UNITED
STATES

SECURITIES
AND EXCHANGE COMMISSION

Washington,
D.C. 20549



FORM
10-QSB



[X]
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)

OF THE
SECURITIES EXCHANGE ACT OF 1934



[ ]
TRANSITION REPORT PURSUANT TO SECTION 13 OR

15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934



For the
quarterly period ended: June 30, 2003



Commission
file number 000-25415



Twin
Faces East Entertainment Corporation

(Exact
name of registrant as specified in its charter)



Nevada                                                                                                        
94-3326901

(State or other
jurisdiction
of                                                                
(I.R.S. Employer

incorporation or
organization)                                                     
Identification Number)

94 Arthur Hills Court

Henderson, Nevada                                                                                             
89074

(Address of Principal
Executive
Offices)                                                      
(Zip Code)



(702)
617-8832

(Registrant's
telephone number, including area code)



Indicate
by check mark whether the registrant (1) filed all reports required to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the last 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 ____



The number of shares of Common Stock, $0.001 par value, outstanding on June 30,
2003, was 9,577,348 shares, held by approximately 53 shareholders.



Transitional Small Business Disclosure Format (check one):



Yes  No X





Twin
Faces East Entertainment Corporation

(a
Development Stage Company)

Balance
Sheet

ITEM 1. FINANCIAL
STATEMENTS

|                                                                                                                                                                                                | June
      30, 2003
      (Unaudited) | December
      31, 2002
      (Audited)
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------- | ---------------------------------------
|Assets                                                                                                                                                                                          |                                       |                                        
|                                                                                                                                                                                                |                                       |                                        
|Current assets:                                                                                                                                                                                 |                                       |                                        
|Cash and
      equivalents                                                                                                                                                                      | $ 5                                   | $
      65                             
|Total current
      assets                                                                                                                                                                      | 5                                     | 65                                     
|                                                                                                                                                                                                |                                       |                                        
|Fixed assets, net                                                                                                                                                                               | 0                                     | 201                                    
|                                                                                                                                                                                                |                                       |                                        
|                                                                                                                                                                                                |                                       |                                        
|Other noncurrent
      assets                                                                                                                                                                   | 230,000                               | 230,000                                
|                                                                                                                                                                                                | $
      230,005                       | $
      230,266                        
|                                                                                                                                                                                                |                                       |                                        
|Liabilities and
      Stockholders' Equity                                                                                                                                                      |                                       |                                        
|                                                                                                                                                                                                |                                       |                                        
|Current
      liabilities:                                                                                                                                                                      |                                       |                                        
|Accrued salaries
      and benefits                                                                                                                                                             | $
      1,011,165                     | $
      826,915                        
|Other accrued
      expenses                                                                                                                                                                    | 1,196,116                             | 694,063                                
|Short-term note
      payable                                                                                                                                                                   | 73,000                                | 73,000                                 
|Stockholders'
      advances                                                                                                                                                                    | 458,749                               | 458,749                                
|Total current
      liabilities                                                                                                                                                                 | 2,739,030                             | 2,052,727                              
|                                                                                                                                                                                                |                                       |                                        
|Long-term debt                                                                                                                                                                                  | 465,900                               | 465,900                                
|                                                                                                                                                                                                |                                       |                                        
|                                                                                                                                                                                                | 3,204,930                             | 2,518,627                              
|                                                                                                                                                                                                |                                       |                                        
|Stockholders'
      equity:                                                                                                                                                                     |                                       |                                        
|Preferred stock,
      $.001 par value, authorized 5,000,000
      shares; no shares issued
      and outstanding                                                                               | -                                     | -                                      
|                                                                                                                                                                                                |                                       |                                        
|Common stock,
      $.001 par value, authorized 20,000,000
      shares; 9,577,348
      issued and outstanding at 12/30/03 and
      8,527,348 shares
      issued and outstanding at 12/31/03 | 9,577                                 | 8,527                                  
|                                                                                                                                                                                                |                                       |                                        
|Additional
      paid-in capital                                                                                                                                                                | 1,254,668                             | 1,136,208                              
|(Deficit)
      accumulated during development stage                                                                                                                                            | (4,269,195)                           | (3,463,181)                            
|Prior period
      adjustment                                                                                                                                                                   | 30,025                                | 30,025                                 
|                                                                                                                                                                                                | (2,974,925)                           | (2,288,361)                            
|                                                                                                                                                                                                | $
      230,005                       | $
      230,266                        

The
accompanying notes are an integral part of these financial statements.





Twin
Faces East Entertainment Corporation

(a
Development Stage Company)

Statements
of Operations

for the
three and six months ended June 30, 2003 and 2002

and for
the period December 5, 1997 (inception) to June 30, 2003



|                                                          | For
      the three months ended
      June
      30, | For
      the six months ended
      June
      30,
|--------------------------------------------------------- | ----------------------------------------------------- | ---------------------------------------------------
|December 5, 1997
      (inception) to June 30, 2003      
|                                                          | 2003                                                  | 2002                                               
|Pre-Operating
      Revenue                               |                                                       |                                                    
|Interest income                                           | $ -                                                   | $
      970                                        
|                                                          |                                                       |                                                    
|Pre-Operating
      Expenses:                             |                                                       |                                                    
|Professional
      services                               | 344,420                                               | 151,888                                            
|Salaries and
      benefits                               | 133,750                                               | 121,250                                            
|Commissions and
      fees                                | 20,000                                                | -                                                  
|General and
      administrative                          | 57,647                                                | 379,585                                            
|Depreciation and
      amortization                       | -                                                     | -                                                  
|                                                          | 555,817                                               | 652,723                                            
|                                                          |                                                       |                                                    
|Net pre-operating
      (loss)                            | (555,817)                                             | (651,753)                                          
|                                                          |                                                       |                                                    
|Other income
      (expenses):                            |                                                       |                                                    
|Interest                                                  | (17,314)                                              | -                                                  
|Net (loss) before
      discontinued operations           | (573,131)                                             | (651,753)                                          
|                                                          |                                                       |                                                    
|(Loss) from
      discontinued operations                 | -                                                     | -                                                  
|                                                          |                                                       |                                                    
|Net (loss)                                                | $
      (573,131)                                     | $
      (651,753)                                  
|                                                          |                                                       |                                                    
|Weighted average
      number of                          |                                                       |                                                    
|common shares
      outstanding - basic and fully diluted | 8,831,515                                             | 8,194,000                                          
|                                                          |                                                       |                                                    
|Net (loss) per
      share before discontinued operations | $
      (0.06)                                        | $
      (0.08)                                     
|Net (loss) per
      share from discontinued operations   | 0.00                                                  | 0.00                                               
|Net (loss) per
      share - basic and fully diluted      | $
      (0.06)                                        | $
      (0.08)                                     



The
accompanying notes are an integral part of these financial statements.





Twin
Faces East Entertainment Corporation

(a
Development Stage Company)

Consolidated
Statement of Cash Flows

for the
six months ended June 30, 2003 and 2002

and for
the period December 5, 1997 (inception) to June 30, 2003



|                                                                   | For
      the six months ended
      June
      30, | December
      5, 1997
      (inception)
      to
      June 30,
      2003
|------------------------------------------------------------------ | --------------------------------------------------- | ---------------------------------------------------------------------------
|                                                                   | 2003                                                | 2002                                                                       
|Cash flows from
      operating activities                         |                                                     |                                                                            
|Net (loss)                                                         | $
      (573,131)                                   | $
      (785,828)                                                          
|Depreciation                                                       | -                                                   | -                                                                          
|Prior period
      adjustment                                      | -                                                   | -                                                                          
|Shares issued for
      salaries - related party                   | 119,450                                             | -                                                                          
|Shares issued for
      services                                   | -                                                   | -                                                                          
|Shares issued for
      employment enticement                      | -                                                   | -                                                                          
|Shares issued for
      debt enticement                            | -                                                   | -                                                                          
|Adjustments to
      reconcile net (loss) to net cash              |                                                     |                                                                            
|(used) by
      operating activities:                              |                                                     |                                                                            
|Increase in
      accrued salaries and benefits                    | 184,250                                             | 281,361                                                                    
|Increase in other
      accrued expenses                           | 269,371                                             | 255,079                                                                    
|Net cash (used)
      by operating activities                      | (60)                                                | (249,388)                                                                  
|                                                                   |                                                     |                                                                            
|Cash flows from
      investing activities                         |                                                     |                                                                            
|Purchase of
      equipment                                        | -                                                   | -                                                                          
|Investment in
      Magellan International, Inc.                   | -                                                   | (48,500)                                                                   
|Short-term note
      payable                                      | -                                                   | (73,000)                                                                   
|Proceeds from
      long-term debt                                 |                                                     | 498,000                                                                    
|Payments on
      long-term debt                                   | -                                                   | (220,000)                                                                  
|Net cash provided
      by investing activities                    | -                                                   | 156,500                                                                    
|                                                                   |                                                     |                                                                            
|Cash flows from
      financing activities                         |                                                     |                                                                            
|Stockholders'
      advances                                       | -                                                   | 41,856                                                                     
|Issuance of
      common stock                                     | -                                                   | 55,000                                                                     
|Net cash provided
      by financing activities                    | -                                                   | 96,856                                                                     
|Net increase
      (decrease) in cash                              | (60)                                                | 3,968                                                                      
|                                                                   |                                                     |                                                                            
|Cash and
      equivalents - beginning                             | 65                                                  | 390                                                                        
|Cash and
      equivalents - ending                                | $ 5                                                 | $
      4,358                                                              
|                                                                   |                                                     |                                                                            
|Supplemental
      disclosures:                                    |                                                     |                                                                            
|Interest paid                                                      | $ -                                                 | $ -                                                                        
|Income taxes paid                                                  | $ -                                                 | $ -                                                                        
|Non-cash
      transactions:                                       |                                                     |                                                                            
|Number of shares
      issued for consulting services              | -                                                   | -                                                                          
|Number of shares
      issued for salaries - related party         | 1,050,000                                           | -                                                                          
|Number of shares issued to satisfy accrued salaries -related party | -                                                   | -                                                                          
|Number of shares
      issued for employment enticement            | -                                                   | -                                                                          
|Number of shares
      issued for debt enticement                  | -                                                   | -                                                                          
|Shares issued for
      contractual payment to acquireMagellan     | -                                                   | -                                                                          



The
accompanying notes are an integral part of these financial statements.



> TWIN
>         FACES EAST ENTERTAINMENT CORPORATION
>         (a
>         development stage company)
>         NOTES
>         TO UNAUDITED FINANCIAL STATEMENTS

Note 1 - Basis of
Presentation

> The
>   accompanying unaudited condensed financial statements at June 30, 2003 have
>   been prepared in accordance with generally accepted accounting principles for
>   interim financial information and with the instructions to Form 10-QSB and
>   reflect all adjustments which, in the opinion of management, are necessary for
>   a fair presentation of financial positions as of June 30, 2003 and results of
>   operations and cash flows for the six months ended June 30, 2003. All such
>   adjustments are of a normal recurring nature. The results of operations for
>   the interim period are not necessarily indicative of the results expected for
>   a full year. The statements should be read in conjunction with the financial
>   statements and footnotes thereto included in the Company's Form 10-KSB for the
>   year ended December 31, 2002.

Note 2 - Going Concern

> The
>   accompanying financial statements at June 30, 2003 have been prepared on a
>   going concern basis, which contemplated the realization of assets and the
>   satisfaction of liabilities in the normal course of business. The Company has
>   suffered losses from operations during its operating history. The ability of
>   the Company to continue as a going concern is dependent upon obtaining future
>   profitable operations. Management is in the process of acquiring and
>   developing products for sale which would generate revenue to sustain the
>   operations of the Company. The financial statements do not include any
>   adjustments relating to the recoverability and classification of recorded
>   assets and classification of liabilities that might be necessary should the
>   Company be unable to continue as a going concern.

Note 3 - Related Party
Transactions

> The
>   Company accrued a total of $267,500 in salaries and benefits owed to its
>   officers and directors during the six months ended June 30, 2003.
>   
>   The
>   Company accrued a total of $502,053 in other expenses owed to its officers and
>   directors during the six months ended June 30, 2003.
>   
>   The
>   Company issued 1,050,000 shares of its $0.001 par value common stock to its
>   officers in lieu of salaries totaling $119,450 during the six months ended
>   June 30, 2003.

Note 4
- Stockholders' Equity

> During
>   May and June 2003, the Company issued a total of 29,595 shares of its Series B
>   Preferred Stock in anticipation of the receipt of financing. As of June 30,
>   2003, the shares have not been delivered and are being held in escrow pending
>   receipt of funding by the Company.





Item 2.
Plan of Operation



With
the exception of historical matters, the matters discussed herein are
forward-looking statements that involve risks and uncertainties. Forward-looking
statements include, but are not limited to, statements concerning anticipated
trends in revenues and net income, the date of introduction or completion of our
products, projections concerning operations and available cash flow. Our actual
results could differ materially from the results discussed in such
forward-looking statements primarily as the result of insufficient cash to
pursue production and marketing efforts. The following discussion of our
financial condition and results of operations should be read in conjunction with
our financial statements and the related notes thereto appearing elsewhere
herein.



Overview



Twin
Faces was incorporated on December 5, 1997 under the laws of the State of
Delaware and reincorporated under the laws of the State of Nevada on June 17,
1998. We are in the development stage as an entertainment and film production
company.



We
have yet to generate revenues from operating activities and there is a
substantial going concern issue as to whether we will ever be able to produce
and market our films and generate sufficient, if any, revenues to satisfy our
working capital requirements. Since inception we have been dependent on the sale
of our equity securities and loans from affiliates to satisfy our working
capital requirements. We continue to have a working capital deficiency that
raises substantial concern regarding our ability to continue as a going concern.



Plan of
Operation



During
the next twelve months we plan to focus our efforts on our development of four
primary properties, including, "Pages From A Rabbit Journal",
"The Town That Arrested Santa Claus", and the "Einstein"
property. We are also working on the production of a new feature film, "A
Real Man", written by Johnnie King; however actual production will not
commence until we have sufficient capital for production and marketing.



Satisfaction
of our cash obligations for the next 12 months. Our plan of operation
has been stalled by our lack of cash. Under our current plan of operation we
will be required to generate at least $800,000 (minimal cash requirement) to
continue in operation for the next 12 months.



Summary
of any product research and development that we will perform for the term of our
plan of operation. We do not anticipate performing any significant
product research and development under our plan of operation.



Expected
purchase or sale of plant and significant equipment. We do not
anticipate the purchase or sale of any plant or significant equipment, as such
items are not required by us at this time or in the next 12 months.



Significant
changes in the number of employees. In the event we are successful in
obtaining additional debt or equity, which will provide us with the cash to
develop an entertainment product, then in that event we will be required to hire
2 additional full time staff members for the company.





Liquidity
and Capital Resources







The
preferred stock shall be converted to common stock in the Company on the dates
following:



> October
> 1, 2004, conversion of 250,000 shares preferred stock to common stock,
> October
> 1, 2005, conversion of 250,000 shares preferred stock to common stock,
> October
> 1, 2006, conversion of 250,000 shares preferred stock to common stock,
> October
> 1, 2007, conversion of 250,000 shares preferred stock to common stock.

We will
issue a 5% cash dividend on the principle amount of the unconverted preferred
stock, payable in common stock as follows:



> October
> 1, 2004, $200,000 of common stock,
> October
> 1, 2005, $120,000 of common stock,
> October
> 1, 2006, $100,000 of common stock,
> October
> 1, 2007, $50,000 of common stock.

At our
option the stock shall be converted according to either of the following:



Option
1- Average prior 30 days closing price on current quoted exchange so the
market value of the common issued is one million five hundred thousand dollars
($1,500,000). For example, if 30-day average quoted closing price is $1 per
share on October 1, 2004, Mr. King will receive 1,500,000 shares of common stock
for his 250,000 shares of preferred stock for a valuation conversion of 6 common
shares for each preferred share.



Option
2- The stock may be converted at a conversion ratio of 2 common shares for
each preferred share. For example, on October 1, 2003 we may convert the 250,000
shares of preferred stock to 500,000 shares of common stock in the Company.



On June
20, 2003, we executed a Promissory Note with Johnnie King, our Director of Film
Development for the principal amount of $4,000,000. The funding date is on or
before December 31, 2003 and the due date is on or before December 31, 2008.
Pursuant to the note we promise to pay to the order of Johnnie King the sum of
$4,000,000 together with interest thereon at 10% per annum as prescribed below.
The sum and interest shall be paid in the manner following:



Interest
Due December 31, 2004-

Payable
as $400,000 worth of 144 stock or $400,000 cash

Interest
Due December 31, 2005-

Payable
as $400,000 worth of 144 stock or $400,000 cash

Interest
Due December 31, 2006-

Payable
as $400,000 worth of 144 stock or $400,000 cash

Interest
Due December 31, 2007-

Payable
as $400,000 worth of 144 stock or $400,000 cash





At
    the principal due date of the note, we agree to pay to Mr. King, at our
    option either $4,400,000 cash or $4,800,000 worth of 144 stock.



We may
prepay the promissory note at any time, without penalty, by delivery of the
principal amount in cash and appropriate pro-rata interest as prescribed above.



As of
the date of this filing we have not yet received any funds from Mr. King. Upon
receipt of funds we will file a Form 8-K.



A
critical component of our operating plan impacting our continued existence is
the ability to obtain additional capital through additional equity and/or debt
financing. We do not anticipate enough positive internal operating cash flow
until such time as we can generate substantial revenues from fees earned as a
result of our documentary films of Dr. Albert Einstein and feature film and
television scripts, which may take the next few years to fully realize. In the
event we cannot obtain the necessary capital to pursue our strategic plan, we
may have to cease or significantly curtail our operations. This would materially
impact our ability to continue operations.



Our
near term cash requirements are anticipated to be offset through the receipt of
funds from private placement offerings and loans obtained through private
sources. Since inception, we have financed cash flow requirements through debt
financing and issuance of common stock for cash and services. As we expand
operational activities, we may continue to experience net negative cash flows
from operations, pending receipt of servicing or licensing fees, and will be
required to obtain additional financing to fund operations through common stock
offerings and bank borrowings to the extent necessary to provide working
capital.



Over
the next twelve months we believe that existing capital and anticipated funds
from operations will not be sufficient to sustain operations and planned
expansion. Consequently, we will be required to seek additional capital in the
future to fund growth and expansion through additional equity or debt financing
or credit facilities. No assurance can be made that such financing would be
available, and if available it may take either the form of debt or equity. In
either case, the financing could have a negative impact on our financial
condition and our Stockholders.



We
anticipate incurring operating losses over the next twelve months. Our lack of
operating history makes predictions of future operating results difficult to
ascertain. Our prospects must be considered in light of the risks, expenses and
difficulties frequently encountered by companies in their early stage of
development. Such risks include, but are not limited to, an evolving and
unpredictable business model and the management of growth. To address these
risks we must, among other things, obtain a customer base, implement and
successfully execute our business and marketing strategy, continue to develop
and upgrade technology and products, respond to competitive developments, and
attract, retain and motivate qualified personnel. There can be no assurance that
we will be successful in addressing such risks, and the failure to do so can
have a material adverse effect on our business prospects, financial condition
and results of operations.





Going
Concern



The
consolidated financial statements included in this filing have been prepared in
conformity with generally accepted accounting principles that contemplate the
continuance of the Company as a going concern. The Company's cash position may
be inadequate to pay all of the costs associated with production and marketing.
Management intends to use borrowings and security sales to mitigate the effects
of its cash position, however no assurance can be given that debt or equity
financing, if and when required will be available. The financial statements do
not include any adjustments relating to the recoverability and classification of
recorded assets and classification of liabilities that might be necessary should
the Company be unable to continue existence.



Item 3.
Controls and Procedures

1. Under the supervision and with the participation of our management, including
our President and Chief Financial Officer, we evaluated the effectiveness of the
design and operation of our disclosure controls and procedures, as such term is
defined under Rule 13a-14(c) promulgated under the Securities Exchange Act of
1934, as amended, within 90 days prior to the filing date of this report. Based
on their evaluation, our President and Chief Financial Officer concluded that
our disclosure controls and procedures are effective.
2. There have been no significant changes (including corrective actions with regard
to significant deficiencies or material weaknesses) in our internal controls or
in other factors that could significantly affect these controls subsequent to
the date of the evaluation referenced in paragraph (a) above.

PART II--OTHER
INFORMATION



Item 1. Legal
Proceedings



None



Item 2. Changes in
Securities



On May 1, 2003, we issued 850,000 shares of our $0.001 par value common stock at
$0.117 per share to Stan Teeple, our Secretary and Treasurer and Frank McEnulty,
an employee of the Company, in satisfaction of accrued salaries and benefits
totaling $99,450. The shares were deemed to have been issued pursuant to an
exemption provided by section 4(2) of the Act, which exempts from registration
"transactions by an issuer not involving any public offering."



On June 5, 2003, we issued 200,000 shares of our $0.001 par value common stock
to Frank McEnulty, an employee of the Company for services rendered. The shares
were deemed to have been issued pursuant to an exemption provided by section
4(2) of the Act, which exempts from registration "transactions by an issuer
not involving any public offering."



Preferred
Series B Stock



On May 9, 2003, we issued 10,000 preferred series B stock to Mercatus &
Partners, Ltd., in anticipation of finalizing a loan agreement between the
Company and Mercatus & Partners,





Ltd. The shares are being held in escrow
pending finalization of funding and a formal loan agreement. Upon finalization
of the loan agreement we will file a Form 8-K disclosing the terms of any
agreement.



On June 13, 2003, we issued 3,401 preferred series B stock to Mercatus &
Partners, Ltd., in anticipation of finalizing a new loan of approximately
$400,000 between the Company and Mercatus & Partners, Ltd. The shares are
being held in escrow pending finalization of funding and a formal loan
agreement. Upon finalization of the loan agreement we will file a Form 8-K
disclosing the terms of any agreement.



On June 26, 2003, we issued 16,194 preferred series B stock to Mercatus &
Partners, Ltd., in anticipation of finalizing a new loan of approximately
$500,000 between the Company and Mercatus & Partners, Ltd. The shares are
being held in escrow pending finalization of funding and a formal loan
agreement. Upon finalization of the loan agreement we will file a Form 8-K
disclosing the terms of any agreement.



Item 3. Defaults by the
Company upon its Senior Securities



None



Item 4. Submission of
Matter to a Vote of Security Holders



None



Item 5. Other
Information



On June 20, 2003, we entered into an Investment Agreement with Johnnie King.
Pursuant to the terms of the agreement, Mr. King will make a direct $4,000,000
cash investment as purchase of series C preferred stock. Within 30 days of
funding we will issue 1,000,000 shares of series C preferred stock of the
Company to Mr. King. The stock will carry conversion rights to common on an
annual basis the first week of October each year commencing October 1, 2004 for
a period of 4 years. We will issue a 5% cash dividend on the principle amount of
the unconverted preferred stock for a period of 4 years. For more information
please see Liquidity and Capital Resources in Item 2 of Part I.







As of the date of this filing we have not yet received any funds from Mr. King.
Upon receipt we will file a Form 8-K.





Item 6. Exhibits and
Reports of Form 8-K



(a) Exhibits



10.1
Investment Agreement between Twin Faces East Entertainment Corp. and Johnnie
King

10.2
Promissory Note of Johnnie King

31.1
Certification pursuant to Section 302 of the Sarbanes-Oxley Act

32.1
Certification Pursuant to Section 906 of the Sarbanes-Oxley Act



(b) Form
8-K



None



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.



TWIN FACES EAST
ENTERTAINMENT CORPORATION

(Registrant)





By: /S/Michael
Smolanoff

Michael Smolanoff,
President

Date: August 5, 2003