weighted-average grant date fair value of stock options granted during
the six-month periods ended June 30, 2006 and 2005 was $8.83 and $2.62 per
share, respectively. The total intrinsic value of stock options exercised during
the six-month periods ended June 30, 2006 and 2005 was $1,505,281 and $81,250,
respectively.

     The fair value of each option granted was estimated on the date of grant
using the Black-Scholes option-pricing model with the following assumptions:

                                                        Six Months Ended
                                                 June 30, 2006    June 30, 2005
                                                 -------------    -------------

     Weighted-average expected stock-price
       volatility                                  32.0%            33.0%
     Weighted-average expected option life          7.0 years        7.0 years
     Average risk-free interest rate                4.325%           4.066%
     Average dividend yield                         0.0%             0.0%

     Pro-forma information regarding net income and earnings per share required
under FAS 123, ACCOUNTING FOR STOCK-BASED COMPENSATION before the adoption of
FAS 123R follows:

                                          Three Months Ended    Six Months Ended
                                            June 30, 2005         June 30, 2005
                                          ------------------    ----------------

     Net income, as reported                  $ 381,533             $ 733,440
       Stock based compensation expense
        based upon fair value methods           146,639               215,343
                                              ---------             ---------
       Pro forma net income                   $ 234,894             $ 518,097
                                              =========             =========

     Earnings per share
       As reported - Basic                      $ 0.04                $ 0.07
       Pro forma - Basic                          0.02                  0.05
       As reported - Diluted                      0.03                  0.06
       Pro forma - Diluted                        0.02                  0.05


                                       10
<PAGE>

(9) Income taxes

     The provision for income taxes of $370,475 for the six months ended June
30, 2006 reflects an expected effective rate of approximately 43% for 2006. The
combined estimated federal and state effective tax rate is greater than the
statutory rate as a result of non-deductible stock compensation expense
partially offset by anticipated state and federal R&D tax credits. The 41%
effective tax rate used for the three months ended June 30, 2006 reflects a
year-to-date change in accounting estimate adjustment to account for the 48%
effective tax rate used during the first three months of 2006. The provision for
income taxes of $360,680 for the first six months of 2005 reflected an effective
tax rate of 33% resulting primarily from anticipated R&D tax credits.

ITEM 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
------------------------------------------------------------------------------
OF OPERATIONS
-------------

     Certain statements included in this report, including without limitation
statements in the Management's Discussion and Analysis of Financial Condition
and Results of Operations, which are not historical facts, are "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended.
These forward-looking statements represent the Company's current expectations
regarding future events. The Company cautions that such statements are qualified
by important factors that could cause actual results to differ materially from
expected results which may be contained in the forward-looking statements. All
forward-looking statements involve risks and uncertainties, including, but not
limited to, the following: foreign currency fluctuations, regulations and other
economic and political factors which affect the Company's ability to market its
products internationally, new product introductions by the Company's
competitors, increased price competition, dependence upon significant customers,
availability and cost of components for the Company's products, marketplace
acceptance for the Company's new products, FDA and other governmental regulatory
and enforcement actions, changes to federal research and development grant
programs presently utilized by the Company and other factors described in
greater detail in the Company's most recent annual report on Form 10-KSB.

Results of Operations
---------------------

     For the three months ended June 30, 2006, the Company reported net income
of $351,000, or $0.03 per diluted common share compared to net income of
$382,000 or $0.03 per diluted common share reported for the three months ended
June 30, 2005. Net income for the three months ended June 30, 2006 was affected
by $67,000 of non-deductible stock compensation expense. As of January 1, 2006,
the Company adopted FASB No. 123R, "Share-Based Payment". This standard requires
that all stock-based awards be recognized as expenses in the financial
statements at the fair value of the award over their vesting term. Pre-tax
income for the three months ended June 30, 2006 was also affected by significant
increases in research and development ("R&D") expenses of $345,000. Pre-tax
income for the three months ended June 30, 2006 was favorably affected by a
reduction in accrued retirement benefit costs of $87,000 related to changes to
the Company's post-retirement health benefit plan (the "Plan") during 2005.
Moreover, the Company's retirement benefit obligation pursuant to the Plan at
June 30, 2006 of $175,000 will be amortized to income ratably over the remainder
of 2006.

                                       11
<PAGE>

     The Company reported net income of $491,000 or $0.04 per common share on a
diluted basis for the six months ended June 30, 2006 compared to $733,000 or
$0.06 per diluted common share for the six months ended June 30, 2005. Net
income for the six months ended June 30, 2006 was affected by $201,000 of
non-deductible stock compensation expense. Further, R&D expenses increased
$698,000 over the first six months of the prior year. Pre-tax income for the
first six months of 2006 was favorably impacted by a reduction of $175,000 in
accrued retirement benefit costs for the reasons stated above.

     The Company generated revenues of $8,029,000 for the three months ended
June 30, 2006, an increase of $2,146,000 or 36%, over revenues of $5,883,000 for
the three months ended June 30, 2005. Revenues from the sales of Statcorp
products accounted for $1,183,000 of the increase in revenues (Statcorp was
acquired May 15, 2005). Increases in blood pressure product sales of 24%,
primarily from sales of original equipment ("OEM") modules and sales of private
label monitors into the veterinary market, accounted for the remainder of the
increase in revenues.

     The Company recorded revenues of $15,586,000 for the six months ended June
30, 2006, an increase of $4,755,000 or 44%, over revenues of $10,831,000 for the
first six months of the prior year. Statcorp product sales accounted for
$2,923,000 of the increase in revenues. Increases in blood pressure product
sales of 23%, primarily from sales of vital signs monitors including private
label veterinary monitors, accounted for the remainder of the increase in
revenues.

     The cost of products sold was $4,564,000 or 56.8% of revenues for the three
month period ended June 30, 2006 compared to $3,263,000 or 55.5% for the same
period of 2005. The increase in cost of products sold as a percentage of
revenues is primarily related to the full quarter effect of the Statcorp
acquisition consummated during May 2005. The Company realizes lower average
gross margins on products sold by Statcorp. Partially offsetting the effect of
the Statcorp products were improvements in gross margins due to product mix.

     The cost of products sold was $9,168,000 or 58.8% of revenues for the first
six months of 2006 compared to $5,966,000 or 55.1% for the first six months of
2005. The increase in cost of products sold as a percentage of revenues results
from both the full six month effect of Statcorp as well as increases in cost of
product sold as a percentage of revenues during the first quarter of 2006
resulting from product mix.

     R&D expenses increased $345,000 or 122% to $628,000 for the three months
ended June 30, 2006 compared to $283,000 for the three months ended June 30,
2005. R&D expenses for the six months ended June 30, 2006 increased $698,000 or
130% to $1,233,000 from $535,000 for the six months ended June 30, 2005. The
increase in R&D spending for both periods resulted primarily from increased
salaries and related fringe benefits associated with additional headcount
required to support the Company's Near-Infrared Spectroscopy ("NIRS") research
efforts. Stock compensation expense, engineering project spending and reductions
in reimbursements from the National Institutes of Health ("NIH") under
established grant programs also contributed to the increase in R&D expense. NIH
reimbursements for the six months ended June 30, 2006 were $21,000 compared to
$251,000 for the six months ended June 30, 2005.

     The Company does not expect to receive reimbursements from the NIH for the
remainder of 2006. However, it is continuing to pursue additional NIH grants to
support its NIRS research.

     Selling, general and administrative expenses ("S, G&A") increased $455,000
or 26.3% to $2,182,000, representing 27.2% of revenues for the three months
ended June 30, 2006 compared to $1,727,000 or 29.4% of revenues for the three
months ended June 30, 2005. Marketing expenses accounted for approximately
$192,000 of the overall increase in S,G&A primarily from increases in salaries
and related benefits, travel and entertainment expenses, and marketing
promotional costs. General and administrative ("G&A") expenses accounted for
approximately $302,000 of the increase primarily from legal fees, stock
compensation charges, accrued company incentive plan costs, investor relations
costs and bad debt charges.

                                       12
<PAGE>

     S, G&A expenses increased $996,000 or 31.1% to $4,195,000, representing
26.9% of revenues for the six month period ended June 30, 2006 compared to
$3,199,000 or 29.5% of revenues for the six month period ended June 30, 2005.
Marketing expenses accounted for approximately $338,000 of the overall increase
in S,G&A primarily from salaries and related benefits, marketing promotional
expenditures, travel and entertainment expenses, and stock compensation charges
Statcorp accounted for $224,000 of the increase primarily from the full six
month effect of the acquisition compared to approximately one and one-half
months of expenses attributable to the first six months of 2005. G&A expenses
accounted for approximately $447,000 of the overall increase resulting from
increases in salaries and related fringe benefits, accrued incentive plan costs,
legal fees, stock compensation costs, investor relations costs and bad debt
charges. Partially offsetting the increases in G&A costs were reductions in
post-retirement health benefit costs related to the curtailment of the Company's
Plan.

     Interest expense increased to $63,000 and $128,000, respectively, for the
three and six months ended June 30, 2006 compared to $34,000 and $37,000,
respectively for the three and six months ended June 30, 2005. The increase in
interest expense resulted from the Statcorp acquisition loan consummated on May
16, 2005.

     The provision for income taxes of $370,000 for the six months ended June
30, 2006 reflects an expected effective rate of approximately 43% for the 2006
year. The combined estimated federal and state effective tax rate is greater
than the statutory rate as a result of non-deductible stock compensation expense
partially offset by anticipated state and federal R&D tax credits. The 41%
effective tax rate used for the three months ended June 30, 2006 reflects a
year-to-date change in accounting estimate adjustment to account for the 48%
effective tax rate used during the first three months of 2006. The provision for
income taxes of $361,000 for the first six months of 2005 reflected an effective
tax rate of 33% resulting primarily from anticipated R&D tax credits.

Financial Condition, Liquidity and Capital Resources
----------------------------------------------------

     At June 30, 2006, the Company's cash and cash equivalents totaled
$1,203,000 compared to $1,893,000 at December 31, 2005. Working capital
decreased by $22,000 to $7,460,000 at June 30, 2006, from $7,482,000 on December
31, 2005. The Company's current ratio decreased to 2.6 to 1 from 2.85 to 1.

     Cash used by operations for the six months ended June 30, 2006 was $219,000
compared to cash used of $55,000 for the first six months of the prior year. In
both periods, the Company continued to make investments in inventories and
accounts receivable to support increased sales. Non-cash charges and credits to
operations for stock compensation and retirement benefits substantially offset
one another.

     Cash used by investing activities was $471,000 for the six months ended
June 30, 2006 compared to $4,635,000 for the first six months of the prior year.
Expenditures for property and equipment of $384,000 during the six months ended
June 30, 2006 were varied in nature and included building improvements,
manufacturing equipment and engineering equipment. Prior year expenditures
reflected $523,000 of increased expenditures for equipment and intangible assets
and $4,112,000 for the purchase of Statcorp. Equipment purchases of $439,000 for
the six months ended June 30, 2005 were primarily related to the acquisition and
installation of the Company's new enterprise resource planning system and
related hardware upgrades, leasehold improvements related to a three year
facilities lease agreement effective December 2004 and manufacturing inspection
equipment.

     Cash used by financing activities for the six months ended June 30, 2006
was $100 compared to cash provided of $4,222,000 for the first six months of the
prior year. Financing activities for the first six months of 2006 included
$504,000 of repayments of notes payable and long-term debt offset by $188,000 of
proceeds from notes payable to finance various insurance coverage and $316,000
of proceeds from the issuance of common stock primarily related to the exercise
of stock options and non-employee warrants.

                                       13
<PAGE>

     During the latter half of 2006, the Company intends to significantly
increase its spending associated with the NIRS cerebral oximeter, scheduled for
launch by the end of the year. Such spending includes additional R&D, on-going
clinical studies, marketing expenses, manufacturing start-up costs and capital
expenditures. The Company believes that its sources of funds consisting of cash
and cash equivalents, cash flow from operations and funds available from the
revolving credit facility will be sufficient to meet its current and expected
short-term requirements. Management believes that, if needed, it would be able
to find additional sources of funds on commercially acceptable terms which may
be required to support the Company's long-term initiatives.

Critical Accounting Judgments and Estimates
-------------------------------------------

     The Company's discussion and analysis of financial condition and results of
operations are based upon the condensed financial statements, which have been
prepared in accordance with accounting principles generally accepted in the
United States of America. The preparation of these financial statements requires
the Company to make estimates and judgments that affect the reported amounts of
assets, liabilities, revenue and expenses, and disclosure of contingent assets
and liabilities. The Company's estimates include those related to revenue
recognition, the valuation of inventory, and valuation of deferred tax assets
and liabilities, useful lives of intangible assets, warranty obligations and
accruals. The Company bases its estimates on historical experience and on
various other assumptions that management believes to be reasonable under the
circumstances. Actual results may differ from these estimates under different
assumptions or conditions. For a complete description of critical accounting
policies, see Note 3 to our financial statements included in the Company's Form
10-KSB for the year ended December 31, 2005. There were no significant changes
in critical accounting estimates during the three months ended June 30, 2006.


ITEM 3 CONTROLS AND PROCEDURES
------------------------------

     The Company maintains disclosure controls and procedures that are designed
to ensure that information required to be disclosed in the Company's Exchange
Act reports is recorded, processed, summarized and reported within the time
periods specified in the SEC's rules and forms, and that such information is
accumulated and communicated to the Company's management, including its Chief
Executive Officer and Chief Financial Officer, as appropriate, to allow timely
decisions regarding required disclosure based on the definition of "disclosure
controls and procedures" in Rule 13a-15(e). In designing and evaluating the
disclosure controls and procedures, management recognizes that any controls and
procedures, no matter how well designed and operated, can provide only
reasonable assurance of achieving the desired control objectives, and management
necessarily is required to apply its judgment in evaluating the cost-benefit
relationship of possible controls and procedures.

     The Company carried out an evaluation, under the supervision and with the
participation of the Company's management, including the Company's Chief
Executive Officer and the Company's Chief Financial Officer, of the
effectiveness of the design and operation of the Company's disclosure controls
and procedures as of June 30, 2006. Based upon the foregoing evaluation, the
Chief Executive Officer and Chief Financial Officer concluded that the Company's
disclosure controls and procedures were effective as of that date.

     There have been no changes in the Company's internal control over financial
reporting during the quarter ended June 30, 2006 that have materially affected,
or are reasonably likely to materially affect the Company's internal control
over financial reporting.

     Reference is made to the Certifications of the Chief Executive Officer and
the Chief Financial Officer about these and other matters attached as Exhibits
31.1, 31.2 and 32.1 to this report.

                                       14
<PAGE>

                          PART II - OTHER INFORMATIION

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

     At the Company's annual meeting of stockholders held on June 14, 2006,
three proposals were voted upon and approved by the Company's stockholders. A
brief description of each proposal voted upon at the annual meeting and the
number of votes cast for, against and withheld, as well as the number of
abstentions and broker non-votes to each proposal are set forth below.


     1)   Election of members of the Board of Directors, each for a term of one
          year

     Nominee                                For                    Against
     -------                                ---                    -------

     Louis P. Scheps                        9,182,537               10,437
     Lawrence S. Burstein                   9,180,284               12,690
     Jerome S. Baron                        9,183,665                9,309
     Saul S. Milles                         8,841,710              351,264



     2)   Amendment of the Company's Certificate of Incorporation to increase
          the number of authorized shares of common stock

                    For                 Against                Abstain

                 9,038,839              146,226                 7,908


     3)   Ratification of the appointment of UHY LLP as auditor for the Company
          for the fiscal year ending December 31, 2006

                    For                 Against                Abstain

                 9,179,284               4,290                  9,400


ITEM 6. EXHIBITS
----------------

   31.1   Certification pursuant to Rule 13a-14(a) of Louis P. Scheps, President
          and Chief Executive Officer

   31.2   Certification pursuant to Rule 13a-14(a) of Jeffery A. Baird, Chief
          Financial Officer

   32.1   Certification pursuant to 18 U.S.C. 1350 of Periodic Financial Report
          of Louis P. Scheps, President and Chief Executive Officer and Jeffery
          A. Baird, Chief Financial Officer

                                       15
<PAGE>

                                   SIGNATURES


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


CAS MEDICAL SYSTEMS, INC.
-------------------------
(Registrant)


/s/ Louis P. Scheps                                Date: August 11, 2006
------------------------------
By: Louis P. Scheps
    Chairman of the Board, President and
    Chief Executive Officer



/s/ Jeffery A. Baird                               Date: August 11, 2006
------------------------------
By: Jeffery A. Baird
    Chief Financial Officer














                                       16