<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

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

                 For the quarterly period ended January 31, 2005

             [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

            For the transition period from __________ to ____________

                         Commission file number 0-23268


                        AMERICAN TECHNOLOGIES GROUP, INC.
                        ---------------------------------
                 (Name of small business issuer in its charter)


           NEVADA                                                95-4307525
(State or other jurisdiction of                                (IRS Employer
incorporation or organization)                               Identification No.)

                         P.O. BOX 90, MONROVIA, CA 91016
              (Address of principal executive offices) (zip code)

                    Issuer's telephone number: (626) 357-5000

Check whether the issuer (1) filed all reports to be filed by Section 13 or
15(d) of the Exchange Act during the past 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days.
Yes [X] No[ ]

                APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                   PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. Yes [ ] No[ ]

                      APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the registrant's classes of
common equity, as of the latest practicable date: As of March 15, 2005 the
registrant had 99,776,704 shares of Common Stock outstanding.

Transitional Small Business Disclosure Format (Check one): Yes [ ] No [X]


<PAGE>

TABLE OF CONTENTS

PART I   FINANCIAL INFORMATION

ITEM 1   Financial Statements

         Balance Sheets as of January 31, 2005 (unaudited) and
         July 31, 2004......................................................  1

         Statements of Operations (unaudited) for the three and six
         months ended January 31, 2005 and January 31, 2004.................  2

         Statements of Cash Flows (unaudited) for the three and six
         months ended January 31, 2005 and January 31, 2004.................  3

         Notes to Financial Statements (unaudited)..........................  4

ITEM 2   Management's Discussion and Analysis or Plan of Operation..........  9

ITEM 3   Controls and Procedures............................................ 11

PART II  OTHER INFORMATION

ITEM 1   Legal Proceedings.................................................. 12

ITEM 2   Unregistered Sales of Equity Securities and Use of Proceeds........ 12

ITEM 3   Defaults Upon Senior Securities.................................... 12

ITEM 4   Submission of Matters to a Vote of Security Holders................ 12

ITEM 5   Other Information.................................................. 12

ITEM 6   Exhibits........................................................... 12

SIGNATURES.................................................................. 13


IN ADDITION TO HISTORICAL INFORMATION, THIS QUARTERLY REPORT CONTAINS
FORWARD-LOOKING STATEMENTS. THE FORWARD-LOOKING STATEMENTS IN THIS REPORT
REFLECT THE COMPANY'S CURRENT VIEWS WITH RESPECT TO FUTURE EVENTS AND FINANCIAL
PERFORMANCE. THESE FORWARD-LOOKING STATEMENTS ARE SUBJECT TO CERTAIN RISKS AND
UNCERTAINTIES, INCLUDING THOSE DISCUSSED HEREIN AND IN OTHER REPORTS FILED WITH
THE SECURITIES AND EXCHANGE COMMISSION, THAT COULD CAUSE ACTUAL RESULTS TO
DIFFER MATERIALLY FROM HISTORICAL RESULTS OR THOSE ANTICIPATED. IN THIS REPORT,
THE WORDS "ANTICIPATES", "BELIEVES", "INTENDS", "FUTURE", AND SIMILAR
EXPRESSIONS IDENTIFY FORWARD-LOOKING STATEMENTS CONTAINED HEREIN, WHICH SPEAK
ONLY AS OF THE DATE HEREOF. THE COMPANY UNDERTAKES NO OBLIGATION TO PUBLICLY
REVISE THESE FORWARD-LOOKING STATEMENTS TO REFLECT EVENTS OR CIRCUMSTANCES THAT
MAY ARISE AFTER THE DATE HEREOF.

<PAGE>

                          PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS
<TABLE>

                                   AMERICAN TECHNOLOGIES GROUP, INC.

                                            BALANCE SHEETS

                                  January 31, 2005 and July 31, 2004
<CAPTION>

                                                                          JANUARY 31,      JULY 31,
ASSETS                                                                       2005            2004
                                                                         -------------   -------------
                                                                          (UNAUDITED)
<S>                                                                      <C>             <C>
Current assets:
     Cash and cash equivalents                                           $     10,760    $      5,531
     Accounts receivable, net of allowance for doubtful
       accounts of $1,465 and $1,465 at January 31, 2005
       and July 31, 2004, respectively                                             --              --
     Inventories, net                                                             807           2,666
                                                                         -------------   -------------

         Total current assets                                            $     11,567    $      8,197
                                                                         =============   =============

LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:
     Accounts payable and other accrued liabilities                      $    861,596    $    861,596
     Accrued interest payable - convertible debentures                        867,889         731,625
     Accrued interest - related party                                         183,916         145,314
     Accrued payroll and related liabilities                                  413,243         413,243
     Amounts due to related party                                             130,800         130,800
     Note payable - related party                                             883,367         831,277
     Convertible debentures                                                 1,409,511       1,409,511
                                                                         -------------   -------------

         Total current liabilities                                          4,750,322       4,523,366
                                                                         -------------   -------------

Stockholders' deficit:
     Series A convertible preferred stock, $.001 par value;
       10,000,00 shares authorized; 378,061 shares issued and
       outstanding                                                                378             378
     Series B convertible preferred stock, $.001 par value;
       500,000 shares authorized; liquidation value at $8.00
       per share; none issued and outstanding                                      --              --
     Series C convertible preferred stock, $.001 par value;
       2,000 shares authorized; liquidation value at $1,000
       per share; none issued and outstanding                                      --              --
     Common stock, $.001 par value; 1,000,000,000 shares authorized;
       99,776,704 shares issued and outstanding at January 31, 2005
       and July 31, 2004, respectively, and 4,115,596 shares committed
       but not issued                                                         103,892         103,892
     Additional paid-in capital                                            52,941,367      52,941,367
     Stock subscriptions                                                        6,750           6,750
     Accumulated deficit                                                  (57,791,142)    (57,567,556)
                                                                         -------------   -------------
         Total stockholders' deficit                                       (4,738,755)     (4,515,169)
                                                                         -------------   -------------

                                                                         $     11,567    $      8,197
                                                                         =============   =============


               The accompanying notes are an integral part of these financial statements

                                                  1
</TABLE>




<PAGE>

<TABLE>
                                      AMERICAN TECHNOLOGIES GROUP, INC.

                                           STATEMENTS OF OPERATIONS
                                                 (Unaudited)

                         For The Three and Six Months Ended January 31, 2005 and 2004
<CAPTION>

                                                       THREE MONTHS ENDED               SIX MONTHS ENDED
                                                           JANUARY 31,                    JANUARY 31,
                                                 -----------------------------   -----------------------------
                                                     2005            2004            2005            2004
                                                 -------------   -------------   -------------   -------------
<S>                                              <C>             <C>             <C>             <C>
Revenues:
     Technology products and licensing fees      $      2,761    $        974    $      6,372    $      2,188
                                                 -------------   -------------   -------------   -------------
         Total operating revenue                        2,761             974           6,372           2,188
                                                 -------------   -------------   -------------   -------------

Operating expenses:
     General and administrative                        26,476          51,304          52,850          92,010
     Cost of sales                                        593              --           2,242             109
                                                 -------------   -------------   -------------   -------------
         Total operating expenses                      27,069          51,304          55,092          92,119
                                                 -------------   -------------   -------------   -------------

Other expense:
     Interest expense - convertible debentures        (68,132)        (68,132)       (136,264)       (136,264)
     Interest expense - related party                 (19,592)        (16,679)        (38,602)        (32,311)
                                                 -------------   -------------   -------------   -------------
         Other expense, net                           (87,724)        (84,811)       (174,866)       (168,575)
                                                 -------------   -------------   -------------   -------------

Net loss                                         $   (112,032)   $   (135,141)   $   (223,586)   $   (258,506)
                                                 =============   =============   =============   =============

Basic and diluted net loss per common share      $     (0.001)   $     (0.001)   $     (0.002)   $     (0.003)
                                                 =============   =============   =============   =============

Weighted average number of common shares
  outstanding - basic and diluted                  99,776,704      99,776,704      99,776,704      99,776,704
                                                 =============   =============   =============   =============


                  The accompanying notes are an integral part of these financial statements

                                                      2
</TABLE>




<PAGE>
<TABLE>

                              AMERICAN TECHNOLOGIES GROUP, INC.

                                  STATEMENTS OF CASH FLOWS
                                         (Unaudited)

                     For The Six Months Ended January 31, 2005 and 2004
<CAPTION>

                                                               JANUARY 31,      JANUARY 31,
                                                                  2005             2004
                                                             --------------   --------------
<S>                                                          <C>              <C>

Cash flows from operating activities:
     Net loss                                                $    (223,586)   $    (258,506)
     Adjustments to reconcile net loss to net cash used in
       operating activities:
         Provision for bad debts                                        --           15,000
         Changes in operating assets and liabilities:
              Inventories                                            1,859              140
              Accounts payable and accrued liabilities             174,866          160,119
                                                             --------------   --------------

         Net cash used in operating activities                     (46,861)         (83,247)
                                                             --------------   --------------

Cash flows from financing activities:
     Payments on notes payable and related party debt                   --           (3,172)
     Proceeds from notes payable - related party                    52,090           86,500
                                                             --------------   --------------

     Net cash provided by financing activities                      52,090           83,328
                                                             --------------   --------------

Net change in cash and cash equivalents                              5,229               81

Cash and cash equivalents, beginning of period                       5,531            2,361
                                                             --------------   --------------

Cash and cash equivalents, end of period                     $      10,760    $       2,442
                                                             ==============   ==============


          The accompanying notes are an integral part of these financial statements

                                             3
</TABLE>

<PAGE>

                        AMERICAN TECHNOLOGIES GROUP, INC.

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

          For The Three and Six Months Ended January 31, 2005 and 2004


NOTE 1 - BASIS OF PRESENTATION
------------------------------

The accompanying unaudited financial statements have been prepared in accordance
with accounting principles generally accepted in the United States of America
for interim financial information and with the instructions to Rule 10-01 of
Regulation S-X. Accordingly, they do not include all of the information and
notes required by accounting principles generally accepted in the United States
for complete financial statements. In the opinion of management, all adjustments
(consisting of normal recurring adjustments) considered necessary for a fair
presentation have been included. Operating results for the six-month period
ended January 31, 2005 are not necessarily indicative of the results that may be
expected for the year end July 31, 2005. For further information, please refer
to the financial statements and notes thereto included in the Company's Annual
Report on Form 10-KSB for the year ending July 31, 2004.

NOTE 2 - GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
---------------------------------------------------------------

Organization and Line of Business
---------------------------------

American Technologies Group, Inc. (the "Company" or "ATG"), a Nevada
corporation, is engaged in the development, commercialization and sale of
products and systems using its patented and proprietary technologies. The
resulting products are intended to offer cost-effective solutions to reduce, and
in some cases eliminate, hazardous chemical by-products or emissions resulting
from industrial and combustion processes. The Company's proprietary catalyst
technology may improve many commercial products including detergents and
cosmetics.

The Company has suspended substantive operations subsequent to July 31, 2001.
The one business segment remaining selling technology products is not currently
operating substantially.Management is currently pursuing various options to
obtain additional funding, including the sale of a majority equity position to
investors with an alternative business plan.

To date, the Company has been unable to generate significant cash flows from
their business operations. As a result, the Company has funded their operations
through investor financing, including sales of common stock and the exercise of
warrants and options. The Company has also used debt to fund operations. Until
such time as the Company is able to generate significant cash flow from
operations through increased sales of their products, they will be required to
continue their reliance on investor financing and debt to fund the Company's
operations.

The Company does not have existing capital resources or credit lines available
that are sufficient to fund operations and capital requirements as presently
planned over the next twelve months. The Company is actively pursuing additional
funds through the issuance of debt and/or equity instruments. The Company may
also seek additional funds from the sale of most or all of their assets.
However, such funds may not be available on favorable terms or at all.

Significant Business Risks
--------------------------

Since its inception, the Company has incurred significant operating losses
totaling over $57 million, and at January 31, 2005, has a working capital
deficit of $4,738,755 and has suspended substantive operations. The ability of
the Company to operate as a going concern is dependent upon its ability (1) to
obtain sufficient additional debt and/or equity capital, (2) sell or license
certain technologies and/or (3) generate significant revenues through its
existing assets and operating business. The successful outcome of future
activities cannot be determined at this time and there are no assurances that if
achieved, the Company will have sufficient funds to execute their business plans
or generate positive operating results. These issues, among others, raise
substantial doubt about the ability of the Company to continue as a going
concern. The financial statements do not include any adjustments relating to the
recoverability and classification of asset carrying amounts or the amount and
classification of liabilities that might result should the Company be unable to
continue as a going concern.

                                       4



<PAGE>
                        AMERICAN TECHNOLOGIES GROUP, INC.

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

          For The Three and Six Months Ended January 31, 2005 and 2004


NOTE 2 - GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
--------------------------------------------------------------------------

Management is currently pursuing various options to obtain additional funding
including the sale of a majority equity position to investors with an
alternative business plan.

Net Loss Per Share
------------------

Net loss per common share is based upon the weighted average number of common
shares outstanding during the fiscal year under the provisions of Statement of
Financial Accounting Standards No. 128, "Earnings Per Share." Common share
equivalents were not considered as they would be anti-dilutive and had no impact
on earnings per share for any periods presented. Had common share equivalents
been considered, the incremental shares from dilutive options, warrants, and
convertible debentures would have been 489,422,133 and 1,171,142,500 as of
January 31, 2005 and 2004, respectively.

Segments
--------

The Company operates in one business segment, technology products, as a result
of the sale of its mining business in fiscal 2000.

Stock-Based Compensation
------------------------

The Company accounts for non-employee stock-based compensation under Statement
of Financial Accounting Standards No. 123 ("SFAS 123"), "Accounting for
Stock-Based Compensation." SFAS 123 defines a fair value based method of
accounting for stock-based compensation. However, SFAS 123 allows an entity to
continue to measure compensation cost related to stock and stock options issued
to employees using the intrinsic method of accounting prescribed by Accounting
Principles Board Opinion No. 25 ("APB 25"), "Accounting for Stock Issued to
Employees." Under APB 25, compensation cost, if any, is recognized over the
respective vesting period based on the difference, on the date of grant, between
the fair value of the Company's common stock and the grant price. Entities
electing to remain with the accounting method of APB 25 must make pro forma
disclosures of net income and earnings per share, as if the fair value method of
accounting defined in SFAS No. 123 had been applied.

In December 2002, SFAS 148, "Accounting for Stock-Based Compensation -
Transition and Disclosure," was issued. SFAS 148 amends SFAS 123 to provide
alternative methods of transition for voluntary change to the fair value based
method of accounting for stock-based employee compensation. In addition, SFAS
148 amends the disclosure requirements of SFAS 123 to require prominent
disclosures in both annual and interim financial statements about the method of
accounting for stock-based employee compensation and the effect of the method
used on reported results. The provisions of SFAS 148 are effective for financial
statements for fiscal years ending after December 15, 2002. The Company adopted
the disclosure provisions of SFAS 148 in these financial statements.

At January 31, 2005, the Company has two stock-based employee compensation
plans. The Company accounts for these plans under the recognition and
measurement principles of APB 25, and related interpretations. During the three
and six months ended January 31, 2005 and 2004, no stock-based employee
compensation cost is reflected in the accompanying unaudited statements of
operations, as all options granted under those plans had exercise prices equal
to or greater than the market value of the underlying common stock on the date
of grant. Had compensation cost for the Company's plans been determined
consistent with the provisions of SFAS 123, the Company's net loss would not
have changed.

                                       5



<PAGE>
                        AMERICAN TECHNOLOGIES GROUP, INC.

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

          For The Three and Six Months Ended January 31, 2005 and 2004


NOTE 2 - GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
--------------------------------------------------------------------------

Derivative Instruments
----------------------

The Company accounts for freestanding derivative financial instruments
potentially settled in its own common stock under Emerging Issues Task Force
("EITF") Issue No. 00-19, "Accounting for Derivative Financial Instruments
Indexed to, and Potentially Settled in, a Company's Own Stock." As of January
31, 2005, the Company has sufficient authorized shares available to settle its
open stock-based contracts. Pursuant to EITF Issue No. 00-19, the Company is
required to recognize the initial fair value of the applicable contracts
(consisting primarily of non-employee stock warrants and options to purchase
common stock) as an asset or liability, and subsequently measure the change in
the fair value (based on a Black-Scholes computation), with gains and losses
included in a statement of operations. The Company has determined that there is
no fair value associated with the freestanding derivatives since the Company has
sufficient authorized shares.

Recently Issued Accounting Pronouncements
-----------------------------------------

In December 2004, the FASB issued SFAS No. 123 (revised 2004), "Share-Based
Payment" ("Statement 123(R)") to provide investors and other users of financial
statements with more complete and neutral financial information by requiring
that the compensation cost relating to share-based payment transactions be
recognized in financial statements. That cost will be measured based on the fair
value of the equity or liability instruments issued. Statement 123(R) covers a
wide range of share-based compensation arrangements including share options,
restricted share plans, performance-based awards, share appreciation rights, and
employee share purchase plans. Statement 123(R) replaces SFAS No. 123, and
supersedes APB 25. SFAS No. 123, as originally issued in 1995, established as
preferable a fair-value-based method of accounting for share-based payment
transactions with employees. However, that Statement permitted entities the
option of continuing to apply the guidance in APB 25, as long as the footnotes
to financial statements disclosed what net income would have been had the
preferable fair-value-based method been used. Public entities (other than those
filing as small business issuers) will be required to apply Statement 123(R) as
of the first interim or annual reporting period that begins after December 15,
2005. The Company is in the process of evaluating whether the adoption of SFAS
123(R) will have a significant impact on the Company's overall results of
operations or financial position.

NOTE 3 - NOTE PAYABLE - RELATED PARTY
-------------------------------------

In November 2001, the Company signed an unsecured promissory note for borrowings
of up to $400,000 with a third party who has since become the Company's chief
executive officer, which was later amended and increased to $800,000. The note
was due August 8, 2002. The note has not been repaid and is due on demand. As of
January 31, 2005, the Company has a balance of $883,367 under the promissory
note. Borrowings bear interest at 9% per annum with interest payments due
monthly. The Company has not paid interest since fiscal 2001. Accrued interest
on this note totaled $183,916 as of January 31, 2005. Interest expense on the
notes payable above totaled $38,602 and $32,311 for the six months ended January
31, 2005 and 2004, respectively, and $19,592 and $16,679 for the three months
ended January 31, 2005 and 2004, respectively.

NOTE 4 - CONVERTIBLE DEBENTURES
-------------------------------

Convertible debentures are summarized as follows as of January 31, 2005:

      Convertible debentures, 7.5%                                 $     75,000
      Secured subordinated convertible debentures, 8%                 1,334,511
                                                                   -------------
                                                                   $  1,409,511
                                                                   =============

                                       6



<PAGE>

                        AMERICAN TECHNOLOGIES GROUP, INC.

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

          For The Three and Six Months Ended January 31, 2005 and 2004


NOTE 4 - CONVERTIBLE DEBENTURES, CONTINUED
------------------------------------------

The 7.5% convertible debentures matured on October 15, 1999 and are in default.
The Company continues to accrue interest on these notes at 7.5%. Accrued
interest on these convertible debentures is due on the earlier of conversion or
maturity and both the accrued interest and the principal are payable in cash or
the Company's common stock at the Company's discretion. The conversion price is
equal to the lower of the average closing bid price of the common stock for the
five trading days prior to the closing or 75% of the average closing bid price
of the common stock for the five trading days prior to conversion.

The remaining outstanding 8% convertible debentures have all matured and are in
default. The Company continues to accrue interest at a 20% default interest rate
on these debentures. These debentures are convertible at fixed or variable
rates, at prices ranging from $0.002 to $0.05 per share as of January 31, 2005.

NOTE 5 - STOCKHOLDERS' EQUITY
-----------------------------

Stock Subscriptions
-------------------

As of January 31, 2005, the Company had not issued 15,000 shares of Common Stock
owed for services at $0.45 per share totaling $6,750 which is included in stock
subscriptions in the accompanying balance sheets.

Increase in Authorized Shares
-----------------------------

On August 30, 2002, the stockholders approved an amendment to the Company's
certificate of incorporation to increase the authorized number of shares of
common stock from 100,000,000 shares to 1,000,000,000 shares. The Company has
not filed the Certificate of Amendment of Certificate of Incorporation with the
Secretary of the State of Nevada as of March 15, 2005.

Committed Common Stock
----------------------

In connection with certain settlement agreements entered into with note holders,
employees and vendors during 2002, the Company committed to issue 4,115,596
shares of the Company's common stock. At January 31, 2005, the committed shares
have not been issued.

NOTE 6 - COMMITMENTS AND CONTINGENCIES
--------------------------------------

Litigation
----------

The Company is involved in various threatened lawsuits arising in the normal
course of business. Management believes that any financial responsibility that
may be incurred in settlement of such potential claims and lawsuits would not be
material to the Company's financial position of results of operations, or have
already been reflected in the accompanying financial statements.

Leases
------

The Company leases offices and warehouse space under month-to-month agreements.
For the three months ended January 31, 2005 and 2004, rent expense totaled
$4,500 and $4,500, respectively. For the six months ended January 31, 2005 and
2004, rent expense totaled $9,000 and $9,000, respectively.

                                       7

<PAGE>

                        AMERICAN TECHNOLOGIES GROUP, INC.

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

          For The Three and Six Months Ended January 31, 2005 and 2004


NOTE 6 - COMMITMENTS AND CONTINGENCIES, CONTINUED
-------------------------------------------------

Indemnities and Guarantees
--------------------------

During the normal course of business, the Company has made certain indemnities
and guarantees under which it may be required to make payments in relation to
certain transactions. The duration of these indemnities and guarantees varies
and, in certain cases, is indefinite. The majority of these indemnities and
guarantees do not provide for any limitation of the maximum potential future
payments the Company could be obligated to make. Historically, the Company has
not been obligated to make significant payments for these obligations and no
liabilities have been recorded for these indemnities and guarantees in the
accompanying balance sheet.


NOTE 7 - SUBSEQUENT EVENT
-------------------------

Beginning in February 2005 the Company offered certain of its creditors the
opportunity to accept cash and/or shares of the Company's common stock in
complete satisfaction of the amounts owed to them. The offer made to these
creditors is conditional on acceptance by substantially all of the Company's
unsecured creditors of similar terms. As of March 15, 2005, creditors owed a
total of $306,595 accepted a settlement of cash of approximately $4,500 and
approximately 9,780,000 of committed shares of the Company's common stock
together valued at approximately $73,000. If the conditions are satisfied, and
the offers accepted, these offers will result in a gain on the relief of
indebtedness of approximately $233,595. There can be no assurance that other
creditors will accept, and that the gain described herein will be realized.

                                       8

<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS

As reported in our prior public reports, the Company largely had ceased
operations during the fiscal year 2001 and began focusing efforts on
restructuring and refinancing. In 2004 and 2003, the Company successfully
continued these efforts to settle various pending law suits, reduce outstanding
liabilities, acquire an equity funding facility to finance acquisition of new
products, entities and technologies, and otherwise strengthen the business.

During 2002, the Company entered into various settlement agreements with
noteholders, employees and vendors. The summary of the related debt
extinguishments is as follows:

Settlement of convertible debentures, loan payable and
accrued interest totaling $2,515,941 in exchange for
7,000,000 shares of common stock with a value of $35,000
and patents with a net book value of $37,187                      $   2,443,754

Settlement of amount due to related party and accrued
payroll of $339,433 and $110,777, respectively, in exchange
for 960,000 shares of common stock and 3,040,000 shares of
committed common stock valued at $20,000                                430,210

Settlement of accrued payroll of $96,128 in exchange for
1,625,000 shares of common stock and 600,000 shares of
committed common stock valued at $8,475 and an agreement
to be paid $45,000                                                       42,653

Gain on write-down of accounts payable due to lack of
performance by the vendor or lack of recent collection
activity on the part of the vendor                                      255,469

Gain on the settlement of accounts payable of $110,000 in
exchange for 1,060,460 shares of common stock valued at $10,605          99,395

Gain on settlement of accrued payroll of $52,785 in exchange
for 450,000 shares of common stock and 475,596 shares of
committed common stock valued at $4,949 and an agreement
to be paid $12,000                                                       35,836
                                                                    ------------

                                                                    $ 3,307,317
                                                                    ============

During 2003, the Company entered into a settlement agreement
with a former employee regarding accrued payroll of $86,219
in exchange for 325,000 shares of common stock valued at
$1,138 and agreement to be paid $64,398.                            $    20,683
                                                                    ============


Beginning in February 2005, we offered certain of our creditors the opportunity
to accept cash and/or shares of our common stock in complete satisfaction of the
amounts owed to them. The offer made to these creditors is conditional on
acceptance by substantially all of our unsecured creditors of similar terms. As
of March 15, 2005, creditors owed a total of $306,595 accepted a settlement of
cash of approximately $4,500 and approximately 9,780,000 of committed shares of
our common stock together valued at approximately $73,000. If the conditions are
satisfied, and the offers accepted, these offers will result in a gain on the
relief of indebtedness of approximately $233,595. There can be no assurance that
other creditors will accept, and that the gain described herein will be
realized.

We will continue to explore possibilities for licensing and distributing the
distiller for manufacture and sales in selected Asian markets. The same is true
for the Force products, which still find interested customers both domestically
and overseas. Efforts will be underway to examine strengthening the distribution
network so as to increase sales. The acquisition of new entities, technologies
and products to create value for shareholders, too, will be underway in the form
of evaluating possible investments.

To date, we have been unable to generate significant cash flows from our
business operations. As a result, we have funded our operations through investor
financing, including sales of common stock and the exercise of warrants and
options. We have also used debt to fund our operations. Until such time as we
are able to generate significant cash flow from operations through increased
sales of our products, we will be required to continue our reliance on investor
financing and debt to fund our operations.

                                       9

<PAGE>

We do not have existing capital resources or credit lines available that are
sufficient to fund our operations and capital requirements as presently planned
over the next 12 months. We are actively pursuing additional funds through the
issuance of debt and/or equity instruments. We may also seek additional funds
from the sale of most or all of our assets. However, such funds may not be
available on favorable terms or at all.


                           For the three months ended:
                                  January 31,
RESULTS OF OPERATIONS:                                 2005            2004
                                                   -------------   -------------
REVENUE:
Technology rights                                  $      2,761    $        974
                                                   -------------   -------------

OPERATING EXPENSES:
General and Administrative                               26,476          51,304
Cost of Sales                                               593               -
                                                   -------------   -------------
            Total Operating Expenses                     27,069          51,304
                                                   -------------   -------------


OTHER EXPENSE:                                          (87,724)        (84,811)
                                                   -------------   -------------

Net Loss Attributable to Common Stockholders       $   (112,032)   $   (135,141)
                                                   =============   =============

Basic and Fully Diluted Net Loss Per Common Share: $    ($0.001)   $    ($0.001)
                                                   =============   =============

Weighted average number of common shares
      outstanding                                    99,776,704      99,776,704
                                                   =============   =============

                          For the six months ended:
                                January 31,

RESULTS OF OPERATIONS:                                 2005            2004
                                                   -------------   -------------
REVENUE:
Technology rights                                  $      6,372    $      2,188
                                                   -------------   -------------

OPERATING EXPENSES:
General and Administrative                               52,850          92,010
Cost of Sales                                             2,242             109
                                                   -------------   -------------
            Total Operating Expenses                     55,092          92,119
                                                   -------------   -------------


OTHER EXPENSE:                                         (174,866)       (168,575)
                                                   -------------   -------------

Net Loss Attributable to Common Stockholders       $   (223,586)   $   (258,506)
                                                   =============   =============

Basic and Fully Diluted Net Loss Per Common Share: $    ($0.002)   $    ($0.003)
                                                   =============   =============

Weighted average number of common shares
      outstanding                                    99,776,704      99,776,704
                                                   =============   =============

Technology rights revenue increased by $1,787 from $974 for the three months
ending January 31, 2004 to $2,761 for the three months ending January 31, 2005
due generally to increased sales of our products during the quarter ended
January 31, 2005. In addition, technology rights revenue increased by $4,184
from $2,188 for the six months ending January 31, 2004 to $6,372 for the six
months ending January 31, 2005 due generally to increased sales of our products
during the quarter ended January 31, 2005.

                                       10

<PAGE>

A majority of our efforts during the past twelve months has been focused on
stabilizing our financial situation, settling lawsuits with major creditors and
former employees, increasing our authorized capital stock, and beginning the
process of seeking new technologies and activities to merge into.

The Company plans to execute its filings with the State of Nevada to increase
its authorized shares to 1,000,000,000 in the near term.

LIQUIDITY AND CAPITAL RESOURCES

To date, we have been unable to generate significant cash flows from our
business operations. As a result, we have funded our operations through investor
financing, including sales of common stock and the exercise of warrants and
options. We have also used debt to fund our operations. Until such time as we
are able to generate significant cash flow from operations through increased
sales of our products, we will be required to continue our reliance on investor
financing and debt to fund our operations.

We do not have existing capital resources or credit lines available that are
sufficient to fund our operations and capital requirements as presently planned
over the next twelve months. We are actively pursuing additional funds through
the issuance of debt and/or equity instruments. We may also seek additional
funds from the sale of most or all of our assets. However, such funds may not be
available on favorable terms or at all.

We have concluded that without new acquisitions of technology and products, the
shareholders cannot hope to see their investment valued at a level, which is
deserving.

In November 2001, the Company signed a promissory note with a third party who
has since become the Company's chief executive officer for $400,000, which was
later increased to $800,000. The note is unsecured and due on demand. As of
January 31, 2005, the Company has a balance of $883,367 outstanding under the
promissory note. Borrowings bear interest at 9% per annum with interest payments
due monthly. The Company has not paid interest since fiscal 2001 and the first
quarter of fiscal 2005. Accrued interest for this note totaled $183,916 as of
January 31, 2005.

GOING CONCERN

Since its inception, the Company has incurred significant operating losses
totaling over $57 million, and at January 31, 2005, has a working capital
deficit of $4,738,755, is in default on its convertible debentures and has
suspended substantive operations. The ability of the Company to operate as a
going concern is dependent upon its ability to (1) obtain sufficient additional
debt and/or equity capital, (2) sell or license certain technologies and/or (3)
generate significant revenues through its existing assets and operating
business. Our independent auditors indicated in their auditor's report for the
year ended July 31, 2004 that these issues, among others, raise substantial
doubt about the ability of the Company to continue as a going concern. The
financial statements do not include any adjustments relating to the
recoverability and classification of asset carrying amounts or the amount and
classification of liabilities that might result should the Company be unable to
continue as a going concern.

ITEM 3. CONTROLS AND PROCEDURES

(a) EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

As of January 31, 2005, we carried out an evaluation, under the supervision and
with the participation of our Chief Executive Officer and Chief Financial
Officer, of the effectiveness of the design and operation of our disclosure
controls and procedures. Based on this evaluation, our Chief Executive Officer
and Chief Financial Officer concluded that our disclosure controls and
procedures are effective in timely alerting them to material information
required to be included in our periodic reports that are filed with the
Securities and Exchange Commission. It should be noted that the design of any
system of controls is based in part upon certain assumptions about the
likelihood of future events, and there can be no assurance that any design will
succeed in achieving its stated goals under all potential future conditions,
regardless of how remote. In addition, we reviewed our internal controls, and
there have been no significant changes in our internal controls or in other
factors that could significantly affect those controls subsequent to the date of
their last valuation.

(b) CHANGES IN INTERNAL CONTROLS

There were no significant changes in the Company's internal controls or in other
factors that could significantly affect these controls during the quarter
covered by this Report or from the end of the reporting period to the date of
this Form 10-QSB.

                                       11

<PAGE>

                                     PART II
                                OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

None.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

(a) Exhibits.

31.1     Certification by Chief Executive Officer and
         Chief Financial Officer pursuant to Sarbanes-Oxley
         Section 302:                                          Provided Herewith

32.1     Certification by Chief Executive Officer and
         Chief Financial Officer pursuant to 18 U.S. C.
         Section 1350:                                         Provided Herewith

                                       12

<PAGE>

                                   SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                                   AMERICAN TECHNOLOGIES GROUP, INC.


                                   BY: /S/ DR. GARY FROMM
                                       -------------------------------
                                       DR. GARY FROMM
                                       CHAIRMAN OF THE BOARD AND
                                       CHIEF EXECUTIVE OFFICER


DATE: MARCH 22, 2005



In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.


/S/ DR. GARY FROMM          CHAIRMAN OF THE BOARD,          MARCH 22, 2005
------------------          CHIEF EXECUTIVE OFFICER
    GARY FROMM          ACTING CHIEF FINANCIAL OFFICER
                        ACTING CHIEF ACCOUNTING OFFICER


                                       13