UNITED
      STATES


SECURITIES
      AND EXCHANGE COMMISSION


WASHINGTON,D.C.20549





FORM
      10-QSB





(Mark
      One)





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





For
      the quarterly period ended September
      30, 2007





[   
                ]
            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:000-29483





Pacific
      Sands, Inc.


(Exact
      name of small business issuer as
      specified in its charter)




Nevada
            88-0322882State
                or other jurisdiction of
                incorporation or organization)
            (IRS
                Employer Identification
                No.)





1509
      Rapids Drive,Racine,WI53404


(Address
      of principal executive
      offices)





(262)
      619-3261


(Issuer's
      telephone
      number)







Not
      Applicable


(Former
      name, former address and former
      fiscal year, if changed since last report)





Check
      whether the issuer (1) filed
      all reports required to be filed by Section 13 or 15(d) of the Exchange Act
      of 1934 during the past 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.





YesXNo ____




As
      of November 19, 2007, the Company had
      34,826,124 shares outstanding of its $.001 par value common
      stock.








Transitional
      Small Business Disclosure
      Format (check one):





Yes 
____  
      NoX




















**Table
      of
      Contents**











PART
                I   FINANCIAL
                INFORMATIONItem
                1.
            Financial
                Statements
            3Balance
                Sheet as of September 30,
                2007 (unaudited)
            3Statements
                of Operations for the
                Three Months  Ended September 30, 2007 and 2006
                (unaudited)
            4Statements
                of Cash Flows for the
                Three Months  Ended September 30, 2007 and 2006
                (unaudited)
            5Notes
                to Financial Statements
                (unaudited)
            7Item
                2.
            Management's
                Discussion and
                Analysis and Results of Operations
            14Item
                3.
            Quantitative
                and Qualitative
                Disclosers About Market Risk
            17Item
                4.
            Controls
                and
                Procedures
            18PART
                II   OTHER
                INFORMATIONItem
                1.
            Legal
                Proceedings
            20Item
                2.
            Unregistered
                Sales of Equity
                Securities and Use of Proceeds
            20Item
                3.
            Defaults
                Upon Senior
                Securities
            20Item
                4.
            Submission
                of Matters to a Vote of
                Security Holders
            20Item
                5.
            Other
                Information
            20Item
                6.
            Exhibits
            20Signatures
            21











2





**PACIFIC
      SANDS, INC.**





BALANCE
      SHEET




SEPTEMBER
      30, 2007







**ASSETS**





**CURRENT
                ASSETS**Cash
                and cash equivalents
            
            $
            2,805Trade
                receivables, net of allowance for doubtful accounts of
                $10,323
            
            
            136,768Inventories
            
            
            95,051Prepaid
                expenses
            
            
            14,117Other
                current assets
            
            
            4,725Total
                Current Assets
            
            
            253,466**PROPERTY
                AND EQUIPMENT**Furniture
                and fixtures & office equipment
            
            
            24,954Manufacturing
                equipment
            
            
            12,204Leasehold
                improvements
            
            
            3,035Computer
                software
            
            
            15,27755,470Less
                accumulated depreciation
            
            
            (20,633
            )Property
                and Equipment, net
            
            
            34,837**OTHER
                ASSETS**Security
                deposits
            
            
            816Total
                Assets
            
            
            289,119**LIABILITIES
                AND STOCKHOLDERS' EQUITY****CURRENT
                LIABILITIES**Accounts
                payable
            
            
            122,325Current
                maturities of long-term obligations
            
            
            11,712Accrued
                expenses
            
            
            63,285Deferred
                compensation
            
            
            252,730Notes
                payable
            
            
            102,233Notes
                payable - other
            
            
            39,683Total
                Current Liabilities
            
            
            591,968**LONG
                TERM LIABILITIES**Capital
                leases, less current portion
            
            
            8,819**COMMITMENTS
                AND CONTINGENCIES**
            
            
            -**STOCKHOLDERS'
                EQUITY**Common
                stock (50,000,000 shares authorized, 41,347,811 shares issued and
                34,738,624 shares outstanding)
            
            
            41,348Additional
                paid in capital
            
            
            3,552,793Treasury
                stock, at cost
            
            
            (132,030
            )Accumulated
                deficit
            
            
            (3,773,779
            )Total
                Stockholders' Equity
            
            
            (311,668
            )Total
                Liabilities and Stockholders' Equity
            
            
            289,119






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





3





**PACIFIC
      SANDS, INC.**





STATEMENTS
      OF OPERATIONS





FOR
      THE
      THREE MONTHS ENDED SEPTEMBER 30, 2007 AND 2006








2007
            
            
            2006NET
                SALES
            
            $
            179,807
            
            
            $
            119,558COST
                OF SALES
            
            
            62,863
            
            
            
            65,313GROSS
                PROFIT
            
            
            116,944
            
            
            
            54,245SELLING
                AND ADMINISTRATIVE EXPENSES
            
            
            167,806
            
            
            
            334,398LOSS
                FROM OPERATIONS
            
            
            (50,862
            )
            
            
            (280,153
            )OTHER
                INCOME (EXPENSES)Interest
                expense
            
            
            (2,967
            )
            
            
            (11,931
            )LOSS
                BEFORE INCOME TAXES
            
            
            (53,829
            )
            
            
            (292,084
            )INCOME
                TAXES
            
            
            -
            
            
            
            -NET
                LOSS
            
            $
            (53,829
            )
            
            $
            (292,084
            )BASIC
                AND DILUTED NET LOSS PER SHARE
            
            $
            (0.002
            )
            
            $
            (0.009
            )BASIC
                AND DILUTED WEIGHTED AVERAGE SHARES OUTSTANDING
            
            
            34,004,047
            
            
            
            31,212,029



























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








4





**PACIFIC
      SANDS, INC.**





STATEMENTS
      OF CASH FLOWS





FOR
      THE
      THREE MONTHS ENDED SEPTEMBER 30, 2007 AND 2006








2007
            
            
            2006CASH
                FLOWS FROM OPERATING ACTIVITIESNet
                loss
            
            $
            (53,829
            )
            
            $
            (292,084
            )Adjustments
                to reconcile net loss to net cash (used in)/provided by operating
                activities -Depreciation
                and amortization
            
            
            3,540
            
            
            
            1,608Deferred
                compensation
            
            
            -
            
            
            
            22,500Compensation
                expenses on stock options granted
            
            
            -
            
            
            
            134,211Common
                shares and rights issued for services and compensation
            
            
            15,975
            
            
            
            71,285Changes
                in assets and liabilities -Trade
                accounts receivable
            
            
            (38,119
            )
            
            
            44,714Inventories
            
            
            (1,794
            )
            
            
            5,367Prepaid
                expenses
            
            
            2,975
            
            
            
            4,464Other
                assets
            
            
            1,433
            
            
            
            -Accounts
                payable and other current liabilities
            
            
            (29,303
            )
            
            
            9,206Net
                Cash (Used in)/Provided by Operating Activities
            
            
            (99,122
            )
            
            
            1,271CASH
                FLOWS FROM INVESTING ACTIVITIESPurchases
                of equipment
            
            
            -
            
            
            
            (4,365
            )Net
                Cash Used in Investing Activities
            
            
            -
            
            
            
            (4,365
            )CASH
                FLOWS FROM FINANCING ACTIVITIESIssuance
                of common stock
            
            
            20,000
            
            
            
            5,000Issuance
                of notes payable
            
            
            106,696
            
            
            
            9,774Repayment
                of notes payable and long term obligations
            
            
            (35,938
            )
            
            
            (14,226
            )Deferred
                compensation payments
            
            
            (2,800
            )
            
            
            -Net
                Cash Provided by Financing Activities
            
            
            87,958
            
            
            
            548NET
                DECREASE IN CASH AND CASH EQUIVALENTS
            
            
            (11,164
            )
            
            
            (2,546
            )CASH
                AND CASH EQUIVALENTSBeginning
                of year
            
            
            13,969
            
            
            
            4,977End
                of year
            
            $
            2,805
            
            
            $
            2,431





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








5





**PACIFIC
      SANDS, INC.**





STATEMENTS
      OF CASH FLOWS





YEARS
      ENDED SEPTEMBER 30, 2007 AND 2006








SUPPLEMENTAL
      DISCLOSURES OF CASH FLOW INFORMATION


2007
            
            
            2006Cash
                paid during the year for:Interest
            
            $
            2,483
            
            
            $
            11,932Income
                taxes
            
            $
            -
            
            
            $
            -SUPPLEMENTAL
                INFORMATION FROM NONCASH FINANCING ACTIVITIESConversion
                of debt to equity
            
            $
            -
            
            
            $
            19,207Capital
                lease obligations
            
            $
            -
            
            
            $
            2,332






























































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








6





**PACIFIC
      SANDS,
      INC**


**NOTES
      TO FINANCIAL
      STATEMENTS** **SEPTEMBER
        30, 2007 AND 2006**








**1.**
            **BASIS
                OF PRESENTATION**





The
      accompanying unaudited interim consolidated financial statements of Pacific
      Sands, Inc., have been prepared in accordance with accounting principles
      generally accepted in the United States of America and the rules of the
      Securities and Exchange Commission (“SEC”), and should be read in conjunction
      with the audited financial statements and notes thereto contained in Pacific
      Sands, Inc’s Annual Report filed with the SEC on Form 10-KSB.  In the
      opinion of management, all adjustments, consisting of normal recurring
      adjustments, necessary for a fair presentation of financial position and the
      results of operations for the interim periods presented have been reflected
      herein.  The results of operations for interim periods are not
      necessarily indicative of the results to be expected for the full
      year.  Notes to the financial statements which would substantially
      duplicate the disclosure contained in the audited financial statements for
      fiscal 2007 as reported elsewhere in this Form 10-QSB have been
      omitted.








**2.**
            **DESCRIPTION
                OF BUSINESS AND SIGNIFICANT ACCOUNTING
                POLICIES**





**Nature
      of Business** - Pacific Sands, Inc. with the right to do business as
      Natural Water Technologies (the "Company") was incorporated in Nevada on July
      7,
      1994 with an original authorized capital stock of 25,000 shares of $0.001 par
      value which was increased to 20,000,000 shares in 1997 with the same par
      value.  On May 6, 2002, the authorized capital stock was increased to
      50,000,000 shares.





The
      Company manufactures and distributes nontoxic cleaning and water treatment
      products with applications ranging from home spas and swimming pools to cleaning
      and pet care.





**Inventories**
      - Inventories are stated at the lower of cost or market on the first-in,
      first-out (FIFO) basis.





**Depreciation**
      - For financial reporting purposes, depreciation of property and equipment
      has
      been computed over estimated useful lives of two to seven years primarily using
      the straight-line method.  Depreciation charges totaled $3,540 and
      $1,608 during the three months ended September 30, 2007 and 2006,
      respectively.





**Revenue
      Recognition** - Revenue from sales to distributors and resellers is
      recognized when the related products are shipped.





**Advertising
      and Promotional Costs** - Advertising and promotion costs are expensed as
      incurred.  During fiscal three months ended September 30, 2007 and
      2006, advertising and promotion costs totaled $3,341 and $13,772,
      respectively.





**Income
      Taxes** - The Company accounts for income taxes under Statement of
      Financial Accounting Standards (SFAS) 109.  Under the asset and
      liability method of SFAS 109, deferred income taxes are recognized for the
      tax
      consequences of temporary differences by applying enacted statutory rates
      applicable to future years to the difference between the financial statement
      carrying amounts and the tax basis of existing assets and
      liabilities.








7





**PACIFIC
      SANDS,
      INC**


**NOTES
      TO FINANCIAL
      STATEMENTS**


SEPTEMBER
      30, 2007 AND 2006








**Accounts
      Receivable** - The Company makes judgments as to the collectibility of
      trade and other accounts receivable based on historic trends and future
      expectations.  Management estimates an allowance for doubtful
      receivables, which reflects its current assessment of the collectibility of
      the
      receivables.  Management believes that the current specific and
      general receivable reserves aggregating $10,323 is adequate as of September
      30,
      2007.





**Basic
      and Diluted Net Loss Per Share** - Net loss per share is calculated in
      accordance with Statement of Financial Accounting Standards 128, Earnings Per
      Share ("SFAS 128").  Basic net loss per share is based upon the
      weighted average number of common shares outstanding.  Diluted net
      loss per share is based on the assumption that all dilutive convertible shares
      and stock options were converted or exercised.  Dilution is computed
      by applying the treasury stock method.  Under this method, options and
      warrants are assumed to be exercised at the beginning of the period (or at
      the
      time of issuance, if later), and as if funds obtained thereby were used to
      purchase common stock at the average market price during the
      period.





**Use
      of Accounting Estimates** - The preparation of financial statements in
      conformity with generally accepted accounting principles requires management
      to
      make estimates and assumptions that affect the reported amounts of assets and
      liabilities and disclosure of contingent assets and liabilities at the date
      of
      the financial statements and reported amounts of revenues and expenses during
      the reporting period.  Actual results could differ from these
      estimates.





**Statement
      of Cash Flows** - For purposes of the statements of cash flows, the
      Company considers all highly liquid debt instruments purchased with an initial
      maturity of three months or less to be cash equivalents.





**Recent
      Accounting Pronouncements** - The following is a summary of recent
      authoritative pronouncements that affect accounting, reporting and disclosure
      of
      financial information by the Company.





In
      September 2006, the FASB issued Statement of Financial Accounting Standards
      No.
      157, Fair Value Measurements. SFAS No. 157 provides enhanced guidance for using
      fair value to measure assets and liabilities. The standard also requires
      expanded disclosures about the extent to which companies measure assets and
      liabilities at fair value, the information used to measure fair value and the
      effect of fair value measurements on earnings. SFAS No. 157 is effective for
      financial statements issued for fiscal years beginning after November 15, 2007,
      and interim periods within those fiscal years. The Company is still evaluating
      the effects of Statement No. 157.











8





**PACIFIC
      SANDS,
      INC**


**NOTES
      TO FINANCIAL
      STATEMENTS**


SEPTEMBER
      30, 2007 AND 2006








**3.**
            **GOING
                CONCERN**





The
      accompanying financial statements have been presented assuming that the Company
      will continue as a going concern.  This basis of accounting
      contemplates the recovery of the Company's assets and the satisfaction of its
      liabilities in the normal course of business.  Through September 30,
      2007, the Company has incurred cumulative losses of $ 3,773,779.  The
      Company's successful transition to attaining profitable operations is dependent
      upon obtaining financing adequate to fulfill its development, marketing and
      sales activities and achieving a level of revenues adequate to support the
      Company's cost structure.  Management's plan of operations anticipates
      that the cash requirements of the Company for the next twelve months will be
      met
      by obtaining capital contributions through the sale of common stock and from
      current operations.  However, there is no assurance that the company
      will be able to fully implement its plan in order to generate the funds needed
      on a going concern basis.











**4.**
            **INVENTORIES**





Inventories
      at September 30, 2007 consisted of the following:





Raw
                materials
            
            $
            74,764Finished
                Goods
            
            
            20,287Total
            
            $
            95,051











**5.**
            **LONG
                TERM OBLIGATIONS**





Long
      term
      obligations consist of the following capital lease obligations: a four year
      agreement for software dated June 20, 2005 with an imputed interest rate of
      14.45%; a two year agreement for computer hardware with an imputed interest
      rate
      of 22.94% placed in service in December 2005;  a three year agreement
      for computer hardware with an imputed interest rate of 21.62%, placed in service
      in August 2005; a three and a half year agreement for software with an imputed
      interest rate of 12.64%, placed in service in January 2006; and a two year
      agreement for computer hardware with an imputed interest rate of 22.81%, placed
      in service in September  2006.   Monthly installment
      payments are $691, $67, $93, $312 and $59, respectively with a bargain purchase
      option at the end of each lease of $1. All of the above agreements have been
      accounted for as capital leases in accordance with generally accepted accounting
      principles.











9





**PACIFIC
      SANDS,
      INC**


**NOTES
      TO FINANCIAL
      STATEMENTS**


SEPTEMBER
      30, 2007 AND 2006








The
      scheduled maturities are as follows for the years ending September
      30,





2008
            
            $
            11,7122009
            
            
            8,819











**6.**
            **NOTES
                PAYABLE**





The
      Company received a line of credit from Dell Financial Services for $15,000
      with
      an imputed interest rate of 27.24% on any outstanding balance.  To
      date the Company has used the line of credit to purchase computer hardware
      to
      serve its accounting and e-commerce functions.  As of September 30,
      2007, $6,042 was outstanding against the line of credit.





On
      July
      27, 2007, the Company executed a promissory note pursuant to a business line
      of
      credit ("BLOC") with JP Morgan Chase Bank, NA.  Under the term of the
      promissory note, the Company may borrow up to $100,000 against the BLOC at
      the
      prime interest rate plus 1.5%.   The Company must pay all accrued
      interest on a monthly basis.  The promissory note is secured by the
      assets of the Company.  As of September 30, 2007, the amount due on
      the line of credit was $96,190.





Notes
      payable - other consist of various
      small unsecured notes to stockholders/officers at rates fluctuating up to
      10%.











**7.**
            **STOCKHOLDERS’
                EQUITY**





On
      September 25, 2007, the Company
      issued 200,000 shares of its common stock, par value $0.001 per share, to an
      investor for $20,000.





On
      September 25, 2007, the Company
      issued 60,000 shares of its common stock, par value $0.001 per share, to its
      three directors and 117,500 shares of its common stock, par value $0.001 per
      share, to three consultants for services performed. The fair market value of
      the
      shares on the date issued was $0.09 per share.  The Company recorded
      compensation expense of $15,975 related to the issuance of these
      shares.











**8.**
            **LEASE
                COMMITTMENTS**





The
      Company entered into a one and a
      half year lease expiring July 31, 2007 for 11,000 square feet of office and
      warehouse space forapproximately $2,000per month. Subsequent to expiration,
      the Company is leasing the facility on a month to month basis under the existing
      terms.  The Company is responsible for insuring the
      premises.  Rent expense was approximately$6,100 and $6,000 for
      the three months
      ended September30, 2007
      and 2006, respectively.











10





**PACIFIC
      SANDS,
      INC**


**NOTES
      TO FINANCIAL
      STATEMENTS**


SEPTEMBER
      30, 2007 AND 2006








**9.**
            **LOSS
                PER SHARE**





Basic
      loss per common share is based on
      the weighted average number of common shares outstanding in each period and
      earnings adjusted for preferred stock dividend requirements.  Diluted
      earnings per common share assume that any dilutive convertible preferred shares
      outstanding at the beginning of each period were converted at those dates,
      with
      related interest, preferred stock dividend requirements and outstanding common
      shares adjusted accordingly.  It also assumes that outstanding common
      shares were increased by shares issuable upon exercise of those stock options
      and warrants for which market price exceeds exercise price, less shares which
      could have been purchased by the Company with related
      proceeds.




The
      following table sets forth the computation of basic and diluted earnings per
      share.





Three
                Months EndedSeptember 30,
                2007
            
            
            September 30,
                2006NumeratorBasic
                and diluted loss
            
            $
            (53,829
            )
            
            $
            (292,084
            )DenominatorBasic
                and diluted earnings per share-weighted average shares
                outstanding
            
            
            34,004,047
            
            
            
            31,212,029Basic
                and diluted loss per common share
            
            $
            (0.002
            )
            
            $
            (0.009
            )












September
                30, 2007
            
            September
                30, 2006Stock
              Options
            3,000,000
            
            3,000,000






**10.**
            **INCOME
                TAXES**





The
      Company recognizes deferred tax assets and liabilities for temporary differences
      between the financial reporting and tax bases of its assets and
      liabilities.  Deferred assets are reduced by a valuation allowance
      when deemed appropriate.





The
      tax
      effects of existing temporary differences that give rise to significant portions
      of deferred tax assets at September 30, 2007 are as follows:








11





**PACIFIC
      SANDS,
      INC**


**NOTES
      TO FINANCIAL
      STATEMENTS**


SEPTEMBER
      30, 2007 AND 2006








Net
                Operating Loss Carryforwards
            
            $
            707,000Deferred
                compensation
            
            
            88,000Stock
                Option Compensation
            
            
            65,000Valuation
                Allowance
            
            
            (860,000
            )Net
                deferred Tax Asset
            
            $
            --





At
      September 30, 2007, the Company has
      net operating loss carryforwards for Federal tax purposes of approximately
      $2,460,000 which, if unused to offset future taxable income, will expire in
      years beginning in 2018.




Accounting for Uncertainty in Income Taxes - an interpretation of FASB
      Statement No. 109, Accounting for Income Taxes.







**11.**
            **RELATED
                PARTY TRANSACTIONS**





On
      June
      15, 2004, Stan and Rita Paulus resigned as officers and board members of the
      Company and were replaced by a new management team.  As part of the
      transition in management, several transactions occurred which are all recorded
      below.





Stan
      and
      Rita agreed to waive all unpaid compensation from the Company except for
      $100,000, which shall be paid in full within three years of the transition
      date.





The
      Paulus' purchased from the Company the inventory known as "technical books"
      for
      the sum of $150,000 in exchange for 4,859,187 shares of Pacific Sands, Inc.
      common stock.  Based on the average market value of the Company's
      stock, which valued these


shares
      at
      $121,480, there was an additional write down of the inventory of
      $28,500.  This amount was recorded as a reduction to additional paid
      in capital based on the related party nature of the transaction. Since the
      shares were still being held in escrow by legal counsel at June 30, 2004, the
      transaction was recorded as due from shareholder.  During the fiscal
      year end June 30, 2005, the shares were returned to treasury.





In
      addition, management has negotiated the restructuring of debt due to the
      Paulus'.  This restructuring reduced the debt balance due the Paulus'
      by $15,791 and extended the due date to June, 2006.  This reduction
      has been recorded as a gain from restructuring of debt in the statement of
      operations.





On
      June
      14, 2006, one day prior to the due date of the unpaid compensation to the
      Paulus' of $100,000, the Company and the Paulus' agreed to extend the
      payment until January, 2007 with monthly payments of $25,000 beginning in
      October, 2006.  In addition, there was a $5,000 note payable rolled
      into the monthly payment plan due January, 2007.  In July, 2006
      100,000 shares of restricted stock were issued in exchange for extending the
      payment.  This restructuring increased the note amount due the Paulus'
      by $7,810.  No Payments have been made.  Mr. Paulus has filed suit
      against the Company. (See Note 12)





Finally,
      two of the current officers of the Company have agreed to defer a substantial
      portion of their salaries until such time as it may be paid.  As of
      September 30, 2007, the deferred compensation for these two officers was
      $152,730.  Prior to accepting the position as an officer of the
      Company, one of the current officers agreed to defer $11,500 of his professional
      consulting services which is still unpaid as of September 30,
      2007.  The deferred compensation charged to operations for the three
      months ended September 30, 2006 was $22,500.  Payments of deferred
      compensation of $2,800 were made by the Company to one of the officers during
      the three months ended September 30, 2007.











12





**PACIFIC
      SANDS,
      INC**


**NOTES
      TO FINANCIAL
      STATEMENTS**


SEPTEMBER
      30, 2007 AND 2006








**12.**
            **CONTINGENCIES**




The
      Company received notice on May 3, 2007 that a lawsuit had been filed against
      the
      Company in US District Court, Eastern District of California by the Company's
      former CEO, Stanley Paulus.  The lawsuit demands payment of $105,000
      plus penalties and legal fees for a note that was issued in June of
      2006.  The note was based on deferred salaries accrued for Mr. Paulus
      during his tenure as CEO of the Company.  On June 7, 2007, the Company
      filed a counter-complaint specifying certain allegations against Mr. 
Paulus.  One June 27, 2007, Mr. Paulus filed a motion to dismiss the
      Company's counter-complaint.  On August 12, 2007, the Court denied Mr.
      Paulus' motion to dismiss, but did order the Company to amend its
      counter-complaint which the Company did and filed on September 12, 2007. 
Mr. Paulus has until October 15, 2007 to respond to the amended
      counter-complaint.  As of this filing, Mr. Paulus had not responded to or
      contested the amended counter complaint.  As of November 19, 2007, the
      matter was unresolved.











**13.**
            **CONCENTRATIONS**





The
      Company distributes water treatment
      and nontoxiccleaning
      products to the entireU.S.market.  For the three months
      ended September 30, 2007 and 2006, one customer accounted for
      approximately29.5%and 31% of the
      Company's sales, respectively, and 40% and40%of the company's trade receivables,
      respectively.



















































































13





**Item
                2.**
            **Management
                Discussion and Analysis of Financial Condition and Results of
                Operation**








THIS
      REPORT CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF SECTION 27A
      OF
      THE SECURITIES ACT OF 1933, AS AMENDED, AND SECTION 21E OF THE SECURITIES
      EXCHANGE ACT OF 1934, AS AMENDED. ALL FORWARD-LOOKING STATEMENTS ARE INHERENTLY
      UNCERTAIN AS THEY ARE BASED ON CURRENT EXPECTATIONS AND ASSUMPTIONS CONCERNING
      FUTURE EVENTS OR FUTURE PERFORMANCE OF THE COMPANY. READERS ARE CAUTIONED NOT
      TO
      PLACE UNDUE RELIANCE ON THESE FORWARD-LOOKING STATEMENTS, WHICH ARE ONLY
      PREDICTIONS AND SPEAK ONLY AS OF THE DATE HEREOF. FORWARD-LOOKING STATEMENTS
      USUALLY CONTAIN THE WORDS "ESTIMATE," "ANTICIPATE," "BELIEVE," "EXPECT," OR
      SIMILAR EXPRESSIONS, AND ARE SUBJECT TO NUMEROUS KNOWN AND UNKNOWN RISKS AND
      UNCERTAINTIES. IN EVALUATING SUCH STATEMENTS, PROSPECTIVE INVESTORS SHOULD
      CAREFULLY REVIEW VARIOUS RISKS AND UNCERTAINTIES IDENTIFIED BELOW, AS WELL
      AS
      THE MATTERS SET FORTH IN THE COMPANY'S ANNUAL REPORT ON 10-KSB FOR THE YEAR
      ENDED JUNE 30, 2006 AND ITS OTHER SEC FILINGS. THESE RISKS AND UNCERTAINTIES
      COULD CAUSE THE COMPANY'S ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE
      INDICATED IN THE FORWARD-LOOKING STATEMENTS. THE COMPANY UNDERTAKES NO
      OBLIGATION TO UPDATE OR PUBLICLY ANNOUNCE REVISIONS TO ANY FORWARD-LOOKING
      STATEMENTS TO REFLECT FUTURE EVENTS OR DEVELOPMENTS.





Pacific
      Sands, Inc. (the "Company" or "Pacific Sands") was incorporated in the State
      of
      Nevada on July 7, 1994. The Company's fiscal year ends June 30. The Company
      is a
      C-Corporation for federal income tax purposes. The Company does not have
      subsidiaries or affiliated entities. The Company also does business as "Natural
      Water Technologies" and ecoONE Marketing Group.





The
      Company develops, manufactures, markets and sells a range of non-toxic,
      environment friendly cleaning and water-treatment products based on proprietary
      blended botanical and nontoxic chemical technologies. The Company's products
      have applications ranging from water installation maintenance (spas, swimming
      pools, fountains, decorative ponds) to cleaning (non-toxic household and
      industrial) and pet care.





The
      Company has a mature, actively marketed product line known as the ecoONE® Spa
      Treatment system as well as ecoONE® Pool conditioner and the Pacific Sands
      All-Purpose Hose Filter. Pacific Sands is also the master distributor for Rain
      Forest Blue, an EPA Registered chlorine and bromine free, non irritating, odor
      free, bactericide / algaecide alternative for the treatment of pool
      water.





Currently
      the Company markets and sells its product lines over the Internet and through
      numerous retail outlets in the US, Canada and Europe. The products are also
      sold
      via Pacific Sands distributors, manufacturer's representatives and
      internationally established pool and spa industry distribution
      networks.











14





The
      Company's goal is to achieve sustained and significant profitability through
      revenues achieved by marketing and sale of its nontoxic, earth, health and
      kid-friendly, ecoONE® Pool, Spa, Household Cleaning and other product
      lines.





In
      July
      of 2004, management began the implementation of a three year market saturation
      strategy for the ecoONE® line of pool and spa products. The strategy has been
      very successful to date, resulting in sharp increases in sales, dealer and
      distributor outlets and industry recognition.





Management
      intends to continue the aggressive marketing and sale of its products through
      direct retail and a widening base of retail outlets, distribution centers and
      OEM arrangements in order to achieve its goals.





The
      Company's ability to achieve its objectives is dependent on its ability to
      sustain and enhance its revenue stream and to continue to raise funds through
      loans, credit and the private placement of restricted securities until such
      time
      as the Company achieves sustained fiscal profitability.





To
      date,
      the Company has funded operations through a combination of revenues from the
      sale of its products, established credit with vendors, and the sale of rule
      144
      stocks through private placement. The Company's failure to continue to raise
      adequate financing to fund operations may jeopardize its existence. (See
“Liquidity and Capital Resources”)





Management
      knows of no additional trends or uncertainties beyond those discussed that
      are
      reasonably likely to have a material impact on the Company's short or long-term
      liquidity.











RESULTS
      OF OPERATIONS





Results
      for the three months ending September 30, 2007 compared to the three months
      ending September 30, 2006.





For
      the
      three months ending September 30, 2007 net sales were $179,807 an increase
      of
      50% over net sales of $119,558 for the same period in 2006. The increase in
      sales is attributable to a number of factors including more retail outlets
      carrying the ecoONE® pool and spa treatment products, an increased sales cycle
      attributable to new marketing and sales initiatives and an increase in direct
      Internet retail sales, particularly of the company's All-Purpose Garden Hose
      Filter.





Cost
      of
      Goods Sold was $62,863 compared to $65,313 for the same period the previous
      fiscal year. The decrease in cost of goods sold was due, in part to a decrease
      in the amount of lower-profit sale of promotional materials to the company's
      OEM
      spa manufacturer partner during the period as well as increased
      efficiencies.





Gross
      profits for the three months ending September 30, 2007 were $116,944 or 65%
      compared to $54,245 or 46% for the same period the previous fiscal
      year.  The significant increase in gross profit is a sharp increase in
      overall sales, coupled with a decrease in the amount of lower-profit sale of
      promotional materials to the company's OEM spa manufacturer partner. It is
      anticipated that the sale of those lower-profit promotional goods will
      concentrate in the up-coming quarter.











15





For
      the
      three months ending September 30, 2007, selling and general administrative
      expenses were down 50% to $167,806 compared to $334,398 for the three
      months ending September 30, 2006. During the three months ending September
      30,
      2006, the Company incurred a charge of $134,211 for stock based compensation
      in
      the form of options as well as a charge of $35,160 for stock based compensation
      in the form of restricted stock to its officers.  During the three
      months ended September 30, 2007, the Company’s stock based compensation to
      officers and directors totaled $5,400.  Other selling and general
      administrative cost remained relatively consistent for the three months ended
      September 30, 2007 as compared to the three months ended September 30,
      2006.





Interest
      expense for the three months ended September 30, 2007 was $2,967 as compared
      to
      $11,931 for the same period in fiscal 2007.  The decrease is
      attributed to the reduction of five capital lease obligations for which the
      Company makes monthly payments thus reducing the principal owed.








LIQUIDITY
      AND CAPITAL RESOURCES





Management
      believes that the Company is positioned for sales growth but will require
      additional funding to continue operations. The Company's ability to achieve
      its
      objectives is dependent on its ability to sustain and enhance its current
      revenue stream and to continue to raise funds through loans, credit and the
      private placement of restricted securities until such time as the Company
      sustains fiscal profitability. To date, the Company has funded operations and
      expansion through a combination of revenues from the sale of its products,
      established credit with vendors, deferred salaries and the sale of rule 144
      stock through private placement. The Company's failure to continue to raise
      adequate financing to fund planned expansion may jeopardize its plans for
      growth.





Additionally,
      the Board of Directors has instructed the President (Mr. Wynhoff) to begin
      the
      process of evaluating certain profitable companies and/or enterprises with
      similar or complimentary business models  as potential acquisition
      candidates in order to accelerate the growth of  Pacific Sands and
      enhance its revenue stream and shareholder value.





As
      of
      September 30, 2007, the Company had $253,466 of current assets and total assets
      for fiscal year 2007 were $289,119. Cash and cash equivalents totaled $2,805
      on
      September 30, 2007.





Current
      liabilities at September 30, 2007 were $591,968 of which approximately $252,000
      was deferred compensation owed to two of the Company's officers and another
      related party. Current liabilities also include amounts owed on two lines of
      credit, one being a bank line of credit with Chase Bank for approximately
      $96,000 and the other is with Dell for approximately $6,000.





Net
      cash
      used in operating activities during the three months ended September 30, 2007
      was $99,122 compared to net cash provided by operations of $1,271 for the three
      months ended September 30, 2006.  The decrease in net cash from
      operations comes from an increase in accounts receivable as the result of higher
      sales volume, and a decrease in accounts payable and accrued
      expenses.  The Company used proceeds from its bank line of credit to
      pay down trade payables and other accrued expenses.








16





The
      Company did not use any in investing activities for the three months ended
      September 30, 2007.  For the same period last fiscal year, the Company
      purchased capital assets in the amount of $4,365, representing the only use
      of
      cash for investing activities.





Net
      cash
      provided by financing activities was $87,958 and $548 for the three months
      ended
      September 30, 2007 and 2006, respectively. In July 2007, the Company executed
      a
      bank line of credit for $100,000. At September 30, 2007 the Company had a
      balance due of approximately $96,000. The proceeds were used primarily to fund
      operations. Additionally, the Company received $20,000 by issuing 200,000 shares
      of its common stock to an investor.





The
      Company's ability to achieve its
      objectives is dependent on its ability to sustain and enhance its revenue stream
      and to continue to raise funds through loans, credit and the private placement
      of restricted securities until such time as the Company achieves profitability.
      To date, management has been successful in raising cash on an as-needed basis
      for the continued operations of the Company. There is no guarantee that
      management will be able to continue to raise needed cash in this
      fashion.





The
      Company has no material commitments
      for capital expenditures at this time. The Company has no “off balance sheet”
source of liquidity arrangements.





The
      Company presently employs five full time and three part time
      employees.





**Item
                3.**
            **Quantitative
                and Qualitative
                Disclosers  About Market
                Risk**





An
      investment in the common stock of the
      Company involves a high degree of risk. In addition to the other information
      in
      this report, the following risk factors should be considered carefully in
      evaluating the Company and its business. This Report contains forward-looking
      statements. All forward-looking statements are inherently uncertain as they
      are
      based on current expectations and assumptions concerning future events or future
      performance of the Company. Readers are cautioned not to place undue reliance
      on
      these forward-looking statements, which are only predictions and speak only
      as
      of the date hereof. Forward-looking statements usually contain the words
      "estimate," "anticipate," "believe," "plan," "expect," or similar expressions,
      and are subject to numerous known and unknown risks and uncertainties. In
      evaluating such statements, prospective investors should review carefully
      various risks and uncertainties identified in this report, including the matters
      set below and in the Company's other SEC filings. These risks and uncertainties
      could cause the Company's actual results to differ materially from those
      indicated in the forward-looking statements. The Company undertakes no
      obligation to update or publicly announce revisions to any forward-looking
      statements to reflect future events or developments.




THE
      COMPANY HAS EXPERIENCED LOSSES FROM
      OPERATIONS SINCE COMMENCING OPERATIONS:


With
      the exception of 4thquarters of fiscal 2007 and 2006, the
      Company since commencing operations, has not been profitable on an annual or
      quarterly basis. The Company cannot guarantee that recent quarterly
      profitability will continue on a quarter by quarter basis. The Company may
      not,
      in the future, generate sufficient revenues to achieve sustainable
      profitability.








17





POSSIBLE
      DIFFICULTY FINANCING PLANNED
      GROWTH:


The
      Company's present plans require an
      amount of expenditure and working capital. In the future the Company will
      require financing in addition to the cash generated from operations to fund
      planned growth. If additional resources are unavailable the Company may be
      unable to grow according to its present plan.




MANAGEMENT'S
      ASSUMPTIONS REGARDING THE
      FUTURE MARKET MAY BE FAULTY:


Management
      assumes there will be a
      continuing and increased desirability in the retail market for nontoxic,
      environment and health friendly products for cleaning and water treatment use.
      Should management's assumptions as to this increased desirability be faulty,
      the
      Company may have difficulty achieving its planned growth.




THE
      LOSS OF KEY PERSONNEL COULD
      ADVERSELY AFFECT THE COMPANY:


The
      Company is run by a small number of
      key personnel. Should the Company experience a loss of these key people due
      to
      their inability or unwillingness to continue in their present positions, the
      Company's business and financial results could be adversely
      affected.





**Item
                4.**
            **Controls
                and
                Procedures**





(a)
      Evaluation of disclosure controls
      and procedures




We
      maintain disclosure controls and
      procedures designed to ensure that financial information required to be
      disclosed in our reports filed under the Securities Exchange Act of 1934, as
      amended (the “Exchange Act”), is recorded, processed, summarized, and reported
      within the required time periods, and that such information is accumulated
      and
      communicated to our management, including our Chief Executive Officer and Chief
      Financial Officer, as appropriate, to allow for timely decisions regarding
      disclosure.



































18








In
      connection with the completion of its
      audit of, and issuance of its report on, our financial statements for the year
      ended June 30, 2007, Frank L. Sassetti & Co. (“Sassetti”) considered our
      internal controls in order to determine their auditing procedures for the
      purpose of expressing their opinion on the financial statements and not to
      provide assurance on our internal controls. Sassetti identified deficiencies
      that existed in the design or operation of our internal controls over financial
      reporting that it considered to be “significant deficiencies” or “material
      weaknesses.” The Public Company Accounting Oversight Board (“PCAOB”) has defined
“significant deficiency” as a control deficiency, or a combination of control
      deficiencies, that adversely affects the Company’s ability to initiate,
      authorize, record, process, or report external financial data reliably in
      accordance with generally accepted accounting principles such that there is
      more
      than a remote likelihood that the misstatement of the Company’s annual or
      interim financial statements that is more than inconsequential will not be
      detected. The PCAOB has defined a “material weakness” as a “significant
      deficiency or combination of significant deficiencies that results in more
      than
      a remote likelihood that a material misstatement of the annual or interim
      financial will not be prevented or detected.”




Significant
      deficiencies or material
      weaknesses in our internal controls related to segregation of incompatible
      duties and controls over inventory and equity transactions still exist. We
      have
      disclosed those significant deficiencies and material weaknesses to our Board
      of
      Directors. Additional effort will continue to work with our management and
      outside advisors with the goal to implement internal controls over financial
      reporting that are adequate and effective.




Because
      of inherent limitations of
      internal control, errors or fraud may nevertheless occur and not be detected.
      Also, projection of any evaluation of the internal control to future periods
      is
      subject to the risk that internal control may become inadequate because of
      changes in conditions or that the degree of compliance may deteriorate. Sassetti
      noted the following significant deficiencies that they believe to be material
      weaknesses: (i) Improve segregation of incompatible accounting department
      duties, (ii) Improve maintenance of accounting records by implementing the
      use
      of an accounting software system and (iii) Implement a Corporate Code of
      Conduct.




Based
      upon the above evaluation of
      Management, the Company's Chief Executive Officer and Chief Financial Officer
      concluded that the Company's disclosure controls and procedures are not yet
      effective, but the procedures are as effective as possible, considering the
      fact
      that there is a lack of segregation of duties which will continue until such
      time as the Company can support additional executive personnel to enhance
      segregation of duties.




(b)
      Changes in internal controls and
      procedures




There
      has been no change in our internal
      control over financial reporting during the quarter ended September 30, 2007,
      that has materially affected, or is reasonably likely to material affect, our
      internal control over financial reporting.











19





**PART
      II OTHER
      INFORMATION**





**ITEM
      1 – LEGAL PROCEEDINGS**





The
      Company is currently being sued by former CEO, Stanley Paulus for failure to
      pay
      a $105,000 note which was based on back salary which was accrued on the books
      of
      the Company during his tenure as CEO of the Company. Upon an internal
      re-examination of Company filings and comparison to internal Company accounting
      and records, management discovered evidence suggesting that Mr. Paulus had
      received significant compensation from the Company in the form of stock grants
      and other considerations that were neither recorded nor represented as
      compensation among other discrepancies. On June 7, 2007 the Company filed a
      counter-complaint specifying its allegations against Mr. Paulus.  On
      June 27, 2007, Mr. Paulus filed a motion to dismiss the Company’s
      counter-complaint.  On August 12, 2007, the Court denied Mr. Paulus’
motion to dismiss, but did ordered the Company to amend its counter-complaint
      which the Company did and filed on September 12, 2007.  Mr. Paulus had
      until October 15, 2007 to respond to the amended counter-complaint. At the
      time
      of this filing, Mr. Paulus had not responded to or contested the amended counter
      complaint.





As
      of
      November 19, 2007, this matter was unresolved.





**ITEM
      2 – UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
      PROCEEDS**





On
      September 25th,
      2007, an accredited investor purchased
      200,000 shares of restricted stock $20,000.





**ITEM
      3 – DEFAULTS UPON SENIOR SECURITIES**





None





**ITEM
      4 – SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS**





None




**ITEM
      5 – OTHER INFORMATION**








**ITEM
      6 – EXHIBITS**





(a)
            Exhibit
                Index





Exhibit
            Description
                of the Exhibit





31.1
            Chairman
                of the Board Certification of Periodic Financial Report Pursuant
                to
                Section 302 of the Sarbanes-Oxley Act of
                2002.





31.2
            Chief
                Financial Officer Certification of Periodic Financial Report Pursuant
                to
                Section 302 of the Sarbanes-Oxley Act of
                2002.





32.1
            Chairman
                of the Board Certification Pursuant to 18 U.S.C. Section 1350, as
                adopted
                pursuant to Section 906 of the Sarbanes-Oxley Act of
                2002.





32.2
            Chief
                Financial Officer Certification Pursuant to 18 U.S.C. Section 1350,
                as
                adopted pursuant to Section 906 of the Sarbanes Oxley Act of
                2002.






20








**SIGNATURES**





In
      accordance with the requirements of
      the Exchange Act, the registrant caused this report to be signed on its behalf
      by the undersigned, thereunto duly authorized.








PACIFIC
                SANDS,
                INC.Dated:
                November 19,
                2007
            By:
            /s/
                Michael
                WynhoffMichael
                WynhoffChief
                Executive
                OfficerDated:
                November 19,
                2007
            By:
            /s/
                Michael
                MichieMichael
                MichieChief
                Financial
                Officer






























































21