SECURITIES
      AND EXCHANGE COMMISSION





Washington,
      D.C. 20549


__________





Form
      10-Q





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





For
      the quarterly period ended September
      30, 2005





OR





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





For the transition period from  ___________ to
      ___________




Commission
      file number  -1-31943





**CRITICARE
                SYSTEMS, INC.**(Exact
                name of registrant as specified in its
                charter)





Delaware
            
            39-1501563(State
                or other jurisdiction of
              incorporation
                or organization)
            
            (IRS
                Employer Identification No.)





20925
                Crossroads Circle, Suite 100, Waukesha, Wisconsin
            
            53186(Address
                of principal executive offices)
            
            (Zip
                Code)





Registrant's
      telephone number including area code (262)
      798-8282





N/AFormer
                name, former address and former fiscal year, if changed since last
                report.




Indicate
      by check mark whether the registrant (1) has filed all reports required to
      be
      filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
      the
      preceding 12 months (or for such shorter period that the registrant was required
      to file such reports), and (2) has been subject to such filing requirements
      for
      the past 90 days.




Yes X No
       ____





Indicate
      by check mark whether the registrant is an accelerated filer (as defined in
      Exchange Act Rule 12b-2).




Yes
      ____   No  X





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





Yes
      ____   No X





Number
      of
      shares outstanding of each class of the registrant's classes of common stock
      as
      of September 30, 2005: Class A Common Stock 12,009,426 shares.







CRITICARE
      SYSTEMS, INC.


CONSOLIDATED
      BALANCE SHEETS


SEPTEMBER
      30, 2005 AND JUNE 30, 2005





(UNAUDITED)


ASSETS
            
            **September
                30,**
              **2005**
            
            **June
                30,**
              **2005**CURRENT
                ASSETS:Cash
                and cash equivalents
            
            $
            3,589,832
            
            $
            3,680,965Accounts
                receivable, less allowance for doubtful accountsof
                $300,000 and $300,000, respectively
            
            
            7,710,851
            
            
            6,847,432Other
                receivables
            
            
            654,404
            
            
            645,479Inventories
            
            
            6,420,233
            
            
            5,551,093Prepaid
                expenses
            
            
            264,188
            
            
            255,104Total
                current assets
            
            
            18,639,507
            
            
            16,980,073Property,
                plant and equipment - net
            
            
            2,233,177
            
            
            2,010,417License
                rights and patents - net
            
            
            68,232
            
            
            69,983TOTAL
                ASSETS
            
            $
            20,940,917
            
            $
            19,060,473LIABILITIES
                AND STOCKHOLDERS' EQUITYCURRENT
                LIABILITIES:Accounts
                payable
            
            $
            4,420,623
            
            $
            3,033,559Accrued
                liabilities:Compensation
                and commissions
            
            
            847,226
            
            
            900,636Product
                warranties
            
            
            422,522
            
            
            452,000Obligations
                under capital lease
            
            
            64,063
            
            
            62,739Other
            
            
            184,572
            
            
            191,807Total
                current liabilities
            
            
            5,939,006
            
            
            4,640,741LONG-TERM
                LIABILITIES:Obligations
                under capital lease
            
            
            185,510
            
            
            202,031Other
                long-term obligations
            
            
            6,586
            
            
            8,561Total
                long-term liabilities
            
            
            192,096
            
            
            210,592TOTAL
                LIABILITIES
            
            
            6,131,102
            
            
            4,851,333STOCKHOLDERS'
                EQUITY:Preferred
                stock - $.04 par value, 500,000 shares authorizedno
                shares issued or outstanding
            
            
            —
            
            
            —Common
                stock - $.04 par value, 15,000,000 shares authorized, 12,120,461
                and11,925,086
                shares issued, and 12,009,426 and 11,812,493 outstanding,
                respectively
            
            
            484,818
            
            
            477,003Additional
                paid-in capital
            
            
            25,228,574
            
            
            24,775,995Common
                stock held in treasury (111,035 and 112,593 shares,
                respectively)
            
            
            (383,931
            )
            
            (386,834
            )Retained
                earnings (accumulated deficit)
            
            
            (10,511,534
            )
            
            (10,648,912
            )Cumulative
                translation adjustment
            
            
            (8,112
            )
            
            (8,112
            )Total
                stockholders' equity
            
            
            14,809,815
            
            
            14,209,140TOTAL
                LIABILITIES AND STOCKHOLDERS’ EQUITY
            
            $
            20,940,917
            
            $
            19,060,473





See
      notes
      to consolidated financial statements.


2





CRITICARE
      SYSTEMS, INC.


CONSOLIDATED
      STATEMENTS OF OPERATIONS


THREE
      MONTHS ENDED SEPTEMBER 30, 2005 AND 2004





(UNAUDITED)


******2006**
            
            ******2005**NET
                SALES
            
            $
            7,672,313
            
            $
            5,331,357COST
                OF GOODS SOLD
            
            
            4,737,013
            
            
            3,459,923GROSS
                PROFIT
            
            
            2,935,300
            
            
            1,871,434OPERATING
                EXPENSES:Sales
                and marketing
            
            
            1,486,832
            
            
            1,314,487Research,
                development and engineering
            
            
            626,650
            
            
            541,118Administrative
            
            
            764,747
            
            
            749,904Total
            
            
            2,878,229
            
            
            2,605,509INCOME
                (LOSS) FROM OPERATIONS
            
            
            57,071
            
            
            (734,075
            )OTHER
                INCOME (EXPENSE):Interest
                expense
            
            
            (5,443
            )
            
            (6,661
            )Interest
                income
            
            
            20,256
            
            
            8,608Other
                income
            
            
            65,494
            
            
            31,819Total
            
            
            80,307
            
            
            33,766INCOME
                (LOSS) BEFORE INCOME TAXES
            
            
            137,378
            
            
            (700,309
            )INCOME
                TAX PROVISION
            
            
            —
            
            
            —NET
                INCOME (LOSS)
            
            $
            137,378
            
            $
            (700,309
            )NET
                INCOME (LOSS) PER COMMON SHAREBasic
            
            $
            0.01
            
            $
            (0.06
            )Diluted
            
            $
            0.01
            
            $
            (0.06
            )WEIGHTED
                AVERAGE NUMBER OF COMMONSHARES
                OUTSTANDING:Basic
            
            
            11,843,923
            
            
            11,451,465Diluted
            
            
            12,192,149
            
            
            11,451,465





See
      notes
      to consolidated financial statements.


3




CRITICARE
      SYSTEMS, INC.


CONSOLIDATED
      STATEMENTS OF CASH FLOWS


THREE
      MONTHS ENDED SEPTEMBER 30, 2005 AND 2004





(UNAUDITED)


**2006**
            
            **2005**OPERATING
                ACTIVITIES:Net
                income (loss)
            
            $
            137,378
            
            $
            (700,309
            )Adjustments
                to reconcile net income (loss) to net cashused
                in operating activities:Depreciation
            
            
            146,155
            
            
            152,656Amortization
            
            
            1,751
            
            
            1,751Provision
                for doubtful accounts
            
            
            —
            
            
            40,075Provision
                for obsolete inventory
            
            
            (125,440
            )
            
            75,000Changes
                in assets and liabilities:Accounts
                receivable
            
            
            (863,419
            )
            
            525,261Other
                receivables
            
            
            (8,925
            )
            
            283,160Inventories
            
            
            (949,483
            )
            
            (352,326
            )Prepaid
                expenses
            
            
            (9,084
            )
            
            140,150Accounts
                payable
            
            
            1,387,064
            
            
            (1,044,457
            )Accrued
                liabilities
            
            
            (92,098
            )
            
            (304,109
            )Net
                cash used in operating activities
            
            
            (376,101
            )
            
            (1,183,148
            )INVESTING
                ACTIVITIES:Purchases
                of property, plant and equipment, net
            
            
            (163,132
            )
            
            (56,374
            )Net
                cash used in investing activities
            
            
            (163,132
            )
            
            (56,374
            )FINANCING
                ACTIVITIES:Retirement
                of obligations under capital lease
            
            
            (15,197
            )
            
            (13,979
            )Proceeds
                from issuance of common stock
            
            
            463,297
            
            
            5,388Net
                cash provided by (used in) financing activities
            
            
            448,100
            
            
            (8,591
            )NET
                DECREASE IN CASH AND CASH EQUIVALENTS
            
            
            (91,133
            )
            
            (1,248,113
            )CASH
                AND CASH EQUIVALENTS, BEGINNING OF PERIOD
            
            
            3,680,965
            
            
            3,738,825CASH
                AND CASH EQUIVALENTS, END OF PERIOD
            
            $
            3,589,832
            
            $
            2,490,712SUPPLEMENTAL
                CASH FLOW INFORMATION:Cash
                paid for:Income
                taxes paid-net
            
            $
            2,825
            
            $
            3,125Interest
            
            $
            5,443
            
            $
            6,661





See
      notes
      to consolidated financial statements.


4




CRITICARE
      SYSTEMS, INC.


Condensed
      Notes to Consolidated Financial Statements


(Unaudited)





**1. 
      Basis of Presentation**





The
      accompanying unaudited financial statements have been prepared by Criticare
      Systems, Inc. (the "Company") pursuant to the rules and regulations of the
      Securities and Exchange Commission ("SEC") and, in the opinion of the Company,
      include all adjustments necessary for a fair statement of results for each
      period shown. Certain information and footnote disclosures normally included
      in
      financial statements prepared in accordance with generally accepted accounting
      principles have been condensed or omitted pursuant to such SEC rules and
      regulations. The Company believes that the disclosures made are adequate to
      prevent the financial information given from being misleading. It is suggested
      that these financial statements be read in conjunction with the financial
      statements and notes thereto included in the Company's latest annual report
      and
      previously filed Form 10-K. Certain amounts from the fiscal 2005 financial
      statements have been reclassified to conform to the 2006
      presentation.





**2.
       Inventory Valuation**





Inventory
      is stated at the lower of cost or market, with cost determined on the first-in,
      first-out method. Components of inventory consisted of the following at
      September 30, 2005 and June 30, 2005, respectively:




September
                30,
              2005
            
            June
                30,
              2005Component
                parts
            
            $
            2,581,319
            
            $
            3,573,396Work
                in process
            
            
            1,228,376
            
            
            1,085,172Finished
                units
            
            
            2,923,398
            
            
            1,330,825Total
                inventories
            
            
            6,733,093
            
            
            5,989,393Less:
                reserve for obsolescence
            
            
            312,860
            
            
            438,300Net
                inventory
            
            $
            6,420,233
            
            $
            5,551,093





**3. 
      Property, Plant and Equipment**





Property,
      plant and equipment consist of the following:





September
                30,
              2005
            
            June
                30,
              2005Machinery
                and equipment
            
            $
            2,946,676
            
            $
            2,800,269Furniture
                and fixtures
            
            
            951,263
            
            
            947,726Leasehold
                improvements
            
            
            220,407
            
            
            220,407Production
                tooling
            
            
            2,023,001
            
            
            2,009,809Demonstration
                and loaner monitors
            
            
            1,688,295
            
            
            1,352,267Property,
                plant and equipment - cost
            
            
            7,829,642
            
            
            7,330,478Less:
                accumulated depreciation
            
            
            (5,596,465
            )
            
            (5,320,061
            )Property,
                plant and equipment - net
            
            $
            2,233,177
            
            $
            2,010,417





The
      Company capitalizes and subsequently reports at the lower of unamortized cost
      or
      net realizable value, all software production costs once technological
      feasibility has been established for the product.


5


**4. 
      Stock Options**





Prior
      to
      fiscal 2006, the Company had adopted the disclosure-only provisions of SFAS
      No.
      123, “Accounting for Stock-Based Compensation” and SFAS No. 148, “Accounting for
      Stock-Based Compensation—Transition and Disclosure”. Effective July 1, 2005, the
      Company adopted the fair value recognition provisions of SFAS No. 123,
“Accounting for Stock-Based Compensation”. Under the modified prospective method
      of adoption selected by the Company under the provisions of SFAS No. 148,
“Accounting for Stock-Based Compensation—Transition and Disclosure”,
      compensation cost recognized in fiscal 2006 is the same as that which would
      have
      been recognized had the recognition provisions of SFAS No. 123 been applied
      from
      its original effective date. Results for the prior year has not been restated.
      If the Company had elected to recognize compensation cost for the options
      granted for the three months ended September 30, 2004, consistent with the
      method prescribed by SFAS No. 123, net loss and net loss per share would have
      been changed to the pro forma amounts indicated below:





Three
                Months ended September 30,2005
            
            2004Net
                income (loss) - as reported
            
            $
            137,378
            
            $
            (700,309
            )Add:
                Stock-based employee compensationexpense
                included in reported net income
            
            
            40,017
            
            
            --Deduct:
                Total stock-based employee compensationexpense
                determined under fair value basedmethod
                for all awards
            
            
            (40,017
            )
            
            (29,362
            )Net
                income (loss) - pro forma
            
            $
            137,378
            
            $
            (729,671
            )Basic
                and diluted net income (loss)
              per
                share - as reported
            
            $
            0.01
            
            $
            (0.06
            )Basic
                and diluted net income (loss)
              per
                share - pro forma
            
            $
            0.01
            
            $
            (0.06
            )





For
      the
      three months ended September 30, 2004 the Company granted options totaling
      50,000 shares at an exercise price of $2.61, which are valued at $73,576. The
      fair value of stock options used to compute pro forma net income (loss) and
      net
      income (loss) per share is the estimated present value at the grant date using
      the Black-Scholes option-pricing model.





**5. 
      Income Taxes**





No
      income
      tax provision has been made in the consolidated income statements due to federal
      and state net operating loss carry forwards that will be utilized to offset
      taxable income earned. At September 30, 2005, the Company had federal net
      operating loss carry forwards of approximately $17,661,000 (which expire from
      2008 through 2025) and state net operating loss carry forwards of approximately
      $12,022,000 (which expire from 2005 through 2020) available to offset future
      taxable income. The Company has recorded a valuation allowance to offset the
      related deferred income tax assets arising from these net loss carry forwards
      due to the uncertainty of realizing the benefits of these assets in future
      years.


6


**6. 
      Line of Credit Facility**





At
      September 30, 2005, the Company had a $2,000,000 demand line of credit facility
      with a commercial bank to meet its short-term borrowing needs. Borrowings
      against the line were payable on demand with interest payable monthly at the
      bank's reference rate, less 0.25% (6.50% as of September 30, 2005). As of
      September 30, 2005 and 2004 there were no borrowings against the line.
      Borrowings under the line of credit facility are collateralized by substantially
      all assets of the Company. The credit facility has covenants which require
      minimum income or liquidity levels. The Company was in compliance with the
      covenants at September 30, 2005.





**7. 
      Net Income (Loss) Per Common Share**





Basic
      income (loss) per share is computed using the weighted average number of common
      shares outstanding during the periods. Diluted income per share is computed
      using the weighted average number of common and dilutive common equivalent
      shares outstanding during the periods. The basic and diluted weighted average
      number of common shares outstanding in the financial statements are the same
      in
      fiscal year 2005 because including a diluted calculation in a loss position
      would produce an anti-dilutive per share amount. The number of diluted weighted
      average common shares outstanding would be higher by 95,950 shares in 2005
      without this anti-dilutive impact.


7


CRITICARE
      SYSTEMS, INC.


Management's
      Discussion and Analysis of


Results
      of Operations and Financial Condition


Three
      Months Ended September 30, 2005 and 2004





**Results
      of Operations**





Net
      sales
      of $7,672,313 for the three months ended September 30, 2005 increased 43.9%
      from
      $5,331,357 for the same period in fiscal 2005. A 10.7% increase in the number
      of
      units shipped and a 29.8% increase in the average sales price were partially
      offset by a 12.8% reduction in accessory sales in the current period. The
      increased sales were the result of a $831,946 net increase in original equipment
      manufacturer ("OEM") sales, $547,095 in acute care sales, a $410,182 increase
      in
      international sales and a $294,309 increase in domestic sales. 67.7% of the
      Company’s increased sales were driven by an increase in sales to our largest OEM
      customer.





The
      gross
      profit percentage of 38.2% for the three months ended September 30, 2005
      increased from 35.1% for the same period in fiscal 2005. The increased margins
      in the current period were mainly due to increased manufacturing overhead
      absorption, resulting from the increase in the number of units shipped and
      relatively fixed overhead costs. The gross profit for the first quarter of
      fiscal 2006 was adversely affected by increased overhead costs associated with
      the one-time manufacturing start-up costs related to our new portable cardiac
      monitor. Upon the stabilization of the portable cardiac monitor product line
      and
      manufacturing process, the Company will explore cost savings through the
      offshore manufacturing of the monitor.




Operating
      expenses for the three months ended September 30, 2005 increased $272,720 from
      the same period in fiscal 2005. The increase of $172,345 in sales and marketing
      expenses was due mainly to a $75,603 increase in the commissions earned by
      dealers and employees, due to increased sales, combined with a $57,620 decrease
      in service sales for the three months ended September 30, 2005. The increase
      of
      $85,532 in research, development and engineering expenses was mainly due to
      $125,000 of funding received, in the first quarter of fiscal 2005, from our
      largest OEM customer to jointly develop a highly specialized monitoring system
      for medical imaging applications. Administrative expenses increased by $14,800
      mainly due to $40,017 in compensation expenses recognized in conjunction with
      SFAS 123(R) and an increase of $11,449 in license fees, which was partially
      offset by a $19,094 reduction in consulting fees and a $26,633 reduction in
      legal fees. The Company has a receivable, that has been outstanding for over
      one
      year, with our distributor in Mexico in the amount of $1,240,858. If the
      distributor is unable to complete the tender with the Mexican government, the
      Company may need to reserve a portion of the receivable, which would increase
      operating expenses.




Total
      other income for the three months ended September 30, 2005 increased $46,541
      from the same period in fiscal 2005. This increase was driven by a $42,750
      increase in royalty fees.





The
      $1,063,866 and $46,541 increase in gross profit and total other income
      respectively, partially offset by the increased operating expenses of $272,720,
      resulted in net income of $137,378 for the three months ended September 30,
      2005
      compared to a net loss of $(700,309) for the same period in fiscal
      2005. ****


8





**Liquidity
      and Capital Resources**





As
      of
      September 30, 2005, the Company had a cash balance of $3,589,832 that was
      $91,133 lower than its balance at June 30, 2005 of $3,680,965. The Company
      continues to maintain a long-term bank debt free balance sheet since August
      30,
      2002 when it sold its building and used the proceeds from the sale to retire
      the
      long-term bank debt on the facility.





The
      Company’s cash position decreased by $91,133 for the three months ended
      September 30, 2005 as $448,100 of cash provided by financing activities was
      more
      than offset by $163,132 of capital expenditures and $376,101 of cash used in
      operations. Cash used in operations was $376,101 for the three months ended
      September 30, 2005 as an increase of $1,812,902 in receivables and inventory
      was
      nearly offset by a $1,387,064 increase in accounts payable.





The
      Company believes all future capital and liquidity requirements will be satisfied
      by cash generated from operations, proceeds received from the issuance of common
      stock related to the exercise of stock options, and its current cash balances.
      No major capital equipment expenditures are expected in the Company’s next
      fiscal year ending June 30, 2006. The Company also has a $2,000,000 line of
      credit currently in place that could be utilized, if necessary. At June 30,
      2005, there were no borrowings outstanding under this line of credit. The credit
      facility has covenants which require minimum income or liquidity levels. The
      Company was in compliance with the covenants at September 30, 2005. This line
      expires in June 2006.





**Forward
      Looking Statements**





A
      number
      of the matters and subject areas discussed herein that are not historical or
      current facts deal with potential future circumstances and developments. These
      include anticipated product introductions, expected future financial results,
      liquidity needs, financing ability, management's or the Company's expectations
      and beliefs and similar matters discussed in Management's Discussion and
      Analysis or elsewhere herein. The discussions of such matters and subject areas
      are qualified by the inherent risk and uncertainties surrounding future
      expectations generally, and also may materially differ from the Company's actual
      future experience.





The
      Company's business, operations and financial performance are subject to certain
      risks and uncertainties which could result in material differences in actual
      results from management's or the Company's current expectations. These risks
      and
      uncertainties include, but are not limited to, general economic conditions,
      demand for the Company's products, costs of operations, the development of
      new
      products, the reliance on single sources of supply for certain components in
      the
      Company's products, government regulation, health care cost containment
      programs, the effectiveness of the Company's programs to manage working capital
      and reduce costs, competition in the Company's markets, compliance with product
      safety regulations and product liability and product recall risks, risks
      relating to international sales and compliance with U.S. export regulations,
      unanticipated difficulties in outsourcing the manufacturing of the majority
      of
      its products to foreign manufacturers and risks related to foreign
      manufacturing, including economic and political instability, trade and foreign
      tax laws, production delays and cost overruns and quality
      control.


9


**Quantitative
      and Qualitative Disclosures about Market Risk**





The
      Company has a demand line of credit facility with a commercial bank with
      interest payable monthly at 25 basis points below the bank's reference rate.
      The
      Company had no borrowings outstanding under this bank facility at September
      30,
      2005 and June 30, 2005. Due historically to the lack of need to borrow from
      this
      credit facility and due to the Company’s current cash position, the Company is
      not subject to financial risk on this obligation if interest rates in the market
      change significantly.





The
      Company’s net sales are primarily denominated in United States dollars, except
      for a small amount of net sales from the Company’s operation in India
      denominated in Indian rupees. As a result, part of the Company’s accounts
      receivable are denominated in rupees and translated into U.S. dollars for
      financial reporting purposes. A 10% change in the exchange rate of the U.S.
      dollar with respect to the Indian rupee would not have a material adverse effect
      on the Company’s financial condition or results of operations for the quarter
      ended September 30, 2005. The Company does not use any hedges or other
      derivative financial instruments to manage or reduce exchange rate
      risk.





**Controls
      and Procedures**





As
      of the
      end of the period covered by this report, 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 Vice President
      - Finance, of the Company’s disclosure controls and procedures (as defined in
      Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as
      amended). Based on this evaluation, the Company’s Chief Executive Officer and
      Vice President - Finance concluded that, as of the end of such period, the
      Company’s disclosure controls and procedures were effective in recording,
      processing, summarizing and reporting, on a timely basis, information required
      to be disclosed by the Company in reports that the Company files with or submits
      to the Securities and Exchange Commission. It should be noted that in designing
      and evaluating the disclosure controls and procedures, management recognized
      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 was required to apply its judgment in evaluating
      the
      cost-benefit relationship of possible controls and procedures. The Company
      has
      designed its disclosure controls and procedures to reach a level of reasonable
      assurance of achieving the desired control objectives and based upon the
      evaluation described above, the Company’s Chief Executive Officer and Vice
      President -Finance concluded that the Company’s disclosure controls and
      procedures were effective at reaching that level of reasonable
      assurance.





There
      was
      no change in the Company’s internal control over financial reporting (as defined
      in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934,
      as
      amended) during the Company’s most recently completed fiscal quarter that has
      materially affected, or is reasonably likely to materially affect, the Company’s
      internal control over financial reporting.


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PART
      II -
      OTHER INFORMATION





Item
      6. Exhibits.





3.1
            Restated
                Certificate of Incorporation of the Company (incorporated by reference
                to
                the Registration Statement filed on Form S-1, Registration No.
                33-13050).





3.2
            By-Laws
                of the Company (incorporated by reference to the Registration Statement
                filed on Form S-1, Registration No.
                33-13050).





4.1
            Specimen
                Common Stock certificate (incorporated by reference to the Registration
                Statement filed on Form S-1, Registration No.
                33-13050).




4.2
            Rights
                Agreement (incorporated by reference to the Company’s Current Report on
                Form 8-K filed on April 18, 1997).





31.1
            Certification
                of Emil H. Soika, President and Chief Executive Officer (Principal
                Executive Officer) pursuant to Section 302 of the Sarbanes-Oxley
                Act of
                2002.





31.2
            Certification
                of Joel D. Knudson, Vice President - Finance and Secretary (Principal
                Financial Officer) pursuant to Section 302 of the Sarbanes-Oxley
                Act of
                2002.





32*
            Certification
                of Principal Executive Officer and Principal Financial Officer pursuant
                to
                18 U.S.C. Section 1350.





__________________


*
      This
      Certification is not “filed” for purposes of Section 18 of the Securities
      Exchange Act of 1934, as amended, or incorporated by reference into any filing
      under the Securities Act of 1933, as amended, or the Securities Exchange Act
      of
      1934, as amended.





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SIGNATURES





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





CRITICARE
      SYSTEMS, INC.


(Registrant)





Date:
      November 10,
      2005 BY /s/
      Joel D. Knudson


Joel D. Knudson


Vice President - Finance


(Chief Accounting Officer and


Duly Authorized Officer)







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