**EXHIBIT
14.1**
  **Precision
Optics Corporation, Inc.**
  **Corporate
Code of Ethics and Conduct**
  **1.**  **General
Policy**
  It
is the policy of Precision Optics Corporation, Inc. ("Precision Optics" or the
"Company") to conduct business in compliance with all applicable laws, rules and
regulations. Further, it is our policy to conduct business with integrity. We
make this commitment to our customers, to our partners, to our stockholders, to
our community, to those government agencies that regulate Precision Optics, and
to ourselves.
  Each
Precision Optics employee, officer and director must work to comply with the
policies set forth in this Code of Ethics and Conduct (the "Code"). All
employees, officers and directors should review this Code and related materials,
including the Company’s Employee Manual dated May 1, 2001 (the "Employee
Manual"), portions of which are referred to in this Code, and make sure that
these policies guide their actions. Because of the complex and changing nature
of legal requirements, each member of Precision Optics must be constantly
vigilant to ensure that their conduct complies with the Code. If any employee,
officer or director becomes aware of an issue of legal compliance which is not
adequately addressed in this Code, you should notify your supervisor or the
Chief Financial Officer.
  Precision
Optics takes compliance with laws, regulations, rules and the Code seriously.
Any violation of such will result in disciplinary action. Such action may
include an oral or written warning, disciplinary probation, suspension,
reduction in salary, demotion or dismissal from employment. These disciplinary
actions also may apply to an employee’s supervisor who directs or approves the
employee’s improper actions or is aware of those actions, but does not act
appropriately to correct them or fails to exercise appropriate
supervision.
  If
a question arises as to whether any action complies with Precision Optics’
policies or applicable law, an employee, officer or director should present that
question directly to the Company’s Chief Financial Officer (the "Compliance
Officer"). The Compliance Officer’s telephone number is (978) 630-1800 ext. 117. **** Concerns
about violations of any part of this Code made to the telephone number may be
made anonymously. **** Any
calls, detailed notes and/or emails will be dealt with confidentially. In
raising an issue, you may remain anonymous, although you are encouraged to
identify yourself. Should you choose to identify yourself, your identity will be
kept confidential to the extent feasible or permissible under the law. All
employees, officers and directors of Precision Optics have the commitment of
Precision Optics and of the Audit Committee of Precision Optics’ Board of
Directors that they will be protected from retaliation .  However,
Precision Optics reserves the right to discipline anyone who knowingly makes a
false accusation, provides false information to the Company or has acted
improperly. ****  Failure
to report known or suspected wrongdoing of which any member of Precision Optics
has knowledge may, by itself, subject that person to disciplinary
action.
  This
Code generally highlights some of the more important legal principles with which
employees, officers and directors are expected to be familiar. The fact that
this Code does not specifically reference other applicable laws (some of which
may be covered in other Precision Optics policies) does not diminish their
importance or application.
   1
  **2.**  **Compliance
with the Law**
  Precision
Optics seeks to comply with all applicable government laws, rules and
regulations. We need the cooperation of all employees, officers and directors to
do so and to bring lapses or violations to light. While some regulatory schemes
may not carry criminal penalties, they may control the licenses and
certifications that allow Precision Optics to conduct its business. Precision
Optics’ continued ability to operate depends upon your help for
compliance.
  Some
of the regulatory programs which employees may deal with in the course of their
duties include, but are not limited to, the following:
  o
    Labor
      laws,
 o
    Occupational
      safety and health regulation,
 o
    Building,
      safety and fire codes,
 o
    Wage
      and hour laws, and
 o
    Applicable
      U.S. Food and Drug Administration regulations.
 
 The
Compliance Officer can provide employees with information on these rules, and
can direct questions or concerns to the proper person.
  **3.**  **Stock**
  Because
our stock is a publicly-traded security, certain activities of Precision Optics
are subject to certain provisions of the federal securities laws. These laws
govern the dissemination or use of information about the affairs of Precision
Optics or its subsidiaries or affiliates, and other information which might be
of interest to persons considering the purchase or sale of our stock. Violations
of the federal securities laws could subject you and the Company to stiff
criminal and civil penalties. Accordingly, Precision Optics does not sanction
and will not tolerate any conduct that risks a violation of these
laws.
 ****
 **a.**  **Disclosure
of Transactions in Company’s Securities**
  The
Securities and Exchange Commission ("SEC") requires continuing disclosure of
transactions in the Company’s publicly traded securities by the Company, its
directors, officers, major stockholders and other affiliated persons. We are
committed to complying with obligations related to this disclosure.
 ****
 **b.**  **Insider
Trading**
  It
is illegal for any person, either personally or on behalf of others, (i) to buy
or sell securities while in possession of material non-public information, or
(ii) to communicate (to "tip") material non-public information to another person
who trades in the securities on the basis of the information or who in turn
passes the information on to someone who trades. All directors, officers,
employees and temporary insiders, such as accountants and lawyers, must comply
with these "insider trading" restrictions. For more information, please see the
section entitled *"Trades
in Public Securities by Company Personnel"* set forth in the Employee Manual, a copy of which has been previously provided
to you but which may also be obtained upon request to the Compliance
Officer.
  
 2
 **4.**  **Confidential
Information**
  You
may be entrusted with Precision Optics’ confidential business information. You
are required to safeguard and use such information only for Precision Optics’
purposes. Confidential information includes all non-public information that
might be of use to competitors or harmful to Precision Optics or its customers,
if disclosed. You are expected to maintain the confidentiality of any and all
such information entrusted to you by Precision Optics or our customers or
partners. Examples of confidential business information include, but are not
limited to: the Company’s trade secrets, business trends, information on product
development programs, detailed sales and cost figures, new product or marketing
plans, research and development ideas or information, manufacturing processes,
and information about potential acquisitions, divestitures and investments.
Failure to observe this duty of confidentiality may compromise our competitive
advantage over competitors and may additionally result in a violation of
securities, antitrust or employment laws. It may also violate agreements
providing for the protection of such confidential information. You should not
discuss confidential Company information outside the Company, even with your own
family.
  You
may also possess sensitive, privileged information about our customers or
partners. These parties properly expect that this information will be kept
confidential. Precision Optics takes very seriously any violation of a
customer’s or partner’s confidentiality and will not tolerate such conduct.
  For
more information, please see the section entitled *"Confidentiality
of Company Information"* set
forth in the Employee Manual.
  **5.**  **Special
Ethical Obligations For Employees With Public Reporting
Responsibilities**
  As
a public company, we are also committed to carrying out all continuing
disclosure obligations in a full, fair, accurate, timely and understandable
manner. Depending on their position with Precision Optics, employees, officers
or directors may be called upon to provide information to assure that the
Company’s public reports are complete, fair and understandable. Precision Optics
expects all of its personnel to take this responsibility very seriously and to
provide prompt and accurate answers to inquiries related to the Company’s public
disclosure requirements.
  The
Accounting Department bears a special responsibility for promoting integrity
throughout the organization, with responsibilities to stockholders both inside
and outside of Precision Optics. The Chief Executive Officer, the Chief
Financial Officer and other Accounting Department personnel have a special role
both to adhere to these principles themselves and also to ensure that a culture
exists throughout the company as a whole that ensures the fair and timely
reporting of Precision Optics’ financial results and condition.
  
 3
 Employees,
officers and directors should promptly report to the Compliance Officer and/or
the Audit Committee any conduct that the individual believes to be a violation
of law or business ethics or of any provision of the Code, including any
transaction or relationship that reasonably could be expected to give rise to
such a conflict. Violations, including failures to report potential violations
by others, will be viewed as a severe disciplinary matter that may result in
personnel action, including termination of employment.
  **6.**  **Continuing
Disclosure Obligations and Accuracy of Business
Records**
  In
order to support all our disclosure obligations, it is our policy to record and
report our factual information honestly and accurately. Failure to do so is a
grave offense and will subject an individual to severe discipline by the
Company, as well as possible criminal and civil penalties.
  Compliance
with established accounting procedures, Precision Optics’ system of internal
controls, and generally accepted accounting principles is necessary at all
times. In order to achieve such compliance, the Company’s records, books and
documents must accurately reflect the transactions and provide a full account of
Precision Optics’ assets, liabilities, revenues and expenses. Knowingly entering
inaccurate or fraudulent information into Precision Optics’ accounting system is
unacceptable and may be illegal. Any individual that has knowledge that an entry
or process is false and material are expected to consult the Compliance Officer.
In addition, it is the responsibility of each member of Precision Optics to give
their cooperation to the Company’s auditors.
  Every
individual should also be aware that almost all business records of the Company
may become subject to public disclosure in the course of litigation or
governmental investigation. Records are also often obtained by outside parties
or the media. Employees should therefore attempt to be as clear, concise,
truthful and accurate as possible when recording any information. They must
refrain from making legal conclusions or commenting on legal positions taken by
the Company or others. They must also avoid exaggeration, colorful language, and
derogatory characterizations of people and their motives. Precision Optics will
not tolerate any conduct that creates an inaccurate impression of Precision
Optics’ business operations.
  **7.**  **Protection
and Proper Use of Company Assets**
  Employees,
officers and directors should protect the Company’s assets and ensure their
efficient use. Theft, carelessness and waste have a direct impact on the
Company’s profitability. All Company assets should be used for legitimate
business purposes. Individual supervisors are responsible for ensuring Company
resources are used productively or to enhance employees’ skills and job
performance.
  Everyone
who works with the Company’s computer-based resources is responsible for their
appropriate use and protection from theft, damage or loss. Employees should take
care to understand the risks and protect and ensure that the security features
of the computer-based resources are not compromised. Information created,
transmitted or accessed on Company networks is Company property and Precision
Optics reserves the right to monitor or restrict access to it. The same level of
care should be taken when using Precision Optics’ e-mail, internet and voice
mail systems as is used in written documents. For example, confidential
information about Precision Optics should not be disclosed on electronic
bulletin boards, in chat rooms or posted on an internet website. For more
information, please see the section entitled *"Use
of Computers"* set
forth in the Employee Manual.
  
 4
 **8.**  **Corporate
Opportunities**
  Employees,
officers and directors are prohibited from (a) taking for yourself personally
opportunities that you discover through the use of Company property, information
or position, (b) using Company property, information or position for personal
gain and (c) competing with the Company. An employee, officer or director owes a
duty to the Company to advance its legitimate interests when the opportunity to
do so arises.
  **9.****Fair
Dealing**
  Employees,
officers and directors should endeavor to deal fairly with the Company’s
customers, partners, suppliers, competitors and employees. You should not take
unfair advantage of anyone through manipulation, concealment, abuse of
privileged information, misrepresentation of material facts or any other
unfair-dealing practices.
  **10.**  **Conflicts
of Interest**
  Precision
Optics’ employees, officers and directors should avoid all potential conflicts
of interest or situations that give the appearance of a conflict of interest. A
conflict of interest occurs when the private interest of a Precision Optics
employee or director (or an immediate family or household member or someone with
whom you have an intimate relationship) interferes, in any way -- or even
appears to interfere -- with the duties performed by the Precision Optics
employee or director or with the interests of the Company as a whole. A conflict
situation can arise when an employee, officer or director takes actions or has
interests that may make it difficult to perform his or her work objectively and
effectively. Conflicts of interest also arise when an employee, officer or
director, or a member of his or her family, receives improper personal benefits
as a result of his or her position in the Company. Loans to, or guarantees of
obligations of, such persons are of special concern.
  To
this end, Precision Optics’ employees, officers or directors may not be employed
by, act as a consultant to, or have an independent business relationship with
any of Precision Optics’ customers, competitors or suppliers. Nor may employees,
officers or directors invest in any customer, supplier, or competitor (other
than through mutual funds or through holdings of less than 2 **** percent
of the outstanding shares of publicly traded securities) unless they first
obtain written permission from the Chief Executive Officer. Employees, officers
or directors may not divulge or use Precision Optics’ confidential information
-- such as financial data, customer information, and computer programs -- for
their own personal or business purposes.
  Any
personal or business activities by an employee, officer or director that may
raise concerns along these lines must be disclosed to and approved in advance by
the Compliance Officer. For more information, please see the section entitled *"Conflict
of Interest"* set
forth in the Employee Manual.
  5
 **11.**  **Gifts,
Meals and Entertainment**
 ****
 **a.**  **Entertainment
and Gifts**
  Precision
Optics recognizes that in some instances, gifts and entertainment can provide an
appropriate means of furthering a business relationship. However, no employee,
officer or director should accept or provide gifts of more than $50 in
connection with their business dealings. The offer or receipt of any such gift
over $50 should be reported immediately to the Compliance Officer. Normal
business courtesies involving no more than ordinary amenities (such as lunch,
dinner, a spectator event or a golf game) are permitted, as are token non-cash
gifts of nominal value. The guiding principle and spirit of this code is that no
gift, favor or entertainment, whether a single event or a pattern of behavior,
should be accepted or provided if it will obligate, or appear to obligate, the
recipient. If you are uncertain about the propriety of a gift, you should
contact the Compliance Officer for guidance.
 ****
 **b.**  **Relationships
with Government Personnel**
  Separate
and more stringent gift, meals, and entertainment rules apply to dealings with
government officials. Federal and state anti-kickback laws prohibit Precision
Optics and its representatives from knowingly and willfully offering, paying,
requesting, or receiving any money or other benefit, directly or indirectly, in
return for obtaining or rewarding favorable treatment in connection with the
award of a government contract. Any employee who becomes aware of any such
conduct should immediately report it to the Compliance Officer.
  The
anti-kickback laws must be considered whenever something of value is given or
received by Precision Optics or its representatives or affiliates that is in any
way connected to work performed for the government. There are many transactions
that may violate the anti-kickback rules. As a result, no one acting on behalf
of Precision Optics may offer or accept gifts, loans, rebates, services, or
payment of any kind to or from government suppliers and vendors without first
consulting the Compliance Officer.
 ****
 **c.**  **Business
Dealings in Foreign Countries**
  Federal
law prohibits U.S. companies, and those acting on their behalf, from bribing
foreign officials to obtain or retain business. Foreign officials include
officers and employees of a foreign government or of a foreign governmental
department or agency. Indirect payments including those to agents or third
parties with the knowledge that at least a portion of the payment will be given
to a foreign official for an illegal purpose are prohibited. Precision Optics
will not tolerate any conduct that violates this law.
  **12.**  **Interacting
with the Government**
  Precision
Optics values its good relations with local, state, federal and foreign
governments. We are committed to being a "good corporate citizen" and are proud
of the contributions we have made to help the communities where we do business.
 6
 
 The
Company’s policy is to deal honestly and fairly with government representatives
and agents and to comply with valid and reasonable governmental requests and
processes. Be truthful and straightforward in your dealings with governmental
representatives and do not direct or encourage another Precision Optics employee
(or someone else) to provide false or misleading information to any government
agent or representative. Do not direct or encourage anyone to destroy records
relevant to a fact-finding process.
  **13.**  **Employee
Relations** ****
  The
Company recognizes and understands the importance of balancing work and family
life. Even though an employee’s non-work-related activities outside of the
Company are considered personal business, employees should always remember that
they are a representative of the Company.
  All
employees, officers and directors should review the Company’s policies regarding
discrimination, workplace harassment (including sexual harassment), health and
safety and related matters, which are set forth in the Employee
Manual.
  **14.**  **Purchasing**
  Purchasing
decisions must be made in accordance with applicable Precision Optics policy. In
addition, the prohibitions discussed in Section 11 of this Code, entitled
"Gifts, Meals and Entertainment" apply to purchasing decisions made on behalf of
Precision Optics. Purchasing decisions must in all instances be made free from
any conflicts of interest that could affect the outcome. Precision Optics is
committed to a fair and objective procurement system which results in the
acquisition of quality goods and services for Precision Optics at a fair
price.
  **15.**  **Exports
and Imports**
  There
are many U.S. laws governing international trade and commerce which serve to
limit the export of certain products to certain countries. Precision Optics is
committed to complying with those laws. Under no circumstances will Precision
Optics make sales contrary to U.S. export laws. Because these regulations are
complicated and change periodically, employees seeking to make a sale to a
customer in a foreign country must first confirm the legal trade status of that
country. If an employee is uncertain about whether a foreign sale complies with
U.S. export laws, he or she must contact the Compliance Officer for guidance.
Precision Optics’ employees should be aware that there are also many U.S. laws
that govern the import of items into the United States. Among other things,
these laws control what can be imported into the United States, how the articles
should be marked, and the amount of duty to be paid. Precision Optics complies
with all U.S. import laws. If an employee is uncertain about whether a
transaction involving the importation of items into the United States complies
with these laws, he or she must contact the Compliance Officer for
guidance.
  **16.**  **Media/Public
Relations and Governmental Inquiries**
  When
Precision Optics provides information to the news media, securities analysts and
stockholders, it has an obligation to do so accurately and completely. In order
to ensure that Precision Optics complies with its obligations, employees
receiving inquiries regarding Precision Optics’ activities, results, plans or
position on public issues should refer the request to the Company’s Chief
Executive Officer, Chief Financial Officer or the designated corporate
spokesperson. Precision Optics’ employees may not speak publicly for the Company
unless specifically authorized by senior management.
  7
 
 Although
unlikely, a government representative may seek to interview an employee
regarding Precision Optics’ business activities or an employee’s work at the
Company. If an employee is contacted by a government agent or representative and
asked to provide information, contact the Chief Financial Officer at (978)
630-1800 ext. 117.
  Occasionally,
someone will arrive unexpectedly or a government representative may seek to
inspect Company property. If this happens, an employee should immediately notify
his or her manager or supervisor and contact the Chief Financial Officer at
(978) 630-1800 ext. 117.
  **17.**  **Response
to Investigations or Government Inquiries**
  Numerous
state and federal agencies have broad legal authority to investigate Precision
Optics and review its records. Precision Optics will comply with subpoenas and
respond to governmental investigations as required by law. The Compliance
Officer is responsible for coordinating Precision Optics’ response to
investigations and the release of any information.
  If
an employee, director or officer receives an investigative demand, subpoena, or
search warrant involving Precision Optics, it should be brought immediately to
the Compliance Officer. No documents should be released or copied without
authorization from the Compliance Officer or Precision Optics’ legal counsel. If
an investigator, agent or government auditor comes to Precision Optics’
corporate headquarters, the Chief Executive Officer should be contacted
immediately. In the absence of the Chief Executive Officer, contact Precision
Optics’ Compliance Officer. Ask the investigator to wait until the contacted
individual arrives before reviewing any documents or conducting any interviews.
The Compliance Officer, his designee, or Company’s legal counsel is responsible
for assisting with any interviews. If Precision Optics’ employees are approached
by government investigators and agents while they are away from Precision
Optics’ premises and asked to discuss Company affairs, the employee has the
right to insist on being interviewed during business hours with a supervisor or
counsel present. Alternatively, any employee may choose to be interviewed or not
to be interviewed at all. The Company recognizes the choice of how to proceed in
these circumstances is left entirely to the employee. If an employee chooses to
speak with government personnel, it is essential that the employee be truthful.
Questions may be directed to the Compliance Officer.
  Precision
Optics’ employees are not permitted to alter, remove, or destroy documents or
records of Precision Optics except in accordance with regular document retention
and destruction practices.
  **18.**  **Disciplinary
Action**
  It
is essential that all employees accept personal responsibility for maintaining
high standards of conduct and job performance, including the observance of the
Code and other Company rules and policies. The Company shall consistently
enforce the Code through appropriate means of discipline. Violations of the Code
shall be promptly reported to the Compliance Officer and the Audit Committee.
The Audit Committee shall determine whether violations of the Code have occurred
and, if so, shall determine the disciplinary measures to be taken against any
employee of the Company who has so violated the Code. Disciplinary measures,
which may be invoked at the discretion of the Audit Committee, include, but are
not limited to, oral or written warnings, disciplinary probation, suspension,
reductions in salary, demotion or termination of employment. The purpose of
disciplinary measures short of termination is corrective, to encourage employees
to improve their conduct or performance so that they may continue their
employment with the Company. These corrective disciplinary measures will not
apply in the event of a serious offense that warrants immediate termination or
in other circumstances when the Audit Committee determines that corrective
measures would be inappropriate.
 8
  
 **19.**  **Amendments and Waivers**
  This
Code applies to all of Precision Optics’ employees, officers and directors.
There shall be no substantive amendment or waiver of any part of the Code
affecting the directors, senior financial officers, or executives officers,
except by a vote of the Board of Directors, which will ascertain whether an
amendment or waiver is appropriate and ensure that the amendment or waiver is
accompanied by appropriate controls designed to protect Precision
Optics.
  In
the event that any substantive amendment is made or any waiver is granted, the
substantive amendment or waiver will be filed with the SEC on a Current Report
on Form 8-K (or such other form as may be prescribed by the SEC), thereby
allowing the Precision Optics stockholders to evaluate the merits of the
particular substantive amendment or waiver.
   9