UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-Q
                                  -------------


|X|  Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
     Act of 1934 for the quarterly period ended April 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 No. 0-25312


                       STARTECH ENVIRONMENTAL CORPORATION
              -----------------------------------------------------
             (Exact name of registrant as specified in its charter)


        Colorado                                               84-1286576
        --------                                               ----------
(State of incorporation)                                    (I.R.S. Employer
                                                          Identification Number)

                            88 Danbury Road, Suite 2A
                            Wilton, Connecticut 06897
           ----------------------------------------------------------
          (Address of principal executive offices, including zip code)

                                 (203) 762-2499
                -------------------------------------------------
               (Registrants telephone number, including area code)

           Securities registered under Section 12(b) of the Act: None

              Securities registered under Section 12(g) of the Act:
                           Common Stock, no par value


     Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. YES [ x ] NO [ ]

     Indicate by check mark whether the Registrant is a large accelerated filer,
an accelerated filer, or a non-accelerated filer. See definition of "accelerated
filer and large accelerated filer" in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer [ ]    Accelerated Filer [ ]   Non-accelerated filer [X]

     Indicate by check mark if the Registrant is a shell company (as defined in
Rule 12b-2 of the Act). YES [ ] NO [ x ]

     As of June 18, 2007, 23,046,840 shares of common stock were outstanding.

<PAGE>


                       STARTECH ENVIRONMENTAL CORPORATION

                                TABLE OF CONTENTS


PART I - FINANCIAL INFORMATION                                             PAGE
------------------------------                                             -----

Item 1. Financial Statements (unaudited)

          Condensed consolidated balance sheets - April 30, 2007 and
          October 31, 2006                                                  1

          Condensed consolidated statements of operations for the
          three and six months ended April 30, 2007 and 2006                2

          Condensed consolidated statements of cash flows for the
          six months ended April 30, 2007 and 2006                          3

          Notes to condensed consolidated financial statements             4-12

Item 2.   Management's Discussion and Analysis of Financial Condition
          and Results of Operations                                       13-17

Item 3.   Quantitative and Qualitative Disclosure about Market Risk        17

Item 4.   Controls and Procedures                                          17

PART II - OTHER INFORMATION
---------------------------

Item 1.  Legal Proceedings                                                 18
Item 1A. Risk Factors                                                      18
Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds       18
Item 3.  Defaults Upon Senior Securities                                   20
Item 4.  Submission of Matters to a Vote of Security Holders               20
Item 5.  Other Information                                                 20
Item 6.  Exhibits                                                          20
Signatures                                                                 21


<PAGE>


                         PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

                                   STARTECH ENVIRONMENTAL CORPORATION
                                 Condensed Consolidated Balance Sheets
<TABLE>
<CAPTION>

                                                                       April 30, 2007
                                                                        (unaudited)          October 31, 2006
                                                                       ---------------       ----------------
                                                Assets
                                                ------
<S>                                                                      <C>                   <C>
Current assets:
   Cash and cash equivalents                                            $  3,681,112            $  2,279,914
   Account receivable                                                         41,000                    --
   Note receivable                                                           385,000                 385,000
   Inventories                                                               326,045                 338,675
   Prepaid expenses and other current assets                                   2,500                   3,007
                                                                        ------------            ------------

Total current assets                                                       4,435,657               3,006,596

Equipment and leasehold improvements, net                                  2,084,105               2,064,454

Deferred financing costs, net                                                   --                    13,783
Other assets                                                                  89,373                  89,266
                                                                        ------------            ------------

Total assets                                                            $  6,609,135            $  5,174,099
                                                                        ============            ============

                                     Liabilities and Stockholders' Equity
                                     ------------------------------------

Current liabilities:
   Accounts payable                                                     $     39,017            $    153,442
   Accrued expenses                                                           78,339                  90,443
   Convertible notes, net of deferred debt discount
   of $101,858 at October 31, 2006                                              --                   589,263
   Detachable warrants                                                          --                   544,286
   Conversion option on convertible notes                                       --                   280,632
   Customer deposits and deferred revenue                                  1,877,840               2,009,792
                                                                        ------------            ------------

      Total current liabilities                                            1,995,196               3,667,858
                                                                        ------------            ------------

Commitments and Contingencies

Stockholders' equity:
   Preferred stock, no par value, 10,000,000 shares
         authorized; none issued andoutstanding                                 --                      --
   Common stock; no par value; 800,000,000 shares
         authorized; 22,346,840 issued and
         outstanding at April 30, 2007; and
         20,718,387 issued and outstanding at October 31, 2006            32,352,113              28,929,534
   Additional paid-in-capital                                              5,397,623               3,780,197
   Deferred offering costs                                                      --                  (341,551)
   Deferred lease costs                                                     (374,776)                   --
   Accumulated deficit                                                   (32,761,021)            (30,861,939)
                                                                        ------------            ------------
      Total stockholders' equity                                           4,613,939               1,506,241
                                                                        ------------            ------------

Total Liabilities and Stockholders' Equity                              $  6,609,135            $  5,174,099
                                                                        ============            ============

                     See accompanying notes to the condensed consolidated financial statements.

                                                           1
<PAGE>


                                          STARTECH ENVIRONMENTAL CORPORATION
                                   Condensed Consolidated Statements of Operations
                                                    (Unaudited)


                                                                    Three Months Ended                 Six Months Ended
                                                                       April 30,                          April 30,
                                                            ------------------------------------------------------------------
                                                                2007              2006              2007              2006
                                                                ----              ----              ----              ----

Revenue                                                     $    191,976      $    111,464      $    257,952      $    475,662

Cost of sales                                                     36,503            82,638            87,760           135,741
                                                            ------------      ------------      ------------      ------------

Gross profit                                                     155,473            28,826           170,192           339,921
                                                            ------------      ------------      ------------      ------------

Operating expenses:
Selling expenses                                                 144,765           161,629           309,583           358,698
Research and development expenses                                 84,980            84,980           170,505           163,202
General and administrative expenses                              860,880           801,037         1,398,790         1,680,179
Depreciation and amortization expenses                            45,131            48,723            90,503            96,492
                                                            ------------      ------------      ------------      ------------
Total operating expenses                                       1,135,756         1,096,369         1,969,381         2,298,571
                                                            ------------      ------------      ------------      ------------

Loss from operations                                            (980,283)       (1,067,543)       (1,799,189)       (1,958,650)
                                                            ------------      ------------      ------------      ------------

Other income (expense):
  Interest income                                                 11,389            20,394            26,137            36,130
  Interest expense                                                  --             (56,507)          (16,045)         (114,484)
  Amortization of deferred financing costs                       (10,187)         (131,177)          (13,783)         (203,066)
  Amortization of deferred debt discount                         (72,131)         (966,409)         (101,858)       (1,509,157)
  Change in values of warrants and conversion option                --          (2,406,597)         (107,826)       (1,350,107)
  Other income (expense)                                          25,994           (10,301)          118,250            41,732
                                                            ------------      ------------      ------------      ------------
     Total other income (expense)                                (44,935)       (3,550,597)          (95,125)       (3,098,952)
                                                            ------------      ------------      ------------      ------------

Net loss before income taxes                                  (1,025,218)       (4,618,140)       (1,894,314)       (5,057,602)

Income tax expense                                                 1,167             2,675             4,768             2,675
                                                            ------------      ------------      ------------      ------------

Net loss                                                    ($ 1,026,985)     ($ 4,620,815)     ($ 1,899,082)     ($ 5,060,277)
                                                            ============      ============      ============      ============

Per share data:
Net loss per share-basic and diluted                        ($      0.05)     ($      0.25)     ($      0.09)     ($      0.27)
                                                            ============      ============      ============      ============
Weighted average common shares outstanding-basic
     and diluted                                              21,378,226        18,823,028        21,043,862        18,736,083
                                                            ============      ============      ============      ============

                              See accompanying notes to the condensed consolidated financial statements.

                                                                 2

<PAGE>


                                                 STARTECH ENVIRONMENTAL CORPORATION
                                         Condensed Consolidated Statements of Cash Flows
                                                          (Unaudited)

                                                                                         Six Months Ended
                                                                                             April 30,
                                                                               -------------------------------------

                                                                                  2007                      2006
                                                                               -----------              ------------

Cash flows from operating activities:
   Net loss                                                                    $(1,899,082)             $(5,060,277)
   Adjustments to reconcile net loss to net cash used in
    operating activities:
     Stock based compensation                                                      211,280                  430,187
     Non-cash consulting expenses                                                   73,250                     --
     401(k) match through issuance of common stock                                  32,415                   36,484
     Depreciation and amortization                                                  90,503                   96,492
     Amortization of deferred financing costs                                       13,783                  203,066
     Amortization of deferred lease costs                                           98,625                     --
     Amortization of deferred debt discount                                        101,858                1,509,157
     Change in values of warrants and conversion option                            107,826                1,350,107
Changes in operating assets and liabilities:
     Accounts receivable                                                           (41,000)                  16,918
     Prepaid expense and other current assets                                          507                   35,501
     Inventory                                                                      12,630                     --
     Other assets                                                                     (107)                    --
     Accounts payable                                                             (114,425)                  11,750
     Customer deposits and deferred revenue                                       (131,952)                 268,948
     Accrued expenses                                                              (12,104)                 (73,292)
                                                                               -----------              -----------
Net cash used in operating activities                                           (1,455,993)              (1,174,959)
                                                                               -----------              -----------

Cash flows used in investing activities:
     Purchase of equipment                                                        (110,154)                 (99,603)
                                                                               -----------              -----------
Net cash used in investing activities                                             (110,154)                 (99,603)
                                                                               -----------              -----------

Cash flows from financing activities:
     Proceeds from exercises of options, warrants and
          common stock issuances                                                 3,159,202                  225,598
         Repayments of convertible debentures                                     (191,857)                (243,214)
         Repayment of capital lease payable                                           --                       (242)
                                                                               -----------              -----------
Net cash provided by (used in) financing activities                              2,967,345                  (17,858)
                                                                               -----------              -----------

Net increase (decrease) in cash and cash equivalents                             1,401,198               (1,292,420)

Cash and cash equivalents, beginning of period                                   2,279,914                2,489,529
                                                                               -----------              -----------

Cash and cash equivalents, end of period                                       $ 3,681,112              $ 1,197,109
                                                                               ===========              ===========


                  See accompanying notes to the condensed consolidated financial statements.

                                                      3
</TABLE>


<PAGE>


STARTECH ENVIRONMENTAL CORPORATION
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1 - Basis of Presentation and Management's Liquidity Plans.
----------------------------------------------------------------

Basis of Presentation

     The accompanying unaudited condensed consolidated financial statements of
Startech Environmental Corporation (the "Company" or "Startech") have been
prepared in accordance with accounting principles generally accepted in the
United States of America ("GAAP") for interim financial information. In the
opinion of management, such statements include all adjustments (consisting only
of normal recurring adjustments) necessary for the fair presentation of the
Company's financial position, results of operations and cash flows at the dates
and for the periods indicated. Pursuant to the requirements of the Securities
and Exchange Commission (the "SEC") applicable to quarterly reports on Form
10-Q, the accompanying financial statements do not include all the disclosures
required by GAAP for annual financial statements. While the Company believes
that the disclosures presented are adequate to make the information not
misleading, these unaudited interim condensed financial statements should be
read in conjunction with the consolidated financial statements and related notes
included in the Company's Annual Report on Form 10-K for the year ended October
31, 2006. Operating results for the three and six months ended April 30, 2007
are not necessarily indicative of the results that may be expected for the
fiscal year ending October 31, 2007, or any other interim period.

     The accompanying condensed consolidated financial statements have been
prepared in conformity with accounting principles generally accepted in the
United States of America, which contemplate continuation of the Company as a
going concern and the realization of assets and the satisfaction of liabilities
in the normal course of business. The carrying amounts of assets and liabilities
presented in the financial statements do not purport to represent realizable or
settlement values. The Company has no significant recurring revenues, has
suffered significant recurring operating losses and needs to raise additional
capital in order to be able to accomplish its business plan objectives. These
conditions raise substantial doubt about the Company's ability to continue as a
going concern.

Management's Liquidity Plans

     The Company has historically satisfied its capital needs primarily from the
sale of equity securities. On September 16, 2005, the Company entered into a
Securities Purchase Agreement (the "Purchase Agreement") with Cornell Capital
Partners, L.P. and its affiliates ("Cornell"). The Purchase Agreement provides
for Cornell to purchase up to $2,300,000 of Secured Convertible Debentures (the
"Debentures") maturing on October 18, 2007 (as amended). This entire amount was
funded during September and October 2005. On April 22, 2006, Cornell converted
$1,000,000 of the Debentures into 543,478 shares of common stock. From March
2006 through January 31, 2007, the Company has made principal payments of
approximately $808,000 towards the Debentures. On February 12, 2007, Cornell
converted $499,263 of the Debentures into 271,339 shares of common stock and as
of February 15, 2007, the Debentures have been paid in full.

     During the six months ended April 30, 2007, the Company received net cash
proceeds of approximately $3,159,000 from investors for the sale of 1,381,149
shares of common stock pursuant to various private placement transactions.
Subsequent to April 30, 2007, the Company received net cash proceeds of
approximately $1,700,000 from an investor for the sale of 700,000 shares of
common stock pursuant to a private placement transaction. In addition,
subsequent to April 30, 2007, the Company received a cash deposit of $1,950,000
in connection with a Sales Agreement.

     On April 11, 2007, the Company entered into a Standby Equity Distribution
Agreement ("2007 SEDA") with Cornell. Pursuant to the 2007 SEDA, the Company
may, at its discretion, periodically sell to Cornell shares of common stock for
a total purchase price of up to $10 million. The 2007 SEDA will be available to
the Company upon filing an effective registration statement.


                                       4
<PAGE>


     Management of the Company is continuing its efforts to secure additional
funds through equity and/or debt instruments. If the Company is unable to raise
sufficient additional funds, it will have to develop and implement a plan to
extend payables and reduce overhead until sufficient additional capital is
raised to support further operations. There can be no assurance that such a plan
will be successful. These condensed consolidated financial statements do not
include any adjustments that might result from the outcome of this uncertainty.

Note 2 - Stock-Based Compensation.
----------------------------------

Effective November 1, 2005, the Company adopted the fair value recognition
provisions of SFAS 123R, using the modified prospective transition method and,
therefore, did not restate prior periods' results. Stock-based compensation
expense for all share-based payment awards granted after November 1, 2005 is
based on the grant-date fair value estimated in accordance with the provisions
of SFAS 123R. The Company recognizes these compensation costs over the requisite
service period of the award, which is generally the option vesting term. For the
six months ended April 30, 2007 and 2006 the Company incurred stock-based
compensation expense of $211,280 and $430,187, respectively.

The fair value of share-based payment awards was estimated using the
Black-Scholes option pricing model with the following assumptions and weighted
average fair values as follows:

                                                         Six months ended
                                                             April 30
                                                     -------------------------
                                                       2007             2006
                                                     -----------       --------
           Risk-free interest rate range             4.78%- 5.00%      4.31%
           Dividend yield                                 -              -
           Expected volatility                           76%             81%
           Expected life in years                        4.5              6

A summary of option activity for the six months ended April 30, 2007 is as
follows:

<TABLE>
<CAPTION>
                                                                              Weighted-
                                                              Weighted-        Average
                                                              Average         Remaining          Aggregate
                                                              Exercise       Contractual          Intrinsic
           Options                           Shares             Price            Term              Value
-----------------------------------------------------------------------------------------------------------
<S>                     <C>                <C>                  <C>          <C>
Outstanding at November 1, 2006            1,820,500            $4.62        4.55 years
-----------------------------------------------------------------------------------------------------------
Expired                                     (14,000)            $2.35                 -
-----------------------------------------------------------------------------------------------------------
Outstanding at April 30, 2007              1,806,500            $4.92        4.50 years           $159,366
-----------------------------------------------------------------------------------------------------------
Exercisable at April 30, 2007              1,806,500            $4.92        4.50 years           $159,366
-----------------------------------------------------------------------------------------------------------
</TABLE>

     As of April 30, 2007 the total unrecognized compensation costs on
non-vested options is $19,677. Such amounts are expected to be amortized during
the three months ended July 31, 2007.


Net Loss per Share of Common Stock
Basic net loss per share excludes dilution for potentially dilutive securities
and is computed by dividing net loss attributable to common shareholders by the
weighted average number of common shares outstanding during the period. Diluted
loss per share reflects the potential dilution that could occur if securities or

                                       5

<PAGE>


other instruments to issue common stock were exercised or converted into common
stock. Aggregate potentially dilutive securities realizable from the exercise of
options, warrants and convertible notes of 8,804,240 and 4,465,039 at April 30,
2007 and 2006, respectively, are excluded from the computation of diluted loss
per share as their inclusion would be anti-dilutive.


Note 3 - Inventories.
---------------------

     Inventories consist of raw materials and are stated at the lower of cost or
market. Cost is determined by the first-in, first-out method.

Inventories consist of the following:

                                                    April 30,       October 31,
                                                      2007            2006
                                                      ----            ----

Raw materials                                       $281,392        $281,392
Work in process                                       44,653          57,283
                                                    --------        --------
                                                    $326,045        $338,675
                                                    ========        ========


Note 4 - Equipment and Leasehold Improvements.
----------------------------------------------

     Equipment and leasehold improvements consist of the following:
<TABLE>
<CAPTION>

                                                Useful Life         April 30,         October 31,
                                                (In years)             2007               2006
                                                ----------             ----               ----

<S>                                                 <C>              <C>                 <C>
Computer equipment                                  3-5              $249,106            $238,779
Equipment                                          7-15             2,212,422           2,170,797
Furniture and fixtures                              3-7               159,854             144,383
Leasehold improvements                              4-7               109,993             109,993
Other                                               4-7                31,229              23,625
                                                                       ------              ------
                                                                    2,762,604           2,687,577
Less: accumulated depreciation                                    (1,272,024)         (1,181,521)
                                                                  -----------         -----------
                                                                    1,490,580           1,506,056
Construction in progress                                              593,525             558,398
                                                                      -------             -------
Total equipment and leasehold improvements                         $2,084,105          $2,064,454
                                                                   ==========          ==========
</TABLE>

     Construction in progress includes the costs of constructing the Company's
proprietary ceramic filtration system. Costs may include materials, labor,
overhead and permits. When construction is completed, the asset will be
reclassified as equipment and will be amortized when placed in service.

     Depreciation expense totaled $45,131 and $48,723 for the three months ended
April 30, 2007 and 2006, respectively. Depreciation expense totaled $90,503 and
$96,492 for the six months ended April 30, 2007 and 2006, respectively.


Note 5 - Convertible Note and Standby Equity Distribution Agreement.
-------------------------------------------------------------------

     On September 15, 2005, the Company entered into a Securities Purchase
Agreement and a Standby Equity Distribution Agreement ("2005 SEDA") with
Cornell. The Securities Purchase Agreement provides for Cornell to purchase up
to $2,300,000 of secured convertible debentures (the "Debentures") which were
funded during the year ended October 31, 2005. The Debentures are convertible by
Cornell at any time at a conversion price of $1.84 per share of common stock.
The Debentures originally matured in September 2006, require monthly interest
payments at a rate of 10% per annum and monthly principal payments commencing
March 2006. On September 5, 2006, the Company received notification from Cornell

                                        6

<PAGE>


stating that the maturity date of the Debentures was changed to October 18,
2007. The Company can prepay the Debentures at any time upon three days written
notice. If the Company's common stock is trading above the conversion price at
the time of the prepayment the Company must pay a 20% premium on the amount of
the prepayment. The Debentures are secured by substantially all of the Company's
assets and shares of common stock as discussed below. In connection with the
issuance of the Debentures, in September 2005, the Company issued to Cornell a
warrant to purchase 650,000 shares of the Company's common stock for a period of
three years with an exercise price per share of $2.53.

     The gross proceeds of the Debentures in the amount of $2,300,000 were
recorded net of a discount of $2,168,995. The debt discount consisted of a
$897,121 value related to the warrants and $1,271,874 value related to the
embedded conversion option. The warrants and the embedded conversion option were
accounted for under EITF 00-19 and EITF 05-4, View A. Due to certain factors and
the liquidated damage provision in the registration rights agreement, the
Company determined that the embedded conversion option and the warrants are
derivative liabilities. Accordingly the warrants and the conversion option are
being marked to market through earnings at the end of each reporting period. The
warrants and conversion option are valued using the Black-Scholes valuation
model. For the six months ended April 30, 2007 and 2006 the Company recorded a
loss of $107,826 and $1,350,107, respectively, which represents the change in
the fair values of the warrants and conversion option. For the three months
ended April 30, 2006, the Company recorded a loss of $2,406,597, which
represents the change in the fair values of the warrants and conversion option.
The debt discount of $2,168,995 is being accreted over the term of the note.
Accordingly, the Company recorded a charge of $72,131 and $966,409 for the three
months ended April 30, 2007 and 2006, respectively, and a charge of $101,858 and
$1,509,157 for the six months ended April 30, 2007 and 2006, respectively.

     On the date of the agreement the Company paid a fee of $230,000 (10% of the
purchase price), structuring fees equal to $30,000 and other fees of $27,554 in
connection with the issuance of the Debentures. These fees were recorded as
deferred financing costs and are being expensed through the maturity date of the
Debentures. Amortization expense for the six months ended April 30, 2007 and
2006 amounted to $13,783 and $71,889, respectively.

     On April 22, 2006, Cornell converted $1,000,000 of the Debentures into
543,478 shares of common stock. From March 2006 through January 31, 2007, the
Company made principal payments aggregating approximately $808,000 towards the
Debentures. In accordance with EITF 00-19, upon these repayments and conversion,
the Company reclassified $1,355,224 ($89,516 during the six months ended April
30, 2007), representing the portion of the derivative liability, to additional
paid-in capital.

     The 2005 SEDA required Cornell, at the Company's option, to purchase, from
time to time, up to an aggregate of $20,000,000 of the Company's common stock
over a two-year period commencing on the effective date of a registration
statement filed with the SEC. The purchase price for each share of common stock
under the Agreement is equal to 96% of the market price as defined. Each request
by the Company is limited to $2,000,000. The Company issued to Cornell 386,956
shares of the Company's common stock valued at $979,000, as a fee for entering
into the 2005 SEDA and issued 4,348 shares valued at $11,000 to the placement
agent. In addition, the Company incurred legal and various other costs of
$239,595 in connection with this transaction.

     The Securities Purchase Agreement and the 2005 SEDA required that the
Company file a registration statement within 30 days of the date of the
agreements and use its best efforts to have the registration statement declared
effective by the SEC within 120 days of the date of the agreement (extended to
April 15, 2006). In the event the registration statement was not filed or
declared effective within the prescribed time periods, the Company would be
required to pay liquidated damages as defined under the agreement. This
registration statement was not declared effective by the SEC. Accordingly, the
2005 SEDA was not activated and was not available for use. The Company was
informed by Cornell that the liquidated damages provision in this agreement
would not be enforced.

     On January 17, 2007, the Company and Cornell agreed to terminate the 2005
SEDA and begin negotiations on a 2005 SEDA with new terms. In addition, Cornell
has agreed to waive any and all liquidated damages that may be payable in
connection with the Registration Rights Agreement. In addition, Cornell agreed
to return approximately 135,000 of the 391,304 shares issued as offering costs
in connection with the 2005 SEDA.

                                       7

<PAGE>


     On January 26, 2007, the Company withdrew the Registration Statement by
filing a Form RW with the SEC. Accordingly, deferred offering costs of $239,595
were written off as of October 31, 2006. In addition, deferred offering costs of
$648,449, representing 251,956 shares of common stock issued to Cornell and
4,348 shares issued to a placement agent, both of which will not be returned to
the Company in connection with the 2005 SEDA termination were charged to
Terminated Offering Costs as of October 31, 2006. On March 1, 2007, 135,434
shares valued at $341,551 were returned to the Company.

     In accordance with EITF 00-19 and EITF 05-4, the Company reclassified the
remaining derivative liabilities in the amount of $843,230 to equity as of
January 17, 2007 due to the termination of the Registration Rights Agreement as
discussed above. In connection with the Securities Purchase Agreement, the
Company and its President agreed to pledge 3,580,000 shares and 900,000 shares,
respectively, to secure payment of all the obligations due under the Debentures.
Such shares are to be held in escrow until all amounts due under the Debentures
are paid in full. The Company issued 900,000 shares of restricted common stock
to its President during the year ended October 31, 2005 in place of the shares
of common stock being pledged pursuant to the Escrow Agreement. On February 12,
2007, Cornell converted $499,263 of the Debentures into 271,339 shares of common
stock and as of February 15, 2007, the Debentures were paid in full. On March 1,
2007, the 3,580,000 pledged shares were returned to the Company and the 900,000
pledged shares were returned to its President.


Note 6 - Stockholders' Equity.
------------------------------

     On November 22, 2005, the Company entered into the SICAV ONE Stock Purchase
Agreement and SICAV TWO Stock Purchase Agreement (collectively, the "Mercatus
Agreements") with Mercatus & Partners, Limited ("Mercatus"). Pursuant to the
Mercatus Agreements, the Company agreed to sell to Mercatus an aggregate of
2,716,900 shares of common stock (the "Mercatus Shares"), no par value per share
("Common Stock"), for an aggregate purchase price of $5,000,000. Mercatus had up
to thirty days from the date of the delivery of the Mercatus Shares to Brown
Brothers Harriman, the custodial bank, to tender the purchase price to the
Company. The Mercatus Shares were placed in escrow in November 2005. The Company
did not receive any proceeds pursuant to the Mercatus Agreements. In November
2006, Mercatus returned 2,716,900 shares of common stock to the Company.

     On March 12, 2007 the Company issued 25,000 shares of common stock to a
consultant valued at $73,250.

     On March 13, 2007, the Company received net proceeds of $500,002 from an
investor for the sale of 208,334 shares of common stock, the issuance of 208,334
warrants exercisable at $3.40 per share and 208,334 warrants exercisable at
$4.40 per share. In addition, the Company granted 20,834 shares of common stock,
warrants to purchase 20,834 shares of common stock at an exercise price of $3.40
and warrants to purchase 20,834 shares of common stock at an exercise price of
$4.40 to a placement agent in connection with this transaction.

     On March 16, 2007, the Company received net proceeds of $259,200 from an
investor for the sale of 108,000 shares of common stock. The Company also issued
warrants to purchase 108,000 shares of common stock at an exercise price of
$3.40 and warrants to purchase 108,000 shares of common stock at an exercise
price of $4.40. In addition, the Company granted 12,000 shares of common stock,
warrants to purchase 12,000 shares of common stock at an exercise price of $3.40
and warrants to purchase 12,000 shares of common stock at an exercise price of
$4.40 to a placement agent in connection with this transaction.

     On March 22, 2007, the Company received net proceeds of $555,555 from an
investor for the sale of 231,482 shares of common stock. The Company also issued
warrants to purchase 231,482 shares of common stock at an exercise price of
$3.40 and warrants to purchase 231,482 shares of common stock at an exercise
price of $4.40. In addition, the Company paid a commission in the amount of
$55,555 in cash proceeds as a finder's fee to a placement agent.

     On April 11, 2007, the Company entered into a Securities Purchase Agreement
with Cornell. The Company issued and sold to Cornell 833,333 shares of common
stock at a price per share of $2.40, for an aggregate purchase price of

                                       8

<PAGE>


$2,000,000. In connection with the issuance of the common stock, the Company
issued to Cornell a Class A warrant and a Class B warrant, each warrant
entitling Cornell to purchase 833,333 shares of the Company's common stock at an
exercise price per share of $3.40 and $4.40 respectively. The warrants expire on
April 11, 2011. The Company also entered into a Registration Rights Agreement in
connection with this private placement to register for resale the shares of
common stock issued to Cornell and the shares of common stock issuable upon
exercise of the warrants. Pursuant to the Registration Rights Agreement, the
Company is obligated to file a registration statement within 45 days of the
closing and obtain effectiveness no later than 120 days following the closing
(or 150 days if the registration statement receives a "full review" by the
Securities and Exchange Commission) and maintain its effectiveness until all the
shares may be sold without any volume limitations pursuant to Rule 144(k) under
the Securities Act of 1933. In the event the Company does not file the
registration statement or obtain its effectiveness within the time periods
described above, and if certain other events occur, the Company will be subject
to liquidated damages in an amount in cash equal to one percent of the purchase
price paid by Cornell for the shares of common stock issued pursuant to the
Purchase Agreement up to a maximum of twelve percent, or $240,000. In connection
with the Purchase Agreement, the Company paid an origination fee to Cornell in
the form of 41,666 shares of common stock at a price per share of $2.40 and a
cash payment of $95,000.

     On April 11, 2007, the Company entered into a Standby Equity Distribution
Agreement ("2007 SEDA") with Cornell. Pursuant to the 2007 SEDA, the Company
may, at its discretion, periodically sell to Cornell shares of common stock for
a total purchase price of up to $10 million. For each share of common stock
purchased under the 2007 SEDA, Cornell will pay the Company 96% of the lowest
closing bid price of the Company's common stock for the five trading days
immediately following the notice date. Cornell will also retain 5% of the amount
of each advance under the 2007 SEDA. Cornell's obligation to purchase shares of
the Company's common stock under the 2007 SEDA is subject to certain conditions
and limitations, including the Company obtaining an effective registration
statement for shares of the Company's common stock sold under the 2007 SEDA. The
Company incurred a placement agent fee of $5,000 under the Placement Agent
Agreement relating to the 2007 SEDA. The 2007 SEDA will be available to the
Company upon filing an effective registration statemnt.


Note 7 - Operating Leases.
--------------------------

     The Company leases office space, equipment, computers and vehicles under
non-cancelable operating leases through 2009.

     The Company's corporate headquarters is currently located at 88 Danbury
Road, Wilton, Connecticut 06897-2525 where the Company leases 5,612 square feet
of office space from Furst Properties, LLC as landlord. The lease, electrical,
and taxes provides for monthly payments of $12,159 to December 2008, when the
lease expires; however, the Company has the option to extend it for another
three years at the same price. On December 11, 2006, in connection with the
lease agreement, the Company issued a warrant to the landlord to purchase
2,000,000 shares of common stock at an exercise price of $3.00 per share, valued
at approximately $473,000, which will be amortized over the life of the lease.
These warrants will expire on March 11, 2011. During the six months ended April
30, 2007, the Company incurred a charge to operations in the amount of
approximately $99,000 relating to these warrants.

     The Company's product showroom is located at 190 Century Drive, Bristol,
Connecticut, 06010, where the Company leases 10,800 square feet of office space
from Tunxis Management as landlord. The current lease provides for monthly
payments of $8,166 to June 2008, when the lease expires.

     The Company's manufacturing facility is located at 545 Broad Street,
Bristol, Connecticut, 06010, where the Company leases 30,000 square feet of
manufacturing space from Gaski Leasing as landlord. The lease provides for
monthly payments of $5,775 and expires on December 31, 2007. This lease
arrangement is on a month to month basis.

     The following table shows the Company's future lease commitments under its
operating leases:

         Year                      Annual Rent
         ----                      -----------

         2007                      $ 197,972
         2008                        194,904
         2009                        145,908
                                   ---------
         Total                     $ 538,784
                                   =========

                                       9

<PAGE>


Note 8 - Commitments.
---------------------

DOE Grant

     The Company received a grant from the Department of Energy ("DOE") for the
development of a Startech Hydrogen Production Project which includes the
evaluation of the viability of integrated hydrogen production from waste
materials. This program consists of two test phases which evaluate the potential
hydrogen yield and volume which can be obtained from Plasma Converter gas (PCG).
Phase I was initiated in October 2004 and was completed by September 2005. Phase
II was initiated in October 2005 and is planned to be completed during the 3rd
quarter of 2007. During this phase, Startech has incorporated equipment
enhancements and is currently finalizing the final test report providing
technical test results to DOE. The grant is a reimbursement of expenses incurred
in connection with the project and is recorded as other income in the statement
of operations when received. For the six and three months ended April 30, 2007,
the Company received $134,818 and $62,762 under this grant, respectively.

Concentration of Credit Risk

The Company's cash and cash equivalents consist of cash balances at one
financial institution and short-term high quality liquid investments with
maturities of less than thirty days. The short-term investments are high quality
commercial paper, U.S. Treasury notes and U.S. Treasury bills. The cash balances
are insured by the Federal Deposit Insurance Corporation up to $100,000. From
time to time, the Company's balances may exceed these limits. At April 30, 2007,
uninsured cash balances were approximately $3,215,000. The Company believes it
is not exposed to any significant credit risk for cash.


Note 9 - Employee Benefit Plan.
-------------------------------

     The Company sponsors an employee savings plan designed to qualify under
Section 401(k) of the Internal Revenue Code. This plan is for all full-time
employees who have completed 30 days of service. Company contributions are made
in the form of common stock at the prevailing current market price and vest
equally over a three-year period. The Company will match the first six percent
of the employee contribution on a dollar for dollar basis up to the maximum
contribution allowed under Internal Revenue Code. Contributions for the six
months ended April 30, 2007 and 2006 were $32,415, and $36,484, respectively.
These contributions were paid through the issuance of 11,899 and 14,486 shares
of common stock, respectively. Contributions for the three months ended April
30, 2007 and 2006 were $17,064, and $20,126, respectively. These contributions
were paid through the issuance of 5,922 and 5,688 shares of common stock,
respectively.


Note 10 - Recent Accounting Pronouncements.
-------------------------------------------

     In February 2007, the FASB issued Statement of Financial Accounting
Standards No. 159, The Fair Value Option for Financial Assets and Financial
Liabilities ("SFAS 159"), to permit all entities to choose to elect, at
specified election dates, to measure eligible financial instruments at fair
value. An entity shall report unrealized gains and losses on items for which the
fair value option has been elected in earnings at each subsequent reporting
date, and recognize upfront costs and fees related to those items in earnings as
incurred and not deferred. SFAS 159 applies to fiscal years beginning after
November 15, 2007, with early adoption permitted for an entity that has also
elected to apply the provisions of SFAS 157, Fair Value Measurements. An entity
is prohibited from retrospectively applying SFAS 159, unless it chooses early
adoption. SFAS 159 also applies to eligible items existing at November 15, 2007
(or early adoption date). The Company is currently evaluating the impact of
adopting SFAS 159 on its financial statements and is currently not yet in a
position to determine such effects.

     In December 2006, the FASB issued FASB Staff Position EITF 00-19-2
"Accounting for Registration Payment Arrangements" ("FSP EITF 00-19-2") which
specifies that the contingent obligation to make future payments or otherwise
transfer consideration under a registration payment arrangement should be
separately recognized and measured in accordance with FASB Statement No. 5,
"Accounting for Contingencies." Adoption of FSP EITF 00-19-02 is required for
fiscal years beginning after December 15, 2006. The adoption of this

                                       10

<PAGE>


pronouncement did not have a material impact on the Company's consolidated
financial position, results of operations or cash flows.

     In November 2006, the EITF reached a final consensus in EITF Issue 06-6
"Debtor's Accounting for a Modification (or Exchange) of Convertible Debt
Instruments" ("EITF 06-6"). EITF 06-6 addresses the modification of a
convertible debt instrument that changes the fair value of an embedded
conversion option and the subsequent recognition of interest expense for the
associated debt instrument when the modification does not result in a debt
extinguishment pursuant to EITF 96-19, "Debtor's Accounting for a Modification
or Exchange of Debt Instruments,". The consensus should be applied to
modifications or exchanges of debt instruments occurring in interim or annual
periods beginning after November 29, 2006. The adoption of this pronouncement
did not have a material impact on the Company's consolidated financial position,
results of operations or cash flows.

     In November 2006, the FASB ratified EITF Issue No. 06-7, Issuer's
Accounting for a Previously Bifurcated Conversion Option in a Convertible Debt
Instrument When the Conversion Option No Longer Meets the Bifurcation Criteria
in FASB Statement No. 133, Accounting for Derivative Instruments and Hedging
Activities ("EITF 06-7"). At the time of issuance, an embedded conversion option
in a convertible debt instrument may be required to be bifurcated from the debt
instrument and accounted for separately by the issuer as a derivative under FAS
133, based on the application of EITF 00-19. Subsequent to the issuance of the
convertible debt, facts may change and cause the embedded conversion option to
no longer meet the conditions for separate accounting as a derivative
instrument, such as when the bifurcated instrument meets the conditions of Issue
00-19 to be classified in stockholders' equity. Under EITF 06-7, when an
embedded conversion option previously accounted for as a derivative under FAS
133 no longer meets the bifurcation criteria under that standard, an issuer
shall disclose a description of the principal changes causing the embedded
conversion option to no longer require bifurcation under FAS 133 and the amount
of the liability for the conversion option reclassified to stockholders' equity.
EITF 06-7 should be applied to all previously bifurcated conversion options in
convertible debt instruments that no longer meet the bifurcation criteria in FAS
133 in interim or annual periods beginning after December 15, 2006, regardless
of whether the debt instrument was entered into prior or subsequent to the
effective date of EITF 06-7. Earlier application of EITF 06-7 is permitted in
periods for which financial statements have not yet been issued. The adoption of
this pronouncement did not have a material impact on the Company's consolidated
financial position, results of operations or cash flows.


Note 11 - Litigation.
---------------------

     The Company was sued in an action entitled Ann C. Ritson, et al
("Plaintiffs") v. Startech Environmental Corporation and other parties,
CV-06-5005444-S, in the Superior Court, Jurisdiction of Hartford, Connecticut,
commenced in or about July 2006 (the "Primary Action") relating to alleged
misrepresentation in a private placement transaction The Company has denied the
allegations and has asserted certain defenses against the Plaintiffs. At this
time, the Company is unable to evaluate the likelihood of an unfavorable
outcome. In addition, in November 2006, the Company filed a third party
complaint against the private placement agent in the aforementioned matter. The
Company has alleged that if it is adjudged to be liable to the Plaintiffs, they
are entitled to indemnification in whole or in part from the private placement
agent pursuant to a written agreement. This matter is still in the fact
discovery phase. The parties have agreed to mediate the dispute and have
scheduled the mediation in August 2007.


Note 12 - Subsequent Events.
----------------------------

     On May 10, 2007, the Company entered into a Stock Purchase Agreement for
the private placement (the Offering") of the Company's shares of common stock,
pursuant to which the Company issued and sold to the investor 700,000 restricted
shares of Common Stock at $2.40 per share and warrants exercisable into an
aggregate of 1,400,000 restricted shares of Common Stock, for which 700,000 of
such Warrants were issued at an exercise price of $3.40 per share and the other
700,000 of such Warrants were issued at an exercise price of $4.40 per share.
The Warrants are exercisable as of the date of issuance and expire three (3)
years therefrom. The Company granted to the Investor piggyback registration
rights with respect to the shares and the shares of common stock issuable upon
exercise of the warrants.

                                       11
<PAGE>


     On May 10, 2007, the Company entered into a Purchase Agreement with a
customer, whereby the Company agreed to sell three Plasma Converter Systems to
the customer. The Company received a cash deposit of $1,950,000 in connection
with this Agreement. This agreement is subject to certain conditions and
stipulations.


                                       12
<PAGE>



Item 2.  Management's Discussion and Analysis of Financial Condition and
         Results of Operations.

     This quarterly report on Form 10-Q contains a number of "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933, as
amended (the "Securities Act"), and Section 21E of the Securities Exchange Act
of 1934, as amended (the "Exchange Act"). Specifically, all statements other
than statements of historical facts included in this quarterly report regarding
our financial position, business strategy and plans and objectives of management
for future operations are forward-looking statements. These forward-looking
statements are based on the beliefs of management, as well as assumptions made
by and information currently available to management. When used in this
quarterly report, the words "anticipate," "believe," "estimate," "expect,"
"may," "will," "continue" and "intend," and words or phrases of similar import,
as they relate to our financial position, business strategy and plans, or
objectives of management, are intended to identify forward-looking statements.
These statements reflect our current view with respect to future events and are
subject to risks, uncertainties and assumptions related to various factors
including, without limitation, those described below the heading "Overview" and
in our registration statements and periodic reports filed with the SEC under the
Securities Act and the Exchange Act.

     Although we believe that our expectations are reasonable, we cannot assure
you that our expectations will prove to be correct. Should any one or more of
these risks or uncertainties materialize, or should any underlying assumptions
prove incorrect, actual results may vary materially from those described in this
Quarterly Report as anticipated, believed, estimated, expected or intended.

     In this Item 2, references to the "Company," "Startech", "we," or "us"
means Startech Environmental Corporation and its wholly-owned subsidiary.

Overview

     Startech Environmental Corporation is an environmental technology company
commercializing its proprietary plasma processing technology known as the Plasma
Converter(TM) which achieves closed-loop elemental recycling that irreversibly
destroys hazardous and non-hazardous waste and industrial by-products while
converting them into useful commercial products. These products include a rich
synthesis gas called PCG (Plasma Converted Gas)(TM) surplus energy for power,
hydrogen, metals and silicates for use and for sale.

     The Company's activities during the four fiscal years beginning November 1,
1992 and ending October 31, 1995 consisted primarily of the research and
development of the Plasma Converter. On November 17, 1995, Kapalua Acquisitions,
Inc., a Colorado corporation, completed the acquisition of all of the issued and
outstanding shares of the common stock of Startech Corporation, a Connecticut
corporation, and then changed its name to Startech Environmental Corporation.

     On November 18, 1995, the board of directors of the Company unanimously
approved a change of the business purpose of Kapalua Acquisitions Inc. from one
seeking an acquisition candidate to one engaged in the business of manufacturing
and selling the Plasma Converter system to recover, recycle, reduce and
remediate hazardous and non-hazardous waste materials. From that time to the
date of this filing, the Company has maintained this as its principal focus.

     In 2001, recognizing the increasing importance of alternative energy and
power sources in general, and hydrogen in particular, we expanded our product
line to include a StarCell (TM) hydrogen separation technology. Working in
conjunction with our core product, the Plasma Converter(TM), StarCell(TM) will
provide a green and renewable source of hydrogen for power and processing
applications. In 2003, this brought significant change and, due to the factors
mentioned above, as well as the rising comfort level with plasma based
technologies through our educational and informational effort, we are now being
greeted by a much more receptive marketplace. This change was dictated by the
needs of our customers and the demands of the marketplace. This began in January
2002 and continues to be integrated.


                                       13
<PAGE>


     Startech is an environmental technology corporation that manufactures,
markets and sells a recycling system called the Plasma Converter for the global
marketplace. Until January 2002, we were solely engaged in the manufacture and
sale of equipment for use by others. Thereafter, we have attempted to broaden
the scope of our available revenue opportunities. This change was brought about
by management's decision to expand its market penetration strategies and
opportunities. Rather than only market and sell our products for use by others,
we are now seeking opportunities to become directly involved in the operation
and use of our products. We reconsidered our stated philosophy of not engaging
in the processing of feedstock materials and/or waste and decided that it was
timely to seek out and include all possible market penetration strategies,
including build own operate, build own transfer of ownership, and joint
development projects.

     By concentrating on re-positioning the Company for long-term growth, we did
not achieve the sales goals we had anticipated would occur in the 2003, 2004,
2005 and 2006 fiscal years. However, we believe this new way of approaching the
market over time will help achieve maximum penetration in the shortest
timeframe.

     We believe specific events are driving demand for our Plasma Converter.
They include:

     o    Increases in waste, and in particular hazardous waste, due to rising
          consumer/industrial consumption and population growth in most nations;

     o    Current waste disposal and remediation techniques such as landfills
          and incineration becoming regulatorily, socially and environmentally
          unacceptable;

     o    A need for critical resources such as power and water to sustain local
          economies; and

     o    Emphasis being placed upon the production of distributed power and the
          need to provide alternatives to fossil fuels.

     Our core plasma technology addresses these waste and resource issues by
offering remediation solutions that are integrated with a range of equipment
solutions and services. We believe these products will add value to our
customers' business so they can realize revenue streams from disposal or
processing fees and a reduction in material disposal costs, as well as from the
sale of resulting commodity products and services. Alternatively, this will
allow our customers to generate a valuable product while at the same time using
a zero cost basis, or revenue generating source of raw material (waste). The
costs of hazardous waste treatment and disposal methods continue to rise, and
now range from approximately $900 to more than $2,000 per ton. This does not
include the additional processing, handling, packaging, insurance and management
costs sustained by the hazardous waste generator within its facility prior to
final disposal.

     Since 1995, we have been actively educating and promoting to our customers
the benefits of the plasma converter over other forms of waste remediation
technologies. Ongoing education of the public and government is continuing. Like
most new technologies, we have been met with varying degrees of resistance. A
rising comfort level with our plasma converter technology, resulting in part
from our educational and informational efforts, has created additional awareness
in the marketplace. We have taken steps to transform our business model from
being solely a seller of equipment to a total solutions provider, including
facility ownership or management. Our business model and its market development
strategies arise from our mission, which is to change the way the world views
and employs discarded materials; what many would now call waste we view as a
feedstock. We expect to achieve this objective by strategically marketing a
series of products and services emanating from the core Plasma Converter (TM)
technology, resulting in saleable fossil fuel alternatives while providing a
safer and healthier environment. This strategy will be implemented through
Plasma Converter sales with after sales support and service, build own
operate/build own transfer of ownership facilities, joint development projects
and engineering services.

     For the six months ended April 30, 2007, the Company incurred a net loss of
$1,899,082, compared to a net loss of $5,060,277 for same period in 2006.


                                       14

<PAGE>


Results of Operations

Comparison of three months ended April 30, 2007 and 2006

     Revenues. Total revenues were $191,976 for the three months ended April 30,
2007, as compared to $111,464 for the same period in 2006, an increase of
$80,512. For the three months ended April 30 2007, our revenue was generated
from the amortization of portions of the distributorship agreements.
Additionally revenues were derived from the completed installation in Mihama.
For the three months ended April 30, 2006, the Company recognized approximately
$66,000 as revenue from the amortization of the distributorship agreements.
These distributorship agreements were signed with Plasteck Solutions Limited,
representing Australia and New Zealand, Plasmatech Caribbean Corporation
representing Puerto Rico and Materiales Renovados, Sl representing Spain. The
balance of revenues were derived from the overhaul project in Mihama during the
three months ended April 30, 2006.

     Gross Profit. Gross profit was $155,473 for the three months ended April
30, 2007, compared to a gross profit of $28,826 in the same period in 2006, or
an increase of $126,647 from the same period in 2006. Gross margins were
directly impacted due to the revenue recognized from distributorship agreements
and the overhaul project in Mihama during the three months ended April 30, 2007.

     Selling Expenses. Selling expenses for the three months ended April 30,
2007 were $144,765, compared to $161,629 for the same period in the prior year,
an increase of $16,864. Selling expenses decreased as a result of lower
marketing expenses.

     Research and Development Expenses. Research and development expenses for
the three months ended April 30, 2007 and the three months ended April 30, 2006
were $84,981.

     General and Administrative Expenses. General and administrative expenses
for the three months ended April 30, 2007 were $860,880, compared to $801,037
for the same period in 2006, an increase of $59,843. This increase was related
to consultant expense in 2007.

     Other Expense. Other expense for the three months ended April 30, 2007 was
$44,935 compared to $3,550,197, for the same period in 2006, decrease of
$3,505,262. This decrease is mainly attributable to the Cornell transaction
where amortization of deferred debt discount decreased $894,278 and the impact
of the change in value of warrants and conversion options decreased $2,406,597.

     Interest Income. Interest income for the three months ended April 30, 2007
was $11,389, compared to $20,394.

Comparison of six months ended April 30, 2007 and 2006

     Revenues. Total revenues were $257,952 for the six months ended April 30,
2007, as compared to $475,662 for the same period in 2006, a decrease of
$217,710. For the six months ended April 30, 2007, our revenue was generated
from two sources. The amortization of portions of distributorship agreements
with Plasteck Solutions Limited, representing Australia and New Zealand,
Plasmatech Caribbean Corporation representing Puerto Rico and Materiales
Renovados, Sl representing Spain, and the ongoing installation in Mihama. For
the six months ended April 30, 2007, the Company recognized approximately
$131,952 as revenue from the amortization of the distributorship agreements. The
balance of revenues were derived from the overhaul project in Mihama during the
six months ended April 30, 2007.

     Gross Profit. Gross profit was $170,192 for the six months ended April 30,
2007, compared to gross profit of $339,921 in the same period in 2006, a
decrease of $169,729. Gross margins were directly impacted due to the revenue
recognized from the overhaul project in Mihama during the six months ended April
30, 2006.

     Selling Expenses. Selling expenses for the six months ended April 30, 2007
were $309,583, compared to $358,698 for the same period in the prior year, an
increase of $49,115. Selling expenses decreased as a result of lower marketing
expenses.

                                       15
<PAGE>


     Research and Development Expenses. Research and development expenses for
the six months ended April 30, 2007 were $170,505, compared to $163,202 for the
same period in the prior year, a increase of $7,303. This increase was related
to an increase in salary expenses.

     General and Administrative Expenses. General and administrative expenses
for the six months ended April 30, 2007 were $1,398,790 compared to $1,680,179
for the same period in 2006, a decrease of $281,389. This decrease was related
to lower stock based compensation, lower stockholders relations, lower rent
expense, and lower insurance expense in 2007.

     Interest Income. Interest income for the six months ended April 30, 2007
was $26,137, compared to $36,130 in the same period in 2006, a decrease of
$9,993.

     Other Expense. Other expense for the six months ended April 30, 2007 was
$95,125 compared to $3,098,952 for the same period in 2006, a decrease of
$3,003,827. This decrease is mainly attributable to the Cornell transaction
where amortization of deferred debt discount decreased $1,407,299 and the impact
of the change in value of the warrants and conversion options decreased
$1,242,281.

Liquidity and Capital Resources

     As of April 30, 2007, we had cash and cash equivalents of $3,681,112 and
working capital of $2,440,461.

     The Company has historically satisfied its capital needs primarily from the
sale of equity securities. On September 16, 2005, the Company entered into a
Securities Purchase Agreement (the "Purchase Agreement") with Cornell Capital
Partners, L.P. and its affiliates ("Cornell"). The Purchase Agreement provides
for Cornell to purchase up to $2,300,000 of Secured Convertible Debentures (the
"Debentures") maturing on October 18, 2007 (as amended). This entire amount was
funded during September and October 2005. On April 22, 2006, Cornell converted
$1,000,000 of the Debentures into 543,478 shares of common stock. From March
2006 through January 31, 2007, the Company has made principal payments of
approximately $808,000 towards the Debentures. On February 12, 2007, Cornell
converted $499,263 of the Debentures into 271,339 shares of common stock and as
of February 15, 2007, the Debentures have been paid in full.

     During the six months ended April 30, 2007, the Company received net cash
proceeds of approximately $3,159,000 from investors for the sale of 1,381,149
shares of common stock pursuant to various private placement transactions.
Subsequent to April 30, 2007, the Company received net cash proceeds of
approximately $1,700,000 from an investor for the sale of 700,000 shares of
common stock pursuant to a private placement transaction. In addition,
subsequent to April 30, 2007, the Company received a cash deposit of $1,950,000
in connection with a Sales Agreement.

     On April 11, 2007, the Company entered into a Standby Equity Distribution
Agreement ("2007 SEDA") with Cornell. Pursuant to the 2007 SEDA, the Company
may, at its discretion, periodically sell to Cornell shares of common stock for
a total purchase price of up to $10 million. The 2007 SEDA has not yet been
activated and is not available for funding.

     Management of the Company is continuing its efforts to secure additional
funds through equity and/or debt instruments. If the Company is unable to raise
sufficient additional funds, it will have to develop and implement a plan to
extend payables and reduce overhead until sufficient additional capital is
raised to support further operations. There can be no assurance that such a plan
will be successful. These condensed consolidated financial statements do not
include any adjustments that might result from the outcome of this uncertainty.

     Working capital has historically been provided from private placements,
customer deposits, and the Cornell Debenture. The Company has and will continue
to be dependent upon the deposits and progress payments from the sale of
distributorship agreements and the private sale of securities. It is anticipated
that our capital requirements for future periods will increase and our future
working capital needs will be obtained from the above sources as well as
additional private placements, demonstration and testing programs, joint
development programs, build own and operate facilities, and from cash generated
from the operations of our business.

     The Company believes that continuing operations for the longer term will be
supported primarily through anticipated growth in revenues and, if necessary,
through additional sales of the Company's securities. Management of the Company
is continuing its efforts to secure additional funds through equity and/or debt
instruments. If the Company is unable to raise sufficient additional funds, it

                                       16

<PAGE>


will have to develop and implement a plan to extend payables and reduce overhead
until sufficient additional capital is raised to support further operations.
There can be no assurance that such a plan will be successful. These conditions
raise substantial doubt about the Company's ability to continue as a going
concern. The consolidated financial statements do not include any adjustments
that might result from the outcome of this uncertainty.

Item 3. Qualitative and Quantitative Disclosures About Market Risk.

     The Company is primarily exposed to foreign currency risk, interest rate
risk and credit risk.

     Foreign Currency Risk - We develop products in the United States and market
our products in North America, Japan, Europe, Asia, Africa, the Middle East and
South America as well as other parts of the world. As a result, our financial
results could be affected by factors such as changes in foreign currency
exchange rates or weak economic conditions in foreign markets. Because a
significant portion of our revenues are currently denominated in U.S. dollars, a
strengthening of the dollar could make our products less competitive in foreign
markets.

     Interest Rate Risk - Interest rate risk refers to fluctuations in the value
of a security resulting from changes in the general level of interest rates.
Investments that are classified as cash and cash equivalents have original
maturities of three months or less. Our interest income is sensitive to changes
in the general level of U.S. interest rates, particularly since the majority of
our investments are in short - term instruments. Due to the short-term nature of
our investments, we believe that we do not have a material interest raterisk
exposure.

     Credit Risk - Our accounts receivables are subject, in the normal course of
business, to collection risks. We regularly assess these risks and have
established policies and business practices to protect against the adverse
effects of collection risks. As a result we do not anticipate any material
losses in this area.

Item 4. Controls and Procedures.

Disclosure Controls and Procedures

     The Company maintains controls and procedures designed to ensure that it is
able to collect the information that is required to be disclosed in the reports
filed with the SEC, and to process, summarize and disclose this information
within the time period specified in the rules of the SEC. The Company's Chief
Executive and Chief Financial Officers are responsible for establishing,
maintaining and enhancing these procedures. They are also responsible, as
required by the rules established by the SEC, for the evaluation of the
effectiveness of these procedures.

     Based on their evaluation of the Company's disclosure controls and
procedures which took place as of the end of the period covered by this report,
the Chief Executive Officer and the Chief Financial Officer concluded that these
disclosure controls and procedures were not effective at the "reasonable
assurance" level. These controls ensure that the Company is able to collect,
process and disclose the information required in the reports that the Company
files with the SEC within the required time period.

Internal Controls

     The Company maintains a system of internal controls designed to provide
reasonable assurance that transactions are executed in accordance with
management's general or specific authorization; transactions are recorded as
necessary to (1) permit preparation of financial statements in conformity with
accounting principles generally accepted in the United States of America, and
(2) maintain accountability for assets. Access to assets is permitted only in
accordance with management's general or specific authorization.

     It is the responsibility of the Company's management to establish and
maintain adequate internal control over financial reporting. However, due to its
small size and limited financial resources the Company's Chief Financial
Officer, a member of management, has been the only full time employee
principally involved in accounting and financial reporting. The Board of
Directors has recognized that as a result, there is no formal segregation of

                                       17

<PAGE>


duties within the accounting function, leaving management of all aspects of
financial reporting and physical control of cash and equivalents in the hands of
the CFO. Based on the integrity and trustworthiness of the Company's Chief
Financial Officer, the Board of Directors has had confidence that there have
been no irregularities in the Company's financial reporting or in the protection
of its assets.

     Our independent auditors have reported to our Board of Directors certain
matters involving internal controls that our independent auditors considered to
be reportable conditions and material weaknesses, under standards established by
the Public Company Accounting Oversight Board. The first material weakness
identified relates to our limited segregation of duties. Segregation of duties
within our company is limited due to the small number of employees that are
assigned to positions that involve the processing of financial information.
Although we are aware that segregation of duties within our company is limited,
we believe (based on our current roster of employees and certain control
mechanisms we have in place), that the risks associated with having limited
segregation of duties are currently insignificant. The second material weakness
we identified is in our ability to ensure that the accounting for our debt and
equity-based transactions is accurate and complete. In recent years we have
consummated a series of complex debt and equity transactions involving the
application of highly specialized accounting principles. Although we believe
that these events are unique to our Company, we are evaluating certain
corrective measures we may take including the possibility of hiring an outside
consultant to provide us with the guidance we need at such times that we may
engage in these complex transactions.

     Given these reportable conditions and material weaknesses, management
devoted additional resources to resolving questions that arose during the three
month period ending April 30, 2007. As a result, we are confident that our
financial statements for the three months ended April, 2007 fairly present, in
all material respects, our financial condition and results of operations.
Management does not believe that the above reportable conditions and material
weaknesses affected the results for the three months ended April 30, 2007 or any
prior period.

     There were no significant changes in our internal controls over financial
reporting that occurred during the three months ended April 30, 2007 that have
materially affected, or are reasonably likely to materially affect, our internal
control over financial reporting.


                           PART II - OTHER INFORMATION

Item 1.  Legal Proceedings.

     We were sued in an action entitled Ann C. Ritson, et al ("Plaintiffs") v.
Startech Environmental Corporation and other parties, CV-06-5005444-S, in the
Superior Court, Jurisdiction of Hartford, Connecticut, which commenced on or
about July 2006 relating to alleged misrepresentation in a private placement
transaction. We have denied the allegations and have asserted certain defenses
against the Plaintiffs. At this time, we are unable to evaluate the likelihood
of an unfavorable outcome. In addition, in November 2006, we filed a third party
complaint against the placement agent in the aforementioned matter. We alleged
that if we are adjudged to be liable to the Plaintiffs, we are entitled to
indemnification in whole or in part from the placement agent pursuant to a
written agreement. This matter is still in the fact discovery phase. The parties
have agreed to mediate the dispute and have scheduled the mediation in August
2007.


Item 1A. Risk Factors.

     There have been no material changes to the Company's risk factors as set
forth in its Annual Report on Form 10-K for the fiscal year ended October 31,
2006.


Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds.

     On March 12, 2007 the Company issued 25,000 shares of Common Stock to a
consultant.

                                       18
<PAGE>


     On March 13, 2007, the Company received net proceeds of $500,002 from an
investor for the sale of 208,334 shares of common stock, the issuance of 208,334
warrants exercisable at $3.40 per share and 208,334 warrants exercisable at
$4.40 per share. In addition, the Company granted 20,834 shares of common stock,
warrants to purchase 20,834 shares of common stock at an exercise price of $3.40
and warrants to purchase 20,834 shares of common stock at an exercise price of
$4.40 to a placement agent in connection with this transaction.

     On March 16, 2007, the Company received net proceeds of $259,200 from an
investor for the sale of 108,000 shares of common stock. The Company also issued
warrants to purchase 108,000 shares of common stock at an exercise price of
$3.40 and warrants to purchase 108,000 shares of common stock at an exercise
price of $4.40. In addition, the Company granted 12,000 shares of common stock,
warrants to purchase 12,000 shares of common stock at an exercise price of $3.40
and warrants to purchase 12,000 shares of common stock at an exercise price of
$4.40 to a placement agent in connection with this transaction.

     On March 22, 2007, the Company received net proceeds of $555,555 from an
investor for the sale of 231,482 shares of common stock. The Company also issued
warrants to purchase 231,482 shares of common stock at an exercise price of
$3.40 and warrants to purchase 231,482 shares of common stock at an exercise
price of $4.40. In addition, the Company paid a commission in the amount of
$55,555 in cash proceeds as a finders fee to a placement agent.

     On April 2, 2007, the Company issued 5,922 shares of common stock to its
401(k) plan as a matching contribution.

     On April 11, 2007, we entered into a Securities Purchase Agreement with
Cornell. We issued and sold to Cornell 833,333 shares of common stock at a price
per share of $2.40, for an aggregate purchase price of $2,000,000. In connection
with the issuance of the common stock, we issued to Cornell a Class A warrant
and a Class B warrant, each warrant entitling Cornell to purchase 833,333 shares
of our common stock at an exercise price per share of $3.40 and $4.40
respectively. The warrants expire on April 11, 2011. We also entered into a
Registration Rights Agreement in connection with this private placement to
register for resale the shares of common stock issued to Cornell and the shares
of common stock issuable upon exercise of the warrants. Pursuant to the
Registration Rights Agreement, we are obligated to file a registration statement
within 45 days of the closing and obtain effectiveness no later than 120 days
following the closing (or 150 days if the registration statement receives a
"full review" by the Securities and Exchange Commission) and maintain its
effectiveness until all the shares may be sold without any volume limitations
pursuant to Rule 144(k) under the Securities Act of 1933. In the event we do not
file the registration statement or obtain its effectiveness within the time
periods described above, and if certain other events occur, we will be subject
to liquidated damages in an amount in cash equal to one percent of the purchase
price paid by Cornell for the shares of common stock issued pursuant to the
Purchase Agreement up to a maximum of twelve percent. In connection with the
Securities Purchase Agreement, we paid an origination fee to Cornell, which
origination fee was paid in the form of 41,666 shares of common stock at a price
per share of $2.40 and a cash payment of $95,000.

     On April 11, 2007, we entered into a Standby Equity Distribution Agreement
("2007 SEDA") with Cornell. Pursuant to the 2007 SEDA, we may, at its
discretion, periodically sell to Cornell shares of common stock for a total
purchase price of up to $10 million. For each share of common stock purchased
under the 2007 SEDA, Cornell will pay us 96% of the lowest closing bid price of
our common stock for the five trading days immediately following the notice
date. Cornell will also retain 5% of the amount of each advance under the 2007
SEDA. Cornell's obligation to purchase shares of our common stock under the 2007
SEDA is subject to certain conditions and limitations, including the Company
obtaining an effective registration statement for shares of our common stock
sold under the 2007 SEDA. We incurred a placement agent fee of $5,000 under the
Placement Agent Agreement relating to the 2007 SEDA. The 2007 SEDA has not yet
been activated and is not available for funding.

     On May 10, 2007, the Company entered into a Stock Purchase Agreement with
Francisco J. Rivera Fernandez ("Investor") for the private placement of our
common stock, pursuant to which the Company issued and sold to the investor
700,000 restricted shares of Common Stock and warrants exercisable into an
aggregate of 1,400,000 restricted shares of Common Stock, for which 700,000 of
such warrants were issued at an exercise price of $3.40 per share and the other
700,000 of such warrants were issued at an exercise price of $4.40 per share.
The warrants are exercisable as of the date of issuance and expire three (3)
years therefrom. We granted the Investor piggyback registration rights with
respect to the shares and the shares of common stock issuable upon exercise of
the warrants.

                                       19
<PAGE>


Item 3. Defaults Upon Senior Securities.

         None.


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

(a) The 2006 Annual Meeting of Shareholders of the Company was held on May 10,
2007.

(b) The following persons were elected as directors pursuant to the votes
indicated:

         Name                             For             Withheld
 -------------------------------------------------- ----------------

 L. Scott Barnard                       11,972,749          194,421
 -------------------------------------------------- ----------------
 Joseph A. Equale                       11,961,424          205,746
 -------------------------------------------------- ----------------
 Joseph F. Longo                        12,007,621          159,549
 -------------------------------------------------- ----------------
 Chase P. Withrow III                   11,938,642          228,528
 -------------------------------------------------- ----------------
 John J. Fitzpatrick                    11,960,124          207,046
 -------------------------------------------------- ----------------

(c)  The only other matter to be voted upon was the ratification of the
     appointment of Marcum & Kleigman LLP as the Company's independent
     registered public accountants for the fiscal year ending October 31, 2007
     as follows:

          For                        Withheld                   Abstain
       ----------------------------------------------------------------

       12,026,561                    136,689                     3,920


Item 5.  Other Information.

         None

Item 6.  Exhibits.

The following exhibits are attached to this report:

     31.1     Certificate of the Chief Executive Officer pursuant to Section 302
              of the Sarbanes-Oxley Act of 2002 *

     31.2     Certificate of the Chief Financial Officer pursuant to Section 302
              of the Sarbanes-Oxley Act of 2002 *

     32.1     Certification of the Chief Executive Officer pursuant to Section
              906 of the Sarbanes-Oxley Act of 2002 *

     32.2     Certification of the Chief Financial Officer pursuant to Section
              906 of the Sarbanes-Oxley Act of 2002 *

----------

*     Filed herewith

                                       20

<PAGE>


                                   SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized, on this 19th day of June, 2007.


                                       STARTECH ENVIRONMENTAL CORPORATION
                                       (Registrant)


                                       BY: /S/ Joseph F. Longo
                                            Joseph F. Longo
                                            Chairman, Chief Executive Officer,
                                            President and Director

                                       BY:  /S/ Peter J. Scanlon
                                             Peter J. Scanlon
                                             Chief Financial Officer, Secretary,
                                             Vice President, and
                                             Principal Financial Officer

     KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Joseph F. Longo and Peter J. Scanlon, or
either of them, his or her attorneys-in-fact, for such person in any and all
capacities, to sign any amendments to this report and to file the same, with
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, hereby ratifying and confirming all that
either of said attorneys-in-fact, or substitute or substitutes, may do or cause
to be done by virtue hereof.

     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following person, on behalf of the Company
and in the capacities and on this 19th day of June 2007.


SIGNATURES                             TITLE
----------                             -----

/s/ Joseph F. Longo                    Chairman, Chief Executive Officer,
-------------------                    President  & Director
Joseph F. Longo

/s/ John J. Fitzpatrick                Director
-----------------------
John J. Fitzpatrick

/s/ Joseph A. Equale                   Director
--------------------
Joseph A. Equale

/s/ Chase P. Withrow III               Director
------------------------
Chase P. Withrow III

/s/ L Scott Barnard                    Director
-------------------
L Scott Barnard

                                       21