----

----

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

| o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|------------------------------------------------------------------------------------------|

| Delaware                                                       | 86-0515678                           |
|----------------------------------------------------------------|--------------------------------------|
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |

| 25 Fairchild Avenue - Suite 250, Plainview, New York | 11803      |
|------------------------------------------------------|------------|
| (Address of principal executive offices)             | (Zip Code) |

| Large accelerated filer  o | Accelerated filer  o         |
|--------------------------------------|----------------------------------------|
| Non-accelerated filer  o   | Smaller reporting company  x |

----

----

----

| Item 1. | Financial Statements. |
|---------|-----------------------|

|                                                                                                                                                                                                                             |   | March 31,2009 |        |   | December 31,2008 |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------|-------------|--------|------------------|--------|
|                                                                                                                                                                                                                             |   | (Unaudited)   |        |   |             |   |
| ASSETS                                                                                                                                                                                                                           |   |          |        |   |             |   |
| Current assets                                                                                                                                                                                                                   |   |          |        |   |             |   |
| Cash                                                                                                                                                                                                                             |   | $             | 64,314      |   |             | $      | 29,411 |   |
| Prepaid expenses and other current assets                                                                                                                                                                                        |   |          | 36,855      |   |             |   | 53,890 |   |
| Total current assets                                                                                                                                                                                                             |   |          | 101,169     |   |             |   | 83,301 |   |
|                                                                                                                                                                                                                             |   |          |        |   |             |   |   |   |
| Property and equipment, net of accumulated depreciation of $23,548 and $17,130, respectively                                                                                                                                     |   |          | 136,019     |   |             |   | 142,437 |   |
| Other assets                                                                                                                                                                                                                     |   |          |        |   |             |   |   |   |
| Patents and trademarks, net of accumulated amortization of $19,199 and $17,882, respectively                                                                                                                                     |   |          | 60,727      |   |             |   | 62,044 |   |
| Other assets                                                                                                                                                                                                                     |   |          | 26,860      |   |             |   | 26,860 |   |
| Total other assets                                                                                                                                                                                                               |   |          | 87,587      |   |             |   | 88,904 |   |
| Total Assets                                                                                                                                                                                                                     |   | $             | 324,775     |   |             | $      | 314,642 |   |
|                                                                                                                                                                                                                             |   |          |        |   |             |   |   |   |
| LIABILITIES AND STOCKHOLDERS' DEFICIENCY                                                                                                                                                                                         |   |          |        |   |             |   |   |   |
| Current liabilities                                                                                                                                                                                                              |   |          |        |   |             |   |   |   |
| Accounts payable and accrued expenses                                                                                                                                                                                            |   | $             | 516,429     |   |             | $      | 410,925 |   |
| Accrued compensation                                                                                                                                                                                                             |   |          | 197,000     |   |             |   | 155,000 |   |
| Accrued consulting and director fees                                                                                                                                                                                             |   |          | 180,000     |   |             |   | 178,000 |   |
| Convertible notes payable to officer and director, including accrued interest of $18,421and $12,171, respectively and net of debt discount of $45,953 and $75,280, respectively                                                  |   |          | 222,468     |   |             |   | 186,891 |   |
| Convertible promissory notes, including accrued interest of $1,458 and $208 and net of debt discount of $13,813 and $19,283, respectively                                                                                        |   |          | 37,646      |   |             |   | 30,925 |   |
| Notes payable, including accrued interest of $272,047 and $269,833, respectively                                                                                                                                                 |   |          | 555,269     |   |             |   | 553,056 |   |
| Fair value of warrants                                                                                                                                                                                                           |   |          | 275,900     |   |             |   | 121,100 |   |
| Fair value of embedded conversion options                                                                                                                                                                                        |   |          | 191,500     |   |             |   | 164,900 |   |
| Accrued dividends payable                                                                                                                                                                                                        |   |          | 190,328     |   |             |   | 190,328 |   |
| Total current liabilities                                                                                                                                                                                                        |   |          | 2,366,540   |   |             |   | 1,991,125 |   |
| Stockholders' deficiency                                                                                                                                                                                                         |   |          |        |   |             |   |   |   |
| Preferred stock, $.001 par value; 10,000,000 shares authorized; 184,144 shares issued and outstanding (liquidation preference of $2,511,025 and $2,483,950 as of March 31, 2009 and December 31, 2008, respectively)             |   |          | 184         |   |             |   | 184 |   |
| Common stock $.001 par value; 450,000,000 shares authorized; 252,707,114 shares issued and 252,702,714 shares outstanding as of March 31, 2009 and 244,850,034 shares issued and 244,845,634 outstanding as of December 31, 2008 |   |          | 252,707     |   |             |   | 244,849 |   |
| Additional paid-in capital                                                                                                                                                                                                       |   |          | 28,789,045  |   |             |   | 28,528,973 |   |
| Treasury stock, at cost, 4,400 shares of common stock                                                                                                                                                                            |   |          | (5,768      | )      |             |   | (5,768 | ) |
| Subscription receivable, including accrued interest of $17,901 and $12,914 respectively                                                                                                                                          |   |          | (355,101    | )      |             |   | (350,114 | ) |
| Accumulated deficit, including $16,191,235 and $15,563,011 of deficit accumulated during the development stage as of March 31, 2009 and December 31, 2008, respectively                                                          |   |          | (30,722,832 | )      |             |   | (30,094,607 | ) |
| Total stockholders’ deficiency                                                                                                                                                                                             |   |          | (2,041,765  | )      |             |   | (1,676,483 | ) |
| Total Liabilities and Stockholders' Deficiency                                                                                                                                                                                   |   | $             | 324,775     |   |             | $      | 314,642 |   |

----

|                                                                                                                                                                                                                                 |   |               |        |   |            |   |        |           |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|-------------|--------|-----------------|--------|-------------|----------------|--------|
|                                                                                                                                                                                                                                 |   | Three Months Ended |        |   | January 1, 2002 |   |
|                                                                                                                                                                                                                                 |   | March 31,          |        |   | to              |   |
|                                                                                                                                                                                                                                 |   | 2009               |        |   | 2008            |   |        | March 31, 2009 |   |
| Sales                                                                                                                                                                                                                                |   | $                  | --          |   |            | $      | --          |           |   | $ | 471,290 |   |
| Costs and expenses (income) -                                                                                                                                                                                                        |   |               |        |   |            |   |        |           |   |   |   |   |
| Cost of sales                                                                                                                                                                                                                        |   |               | --          |   |            |   | --          |           |   |   | 575,680 |   |
| Selling, general and administrative, including stock based compensation of $63,962 and $107,072 for the three months ended March 31, 2009 and 2008, respectively, and $2,736,656 for the period of January 1, 2002 to March 31, 2009 |   |               | 418,412     |   |            |   | 478,614     |           |   |   | 9,342,339 |   |
| Non-dilution agreement termination costs                                                                                                                                                                                             |   |               | --          |   |            |   | --          |           |   |   | 2,462,453 |   |
| Research and development                                                                                                                                                                                                             |   |               | 2,234       |   |            |   | 111,521     |           |   |   | 708,002 |   |
| Interest expense, including interest expense to a related party of $6,250 and $1,233 for the three months ended March 31, 2009 and 2008, respectively, and $140,023 for period of January 1, 2002 to March 31, 2009                  |   |               | 45,079      |   |            |   | 79,499      |           |   |   | 1,561,799 |   |
| Financing costs - extension of warrants                                                                                                                                                                                              |   |               | --          |   |            |   | --          |           |   |   | 74,700 |   |
| Interest expense - conversion provision                                                                                                                                                                                              |   |               | --          |   |            |   | --          |           |   |   | 113,000 |   |
| (Gain) loss on settlement of debt                                                                                                                                                                                                    |   |               | --          |   |            |   | (226,467    | )              |   |   | 2,229,903 |   |
| Change in fair value of warrants and embedded conversion option                                                                                                                                                                      |   |               | 162,500     |   |            |   | 627,800     |           |   |   | (405,351 | ) |
| Total cost and expenses (income)                                                                                                                                                                                                     |   |               | 628,225     |   |            |   | 1,070,967   |           |   |   | 16,662,525 |   |
| Net loss                                                                                                                                                                                                                             |   |               | (628,225    | )      |            |   | (1,070,967  | )              |   |   | (16,191,235 | ) |
| Deemed dividend on preferred stock                                                                                                                                                                                                   |   |               | --          |   |            |   | --          |           |   |   | (2,072,296 | ) |
| Preferred stock dividends                                                                                                                                                                                                            |   |               | (27,075     | )      |            |   | (27,075     | )              |   |   | (753,198 | ) |
|                                                                                                                                                                                                                                 |   |               |        |   |            |   |        |           |   |   |   |   |
| Net loss attributable to common stockholders                                                                                                                                                                                         |   | $                  | (655,300    | )      |            | $      | (1,098,042  | )              |   | $ | (19,016,729 | ) |
|                                                                                                                                                                                                                                 |   |               |        |   |            |   |        |           |   |   |   |   |
| Basic and diluted net loss attributable to common stockholders per common share                                                                                                                                                      |   |               | *           |   |            |   | (0.01       | )              |   |   |   |   |
|                                                                                                                                                                                                                                 |   |               |        |   |            |   |        |           |   |   |   |   |
| Weighted average number of common shares outstanding – basic and diluted                                                                                                                                                       |   |               | 239,169,385 |   |            |   | 218,163,033 |           |   |   |   |   |

| * | Less that $0.01. |
|---|------------------|

----

|                                                 |   |            |    |   |         |   |   |    |   |   |        |   |   | Additional   |    |   | Treasury    |   |       |                |   |   |    |   |   | Total      |     |
|------------------------------------------------------|--------|-----------------|---------|--------|--------------|--------|--------|---------|--------|--------|-------------|--------|--------|--------------|---------|--------|-------------|--------|------------|---------------------|--------|--------|---------|--------|--------|------------|----------|
|                                                 |   | Preferred Stock |    |   | Common Stock |   |   | Paid-In |   |   | Stock       |   |   | Subscription |    |   | Accumulated |   |       | Stockholders’ |   |
|                                                 |   | Shares          |    |   | Amount       |   |   | Shares  |   |   | Amount      |   |   | Capital      |    |   | at Cost     |   |       | Receivable          |   |   | Deficit |   |   | Deficiency |     |
| Balance at December 31, 2008                         |   |            | 184,144 |   |         | $      | 184    |    |   |   | 244,850,034 |   |   | $            | 244,849 |   |        | $      | 28,528,973 |                |   | $      | (5,768  | )      |   |       | (350,114 | ) |   | $ | (30,094,607 | ) |   | $ | (1,676,483 | ) |
|                                                 |   |            |    |   |         |   |   |    |   |   |        |   |   |         |    |   |        |   |       |                |   |   |    |   |   |       |     |   |   |   |   |   |   |   |   |   |
| Proceeds from sale of common stock and warrants:     |   |            |    |   |         |   |   |    |   |   |        |   |   |         |    |   |        |   |       |                |   |   |    |   |   |       |     |   |   |   |   |   |   |   |   |   |
| $0.0330 per share – January 16, 2009           |   |            | --      |   |         |   | --     |    |   |   | 757,576     |   |   |         | 758     |   |        |   | 24,242     |                |   |   | --      |   |   |       | --       |   |   |   | -- |   |   |   | 25,000 |   |
| $0.0320 per share – January 30, 2009           |   |            | --      |   |         |   | --     |    |   |   | 1,562,500   |   |   |         | 1,563   |   |        |   | 48,437     |                |   |   | --      |   |   |       | --       |   |   |   | -- |   |   |   | 50,000 |   |
| $0.0 320 per share – February 09, 2009         |   |            | --      |   |         |   | --     |    |   |   | 640,625     |   |   |         | 641     |   |        |   | 19,859     |                |   |   | --      |   |   |       | --       |   |   |   | -- |   |   |   | 20,500 |   |
| $0.0 299 per share – February 13, 2009         |   |            | --      |   |         |   | --     |    |   |   | 1,672,241   |   |   |         | 1,672   |   |        |   | 48,328     |                |   |   | --      |   |   |       | --       |   |   |   | -- |   |   |   | 50,000 |   |
| $0.0 290 per share – February 17, 2009         |   |            | --      |   |         |   | --     |    |   |   | 1,724,138   |   |   |         | 1,724   |   |        |   | 48,276     |                |   |   | --      |   |   |       | --       |   |   |   | -- |   |   |   | 50,000 |   |
| Common stock issued in repayment of debt:            |   |            |    |   |         |   |   |    |   |   |        |   |   |         |    |   |        |   |       |                |   |   |    |   |   |       |     |   |   |   |   |   |   |   |   |   |
| $0.0547 per share – March 14, 2009             |   |            | --      |   |         |   | --     |    |   |   | 500,000     |   |   |         | 500     |   |        |   | 26,868     |                |   |   | --      |   |   |       | --       |   |   |   | -- |   |   |   | 27,368 |   |
| Common stock issued for services                     |   |            |    |   |         |   |   |    |   |   |        |   |   |         |    |   |        |   |       |                |   |   |    |   |   |       |     |   |   |   |   |   |   |   |   |   |
| $0.0200 per share – February 23, 2009          |   |            | --      |   |         |   | --     |    |   |   | 1,000,000   |   |   |         | 1,000   |   |        |   | 19,000     |                |   |   | --      |   |   |       | --       |   |   |   | -- |   |   |   | 20,000 |   |
| Stock for receivables                                |   |            | --      |   |         |   | --     |    |   |   | --          |   |   |         | --      |   |        |   | --         |                |   |   | --      |   |   |       | (4,987   | ) |   |   | -- |   |   |   | (4,987 | ) |
| Reclassification of warrants to derivative liability |   |            | --      |   |         |   | --     |    |   |   | --          |   |   |         | --      |   |        |   | (18,900    | )                   |   |   | --      |   |   |       | --       |   |   |   | -- |   |   |   | (18,900 | ) |
| Amortization of warrants and options                 |   |            |    |   |         |   |   |    |   |   |        |   |   |         |    |   |        |   |       |                |   |   |    |   |   |       |     |   |   |   |   |   |   |   |   |   |
| for employees and non-employees                      |   |            |    |   |         |   |   |    |   |   |        |   |   |         |    |   |        |   |       |                |   |   |    |   |   |       |     |   |   |   |   |   |   |   |   |   |
|                                                 |   |            | --      |   |         |   | --     |    |   |   | --          |   |   |         | --      |   |        |   | 43,962     |                |   |   | --      |   |   |       | --       |   |   |   | -- |   |   |   | 43,962 |   |
| Net loss                                             |   |            | --      |   |         |   | --     |    |   |   | --          |   |   |         | --      |   |        |   | --         |                |   |   | --      |   |   |       |     |   |   |   | (628,225 | ) |   |   |  (628,225 | )  |
|                                                 |   |            |    |   |         |   |   |    |   |   |        |   |   |         |    |   |        |   |       |                |   |   |    |   |   |       |     |   |   |   |   |   |   |   |   |   |
| BALANCE – March 31, 2009                       |   |            | 184,144 |   |         | $      | 184    |    |   |   | 252,707,114 |   |   | $            | 252,707 |   |        | $      | 28,789,045 |                |   | $      | (5,768  | )      |   | $          | (355,101 | ) |   | $ | (30,722,832 | ) |   | $ | (2,041,765 | ) |

----

|                                                                                                                                                               |   |               |     |   |     |   |       | January  |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|----------|--------|----------|--------|------------|----------|--------|
|                                                                                                                                                               |   | Three Months Ended |     |   | 1, 2002  |   |
|                                                                                                                                                               |   | March 31,          |     |   | to March |   |
|                                                                                                                                                               |   | 2009               |     |   | 2008     |   |       | 31, 2009 |   |
| Cash Flows from Operating Activities:                                                                                                                              |   |               |     |   |     |   |       |     |   |   |
| Net loss                                                                                                                                                           |   | $                  | (628,225 | )      |     | $      | (1,070,967 | )        |   | $ | (16,191,235 | ) |
| Adjustments to reconcile net loss to net cash used in operating activities -                                                                                       |   |               |     |   |     |   |       |     |   |   |   |   |
| Depreciation                                                                                                                                                       |   |               | 6,418    |   |     |   | 1,052      |     |   |   | 23,548 |   |
| Amortization of patents                                                                                                                                            |   |               | 1,317    |   |     |   | 860        |     |   |   | 17,817 |   |
| Interest expense - amortization of deferred financing                                                                                                              |   |               | --       |   |     |   | 2,510      |     |   |   | 22,530 |   |
| Stock-based compensation                                                                                                                                           |   |               | 63,962   |   |     |   | 107,072    |     |   |   | 2,736,656 |   |
| Interest expense - conversion provision                                                                                                                            |   |               | -        |   |     |   | --         |     |   |   | 113,000 |   |
| Stock subscription - interest receivable                                                                                                                           |   |               | (4,988   | )      |     |   | --         |     |   |   | (17,902 | ) |
| Accretion of debt discount                                                                                                                                         |   |               | 34,797   |   |     |   | 67,900     |     |   |   | 603,875 |   |
| Change in fair value of warrants and embedded conversion options                                                                                                   |   |               | 162,500  |   |     |   | 627,800    |     |   |   | (405,351 | ) |
| (Gain) loss on settlement of debt                                                                                                                                  |   |               | --       |   |     |   | (226,467   | )        |   |   | 2,229,903 |   |
| Non-dilution agreement termination cost                                                                                                                            |   |               | --       |   |     |   | --         |     |   |   | 2,462,453 |   |
| Inventory reserve                                                                                                                                                  |   |               | --       |   |     |   | --         |     |   |   | 159,250 |   |
| Write-off of stock subscription receivable                                                                                                                         |   |               | --       |   |     |   | --         |     |   |   | 21,800 |   |
| Financing costs - warrant extension                                                                                                                                |   |               | --       |   |     |   | --         |     |   |   | 74,700 |   |
| Change in assets and liabilities -                                                                                                                                 |   |               |     |   |     |   |       |     |   |   |   |   |
| Prepaid expenses and other current assets                                                                                                                          |   |               | 17,035   |   |     |   | 4,853      |     |   |   | 13,389 |   |
| Security deposit                                                                                                                                                   |   |               | --       |   |     |   | --         |     |   |   | (17,441 | ) |
| Accounts payable, accrued expenses, accrued dividends, accrued compensation, accrued consulting and director fees, customer deposits and other current liabilities |   |               | 186,587  |   |     |   | (146,655   | )        |   |   | 1,981,541 |   |
| Net Cash Used in Operation Activities                                                                                                                              |   |               | (160,597 | )      |     |   | (632,042   | )        |   |   | (6,171,467 | ) |
|                                                                                                                                                               |   |               |     |   |     |   |       |     |   |   |   |   |
| Cash Flows from Investing Activities:                                                                                                                              |   |               |     |   |     |   |       |     |   |   |   |   |
| Purchase of property and equipment                                                                                                                                 |   |               | --       |   |     |   | --         |     |   |   | (159,567 | ) |
| Patent costs                                                                                                                                                       |   |               | --       |   |     |   | --         |     |   |   | (53,871 | ) |
| Net Cash Used in Investing Activities                                                                                                                              |   |               | --       |   |     |   | --         |     |   |   | (213,438 | ) |
|                                                                                                                                                               |   |               |     |   |     |   |       |     |   |   |   |   |
| Cash Flows from Financing Activities:                                                                                                                              |   |               |     |   |     |   |       |     |   |   |   |   |
| Reduction of stock subscription receivable                                                                                                                         |   |               | --       |   |     |   | --         |     |   |   | 65,700 |   |
| Proceeds from sale of preferred stock                                                                                                                              |   |               | --       |   |     |   | --         |     |   |   | 1,130,127 |   |
| Proceeds from sale of common stock                                                                                                                                 |   |               | 195,500  |   |     |   | 500,000    |     |   |   | 4,056,060 |   |
| Proceeds from exercise of warrants                                                                                                                                 |   |               | --       |   |     |   | 9,350      |     |   |   | 9,350 |   |
| Proceeds from sale of common stock to be issued                                                                                                                    |   |               | --       |   |     |   | --         |     |   |   | 300,000 |   |
| Deferred financing costs                                                                                                                                           |   |               | --       |   |     |   | --         |     |   |   | (22,530 | ) |
| Proceeds from convertible promissory note                                                                                                                          |   |               | --       |   |     |   | --         |     |   |   | 850,000 |   |
| Proceeds from officers’ and directors’ loans                                                                                                           |   |               | --       |   |     |   | --         |     |   |   | 300,000 |   |
| Repayment of notes payable                                                                                                                                         |   |               | --       |   |     |   | (28,654    | )        |   |   | (274,999 | ) |
| Net Cash Provided by Financing Activities                                                                                                                          |   |               | 195,500  |   |     |   | 480,696    |     |   |   | 6,413,708 |   |

----

|                                                       |   |               |   |   |     |   |     | January  |   |
|------------------------------------------------------------|--------|--------------------|--------|--------|----------|--------|----------|----------|--------|
|                                                       |   | Three Months Ended |   |   | 1, 2002  |   |
|                                                       |   | March 31,          |   |   | to March |   |
|                                                       |   | 2009               |   |   | 2008     |   |     | 31, 2009 |   |
| Net (Decrease) Increase in Cash                            |   |               | 34,903 |   |     |   | (151,346 | )        |   |   | 28,803 |   |
| Cash at Beginning of Year                                  |   |               | 29,411 |   |     |   | 415,400  |     |   |   | 35,511 |   |
|                                                       |   |               |   |   |     |   |     |     |   |   |   |   |
| Cash at End of Period                                      |   | $                  | 64,314 |   |     | $      | 264,054  |     |   | $ | 64,314 |   |
|                                                       |   |               |   |   |     |   |     |     |   |   |   |   |
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:          |   |               |   |   |     |   |     |     |   |   |   |   |
| Cash paid during the year for -                            |   |               |   |   |     |   |     |     |   |   |   |   |
| Interest                                                   |   | $                  | 567    |   |     | $      | 1,868    |     |   | $ | 370,920 |   |
|                                                       |   |               |   |   |     |   |     |     |   |   |   |   |
| NON-CASH INVESTING ACTIVITIES:                             |   |               |   |   |     |   |     |     |   |   |   |   |
| Notes receivable for common stock issued                   |   | $                  | --     |   |     |   | --       |     |   | $ | 674,400 |   |
|                                                       |   |               |   |   |     |   |     |     |   |   |   |   |
| NON-CASH FINANCING ACTIVITIES:                             |   |               |   |   |     |   |     |     |   |   |   |   |
| Accrued compensation satisfied by issuance of common stock |   |               | --     |   |     |   | --       |     |   | $ | 55,250 |   |
| Common stock issued in satisfaction of liabilities         |   | $                  | 27,368 |   |     | $      | 362,509  |     |   | $ | 7,065,239 |   |
| Reclassification of derivative liabilities                 |   | $                  | 18,900 |   |     | $      | 111,400  |     |   | $ | 520,066 |   |
| Cancellation of debt for no consideration                  |   |               | --     |   |     | $      | --       |     |   | $ | 1,327,321 |   |

----

----

----

|                         |   | March 31, |       |
|------------------------------|--------|-----------|------------|
|                         |   | 2009      |       |   | 2008 |   |
| Warrants                     |   |      | 31,432,326 |   |   |   | 27,542,806 |   |
| Convertible promissory notes |   |      | 9,537,463  |   |   |   | 1,980,611 |   |
| Convertible preferred stock  |   |      | 1,545,760  |   |   |   | 1,587,760 |   |
| Total                        |   |      | 42,515,549 |   |   |   | 31,111,177 |   |

| (a) | In March 2007, the Company’s former director made a loan of $50,000 to the Company. The loan accrues simple interest at the rate of 10% per annum and was due and payable 120 days after funding. The former director was granted the right, if the loan was not repaid by June 25, 2007, to convert his loan principal and interest into shares of common stock ata conversion price equal to 50% of the average closing price of the common stock over the three business days preceding the date on which demand for conversion is made.  Under accounting guidance provide by EITF 00-19, the conversion price of the loans did not have a determinable number of shares the loans could be settled in and, as a result, have been presented as a derivative liability. Accordingly, the conversion right is marked to market through earnings at the end of each reporting period. Asof March 31, 2009, the $50,000 loan and $9,949 of accrued interest owed to the former director is still outstanding.  The former director has made a demand for conversion, but the date of the demand currently is in question. |
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| (b) | On October 14, 2008, Leslie J. Kessler, the Company’s Chief Executive Officer, and Terry R. Lazar, the Company’s Chief Financial Officer each made loans of $50,000 to the Company. The loans accrue interest at the rate of 10% per annum.  In addition, the Company issued to each officer warrants to purchase 256,420 shares of common stock at an exerciseprice of $0.047 per share. The loans  are due and payable by or on October 14, 2009; provided, however, each executive officer may, at the officer’s option and in lieu of conversion as set in the loan agreements, demand repaymentof the loan amount plus all accrued and unpaid interest as of the date demand is received by the Company. The loans are evidenced by the promissory notes of the Company issued to the two officers which each contain a conversion clause that grant the officers, exercisable at the officer’s sole discretion, to convert the loan amount plus all accrued and unpaid interest due under the note into common stock at any time.  The conversion price is $0.04 per share, the closing market price of thecommon stock as of the funding date of the loans. |
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|   | (a) | In April 2009, the Company issued 250,000 shares of common stock and granted a five-year option to purchase an additional 250,000 shares of common stock to the Company’s controller.  The option was made fully exercisable as of its grant date and has an exercise price of $0.041 per share.  Such stock and option were granted under the Company’s 2008 Equity Incentive Plan.  TheCompany incurred stock-based compensation $10,250 and $7,100, respectively, in connection with such stock and option grant. |
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|   | (b) | In April 2009, the Company issued 500,000 shares of common stock and granted a five-year option to purchase an additional 500,000 shares of common stock to the Company’s director of production.  The option was made fully exercisable as of its grant date and has an exercise price of $0.041 per share.  Such stock and option were granted under the Company’s 2008 Equity Incentive Plan.  TheCompany incurred stock-based compensation $20,500 and $14,200, respectively, in connection with such stock and option grant. |
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|   | (c) | In April 2009, the Company issued 2,649,993 shares of common stock to the Company’s chief executive officer.  The issuance was made pursuant to the demand of the officer to convert convertible promissory notes in the aggregate principal amount of $100,000, plus $4,652.51 in accrued interest, into such shares of common stock.  The promissory notes were issued to her on October 14, and November17, 2008. |
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|   | (d) | In April 2009, the Company issued 2,649,993 shares of common stock to the Company’s chief financial officer.  The issuance was made pursuant to the demand of the officer to convert convertible promissory notes in the aggregate principal amount of $100,000, plus $4,652.51 in accrued interest, into such shares of common stock.  The promissory notes were issued to him on October 14, and November17, 2008. |
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|   | (e) | In April 2009, the Company granted the Company’s chief executive officer the right to receive a total of 4,000,000 shares of common stock, 2,000,000 of which were issued in April 2009 and the remaining 2,000,000 shares are issuable on January 1, 2010.  In addition to such stock grants, the officer was granted a five-year option to purchase an additional 3,000,000 shares of common stock.  Theoption was made fully exercisable as of its grant date and has an exercise price of $0.041 per share.  Such stock and option are being issued and were granted under the Company’s 2008 Equity Incentive Plan.  The Company incurred stock-based compensation $82,000 and $84,900, respectively, in connection with such stock and option grant. |
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|   | (f) | In April 2009, the Company granted the Company’s chief financial officer the right to receive a total of 4,000,000 shares of common stock, 2,000,000 of which were issued in April 2009 and the remaining 2,000,000 shares are issuable on January 1, 2010.  In addition to such stock grants, the officer was granted a five-year option to purchase an additional 3,000,000 shares of common stock.  Theoption was made fully exercisable as of its grant date and has an exercise price of $0.041 per share.  Such stock and option are being issued and were granted under the Company’s 2008 Equity Incentive Plan.  The Company incurred stock-based compensation $82,000 and $84,900, respectively, in connection with such stock and option grant. |
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|   | (g) | In April 2009, the Company granted the Company’s chief executive officer five-year warrants to purchase an aggregate 4,000,000 shares of common stock.  The warrants were made fully exercisable as of their grant date and have an exercise price of $0.041 per share.  The Company incurred stock-based compensation $113,200 in connection with the grant of such warrants. |
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|   | (h) | On April 29, 2009, for gross proceeds of $25,000, the Company sold and issued 609,756 shares of common stock and three-year warrants to purchase an additional 121,951 shares of common stock at an exercise price of $0.0492 per share. |
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|   | (i) | In May 2009, the Company issued 250,000 shares of common stock to a director in order to fulfill the Company’s obligation in connection with the appointment of the director effective March 14, 2008.  The Company incurred stock-based compensation of $7,750 in connection with such stock issuance. |
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| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations. |
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| • | our ability to raise capital to finance our research and development and operations, when needed and on terms advantageous to us; |
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| • | our ability to manage growth, profitability and marketability of our products; |
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| • | general economic and business conditions; |
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| • | the effect on our business of recent credit-tightening throughout the United States and the world, especially with respect to federal, state, local and foreign government procurement agencies, as well as quasi-public, charitable and private emergency response organizations; |
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| • | the effect on our business of recently reported losses within the financial, banking and other industries and the effect of such losses on the income and financial condition of our potential clients; |
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| • | the impact of developments and competition within the industries in which we intend to compete; |
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| • | adverse results of any legal proceedings; |
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| • | the impact of current, pending or future legislation and regulation on water safety, including, but not limited to, changes in zoning and environmental laws and regulations within our target areas of operations; |
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| • | our ability to maintain and enter into relationships with suppliers, vendors and contractors of acceptable quality of goods and services on terms advantageous to us; |
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| • | the volatility of our operating results and financial condition; |
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| • | our ability to attract and retain qualified senior management personnel; and |
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| • | the other risks and uncertainties detailed in this Form 10-Q and, from time to time, in our other filings with the SEC. |
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|   | (a) | We paid approximately $70,000 less in accounting and audit fees. |
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|   | (b) | In the first quarter of 2009, we paid $6,125 in consulting fees compared to $85,991 we paid in the same period of 2008, an approximately $80,000 reduction.  The main reason for the reduction is that two of our consultants agreed to defer their compensation until we have sufficient funds. |
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|   | (c) | We paid $44,790 less in salary expense in the first quarter of 2009 compared in the same period in 2008 because a) we eliminated the sales/marketing position in 2008 resulted a smaller payroll and b) both our chief executive officer and chief financial officer chose to defer their compensations until we have sufficient funds. |
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|   | (d) | We spent $2,807 in research and development in the three months ended March 31, 2009.  Compared to $241,023 we spent in the same period of 2008, a $238,216 reduction.  In the first quarter of 2008, our main focus was to complete the prototype of PureSafe(TM) First Response Water System.  Since the completion of the prototype in July of 2008, we are putting more focus on the marketing strategyplanning and preparing to commercialize of our production. |
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| Item 3. | Quantitative and Qualitative Disclosures About Market Risk. |
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| Item 4T. | Controls and Procedures. |
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| Item 1. | Legal Proceedings. |
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| Item 1A. | Risk Factors. |
|----------|---------------|

| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds. |
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| Item 3. | Defaults Upon Senior Securities. |
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| Item 4. | Submission of Matters to a Vote of Security Holders. |
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| Item 5. | Other Information. |
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| Item 6. | Exhibits. |
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| Number | Exhibit Description |
|--------|---------------------|

| 10.1 | Incentive Stock Option Agreement, dated April 17, 2009, between PureSafe Water Systems, Inc. and Leslie J. Kessler. |
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| 10.2 | Incentive Stock Option Agreement, dated April 17, 2009, between PureSafe Water Systems, Inc. and Terry R. Lazar. |
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| 10.3 | Incentive Stock Option Agreement, dated April 17, 2009, between PureSafe Water Systems, Inc. and Al Wolter. |
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| 10.4 | Incentive Stock Option Agreement, dated April 17, 2009, between PureSafe Water Systems, Inc. and Jawyi Dillmann. |
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| 10.5 | Warrant certificate evidencing 4,000,000 warrants registered in the name of Leslie J. Kessler. |
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| 31.1 | Rule 13a-14(a)/15d-14(a) Certification of Principal Executive Officer. |
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| 31.2 | Rule 13a-14(a)/15d-14(a) Certification of Principal Financial Officer. |

| 32.1 | Section 1350 Certification of Principal Executive Officer. |
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| 32.2 | Section 1350 Certification of Principal Financial Officer. |
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| Dated:  May 20, 2009 | PureSafe Water Systems, Inc. |
|--------------------------------|------------------------------|
|                           |                         |   |
|                           |                         |   |
|                           | By:                          | /s/ Leslie J. Kessler |
|                           |                         | Leslie J. Kessler |
|                           |                         | Chief Executive Officer |
|                           |                         | (Duly Authorized Officer and |
|                           |                         | Principal Executive Officer) |
|                           |                         |   |
|                           | By:                          | /s/ Terry R. Lazar |
|                           |                         | Terry R. Lazar |
|                           |                         | Chief Financial Officer |
|                           |                         | (Duly Authorized Officer and |
|                           |                         | Principal Financial Officer) |

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