**Washington,      D. C. 20549**

**FORM      10-Q**

**DELAWARE      77-0313235**

|  **777                S. Figueroa Street, Suite                4250**   |                            |
|------------------------------------------------------------------------------|---------------------------------|
|  **Los                Angeles,                California**              | **90017**                       |
|  (Address                of principal executive                offices) |  (Zip                Code) |

**                                    **

**(213)      271-1600**

**Yes √              No             **

**Large      accelerated filer ___ Accelerated filer  √              Non-accelerated filer ___**

**Yes___        No  √       **

| ***For                  the Three Months ended March 31, 2007***                                                                                      |   |  ***Page*** |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------|--------|
|                                                                                                                                                  |   |             |   |
| **PART                  I - FINANCIAL INFORMATION**                                                                                                   |   |             |   |
|                                                                                                                                                  |   |             |   |
| **ITEM                  1.   Financial Statements**                                                                                         |   |             |   |
|                                                                                                                                                  |   |             |   |
| **Cadiz                  Inc. Consolidated Financial Statements**                                                                                |   |             |   |
|                                                                                                                                                  |   |             |   |
| Unaudited                  Statements of Operations for the three                  months ended March 31, 2007 and 2006                               |   |  1          |   |
|                                                                                                                                                  |   |             |   |
| Unaudited                  Balance Sheets as of March 31,                  2007 and December 31, 2006                                                 |   |  2          |   |
|                                                                                                                                                  |   |             |   |
| Unaudited                  Statements of Cash                  Flows for the three months ended March 31, 2007 and                  2006              |   |  3          |   |
|                                                                                                                                                  |   |             |   |
| Unaudited                  Statement of Stockholders’                  Equity for the three months ended March 31, 2007                         |   |  4          |   |
|                                                                                                                                                  |   |             |   |
| Unaudited                  Notes to the Consolidated                  Financial Statements                                                            |   |  5          |   |
|                                                                                                                                                  |   |             |   |
| **ITEM                  2.   Management’s Discussion and Analysis of                  Financial Condition and Results of Operations** |   |  15         |   |
|                                                                                                                                                  |   |             |   |
| **ITEM                  3.   Quantitative and Qualitative Disclosures                  about Market Risk**                                  |   |  23         |   |
|                                                                                                                                                  |   |             |   |
| **ITEM                  4.   Controls and                  Procedures**                                                                     |   |  23         |   |
|                                                                                                                                                  |   |             |   |
| **PART                  II  - OTHER                  INFORMATION**                                                                               |   |  24         |   |

***CONSOLIDATED        STATEMENTS OF OPERATIONS        (UNAUDITED)***

|                                                                 | **For                the Three Months** |
|----------------------------------------------------------------------|-----------------------------------------|
|                                                                 | **Ended                March 31,**      |
| ***($                in thousands except per share data)***          | **2007**                                | **2006** |
|                                                                 |                                    |   |
| Revenues                                                             | $                                       | 352 |   | $ | 252 |
|                                                                 |                                    |   |   |   |   |
| Costs                and expenses:                                   |                                    |   |   |   |   |
| Cost                of Sales                                         |                                    | 348 |   |   | 211 |
| General                and administrative                            |                                    | 1,775 |   |   | 2,096 |
| Depreciation                and amortization                         |                                    | 37 |   |   | 40 |
|                                                                 |                                    |   |   |   |   |
| Total                costs and expenses                              |                                    | 2,160 |   |   | 2,347 |
|                                                                 |                                    |   |   |   |   |
| Operating                loss                                        |                                    | (1,808) |   |   | (2,095) |
|                                                                 |                                    |   |   |   |   |
| Other                income (expense)                                |                                    |   |   |   |   |
| Interest                expense, net                                 |                                    | (763) |   |   | (481) |
| Other                income                                          |                                    | - |   |   | 350 |
| Other                (expense), net                                  |                                    | (763) |   |   | (131) |
|                                                                 |                                    |   |   |   |   |
| Loss                before income taxes                              |                                    | (2,571) |   |   | (2,226) |
| Income                tax provision                                  |                                    | 5 |   |   | - |
|                                                                 |                                    |   |   |   |   |
| Net                loss                                              | $                                       | (2,576) |   | $ | (2,226) |
|                                                                 |                                    |   |   |   |   |
| Net                loss applicable to common stock                   | $                                       | (2,576) |   | $ | (2,226) |
|                                                                 |                                    |   |   |   |   |
| Basic                and diluted net loss per common share           | $                                       | (0.22) |   | $ | (0.20) |
|                                                                 |                                    |   |   |   |   |
| Basic                and diluted weighted average shares outstanding |                                    | 11,680 |   |   | 11,330 |
|                                                                 |

***CONSOLIDATED        BALANCE SHEET(UNAUDITED)***

|                                                                                                                                                                                                                           | **March                31,** | **December                31,** |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------|---------------------------------|
| ***($                in thousands)***                                                                                                                                                                                          | **2007**                     | **2006**                        |
|                                                                                                                                                                                                                           |                         |                            |
| **ASSETS**                                                                                                                                                                                                                     |                         |                            |
| Current                assets:                                                                                                                                                                                                 |                         |                            |
| Cash                and cash equivalents                                                                                                                                                                                       | $                            | 5,632                           |   | $ | 10,397 |
| Marketable                Securities                                                                                                                                                                                           |                         | 8,540                           |   |   | - |
| Accounts                receivable                                                                                                                                                                                             |                         | 45                              |   |   | 301 |
| Prepaid                expenses and other                                                                                                                                                                                      |                         | 390                             |   |   | 243 |
|                                                                                                                                                                                                                           |                         |                            |   |   |   |
| Total                current assets                                                                                                                                                                                            |                         | 14,607                          |   |   | 10,941 |
|                                                                                                                                                                                                                           |                         |                            |   |   |   |
| Property,                plant, equipment and water programs, net                                                                                                                                                              |                         | 35,154                          |   |   | 35,190 |
| Goodwill                                                                                                                                                                                                                       |                         | 3,813                           |   |   | 3,813 |
| Other                assets                                                                                                                                                                                                    |                         | 368                             |   |   | 382 |
|                                                                                                                                                                                                                           |                         |                            |   |   |   |
| Total                Assets                                                                                                                                                                                                    | $                            | 53,942                          |   | $ | 50,326 |
|                                                                                                                                                                                                                           |                         |                            |   |   |   |
| **LIABILITIES                AND STOCKHOLDERS’ EQUITY**                                                                                                                                                                  |                         |                            |   |   |   |
| Current                liabilities:                                                                                                                                                                                            |                         |                            |   |   |   |
| Accounts                payable                                                                                                                                                                                                | $                            | 381                             |   | $ | 444 |
| Accrued                liabilities                                                                                                                                                                                             |                         | 524                             |   |   | 380 |
| Current                portion of long term debt                                                                                                                                                                               |                         | 9                               |   |   | 9 |
|                                                                                                                                                                                                                           |                         |                            |   |   |   |
| Total                current liabilities                                                                                                                                                                                       |                         | 914                             |   |   | 833 |
|                                                                                                                                                                                                                           |                         |                            |   |   |   |
| Long-term                debt                                                                                                                                                                                                  |                         | 26,756                          |   |   | 25,881 |
|                                                                                                                                                                                                                           |                         |                            |   |   |   |
| Total                Liabilities                                                                                                                                                                                               |                         | 27,670                          |   |   | 26,714 |
|                                                                                                                                                                                                                           |                         |                            |   |   |   |
| Commitments                and contingencies                                                                                                                                                                                   |                         |                            |   |   |   |
|                                                                                                                                                                                                                           |                         |                            |   |   |   |
| Stockholders’                equity:                                                                                                                                                                                     |                         |                            |   |   |   |
| Series                F convertible preferred stock - $.01 par value:                                                                                                                                                          |                         |                            |   |   |   |
| 100,000                shares authorized; shares issued and outstanding - 1,000 at March                31, 2007                and December 31, 2006                                                                          |                         | -                               |   |   | - |
| Common                stock - $.01 par value; 70,000,000 shares authorized; shares issued                and                outstanding - 11,886,322 at March 31, 2007 and 11,536,597 at December                31, 2006 |                         | 119                             |   |   | 116 |
| Additional                paid-in capital                                                                                                                                                                                      |                         | 250,439                         |   |   | 245,206 |
| Accumulated                deficit                                                                                                                                                                                             |                         | (224,286)                       |   |   | (221,710) |
| Total                stockholders’ equity                                                                                                                                                                                |                         | 26,272                          |   |   | 23,612 |
|                                                                                                                                                                                                                           |                         |                            |   |   |   |
| Total                Liabilities and Stockholders’ equity                                                                                                                                                                | $                            | 53,942                          |   | $ | 50,326 |
|                                                                                                                                                                                                                           |                         |                            |

***CONSOLIDATED        STATEMENT OF CASH FLOWS        (UNAUDITED)***

|                                                                                                                             | **For                the Three Months** |
|----------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------|
|                                                                                                                             | **Ended                March 31,**      |
| ***($                in thousands except per share data)***                                                                      | **2007**                                |   | **2006** |
|                                                                                                                             |                                    |   |   |
| Cash                flows from operating activities:                                                                             |                                    |   |   |
| Net                lossAdjustments                to reconcile net loss to                                                       | $                                       | (2,576) |   | $ | (2,226) |
| net                cash used for operating activities:                                                                           |                                    |   |   |   |   |
| Depreciation                and amortization                                                                                     |                                    | 37 |   |   | 40 |
| Amortization                of debt discount & issuance costs                                                                |                                    | 435 |   |   | 7 |
| Interest                expense added to loan principal                                                                          |                                    | 456 |   |   | 522 |
| Compensation                charge for stock awards and share optionsChanges                in operating assets and liabilities: |                                    | 65 |   |   | 529 |
| Decrease                (increase) in accounts receivable                                                                        |                                    | 256 |   |   | 144 |
| Decrease                (increase) in prepaid borrowing expense                                                                  |                                    | - |   |   | 258 |
| Decrease                (increase) in prepaid expenses and other                                                                 |                                    | (147) |   |   | (184) |
| Increase                (decrease) in accounts payable                                                                           |                                    | (63) |   |   | (33) |
| Increase                (decrease) in accrued liabilities                                                                        |                                    | 144 |   |   | 56 |
|  Net                cash used for operating activities                                                                      |                                    |  (1,393) |   |   |  (887) |
|                                                                                                                             |                                    |   |   |   |   |
| Cash                flows from investing activities:                                                                             |                                    |   |   |   |   |
| Investment                in marketable securities                                                                               |                                    | (8,540) |   |   | - |
| Additions                to property, plant and equipment                                                                        |                                    | (1) |   |   | (18) |
|                                                                                                                             |                                    |   |   |   |   |
| Net                cash used by investing activities                                                                             |                                    | (8,541) |   |   | (18) |
|                                                                                                                             |                                    |   |   |   |   |
| Cash                flows from financing activities:                                                                             |                                    |   |   |   |   |
| Net                proceeds from exercise of stock options                                                                       |                                    | 140 |   |   | - |
| Net                proceeds from exercise of warrants                                                                            |                                    | 5,031 |   |   | - |
| Principal                payments on long-term debt                                                                              |                                    | (2) |   |   | (2) |
|                                                                                                                             |                                    |   |   |   |   |
| Net                cash provided by (used by) financing activities                                                               |                                    | 5,169 |   |   | (2) |
|                                                                                                                             |                                    |   |   |   |   |
| Net                decrease in cash and cash equivalents                                                                         |                                    | (4,765) |   |   | (907) |
|                                                                                                                             |                                    |   |   |   |   |
| Cash                and cash equivalents, beginning of period                                                                    |                                    | 10,397 |   |   | 5,302 |
|                                                                                                                             |                                    |   |   |   |   |
| Cash                and cash equivalents, end of period                                                                          | $                                       | 5,632 |   | $ | 4,395 |

***CONSOLIDATED        STATEMENT        OF STOCKHOLDERS' EQUITY(UNAUDITED)***

|                                                           |
|----------------------------------------------------------------|
| ***For                the Three months ended March 31, 2007*** |
| *($                in thousands)*                              |
|                                                           |
|                                                           | **Additional** |   | **Total** |
|                                                           | **Preferred                Stock** | **Common                Stock** | **Paid-in** | **Accumulated** | **Stockholders’** |
|                                                           | **Shares** | **Amount** | **Shares** | **Amount** | **Capital** | **Deficit** | **Equity** |
| Balance                as of                                   |   |   |   |   |   |   |   |
| December                31, 2006                               | 1,000 |   | $ | - |   | 11,536,597  |   | $ | 116  |   | $ | 245,206 |   | $ | (221,710) |   | $ | 23,612  |
|                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Warrants                exercised                              | - |   |   | - |   | 335,440  |   |   | 3  |   |   | 5,028 |   |   | - |   |   | 5,031  |
| Stock                awards and options exercised              | - |   |   | - |   | 14,285                  |    |   | -  |   |   | 140 |   |   | - |   |   | 140  |
| Stock                compensation expense                      | - |   |   | - |   |     -  |   |   |          -  |   |   | 65 |   |   | - |   |   | 6                5 |
|                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                loss                                        | - |   |   | - |   | -  |   |     | - |   |   | - |   |   | (2,576) |   |   | (2,576)  |
|                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                as of March 31, 2007                    | 1,000 |   | $ | - |   | 11,886,322  |   | $ | 119  |   | $ | 250,439 |   | $ | (224,286) |   | $ | 26,272  |

----

***NOTES        TO THE CONSOLIDATED FINANCIAL        STATEMENTS***

**NOTE      1 - DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES      **

***Description      of Business***

***Basis      of Presentation***

***Principles      of Consolidation***

***Marketable      Securities***

***Goodwill***

***Intangible      and Other Long-Lived Assets***

***Recent      Accounting Pronouncements***

**NOTE      2 - PROPERTY, PLANT, EQUIPMENT AND WATER PROGRAMS**

|                                         | **March                31,** |    | **December                31,** |
|----------------------------------------------|------------------------------|---------|---------------------------------|
|                                         | **2007**                     |    | **2006**                        |
|                                         |                         |    |                            |
| Land                and land improvements    | $                            | 21,9866 |                            | $ | 21,986 |
| Water                programs                |                         | 14,274  |                            |   | 14,274 |
| Buildings                                    |                         | 1,191   |                            |   | 1,191 |
| Machinery                and equipment       |                         | 727     |                            |   | 726 |
|                                         |                         | 38,178  |                            |   | 38,177 |
|                                         |                         |    |                            |   |   |
| Less                accumulated depreciation |                         | (3,024) |                            |   | (2,987) |
|                                         |                         |    |                            |   |   |
|                                         | $                            | 35,1545 |                            | $ | 35,190 |

**NOTE      3 - LONG-TERM DEBT**

|                                                                                                                                                                              | **March                31,** |     | **December                31,** |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------|----------|---------------------------------|
|                                                                                                                                                                              | **2007**                     |     | **2006**                        |
|                                                                                                                                                                              |                         |     |                            |
| Zero                coupon secured convertible term loan due June 29, 2011.  Interest                accruing at 5% per annum until June 29, 2009 and at 6%  thereafter | $                            | 37,772   |                            | $ | 37,316 |
| Other                loans                                                                                                                                                        |                         | 29       |                            |   | 31 |
| Debt                Discount                                                                                                                                                      |                         | (11,036) |                            |   | (11,457) |
|                                                                                                                                                                              |                         | 26,765   |                            |   | 25,890 |
|                                                                                                                                                                              |                         |     |                            |   |   |
| Less                current portion                                                                                                                                               |                         | 9        |                            |   | 9 |
|                                                                                                                                                                              |                         |     |                            |   |   |
|                                                                                                                                                                              | $                            | 26,756   |                            | $ | 25,881 |

|   | Loan                balance available for conversion: | $36.4                million |
|--------|-------------------------------------------------------|------------------------------|
|   | Expected                term:                         | 5                years       |
|   | Cadiz                common share price:              | $17.01                       |
|   | Volatility:                                           | 46%                          |
|   | Risk-free                Interest Rate:               | 5.18%                        |
|   | Change                in control probability:         | 10%                          |

**NOTE      4 - STOCK-BASED COMPENSATION PLANS AND WARRANTS**

***Stock      Options Issued under the 2003 Management Equity Incentive      Plan***

***Stock      Awards to Directors, Officer, Consultants and      Employees***

***Stock      Purchase Warrants Issued to Non-Employees***

**NOTE      5 - INCOME TAXES**

**NOTE      6 - NET LOSS PER COMMON SHARE**

**ITEM      2.** **Management’s      Discussion and Analysis of Financial Condition and Results of      Operations**

*In      connection with the "safe harbor" provisions of the Private Securities      Litigation Reform Act of 1995, the following discussion contains trend analysis      and other forward-looking statements. Forward-looking statements can be      identified by the use of words such as "intends", "anticipates", "believes",      "estimates", "projects", "forecasts", "expects", "plans" and "proposes".      Although we believe that the expectations reflected in these forward-looking      statements are based on reasonable assumptions, there are a number of risks      and      uncertainties that could cause actual results to differ materially from these      forward-looking statements. These include, among others, our ability to maximize      value from our Cadiz, California land and water resources; and our ability      to      obtain new financings as needed to meet our ongoing working capital needs.      See      additional discussion under the heading "Certain Trends and Uncertainties"      in      Item 7 of our Annual Report on Form 10-K for the year ended December 31,      2006.*

***Overview***

*Record      of Decision (“ROD”)*
*** ***

***Results      of Operations***

***Three      Months Ended March 31, 2007 Compared to Three Months Ended March 31,      2006***

***Revenues***

***Cost      of Sales***

***             General and Administrative Expenses***
*** ***

***Depreciation      and Amortization***
*** ***

***Interest      Expense, net***
** **

|                                           | **Three                Months Ended**          |
|------------------------------------------------|------------------------------------------------|
|                                           | **March                31,**    |
|                                           | **2007**                                       |   | **2006** |
|                                           |                                           |   |   |   |
| Interest                on outstanding debt    | $                                              | 456 |   | $ | 518 |
| Amortization                of financing costs |                                           | 14 |   |   | 7 |
| Amortization                of debt discount   |                                           | 421 |   |   | - |
| Interest                income                 |                                           | (128) |   |   | (44) |
|                                           |                                           |   |   |   |   |
|                                           | $                                              | 763 |   | $ | 481 |

***Other      Income***

***Income      Taxes***

**LIQUIDITY      AND CAPITAL RESOURCES **

***Current      Financing Arrangements***

| ·   | the                repayment in full of our senior secured term loan with ING; |
|--------------------|--------------------------------------------------------------------------------|

| ·   | a                final maturity date of June 29,                2011; |
|--------------------|-----------------------------------------------------------------------|

| ·   | a                zero coupon structure, which requires no cash interest payments prior                to                the final maturity date; and |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | a                5% interest rate for the first three (3) years, with a 6% interest                rate                thereafter. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------|

**Cash      Used for Operating Activities**

**Cash      Used for Investing activities**

**Cash      Provided by (Used for) Financing Activities**

***Outlook***

**Short      Term Outlook**

**Long      Term Outlook**
*.      *

***Recent      Accounting Pronouncements***

***Certain        Known Contractual Obligations***

|                                       | **Payments                Due by Period** |
|--------------------------------------------|-------------------------------------------|
| **Contractual                Obligations** | **Total**                                 |   | **1                year or less** |   | **2-3                years** |   | **4-5                years** |   | **After                5 years** |
|                                       |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Long                term debt obligations  | $                                         | 37,8011 |   | $ | 9 |   | $ | 20 |   | $ | 37,772 |   | $ | - |
| Interest                Expense            |                                      | 9,9766 |   |   | 1 |   |   | 1 |   |   | 9,974 |   |   | - |
| Operating                leases            |                                      | 699 |   |   | 46 |   |   | 23 |   |   | - |   |   | - |
|                                       | $                                         | 47,8466 |   | $ | 56 |   | $ | 44 |   | $ | 47,746 |   | $ | - |
|                                       |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |

**ITEM      3.** **Quantitative      and Qualitative Disclosures about Market Risk**

**ITEM      4.** **Controls      and Procedures**

**Disclosure      Controls and Procedures**

**Changes      in Internal Controls Over Financial Reporting **

**PART      II - OTHER INFORMATION**

**ITEM      1.     **
**Legal      Proceedings**

**ITEM      1A.   **
**Risk      Factors**

**ITEM      2.     **
**Unregistered      Sales of Equity Securities and Use of Proceeds**

**ITEM      3.     **
**Defaults      Upon Senior Securities**

**ITEM      4.     **
**Submission      of Matter to a Vote of Security Holders**

**ITEM        5.     Other Information**

**ITEM      6. **
**Exhibits      **

|   | (1) | Previously                filed as appendix A to our definitive proxy dated April 27, 2007                as filed                April 27, 2007. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------|

**SIGNATURE**

**Cadiz      Inc.**