----

----

**SECURITIES      AND EXCHANGE COMMISSION**

**WASHINGTON,      D.C. 20549**

**FORM      10-QSB**

| **[X]** | **QUARTERLY                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE                ACT OF                1934** |
|---------|------------------------------------------------------------------------------------------------------------------------------------------|

**FOR      THE QUARTERLY PERIOD ENDED: June 30, 2006**

**OR**

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

**FOR      THE TRANSITION PERIOD FROM _________________ TO      _________________**

**Commission      File Number 1-15497**

**RecycleNet      Corporation**

**(Exact      name of small business issuer in its charter)**

| **Utah**                                                                                             | **87-0301924**                                         |
|------------------------------------------------------------------------------------------------------|--------------------------------------------------------|
| **(State                  or other jurisdiction of incorporation or                  organization)** | **(IRS                  Employer Identification No.)** |
|                                                                                                 |                                                   |

**175      East 400 South, Suite 900, Salt Lake City Utah, 84111**

**(Address      of principal executive offices, including Zip Code)**

**801-531-0404**

**(Issuer's      telephone number)**

----

**RECYCLENET      CORPORATION AND SUBSIDIARIES**

**FORM      10-QSB**

**QUARTER      ENDED JUNE 30, 2006**

**TABLE      OF CONTENTS**

|                                                                                                                                                     |                                                                                                        | **Page** |
|----------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------|----------|
| **PART                I - FINANCIAL INFORMATION**                                                                                                        |                                                                                                        |
|                                                                                                                                                     |                                                                                                        |     |
| Item                1.                                                                                                                                   | Financial                Statements                                                                         |     |
|                                                                                                                                                     |                                                                                                        |     |
| Condensed                Consolidated Balance Sheets - June 30, 2006 and December 31, 2005                (Unaudited)                                    | 3                                                                                                           |
|                                                                                                                                                     |                                                                                                        |     |
| Condensed                Consolidated Statements of Operations for the Three & Six Months Ended                June 30, 2006 and 2005 (Unaudited)    | 4                                                                                                           |
|                                                                                                                                                     |                                                                                                        |     |
| Condensed                Consolidated Statements of Cash Flows for the Six Months Ended June                30,                2006 and 2005 (Unaudited) | 5                                                                                                           |
|                                                                                                                                                     |                                                                                                        |     |
| Notes                to Condensed Consolidated Financial Statements                                                                                      | 6                                                                                                           |
|                                                                                                                                                     |                                                                                                        |     |
| Item                2.                                                                                                                                   | Management’s                Discussion and Analysis                                                   | 7        |
|                                                                                                                                                     |                                                                                                        |     |
| Item                3.                                                                                                                                   | Controls                and Procedures                                                                      | 10       |
|                                                                                                                                                     |                                                                                                        |     |
| **PART                II - OTHER INFORMATION**                                                                                                           |                                                                                                        |
|                                                                                                                                                     |                                                                                                        |     |
| Item                1.                                                                                                                                   | Legal                Proceedings                                                                            | 10       |
|                                                                                                                                                     |                                                                                                        |     |
| Item                2.                                                                                                                                   | Changes                in Securities and Small Business Issuer Purchase of Equity                Securities | 10       |
|                                                                                                                                                     |                                                                                                        |     |
| Item                3.                                                                                                                                   | Default                Upon Senior Securities                                                               | 10       |
|                                                                                                                                                     |                                                                                                        |     |
| Item                4.                                                                                                                                   | Submission                of Matters to a Vote of Security Holders                                          | 10       |
|                                                                                                                                                     |                                                                                                        |     |
| Item                5.                                                                                                                                   | Other                Information                                                                            | 10       |
|                                                                                                                                                     |                                                                                                        |     |
| Item                6.                                                                                                                                   | Exhibits                and Reports on Form 8-K                                                             | 10       |
|                                                                                                                                                     |                                                                                                        |     |
| Signatures                                                                                                                                               | 11                                                                                                          |

----

**PART      I - FINANCIAL INFORMATION**

**ITEM      1. FINANCIAL STATEMENTS**

**RECYCLENET      CORPORATION AND SUBSIDIARIES**

**CONDENSED      CONSOLIDATED BALANCE SHEETS**

**(UNAUDITED)**

|                                                                                                                                                                                             |   | **June                30,** |       | **December                31,** |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------|------------|---------------------------------|--------|
|                                                                                                                                                                                             |   | **2006**                    |       | **2005**                        |   |
| **ASSETS**                                                                                                                                                                                       |   |                        |       |                            |   |
| **Current                Assets**                                                                                                                                                                |   |                        |       |                            |   |
| Cash                                                                                                                                                                                             |   | $                           | 267,687    |                            | $      | 226,979 |   |
| Trade                accounts receivable, net of $2,500 allowance for bad debt                                                                                                                   |   |                        | 38,074     |                            |   | 37,396 |   |
| Other                receivables                                                                                                                                                                 |   |                        | 34         |                            |   | 4,118 |   |
| Prepaid                expenses                                                                                                                                                                  |   |                        | 1,608      |                            |   | 10,214 |   |
| **Total                Current Assets**                                                                                                                                                          |   |                        | 307,403    |                            |   | 278,707 |   |
|                                                                                                                                                                                             |   |                        |       |                            |   |   |   |
| **Property                and Equipment**                                                                                                                                                        |   |                        |       |                            |   |   |   |
| Computer                equipment                                                                                                                                                                |   |                        | 48,773     |                            |   | 46,258 |   |
| Less:                Accumulated depreciation                                                                                                                                                    |   |                        | (32,873    | )                               |   | (30,340 | ) |
|                                                                                                                                                                                             |   |                        |       |                            |   |   |   |
| **Net                Property and Equipment**                                                                                                                                                    |   |                        | 15,900     |                            |   | 15,918 |   |
|                                                                                                                                                                                             |   |                        |       |                            |   |   |   |
| Related                party receivable                                                                                                                                                          |   |                        | 87,117     |                            |   | - |   |
|                                                                                                                                                                                             |   |                        |       |                            |   |   |   |
| **Total                Assets**                                                                                                                                                                  |   | $                           | 410,420    |                            | $      | 294,625 |   |
|                                                                                                                                                                                             |   |                        |       |                            |   |   |   |
| **LIABILITIES                AND STOCKHOLDERS' EQUITY**                                                                                                                                          |   |                        |       |                            |   |   |   |
| **Current                Liabilities**                                                                                                                                                           |   |                        |       |                            |   |   |   |
| Accrued                liabilities                                                                                                                                                               |   | $                           | 33,054     |                            | $      | 41,712 |   |
| Deferred                revenue                                                                                                                                                                  |   |                        | 150,802    |                            |   | 102,027 |   |
|                                                                                                                                                                                             |   |                        |       |                            |   |   |   |
| **Total                Current Liabilities**                                                                                                                                                     |   |                        | 183,856    |                            |   | 143,739 |   |
|                                                                                                                                                                                             |   |                        |       |                            |   |   |   |
| **Stockholders'                Equity**                                                                                                                                                          |   |                        |       |                            |   |   |   |
| Class                N convertible shares (and Class X shares of Amalco) - $0.01 par value;                70,896,789 shares authorized; 60,539,259 shares issued and                outstanding |   |                        | 605,393    |                            |   | 605,393 |   |
| Common                shares - $0.01 par value; 179,103,211 shares authorized; 77,108,214                shares                issued and outstanding                                            |   |                        | 771,082    |                            |   | 771,082 |   |
| Additional                paid-in capital                                                                                                                                                        |   |                        | 34,315     |                            |   | 34,315 |   |
| Accumulated                deficit                                                                                                                                                               |   |                        | (1,184,226 | )                               |   | (1,259,904 | ) |
|                                                                                                                                                                                             |   |                        |       |                            |   |   |   |
| **Total                Stockholders' Equity**                                                                                                                                                    |   |                        | 226,564    |                            |   | 150,886 |   |
|                                                                                                                                                                                             |   |                        |       |                            |   |   |   |
| **Total                Liabilities and Stockholders' Equity**                                                                                                                                    |   | $                           | 410,420    |                            | $      | 294,625 |   |

----

**RECYCLENET      CORPORATION AND SUBSIDIARIES**

**CONDENSED      CONSOLIDATED STATEMENTS OF OPERATIONS**

**(UNAUDITED)**

|                                                                  |   | **For                The Three Months** |        | **For                The Six Months** |   |
|-----------------------------------------------------------------------|--------|-----------------------------------------|-------------|---------------------------------------|--------|
|                                                                  |   | **Ended                June 30,**       |        | **Ended                June 30,**     |   |
|                                                                  |   | **2006**                                |        | **2005**                              |   | **2006** |   | **2005** |   |
| **Sales**                                                             |   | $                                       | 292,805     |                                  | $      | 213,924 |   | $ | 558,651 |   | $ | 401,057 |   |
|                                                                  |   |                                    |        |                                  |   |   |   |   |   |   |   |   |   |
| **Operating                Expenses**                                 |   |                                    |        |                                  |   |   |   |   |   |   |   |   |   |
| Selling,                general and administrative expenses           |   |                                    | 264,775     |                                  |   | 283,544 |   |   | 536,760 |   |   | 489,373 |   |
| Foreign                currency exchange (gain) loss                  |   |                                    | (1,150      | )                                     |   | 1,497 |   |   | 343 |   |   | 2,188 |   |
|                                                                  |   |                                    |        |                                  |   |   |   |   |   |   |   |   |   |
| **Total                Operating Expenses**                           |   |                                    | 263,625     |                                  |   | 285,041 |   |   | 537,103 |   |   | 491,561 |   |
|                                                                  |   |                                    |        |                                  |   |   |   |   |   |   |   |   |   |
| **Income                (Loss) From Continuing Operations**           |   |                                    | 29,180      |                                  |   | (71,117 | ) |   | 21,548 |   |   | (90,504 | ) |
|                                                                  |   |                                    |        |                                  |   |   |   |   |   |   |   |   |   |
| **Discontinued                Operations**                            |   |                                    |        |                                  |   |   |   |   |   |   |   |   |   |
| Loss                from discontinued operations                      |   |                                    | -           |                                  |   | 9,332 |   |   | 4,494 |   |   | 9,332 |   |
|                                                                  |   |                                    |        |                                  |   |   |   |   |   |   |   |   |   |
| **Net                Income (Loss)**                                  |   | $                                       | 29,180      |                                  | $      | (80,449 | ) | $ | 17,054 |   | $ | (99,836 | ) |
|                                                                  |   |                                    |        |                                  |   |   |   |   |   |   |   |   |   |
| **Basic                Income (Loss) Per Common Share From**          |   |                                    |        |                                  |   |   |   |   |   |   |   |   |   |
| Continuing                Operations                                  |   | $                                       | -           |                                  | $      | - |   | $ | - |   | $ | - |   |
| Discontinued                Operations                                |   |                                    | -           |                                  |   | - |   |   | - |   |   | - |   |
| **Basic                Income (Loss) Per Common Share**               |   | $                                       | -           |                                  | $      | - |   | $ | - |   | $ | - |   |
|                                                                  |   |                                    |        |                                  |   |   |   |   |   |   |   |   |   |
| **Diluted                Income (Loss) Per Common Share From**        |   |                                    |        |                                  |   |   |   |   |   |   |   |   |   |
| Continuing                Operations                                  |   | $                                       | -           |                                  | $      | - |   | $ | - |   | $ | - |   |
| Discontinued                Operations                                |   |                                    | -           |                                  |   | - |   |   | - |   |   | - |   |
| **Diluted                Income (Loss) Per Common Share**             |   | $                                       | -           |                                  | $      | - |   | $ | - |   | $ | - |   |
|                                                                  |   |                                    |        |                                  |   |   |   |   |   |   |   |   |   |
| **Basic                Weighted-Average Common Shares Outstanding**   |   |                                    | 77,108,214  |                                  |   | 76,452,012 |   |   | 77,108,214 |   |   | 76,436,985 |   |
|                                                                  |   |                                    |        |                                  |   |   |   |   |   |   |   |   |   |
| **Diluted                Weighted-Average Common Shares Outstanding** |   |                                    | 137,647,473 |                                  |   | 76,452,012 |   |   | 137,647,473 |   |   | 76,436,985 |   |

----

**RECYCLENET      CORPORATION AND SUBSIDIARIES**

**CONDENSED      CONSOLIDATED STATEMENTS OF CASH FLOWS**

**(UNAUDITED)**

| ***For                The Six Months Ended June 30,***                                                                                          |   | **2006** |    | **2005** |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------|---------|----------|--------|
|                                                                                                                                            |   |     |    |     |   |
| **Cash                Flows From Operating Activities:**                                                                                        |   |     |    |     |   |
| Net                income (loss)                                                                                                                |   | $        | 17,054  |     | $      | (99,836 | ) |
| Adjustments                to reconcile net income (loss) to net cash provided by (used in)                operating                activities: |   |     |    |     |   |   |   |
| Depreciation                                                                                                                                    |   |     | 2,533   |     |   | 2,651 |   |
| Foreign                currency exchange loss                                                                                                   |   |     | 343     |     |   | 2,188 |   |
| Issuance                of common shares for consulting services                                                                                |   |     | -       |     |   | 1,250 |   |
| Changes                in assets and liabilities:                                                                                               |   |     |    |     |   |   |   |
| Accounts                and other receivables                                                                                                   |   |     | 3,609   |     |   | 6,121 |   |
| Prepaid                expenses                                                                                                                 |   |     | 8,770   |     |   | (807 | ) |
| Accounts                payable and accrued liabilities                                                                                         |   |     | (12,494 | )        |   | 2,578 |   |
| Deferred                revenue                                                                                                                 |   |     | 48,100  |     |   | 39,878 |   |
|                                                                                                                                            |   |     |    |     |   |   |   |
| **Net                Cash Provided By (Used In) Operating Activities**                                                                          |   |     | 67,915  |     |   | (45,977 | ) |
|                                                                                                                                            |   |     |    |     |   |   |   |
| **Cash                Flows From Investing Activities:**                                                                                        |   |     |    |     |   |   |   |
| Advances                to related party                                                                                                        |   |     | (28,493 | )        |   | - |   |
| Collection                of advances to related party                                                                                          |   |     | -       |     |   | 2,931 |   |
| Purchase                of property and equipment                                                                                               |   |     | (2,490  | )        |   | (2,897 | ) |
|                                                                                                                                            |   |     |    |     |   |   |   |
| **Net                Cash Provided By (Used In) Investing Activities**                                                                          |   |     | (30,983 | )        |   | 34 |   |
|                                                                                                                                            |   |     |    |     |   |   |   |
| **Cash                Flows From Financing Activities:**                                                                                        |   |     | -       |     |   | - |   |
|                                                                                                                                            |   |     |    |     |   |   |   |
| **Effect                of Exchange Rate Changes on Cash**                                                                                      |   |     | 3,776   |     |   | (4,332 | ) |
|                                                                                                                                            |   |     |    |     |   |   |   |
| **Net                Change in Cash**                                                                                                           |   |     | 40,708  |     |   | (50,275 | ) |
|                                                                                                                                            |   |     |    |     |   |   |   |
| **Cash                at Beginning of Period**                                                                                                  |   |     | 226,979 |     |   | 274,244 |   |
|                                                                                                                                            |   |     |    |     |   |   |   |
| **Cash                at End of Period**                                                                                                        |   | $        | 267,687 |     | $      | 223,969 |   |
|                                                                                                                                            |   |     |    |     |   |   |   |
| **Non                Cash Investing and Financing Activities:**                                                                                 |   |     |    |     |   |   |   |
| Contribution                from spin off of Scrap China                                                                                        |   | $        | 58,624  |     | $      | - |   |

----

**RECYCLENET      CORPORATION AND SUBSIDIARIES**

**NOTES      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

**NOTE      1-ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES**

**Basis      of Presentation —**

**Reclassification**

**NOTE      2-RELATED PARTY TRANSACTIONS**

**Related      Party Receivable**
**—**

**NOTE      3-STOCKHOLDERS’ EQUITY**

**NOTE      4-BASIC AND DILUTED INCOME (LOSS) PER COMMON SHARE**

----

|                                                                                                                                                                                  |   | **For                the three months ended** |        | **For                the six months ended** |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------|-------------|---------------------------------------------|--------|
|                                                                                                                                                                                  |   | **June                30,**                   |        | **June                30,**                 |   |
|                                                                                                                                                                                  |   | **2006**                                      |        | **2005**                                    |   | **2006** |   | **2005** |   |
|                                                                                                                                                                                  |   |                                          |        |                                        |   |   |   |   |   |
| Weighted-average                number of common shares used in basic income (loss) per common share                calculation                                                       |   |                                          | 77,108,214  |                                        |   | 76,452,012 |   |   | 77,108,214 |   |   | 76,436,985 |   |
|                                                                                                                                                                                  |   |                                          |        |                                        |   |   |   |   |   |   |   |   |   |
| Incremental                potentially issuable common shares from assumed conversion of Class                N (and                Class X) common shares                            |   |                                          | 60,539,259  |                                        |   | - |   |   | 60,539,259 |   |   | - |   |
|                                                                                                                                                                                  |   |                                          |        |                                        |   |   |   |   |   |   |   |   |   |
| Weighted-average                number of common shares and dilutive potential common shares used                in                diluted income (loss) per common share calculation |   |                                          | 137,647,473 |                                        |   | 76,452,012 |   |   | 137,647,473 |   |   | 76,436,985 |   |

**NOTE      5-ACQUISITIONS**

**ITEM      2. MANAGEMENT'S DISCUSSION AND ANALYSIS **

**Cautionary      Statement Regarding Forward-Looking Statements**

**Overview**

----

**Results      of Operations**

**Sales      Revenues**

|                          |   | **For                the Three Months Ended** |    | **For                the Six Months Ended** |   |
|-------------------------------|--------|-----------------------------------------------|---------|---------------------------------------------|--------|
|                          |   | **June                30,**                   |    | **June                30,**                 |   |
|                          |   | **2006**                                      |    | **2005**                                    |   | **2006** |   | **2005** |   |
|                          |   |                                          |    |                                        |   |   |   |   |   |
| Sales                Revenues |   | $                                             | 292,800 |                                        | $      | 213,900 |   | $ | 558,700 |   | $ | 401,100 |   |

**Operating      Expenses**

|                                                 |   | **For                the Three Months Ended** |    | **For                the Six Months Ended** |   |
|------------------------------------------------------|--------|-----------------------------------------------|---------|---------------------------------------------|--------|
|                                                 |   | **June                30,**                   |    | **June                30,**                 |   |
|                                                 |   | **2006**                                      |    | **2005**                                    |   | **2006** |   | **2005** |   |
|                                                 |   |                                          |    |                                        |   |   |   |   |   |   |   |   |   |
| General                  and Administrative Expenses |   | $                                             | 264,800 |                                        | $      | 283,500 |   | $ | 536,800 |   | $ | 489,400 |   |

----

**Net      Profit (Loss) from Continuing Operations**

|                                                    |   | **For                the Three Months Ended** |   | **For                the Six Months Ended** |   |
|---------------------------------------------------------|--------|-----------------------------------------------|--------|---------------------------------------------|--------|
|                                                    |   | **June                30,**                   |   | **June                30,**                 |   |
|                                                    |   | **2006**                                      |   | **2005**                                    |   | **2006** |   | **2005** |   |
|                                                    |   |                                          |   |                                        |   |   |   |   |   |
| Income                (loss) from continuing operations |   | $                                             | 29,200 |                                        | $      | (71,100 | ) | $ | 21,500 |   | $ | (90,500 | ) |

**Discontinued      Operations**

|  **Liquidity              and Capital Resources** |   | **June                30,** |    | **December                31,** |   |
|--------------------------------------------------------|--------|-----------------------------|---------|---------------------------------|--------|
|                                                   |   | **2006**                    |    | **2005**                        |   |
|                                                   |   |                        |    |                            |   |
| Cash                on Hand                            |   | $                           | 267,700 |                            | $      | 227,000 |   |

----

|  **Deferred              Revenue** |   | **June                30,** |    | **December                31,**** ** |   |
|-----------------------------------------|--------|-----------------------------|---------|-------------------------------------------|--------|
|                                    |   | **2006**                    |    | **2005**                                  |   |
|                                    |   |                        |    |                                      |   |
|                                         |   | $                           | 150,800 |                                      | $      | 102,000 |   |

**ITEM      3. CONTROLS AND PROCEDURES**

**PART      II - OTHER INFORMATION**

| **ITEM                1.** | **LEGAL                PROCEEDINGS** |
|----------------------------|--------------------------------------|

| **ITEM                2.** | **CHANGES                IN SECURITIES AND SMALL BUSINESS ISSUER PURCHASE OF EQUITY                SECURITIES** |
|----------------------------|-----------------------------------------------------------------------------------------------------------------|

| **ITEM                3.** | **DEFAULT                UPON SENIOR SECURITIES** |
|----------------------------|---------------------------------------------------|

| **ITEM                4.** | **SUBMISSION                OF MATTERS TO A VOTE OF SECURITY                HOLDERS** |
|----------------------------|---------------------------------------------------------------------------------------|

| **ITEM                5.** | **OTHER                INFORMATION** |
|----------------------------|--------------------------------------|

| **ITEM                6.** | **EXHIBITS                AND REPORTS ON FORM 8-K** |
|----------------------------|-----------------------------------------------------|

| Exhibit | Description |
|---------|-------------|

| 31.1 | Certification                of the Chief Executive Officer pursuant to Section 302 of the                Sarbanes-Oxley Act of 2002 |
|------|--------------------------------------------------------------------------------------------------------------------------------------|

| 31.2 | Certification                of the Chief Financial Officer pursuant to Section 302 of the                Sarbanes-Oxley Act of 2002 |
|------|--------------------------------------------------------------------------------------------------------------------------------------|

| 32.1 | Certification                of Chief Executive Officer pursuant to U.S.C Section 1350 as adopted                pursuant to Section 906 of the Sarbanes-Oxley Act of                2002 |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 32.2 | Certification                of Chief Financial Officer pursuant to U.S.C Section 1350 as adopted                pursuant to Section 906 of the Sarbanes-Oxley Act of                2002 |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**SIGNATURES**

|                           | RecycleNet                Corporation                                                                                                                                                                                                                                                                                        |
|--------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                           |                                                                                                                                                                                                                                                                                                                         |
|                           |                                                                                                                                                                                                                                                                                                                         |
| August                14, 2006 | /s/ Paul              Roszel                                                 |
|                           | Paul                Roszel, President and Chairmanof                the Board of Directors                                                                                                                                                                                                                                   |
|                           |                                                                                                                                                                                                                                                                                                                         |
|                           |                                                                                                                                                                                                                                                                                                                         |
|                           |                                                                                                                                                                                                                                                                                                                         |
| August                14, 2006 | /s/ Richard              Ivanovick                                                                                             |
|                           | Richard                Ivanovick, C.A., Chief Financialand                Accounting                Officer                                                                                                                                                                                                                  |
|                           |                                                                                                                                                                                                                                                                                                                         |

----