**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** |
|-------|------------------------------------------------------------------------------------------------------------------------------------|

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

**CHINA      SECURITY & SURVEILLANCE TECHNOLOGY, INC.**

| **Delaware**                                   | **98-0509431**                           |
|------------------------------------------------|------------------------------------------|
| (State                or other jurisdiction of | (I.R.S.                Empl. Ident. No.) |
| incorporation                or organization)  |                                     |

**13/F,      Shenzhen Special Zone Press Tower, Shennan Road**

**Futian      District, Shenzhen, China 518034**

**(86)      755-8351-0888**

| Large                accelerated filer o | Accelerated                filer  o | Non-accelerated                filer x |
|------------------------------------------|------------------------------------------|----------------------------------------|

| Class                of Securities             |   | Shares                Outstanding |       |
|------------------------------------------------|--------|-----------------------------------|------------|
| Common                Stock, $0.0001 par value |   |                              | 34,942,206 |   |

----

**TABLE      OF CONTENTS**

|                    | **PART                I**                                                                                                 | **Page** |
|-------------------------|---------------------------------------------------------------------------------------------------------------------------|----------|
|                    |                                                                                                                      |     |
| Item                1.  | Financial                Statements                                                                                       | 1        |
| Item                2.  | Management’s                Discussion and Analysis of Financial Condition and Results of                Operations | 18       |
| Item                3.  | Quantitative                and Qualitative Disclosures About Market Risk                                                 | 27       |
| Item                4T. | Controls                and Procedures                                                                                    | 28       |
|                    |                                                                                                                      |     |
|                    | **PART                II**                                                                                                |     |
|                    |                                                                                                                      |     |
| Item                1.  | Legal                Proceedings                                                                                          | 29       |
| Item                1A. | Risk                Factors                                                                                               | 29       |
| Item                2.  | Unregistered                Sales of Equity Securities and Use of Proceeds                                                | 29       |
| Item                3.  | Defaults                Upon Senior Securities                                                                            | 29       |
| Item                4.  | Submission                of Matters to a Vote of Securities Holders                                                      | 29       |
| Item                5.  | Other                Information                                                                                          | 29       |
| Item                6.  | Index                to Exhibits                                                                                          | 29       |

----

**PART      I **

**FINANCIAL      INFORMATION**

**ITEM      1. FINANCIAL STATEMENTS.**

**CHINA        SECURITY & SURVEILLANCE TECHNOLOGY, INC. AND        SUBSIDIARIES**

**CONDENSED        CONSOLIDATED BALANCE SHEETS **

**Expressed        in thousands of U.S. dollars**

**(Except        for share and per share amounts)**

|                                                                                                                                                                                                                                    |   | **March                  31,** |    | **December                  31,** |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------|---------|-----------------------------------|--------|
|                                                                                                                                                                                                                                    |   | **2007**                       |    | **2006**                          |   |
|                                                                                                                                                                                                                                    |   | **(Unaudited)**                |    |                              |   |
|                                                                                                                                                                                                                                    |   | **USD**                        |    | **USD**                           |   |
| **ASSETS**                                                                                                                                                                                                                              |   |
| **CURRENT                  ASSETS**                                                                                                                                                                                                     |   |                           |    |                              |   |
| Cash                  and cash equivalents                                                                                                                                                                                              |   | $                              | 71,892  |                              | $      | 30,980 |   |
| Accounts                  receivable, net                                                                                                                                                                                               |   |                           | 30,366  |                              |   | 26,754 |   |
| Related                  party receivables                                                                                                                                                                                              |   |                           | 635     |                              |   | 440 |   |
| Inventories,                  net                                                                                                                                                                                                       |   |                           | 22,153  |                              |   | 19,721 |   |
| Prepayments                  & deposits                                                                                                                                                                                             |   |                           | 8,511   |                              |   | 3,533 |   |
| Advances                  to suppliers                                                                                                                                                                                                  |   |                           | 2,814   |                              |   | 2,889 |   |
| Other                  receivables                                                                                                                                                                                                      |   |                           | 2,020   |                              |   | 1,697 |   |
| Deferred                  tax assets - current portion                                                                                                                                                                                  |   |                           | 31      |                              |   | 41 |   |
| Total                  current assets                                                                                                                                                                                                   |   |                           | 138,422 |                              |   | 86,055 |   |
|                                                                                                                                                                                                                                    |   |                           |    |                              |   |   |   |
| Deposits                  for acquisition of subsidiaries and properties                                                                                                                                                                |   |                           | 20,618  |                              |   | - |   |
| Plant                  and equipment, net                                                                                                                                                                                               |   |                           | 8,452   |                              |   | 8,339 |   |
| Land                  use rights, net                                                                                                                                                                                                   |   |                           | 1,153   |                              |   | 1,152 |   |
| Intangible                  assets                                                                                                                                                                                                      |   |                           | 9,532   |                              |   | 9,997 |   |
| Investment,                  at cost                                                                                                                                                                                                    |   |                           | 13      |                              |   | 12 |   |
| Goodwill                                                                                                                                                                                                                                |   |                           | 8,426   |                              |   | 8,426 |   |
| Deferred                  tax assets - non-current portion                                                                                                                                                                              |   |                           | 466     |                              |   | 462 |   |
| TOTAL                  ASSETS                                                                                                                                                                                                           |   | $                              | 187,082 |                              | $      | 114,443 |   |
|                                                                                                                                                                                                                                    |   |                           |         |                              |   |  |   |
| **LIABILITIES                  AND SHAREHOLDERS' EQUITY**                                                                                                                                                                               |
| **CURRENT                  LIABILITIES**                                                                                                                                                                                                |   |                           |         |                              |   |  |   |
| Notes                  payable - short term                                                                                                                                                                                             |   | $                              | 5,948   |                              | $      | 2,272 |   |
| Accounts                  payable                                                                                                                                                                                                       |   |                           | 4,492   |                              |   | 4,000 |   |
| Accrued                  expenses                                                                                                                                                                                                       |   |                           | 958     |                              |   | 749 |   |
| Advances                  from customers                                                                                                                                                                                                |   |                           | 7,484   |                              |   | 5,432 |   |
| Taxes                  payable                                                                                                                                                                                                          |   |                           | 1,579   |                              |   | 1,660 |   |
| Payable                  for acquisition of business                                                                                                                                                                                    |   |                           | -       |                              |   | 7,500 |   |
| Deferred                  income                                                                                                                                                                                                        |   |                           | 766     |                              |   | 831 |   |
| Due                  to a director                                                                                                                                                                                                      |   |                           | -       |                              |   | 76 |   |
| Total                  current liabilities                                                                                                                                                                                              |   |                           | 21,227  |                              |   | 22,520 |   |
|                                                                                                                                                                                                                                    |   |                           |    |                              |   |   |   |
| **LONG-TERM                  LIABILITIES**                                                                                                                                                                                              |   |                           |    |                              |   |   |   |
| Notes                  payable - long term                                                                                                                                                                                              |   |                           | -       |                              |   | 2,010 |   |
| Convertible                  notes payable                                                                                                                                                                                              |   |                           | 61,163  |                              |   | - |   |
| Total                  liabilities                                                                                                                                                                                                      |   |                           | 82,390  |                              |   | 24,530 |   |
|                                                                                                                                                                                                                                    |   |                           |         |                              |   |  |   |
| **MINORITY                  INTEREST IN CONSOLIDATED SUBSIDIARIES**                                                                                                                                                                     |   |                           | 79      |                              |   | 94 |   |
|                                                                                                                                                                                                                                    |   |                           |    |                              |   |   |   |
| **SHAREHOLDERS'                  EQUITY**                                                                                                                                                                                               |   |                           |    |                              |   |   |   |
| Common                    stock, $0.0001 par value; 100,000,000 shares authorized 34,754,127                    (March                    31, 2007) and 31,824,938 (December 31, 2006) shares issued and                    outstanding |   |                           | 3       |                              |   | 3 |   |
| Additional                  paid-in capital                                                                                                                                                                                             |   |                           | 54,786  |                              |   | 45,320 |   |
| Retained                  earnings                                                                                                                                                                                                      |   |                           | 46,016  |                              |   | 41,483 |   |
| Statutory                  reserves                                                                                                                                                                                                     |   |                           | 804     |                              |   | 804 |   |
| Accumulated                  other comprehensive income                                                                                                                                                                                 |   |                           | 3,004   |                              |   | 2,209 |   |
| Total                  shareholders' equity                                                                                                                                                                                             |   |                           | 104,613 |                              |   | 89,819 |   |
| **TOTAL                  LIABILITIES AND SHAREHOLDERS' EQUITY**                                                                                                                                                                         |   | $                              | 187,082 |                              | $      | 114,443 |   |

----

**CHINA        SECURITY & SURVEILLANCE TECHNOLOGY, INC. AND        SUBSIDIARIES**

**CONDENSED        CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME**

**Expressed        in thousands of U.S. dollars**

**(Except        for share and per share amounts)**

|                                                                      |   | **Three                  Months Ended March 31** |       |
|---------------------------------------------------------------------------|--------|--------------------------------------------------|------------|
|                                                                      |   | **2007**                                         |       | **2006** |   |
|                                                                      |   | **(Unaudited)**                                  |       | **(Unaudited)** |   |
|                                                                      |   | USD                                              |       | USD |   |
|                                                                      |   |                                             |       |   |   |
| **Revenues**                                                              |   | $                                                | 38,451     |   | $ | 14,594 |   |
|                                                                      |   |                                             |       |   |   |   |   |
| Cost                  of goods sold                                       |   |                                             | 28,333     |   |   | 10,197 |   |
|                                                                      |   |                                             |       |   |   |   |   |
| **Gross                  profit**                                         |   |                                             | 10,118     |   |   | 4,397 |   |
|                                                                      |   |                                             |       |   |   |   |   |
| Selling                  and marketing                                    |   |                                             | 603        |   |   | 122 |   |
|                                                                      |   |                                             |       |   |   |   |   |
| General                  and administrative                               |   |                                             | 2,251      |   |   | 295 |   |
| (including                  non-cash employee compensation of $265)       |   |                                             |       |   |   |   |   |
|                                                                      |   |                                             |       |   |   |   |   |
| Depreciation                  and amortization                            |   |                                             | 806        |   |   | 102 |   |
|                                                                      |   |                                             |       |   |   |   |   |
| **Income                  from operations**                               |   |                                             | 6,458      |   |   | 3,878 |   |
|                                                                      |   |                                             |       |   |   |   |   |
| Rental                  income received from related party                |   |                                             | 127        |   |   | 122 |   |
|                                                                      |   |                                             |       |   |   |   |   |
| Interest                  income                                          |   |                                             | 82         |   |   | 5 |   |
|                                                                      |   |                                             |       |   |   |   |   |
| Interest                  expense                                         |   |                                             | (1,319     | ) |   | - |   |
|                                                                      |   |                                             |       |   |   |   |   |
| Other                  income, net                                        |   |                                             | 492        |   |   | 115 |   |
|                                                                      |   |                                             |       |   |   |   |   |
| Income                  before income taxes and minority interest         |   |                                             | 5,840      |   |   | 4,120 |   |
|                                                                      |   |                                             |       |   |   |   |   |
| Minority                  interest in income of consolidated subsidiaries |   |                                             | 9          |   |   | - |   |
|                                                                      |   |                                             |       |   |   |   |   |
| Income                  taxes                                             |   |                                             | (1,316     | ) |   | (620 | ) |
|                                                                      |   |                                             |       |   |   |   |   |
| Net                  income                                               |   |                                             | 4,533      |   |   | 3,500 |   |
|                                                                      |   |                                             |       |   |   |   |   |
| Foreign                  currency translation gain                        |   |                                             | 795        |   |   | 380 |   |
|                                                                      |   |                                             |       |   |   |   |   |
| **COMPREHENSIVE                  INCOME**                                 |   | $                                                | 5,328      |   | $ | 3,880 |   |
|                                                                      |   |                                             |            |   |   |  |   |
| NET                  INCOME PER SHARE                                     |   |                                             |            |   |   |  |   |
| BASIC                                                                     |   | $                                                | 0.14       |   | $ | 0.16 |   |
| DILUTED                                                                   |   | $                                                | 0.13       |   | $ | 0.16 |   |
|                                                                      |   |                                             |            |   |   |  |   |
| WEIGHTED                  AVERAGE NUMBER OF SHARES                        |   |                                             |            |   |   |  |   |
| OUTSTANDING                                                               |   |                                             |            |   |   |  |   |
| BASIC                                                                     |   |                                             | 33,108,640 |   |   | 21,591,333 |   |
| DILUTED                                                                   |   |                                             | 34,268,180 |   |   | 21,642,536 |   |
|                                                                      |   |                                             |            |   |   |  |   |

----

**CHINA        SECURITY & SURVEILLANCE TECHNOLOGY, INC. AND        SUBSIDIARIES**

**CONDENSED        CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY**

**THREE        MONTHS ENDED MARCH 31, 2007 (UNAUDITED)**

**Expressed        in thousands of U.S. dollars**

**(Except        for share and per share amounts)**

|                                                                                              |   | **Common                  Stock** |       | **Additional**                 |   |                                 |   | **Accumulated                  Other ** |   |                                      |   |                      |   |
|---------------------------------------------------------------------------------------------------|--------|-----------------------------------|------------|--------------------------------|--------|--------------------------------------|--------|----------------------------------------------|--------|-------------------------------------------|--------|---------------------------|--------|
|                                                                                              |   | **Shares**                        |       | **Par                  Value** |   | **Paid-in                  Capital** |   | **Retained****Earnings**                     |   | **Comprehensive                  Income** |   | **Statutory****reserves** |   | **Total** |   |
|                                                                                              |   |                              |       | USD                            |   | USD                                  |   | USD                                          |   | USD                                       |   | USD                       |   | USD |   |
| **BALANCE                  AT JANUARY 1, 2007**                                                   |   |                              | 31,824,938 |                           | $      | 3                                    |   | $                                            | 45,320 |                                      | $      | 41,483                    |   | $ | 2,209 |   | $ | 804 |   | $ | 89,819 |   |
| Warrants                  exercised (cashless) per                  Securities Purchase Agreement |   |                              | 161,056    |                           |   | -                                    |   |                                         | -      |                                      |   | -                         |   |   | - |   |   | - |   |   | - |   |
| Warrants                  exercised for cash per Securities Purchase Agreement                    |   |                              | 126,285    |                           |   | -                                    |   |                                         | 606    |                                      |   | -                         |   |   | - |   |   | - |   |   | 606 |   |
| Warrants                  exercised for cash per Investor Relation Service Agreement              |   |                              | 228,000    |                           |   | -                                    |   |                                         | 1,095  |                                      |   | -                         |   |   | - |   |   | - |   |   | 1,095 |   |
| Common                  stock issued under Equity Incentive Plan                                  |   |                              | 1,052,100  |                           |   | -                                    |   |                                         | 265    |                                      |   | -                         |   |   | - |   |   | - |   |   | 265 |   |
| Common                  stock issued for acquisition of Cheng Feng                                |   |                              | 1,361,748  |                           |   | -                                    |   |                                         | 7,500  |                                      |   | -                         |   |   | - |   |   | - |   |   | 7,500 |   |
| Foreign                  currency translation                                                     |   |                              | -          |                           |   | -                                    |   |                                         | -      |                                      |   | -                         |   |   | 795 |   |   | - |   |   | 795 |   |
|                                                                                              |   |                              |       |                           |   |                                 |   |                                         |   |                                      |   |                      |   |   |   |   |   |   |   |   |   |   |
| Net                  income for the period                                                        |   |                              | -          |                           |   | -                                    |   |                                         | -      |                                      |   | 4,533                     |   |   | - |   |   | - |   |   | 4,533 |   |
|                                                                                              |   |                              |       |                           |   |                                 |   |                                         |   |                                      |   |                      |   |   |   |   |   |   |   |   |   |   |
| **BALANCE                  AT MARCH 31, 2007**                                                    |   |                              | 34,754,127 |                           | $      | 3                                    |   | $                                            | 54,786 |                                      | $      | 46,016                    |   | $ | 3,004 |   | $ | 804 |   | $ | 104,613 |   |

----

| **CHINA                  SECURITY & SURVEILLANCE TECHNOLOGY, INC. AND                  SUBSIDIARIES** |
|-----------------------------------------------------------------------------------------------------------|
| **CONDENSED                  CONSOLIDATED STATEMENTS OF CASH                  FLOWS**                     |

**Expressed        in thousands of U.S. dollars**

**(Except        for share and per share amounts)**

|                                                                                                                |   | **Three                  Months Ended March 31** |    |
|---------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------|---------|
|                                                                                                                |   | **2007**                                         |    | **2006** |   |
|                                                                                                                |   | **(Unaudited)**                                  |    | **(Unaudited)** |   |
|                                                                                                                |   | **USD**                                          |    | **USD** |   |
| **CASH                  FLOWS FROM OPERATING ACTIVITIES:**                                                          |   |                                             |    |   |   |
| Net                  income                                                                                         |   |                                             | 4,533   |   |   | 3,500 |   |
| Adjustments                    to reconcile net income to net cash (used in) provided by                  operating |   |                                             |    |   |   |   |   |
| activities:                                                                                                         |   |                                             |    |   |   |   |   |
| Depreciation                  and amortization                                                                      |   |                                             | 806     |   |   | 102 |   |
| Amortization                  of consultancy services                                                               |   |                                             | 30      |   |   | 17 |   |
| Non-cash                  employee compensation                                                                     |   |                                             | 265     |   |   | - |   |
| Redemption                  accretion on convertible notes                                                          |   |                                             | 1,163   |   |   | - |   |
| Deferred                  taxes                                                                                     |   |                                             | 12      |   |   | (15 | ) |
| Minority                  interest                                                                                  |   |                                             | (9      | ) |   | - |   |
|                                                                                                                |   |                                             |    |   |   |   |   |
| Changes                  in operating assets and liabilities:                                                       |   |                                             |    |   |   |   |   |
| (Increase)                  decrease in:                                                                            |   |                                             |    |   |   |   |   |
| Accounts                  receivable                                                                                |   |                                             | (3,370  | ) |   | 3,007 |   |
| Related                  party receivables                                                                          |   |                                             | (192    | ) |   | 1,280 |   |
| Inventories                                                                                                         |   |                                             | (2,254  | ) |   | 1,852 |   |
| Prepayments                  & deposits                                                                         |   |                                             | (4,977  | ) |   | - |   |
| Advances                  to suppliers                                                                              |   |                                             | 101     |   |   | (2,745 | ) |
| Other                  receivables                                                                                  |   |                                             | (308    | ) |   | 119 |   |
| Deferred                  expenses                                                                                  |   |                                             | -       |   |   | (1,028 | ) |
|                                                                                                                |   |                                             |    |   |   |   |   |
| (Decrease)                  increase in:                                                                            |   |                                             |    |   |   |   |   |
| Accounts                  payable and accrued expenses                                                              |   |                                             | 744     |   |   | (147 | ) |
| Advances                  from customers                                                                            |   |                                             | 2,003   |   |   | - |   |
| Tax                  payable                                                                                        |   |                                             | (65     | ) |   | 379 |   |
| Deferred                  income                                                                                    |   |                                             | (57     | ) |   | 943 |   |
| Net                  cash (used in) provided by operating activities                                                |   |                                             | (1,575  | ) |   | 7,264 |   |
|                                                                                                                |   |                                             |         |   |   |  |   |
| **CASH                  FLOWS FROM INVESTING ACTIVITIES:**                                                          |   |                                             |         |   |   |  |   |
| Additions                  to plant and equipment                                                                   |   |                                             | (215    | ) |   | (1 | ) |
| Additions                  to intangible assets                                                                     |   |                                             | (66     | ) |   | - |   |
| Deposits                  paid for acquisition of subsidiaries                                                      |   |                                             | (19,972 | ) |   | - |   |
| Deposits                  paid for acquisition of properties                                                        |   |                                             | (646    | ) |   | - |   |
| Net                  cash (used in) investing activities                                                            |   |                                             | (20,899 | ) |   | (1 | ) |
|                                                                                                                |   |                                             |         |   |   |  |   |
| **CASH                  FLOWS FROM FINANCING ACTIVITIES**                                                           |   |                                             |         |   |   |   |   |
| Due                  to a director                                                                                  |   |                                             | (75     | ) |   | 71 |   |
| Issuance                  of common stock, net of issuing expenses                                                  |   |                                             | 1,701   |   |   | - |   |
| New                  borrowings                                                                                     |   |                                             | 65,172  |   |   | - |   |
| Repayment                  of borrowings                                                                            |   |                                             | (3,468  | ) |   | - |   |
| Net                  cash provided by financing activities                                                          |   |                                             | 63,330  |   |   | 71 |   |
|                                                                                                                |   |                                             |    |   |   |   |   |
| **NET                  INCREASE IN CASH AND CASH EQUIVALENTS**                                                      |   |                                             | 40,856  |   |   | 7,334 |   |
| Effect                  of exchange rate changes on cash                                                            |   |                                             | 56      |   |   | 31 |   |
| Cash                  and cash equivalents, at beginning of period                                                  |   |                                             | 30,980  |   |   | 2,277 |   |
|                                                                                                                |   |                                             |    |   |   |   |   |
| **CASH                  AND CASH EQUIVALENTS, END OF PERIOD**                                                       |   |                                             | 71,892  |   |   | 9,642 |   |

----

| **CHINA                  SECURITY & SURVEILLANCE TECHNOLOGY, INC. AND                  SUBSIDIARIES** |
|-----------------------------------------------------------------------------------------------------------|
| **CONDENSED                  CONSOLIDATED STATEMENTS OF CASH                  FLOWS**                     |

**Expressed        in thousands of U.S. dollars**

**(Except        for share and per share amounts)**

| **SUPPLEMENTARY                  CASH FLOW INFORMATION:** |   |   |   |   |   |
|-----------------------------------------------------------|--------|--------|--------|--------|--------|
|                                                      |   |   |   |   |   |
|                                                      |   |   |   |   |   |
| Interest                  paid                            |   | $      | 153    |   | $      | - |   |
| Income                  taxes paid                        |   | $      | 1,397  |   | $      | 334 |   |

**SUPPLEMENTAL        SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:**

|    | 1,361,748                  shares of common stock issuable in satisfaction of the equity portion                  of                  the purchase price of approximately $7,500 in the acquisition of                  Shanghai                  Cheng Feng Digital High-tech Co., Ltd., (“Cheng Feng”), were issued in the                  first quarter of 2007. (Note 15) |
|--------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**CHINA        SECURITY & SURVEILLANCE TECHNOLOGY, INC.**

**NOTES        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)**

**Expressed        in thousands of U.S. dollars**

**(Except        for share and per share amounts)**

| 1.     | BASIS                  OF PRESENTATION The                  accompanying financial statements, as of March 31, 2007 and for                  the three                  months ended March 31, 2007 and 2006, have been prepared by CHINA                  SECURITY & SURVEILLANCE TECHNOLOGY, INC.                  (the “Company”) without audit. Pursuant to the rules and regulations of                  the Securities and Exchange Commission (the “SEC”), certain information                  and footnote disclosures normally included in the financial statements                  prepared in accordance with accounting principles generally accepted                  in                  the United States of America (“US GAAP”) have been condensed or omitted                  pursuant to such rules and regulations. These financial statements                  should                  be read in conjunction with the financial statements and the notes                  thereto                  included in the Company's audited annual financial statements for                  the year                  ended December 31, 2006, which are included in the Company's Annual                  Report                  on Form 10-K for the year ended December 31, 2006, filed with the                  SEC on                  March 21, 2007. Amounts as of December 31, 2006 are derived from                  these                  audited consolidated financial statements. The                  preparation of financial statements in conformity with US GAAP                  requires                  management to make estimates and assumptions that affect the reported                  amounts of assets, liabilities, revenues and expenses and the disclosure                  of contingent assets and liabilities. Actual results could differ                  from                  these estimates. In                  the opinion of the management, all adjustments (which include only                  normal                  recurring adjustments) necessary to present fairly the financial                  position                  as of March 31, 2007, results of operations and cash flows for                  the three                  months ended March 31, 2007 and 2006, have been made. The results                  of                  operations for the three months ended March 31, 2007 are not necessarily                  indicative of the operating results for the full year. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 2.     | SUMMARY                  OF SELECTED SIGNIFICANT ACCOUNTING                  POLICIES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |

| (a)    Accounting                  for Computer Software To Be Sold, Leased or Otherwise                  Marketed |
|----------------------------------------------------------------------------------------------------------------------------------------|

*Accounting        for the Costs of Computer Software to be Sold, Leased, or Otherwise        Marketed*

| (b)    Inventories |
|----------------------------------------|

----

**CHINA        SECURITY & SURVEILLANCE TECHNOLOGY, INC.**

**NOTES        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)**

**Expressed        in thousands of U.S. dollars**

**(Except        for share and per share amounts)**

| 2. | SUMMARY                    OF SELECTED SIGNIFICANT ACCOUNTING POLICIES                    (CONTINUED) |
|----|-------------------------------------------------------------------------------------------------------|

| (c)    Accounts                  Receivable |
|-----------------------------------------------------------------|

| (d)    Revenue                  Recognition |
|-----------------------------------------------------------------|

| (i)    The                  security and surveillance equipment is a standard product with                  minor                  modifications according to customers'                  specifications; |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (ii)    Installation                  does not significantly alter the security and surveillance equipment's                  capabilities; and |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (iii)    Other                  companies which possess the relevant licenses are available to                  perform the                  installation services. |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e)    Research                  and Development Costs |
|----------------------------------------------------------------------------|

| (f)    Advertising                  Costs |
|---------------------------------------------------------------|

----

**CHINA        SECURITY & SURVEILLANCE TECHNOLOGY, INC.**

**NOTES        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)**

**Expressed        in thousands of U.S. dollars**

**(Except        for share and per share amounts)**

| 2. | SUMMARY                        OF SELECTED SIGNIFICANT ACCOUNTING POLICIES                        (CONTINUED) |
|----|---------------------------------------------------------------------------------------------------------------|

| (g)    Retirement                  Benefits |
|-----------------------------------------------------------------|

| (h)    Income                  taxes |
|----------------------------------------------------------|

*,*

| (i)    Use                  of Estimates |
|--------------------------------------------------------------|

| (j)    Earnings                  Per Share |
|----------------------------------------------------------------|

*Earnings        Per Share*

----

**CHINA        SECURITY & SURVEILLANCE TECHNOLOGY, INC.**

**NOTES        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)**

**Expressed        in thousands of U.S. dollars**

**(Except        for share and per share amounts)**

| 3. | ACCOUNTS                        RECEIVABLE |
|----|--------------------------------------------|

|                                                   |   | **March                  31, 2007** |   | **December                  31,** **2006** |   |
|--------------------------------------------------------|--------|-------------------------------------|--------|-------------------------------------------------|--------|
|                                                   |   |                                |   |                                            |   |
| Accounts                  receivable                   |   | $                                   | 30,487 |                                            | $      | 26,877 |   |
| Less:                  allowance for doubtful accounts |   |                                | (121   | )                                               |   | (123 | ) |
| Accounts                  receivable, net              |   | $                                   | 30,366 |                                            | $      | 26,754 |   |

| 4. | RELATED                          PARTY RECEIVABLES |
|----|----------------------------------------------------|

|                                                   |   | **March                    31, 2007** |    | **December                    31, 2006** |   |
|--------------------------------------------------------|--------|---------------------------------------|---------|------------------------------------------|--------|
|                                                   |   |                                  |    |                                     |   |
| Related                  party receivables             |   | $                                     | 635     |                                     | $      | 440 |   |
| Less:                  allowance for doubtful accounts |   |                                  | — |                                     |   | — |   |
| Related                  party receivables, net        |   | $                                     | 635     |                                     | $      | 440 |   |

----

**CHINA        SECURITY & SURVEILLANCE TECHNOLOGY, INC.**

**NOTES        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)**

**Expressed        in thousands of U.S. dollars**

**(Except        for share and per share amounts)**

| 5. | INVENTORIES |
|----|-------------|

|                                                      |   | **March                  31, 2007** |   | **December                  31,** **2006** |   |
|-----------------------------------------------------------|--------|-------------------------------------|--------|-------------------------------------------------|--------|
|                                                      |   |                                |   |                                            |   |
| Raw                  materials                            |   | $                                   | 2,613  |                                            | $      | 2,261 |   |
| Finished                  goods                           |   |                                | 1,025  |                                            |   | 642 |   |
| Installations                  in process                 |   |                                | 18,745 |                                            |   | 17,091 |   |
| Total                                                     |   |                                | 22,383 |                                            |   | 19,994 |   |
| Less:                  allowance for obsolete inventories |   |                                | (230   | )                                               |   | (273 | ) |
| Inventories,                  net                         |   | $                                   | 22,153 |                                            | $      | 19,721 |   |

| 6. | PREPAYMENTS                              & DEPOSITS |
|----|---------------------------------------------------------|

|                                                                                               |   | **March                  31, 2007** |   | **December                  31,** **2006** |   |
|----------------------------------------------------------------------------------------------------|--------|-------------------------------------|--------|-------------------------------------------------|--------|
|                                                                                               |   |                                |   |                                            |   |
| Current                  Portion                                                                   |   | $                                   | 8,511  |                                            | $      | 3,533 |   |
| Non                  current portion-                  Deposits paid for acquisition of properties |   |                                | 646    |                                            |   | - |   |
| -                  Deposits paid for acquisition of subsidiaries                                   |   |                                | 19,972 |                                            |   | - |   |
|                                                                                               |   | $                                   | 20,618 |                                            | $      | - |   |

| 7. | ADVANCE                                PAYMENTS |
|----|-------------------------------------------------|

| 8. | PLANT                                AND EQUIPMENT |
|----|----------------------------------------------------|

|                                            |   | **March                    31, 2007** |   | **December                  31, 2006** |   |
|-------------------------------------------------|--------|---------------------------------------|--------|----------------------------------------|--------|
| Buildings                                       |   | $                                     | 7,649  |                                   | $      | 7,450 |   |
| Leasehold                  improvements         |   |                                  | 870    |                                   |   | 888 |   |
| Plant                  and equipment            |   |                                  | 332    |                                   |   | 267 |   |
| Electronic                  equipment           |   |                                  | 764    |                                   |   | 669 |   |
| Motor                  vehicles                 |   |                                  | 945    |                                   |   | 938 |   |
|                                            |   |                                  | 10,560 |                                   |   | 10,212 |   |
| Less:                  accumulated depreciation |   |                                  | (2,108 | )                                      |   | (1,873 | ) |
| Plant                  and equipment, net       |   | $                                     | 8,452  |                                   | $      | 8,339 |   |

----

**CHINA        SECURITY & SURVEILLANCE TECHNOLOGY, INC.**

**NOTES        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)**

**Expressed        in thousands of U.S. dollars**

**(Except        for share and per share amounts)**

| 9. | LAND                                  USE RIGHTS |
|----|--------------------------------------------------|

|                                            |   | **March                  31, 2007** |   | **December                  31, 2006** |   |
|-------------------------------------------------|--------|-------------------------------------|--------|----------------------------------------|--------|
|                                            |   |                                |   |                                   |   |
| Cost                  of land use rights        |   | $                                   | 1,457  |                                   | $      | 1,445 |   |
| Less:                  Accumulated amortization |   |                                | (304   | )                                      |   | (293 | ) |
| Land                  use rights, net           |   | $                                   | 1,153  |                                   | $      | 1,152 |   |

| 2007                  (remaining 9 months) |   | $      | 22    |   |
|--------------------------------------------|--------|--------|-------|--------|
| 2008                                       |   |   | 29    |   |
| 2009                                       |   |   | 29    |   |
| 2010                                       |   |   | 29    |   |
| 2011                                       |   |   | 29    |   |
| 2012                                       |   |   | 29    |   |
| Thereafter                                 |   |   | 986   |   |
| Total                                      |   | $      | 1,153 |   |

----

**CHINA        SECURITY & SURVEILLANCE TECHNOLOGY, INC.**

**NOTES        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)**

**Expressed        in thousands of U.S. dollars**

**(Except        for share and per share amounts)**

| 10. | INTANGIBLE                                  ASSETS |
|-----|----------------------------------------------------|

|                                                                                                                                    |   | **March                  31, 2007** |   | **December                  31, 2006** |   |
|-----------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------|--------|----------------------------------------|--------|
| Acquired                  customer base from the Four-Related Companies (life of 5                  years)                              |   | $                                   | 5,899  |                                   | $      | 5,840 |   |
| Acquired                  contracts in progress from the Four-Related Companies (life of                  2                  months)    |   |                                | 178    |                                   |   | 177 |   |
| Acquired                  non-competition contracts from the Four-Related Companies (life                  of 5                  years) |   |                                | 956    |                                   |   | 953 |   |
| Acquired                  surveillance software and patents from Cheng Feng (life of 5                  years)                          |   |                                | 3,449  |                                   |   | 3,159 |   |
| Acquired                  surveillance recording system from Yuan Da (life of 5                  years)                                 |   |                                | 522    |                                   |   | 511 |   |
| Less:                  accumulated amortization                                                                                         |   |                                | (1,472 | )                                      |   | (643 | ) |
| Intangible                  assets, net                                                                                                 |   | $                                   | 9,532  |                                   | $      | 9,997 |   |

| 2007                  (remaining nine months) |   | $      | 1,551 |   |
|-----------------------------------------------|--------|--------|-------|--------|
| 2008                                          |   |   | 2,440 |   |
| 2009                                          |   |   | 2,983 |   |
| 2010                                          |   |   | 1,701 |   |
| 2011                                          |   |   | 692   |   |
| Thereafter                                    |   |   | 165   |   |
| Total                                         |   | $      | 9,532 |   |

----

**CHINA        SECURITY & SURVEILLANCE TECHNOLOGY, INC.**

**NOTES        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**Expressed        in thousands of U.S. dollars**

**(Except        for share and per share amounts)**

| 11. | NOTES                                    PAYABLE |
|-----|--------------------------------------------------|

|                                   |   | **March                  31, 2007** |    | **December                  31, 2006** |   |
|----------------------------------------|--------|-------------------------------------|---------|----------------------------------------|--------|
|                                   |   |                                |    |                                   |   |
| Bank                  loans            |   | $                                   | 5,948   |                                   | $      | 4,282 |   |
| Less:                  current portion |   |                                | (5,948  | )                                      |   | (2,272 | ) |
| Long-term                  portion     |   | $                                   | — |                                   | $      | 2,010 |   |

|                                          |   |  **Long-term                    notes** |    |  **Short-term                    notes** |   |  **Total** |   |
|-----------------------------------------------|--------|----------------------------------------------|---------|-----------------------------------------------|--------|-----------------|--------|
| 2007                  (remaining nine months) |   | $                                            | — |                                          | $      | 776             |   | $ | 776 |   |
| 2008                                          |   |                                         | — |                                          |   | 5,172           |   |   | 5,172 |   |
| Total                                         |   | $                                            | — |                                          | $      | 5,948           |   | $ | 5,948 |   |

----

**CHINA        SECURITY & SURVEILLANCE TECHNOLOGY, INC.**

**NOTES        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**Expressed        in thousands of U.S. dollars**

**(Except        for share and per share amounts)**

| 11. | NOTES                                      PAYABLE (CONTINUED) |
|-----|---------------------------------------------------------------------|

| 12. | CONVERTIBLE                                        NOTES                                        PAYABLE |
|-----|---------------------------------------------------------------------------------------------------------|

| 13. | DEFERRED                                          INCOME |
|-----|----------------------------------------------------------|

| 14. | DUE                                  TO A DIRECTOR |
|-----|----------------------------------------------------|

----

**CHINA        SECURITY & SURVEILLANCE TECHNOLOGY, INC.**

**NOTES        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**Expressed        in thousands of U.S. dollars**

**(Except        for share and per share amounts)**

| 15. | ISSUANCE                                    OF COMMON STOCK AND WARRANTS |
|-----|--------------------------------------------------------------------------|

|                                                   |   | **2007** |      | **2006**                                   |   |
|--------------------------------------------------------|--------|----------|-----------|--------------------------------------------|--------|
|                                                   |   |     |      | Weighted                  Average Exercise |   |   |   | Weighted                  Average Exercise |   |
|                                                   |   | Shares   |      | Prices                                     |   | Shares |   | Prices |   |
| Outstanding                  at beginning of period    |   |     | 1,417,292 |                                       | $      | 4.40 |   |   | 100,000 |   | $  | 1.85 |   |
| Granted                                                |   |     | -         |                                       |   | - |   |   | - |   |   | - |   |
| Exercised                                              |   |     | (581,380  | )                                          |   | (4.57 | ) |   | - |   |   | - |   |
| Outstanding                  at end of period          |   |     | 835,912   |                                       | $      | 4.28 |   |   | 100,000 |   | $ | 1.85 |   |
| Warrants                  exercisable at end of period |   |     | 835,912   |                                       |   |  4.28 |   |   | 100,000 |   |   | 1.85 |   |

----

**CHINA        SECURITY & SURVEILLANCE TECHNOLOGY, INC.**

**NOTES        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**Expressed        in thousands of U.S. dollars**

**(Except        for share and per share amounts)**

| 15. | ISSUANCE                                      OF COMMON STOCK AND WARRANTS                                      (CONTINUED) |
|-----|-----------------------------------------------------------------------------------------------------------------------------|

| 16. | EQUITY                                        INCENTIVE                                        PLAN |
|-----|-----------------------------------------------------------------------------------------------------|

|                                                  |   | **Nonvested                    Restricted Stock and Stock Unit Awards** |      |
|-------------------------------------------------------|--------|-------------------------------------------------------------------------|-----------|
|                                                  |   | Number                    of Shares                                     |      | Weighted                    Average Grant Date Fair Values |   |
| Outstanding                    at beginning of period |   |                                                                    | -         |   | $ | - |   |
| Granted                                               |   |                                                                    | 1,052,100 |   |   | 14.20 |   |
| Vested                                                |   |                                                                    | (21,919   | ) |   | - |   |
| Forfeited                                             |   |                                                                    | -         |   |   | - |   |
| Outstanding                    at end of period       |   |                                                                    | 1,030,181 |   | $ | 14.20 |   |

----

**CHINA        SECURITY & SURVEILLANCE TECHNOLOGY, INC.**

**NOTES        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**Expressed        in thousands of U.S. dollars**

**(Except        for share and per share amounts)**

| 17. | SUBSEQUENT                                          EVENTS |
|-----|------------------------------------------------------------|

----

**ITEM        2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF        OPERATIONS. **

***Special      Note Regarding Forward Looking Statements***

***Use      of terms***

***Overview***

|   | · | Achieved                revenues of $38.5 million for the first quarter of 2007, up 163.5%                from                the same quarter of last year. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | Gross                margin was 26.3% for the first quarter of 2007, compared to 30.1%                for the                same period in 2006. Such decrease was mainly due to the increased                competition and the Company’s strategy to lower its selling price to                attract more customers and penetrate into new                markets. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Income                from operations was $6.5 million for the first quarter of 2007, up                from                $3.9 million of the same period last year, representing an increase                of                66.5%. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Fully                diluted income from operations per share was $0.19 for the first                quarter                of 2007. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Operating                margin (the ratio of income from operations to revenues, expressed                as a                percentage) was 16.8% for the first quarter of 2007, compared to                26.6%                during the same period in 2006. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Net                income was $4.5 million for the first quarter of 2007, up 29.5% from                the                same period of last year. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Net                margin (the ratio of net income to revenues, expressed as a percentage)                was 11.7% for the first quarter of 2007, compared to 24.0% for the                same                period in 2006. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Fully                diluted net income per share was $0.13 for the first quarter of                2007. |
|--------|--------|-----------------------------------------------------------------------------------------------------------|

|   | · | Non-cash                items included (i) the redemption accretion on convertible notes                of $1.16                million, (ii) depreciation and amortization of $0.8 million, and                (iii)                non-cash employee compensation expense of $0.27 million for the first                quarter of 2007. Total non-cash items are $2.23 million, an increase                of                $2.13 million, or 2090.2%, from $0.1 million for the same quarter                of last                year. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                             |   | **Three                Months Ended March 31,** |       |     |   |
|------------------------------------------------------------------|--------|-------------------------------------------------|------------|----------|--------|
| **Non-cash                items**                                |   | **2007**                                        |       | **2006** |   | **Increase                (Decrease)** |   |
| Depreciation                and amortization                     |   | $                                               | 806        |     | $      | 102 |   |   | 704 |   |
| Non-cash                employee compensation                    |   |                                            | 265        |     |   | - |   |   | 265 |   |
| Redemption                accretion on convertible notes         |   |                                            | 1,163      |     |   | - |   |   | 1,163 |   |
| **Total**                                                        |   |                                            | 2,234      |     |   | 102 |   |   | 2,132 |   |
|                                                             |   |                                            |       |     |   |   |   |   |   |   |
| **Non-cash                items per share - basic**              |   |                                            |       |     |   |   |   |   |   |   |
| Depreciation                and amortization                     |   | $                                               | 0.0243     |     | $      | 0.0047 |   |   | 0.0196 |   |
| Non-cash                employee compensation                    |   |                                            | 0.0080     |     |   | - |   |   | 0.0080 |   |
| Redemption                accretion on convertible notes         |   |                                            | 0.0351     |     |   | - |   |   | 0.0351 |   |
| **Total                non-cash items per share - basic**        |   | $                                               | 0.0674     |     | $      | 0.0047 |   |   | 0.0627 |   |
|                                                             |   |                                            |       |     |   |   |   |   |   |   |
| **Non-cash                items per share - diluted**            |   |                                            |       |     |   |   |   |   |   |   |
| Depreciation                and amortization                     |   | $                                               | 0.0235     |     | $      | 0.0047 |   |   | 0.0188 |   |
| Non-cash                employee compensation                    |   |                                            | 0.0077     |     |   | - |   |   | 0.0077 |   |
| Redemption                accretion on convertible notes         |   |                                            | 0.0339     |     |   | - |   |   | 0.0339 |   |
| **Total                non-cash items per share - diluted**      |   | $                                               | 0.0651     |     | $      | 0.0047 |   |   | 0.0604 |   |
|                                                             |   |                                            |       |     |   |   |   |   |   |   |
| **Weighted                average number of shares outstanding** |   |                                            |       |     |   |   |   |   |   |   |
| **Basic**                                                        |   |                                            | 33,108,640 |     |   | 21,591,333 |   |   |   |   |
| **Diluted**                                                      |   |                                            | 34,268,180 |     |   | 21,642,536 |   |   |   |   |

----

***Our      Business***

***Recent      Developments***

----

***Material      Opportunities and Challenges***

**Results      Of Operations**

***Three      Months Ended March 31, 2007 Compared to Three Months Ended March 31,      2006***

|                                  |   | **3                Months Ended March 31,** |   |     |   |                       |   |
|---------------------------------------|--------|---------------------------------------------|--------|----------|--------|----------------------------|--------|
| **Item**                              |   | **2007**                                    |   | **2006** |   | **Increase****(Decrease)** |   | **%                Increase****(%                Decrease)** |   |
| Revenue                               |   | $                                           | 38.45  |     | $      | 14.59                      |   | $ | 23.86 |   |   | 163.5 | % |
| Cost                of Goods Sold     |   |                                        | 28.33  |     |   | 10.20                      |   |   | 18.13 |   |   | 177.7 | % |
| Gross                Profit           |   |                                        | 10.12  |     |   | 4.39                       |   |   | 5.73 |   |   | 130.5 | % |
| Operating                Expenses     |   |                                        | 3.66   |     |   | 0.51                       |   |   | 3.15 |   |   | 617.6 | % |
| Other                Income (expense) |   |                                        | (0.61  | )        |   | 0.24                       |   |   | (0.85 | ) |   | (354.2 | )% |
| Provision                for Taxes    |   |                                        | 1.32   |     |   | 0.62                       |   |   | 0.70 |   |   | 112.9 | % |
| Net                income             |   |                                        | 4.53   |     |   | 3.50                       |   |   | 1.03 |   |   | 29.4 | % |

*Revenue*

| Revenue                recognized from contracts signed before 2007               |   | $ | 22.4 |   |
|-----------------------------------------------------------------------------------|--------|---|------|--------|
| Revenue                recognized from contracts signed in the first quarter 2007 |   | $ | 11.7 |   |
| Other                revenue from first quarter 2007                              |   | $ | 2.1  |   |
| Revenue                recognized from Cheng Feng                                 |   | $ | 2.3  |   |
| Total                revenue recognized in the first quarter 2007                 |   | $ | 38.5 |   |
| Revenue                deferred                                                   |   | $ | 0.8  |   |
| Backlog                of contracts signed in the first quarter of 2007           |   | $ | 21.9 |   |

----

*Components      of Revenue*

|                                             |   | Three                months endedMarch                31, |   |
|--------------------------------------------------|--------|-----------------------------------------------------------|--------|
|                                             |   | 2007                                                      |   | 2006 |   |
|                                             |   |                                                      |   |   |   |
| Security                systems and installation |   | $                                                         | 34.03  |   | $ | 13.0 |   |
| Sales                of parts                    |   |                                                      | 4.42   |   |   | 1.5 |   |
|                                             |   |                                                      |        |   |   |  |   |
|                                             |   | $                                                         | 38.45  |   | $ | 14.5 |   |

*Cost      of goods sold*

|                                       |   | Three                months ended March 31, |   |
|--------------------------------------------|--------|---------------------------------------------|--------|
|                                       |   | 2007                                        |   | 2006 |   |
|                                       |   |                                        |   |   |   |
| Purchases                (of raw material) |   | $                                           | 28.0   |   | $ | 10.0 |   |
| Percentage                                 |   |                                        | 98.8   | % |   | 98.0 | % |
| Salary                                     |   | $                                           | 0.3    |   | $ | 0.2 |   |
| Percentage                                 |   |                                        | 1.2    | % |   | 2.0 | % |
|                                       |   |                                        | 100    | % |   | 100 | % |

 

*Net      margin. *

----

*General      and administrative expenses. *

*Total      selling expenses. *

*Income      Taxes*

*Net      income. *

*Income      from operations per share. *

----

**Liquidity      and Capital Resources **

***General***

**Cash      Flow**

|                                                               |   | Three                months endedMarch                31, |    |
|--------------------------------------------------------------------|--------|-----------------------------------------------------------|---------|
|                                                               |   | 2007                                                      |    | 2006 |   |
|                                                               |   |                                                      |    |   |   |
| Net                cash (used in) provided by operating activities |   | $                                                         | (1,575  | ) | $ | 7,264 |   |
| Net                cash (used in) provided by investing activities |   |                                                      | (20,899 | ) |   | (1 | ) |
| Net                cash provided by (used in) financing activities |   |                                                      | 63,330  |   |   | 71 |   |
|                                                               |   |                                                      |    |   |   |   |   |
|  Net                increase in cash and cash equivalents     |   | $                                                         | 40,856  |   | $ | 7,334 |   |

*Operating      Activities:*

** **

*Investing      Activities:*

** **
** **

----

*Financing      Activities:*

** **
** **

*Loan      Facilities*

| **Banks**                                       |   | **At                March 31, 2007** |   | **Beginning                Date** |   | **Ending****Date**            |   | **Duration** |                          |
|-------------------------------------------------|--------|--------------------------------------|--------|-----------------------------------|--------|-------------------------------|--------|--------------|-------------------------------|
| Shanghai                PuDong Development Bank |   |                                 | **-**  |                              |   | August                2006    |   |         | February                2007  |   |   | 6                months |   |
| China                Construction Bank          |   |                                 | **-**  |                              |   | September                2006 |   |         | September                2016 |   |   | 10                years |   |
| Shanghai                PuDong Development Bank |   | $                                    | 3.88   |                              |   | February                2007  |   |         | February                2008  |   |   | 1                year |   |
| Shanghai                PuDong Development Bank |   | $                                    | 1.29   |                              |   | February                2007  |   |         | February                2008  |   |   | 1                year |   |
| Shanghai                PuDong Development Bank |   | $                                    | 0.78   |                              |   | November                2005  |   |         | November                2007  |   |   | 2                years |   |
| Total                                           |   | $                                    | 5.95   |                              |   |                          |   |         |                          |   |   |   |   |

----

***Obligations      Under Material Contracts***

|                                       |   | Payments                due by period |   |
|--------------------------------------------|--------|---------------------------------------|--------|
|                                       |   | Total                                 |   | Less                than 1 year |   | 1-3                years |   | 3-5                years |   | More                than 5 years |   |
| Long-Term                Debt Obligations  |   | $                                     | 60,000 |   | $ | - |   | $ | - |   | $ | 60,000 |   | $ | - |   |
| Operating                Lease Obligations |   |                                  | 497    |   |   | 239 |   |   | 216 |   |   | 42 |   |   | - |   |
| Total                                      |   | $                                     | 60,497 |   | $ | 239 |   | $ | 216 |   | $ | 60,042 |   | $ | - |   |

**Critical      Accounting Policies **

----

**Seasonality**

**Off-Balance      Sheet Arrangements**

**ITEM      3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK**

***Interest      Rate Risk***

***Foreign      Exchange Risk***

----

***Inflation***

**ITEM      4T. CONTROLS AND PROCEDURES**

*Evaluation      of Disclosure Controls and Procedures.*

*Internal      Control Over Financial Reporting.*

|   | · | Pertain                to the maintenance of records that in reasonable detail accurately                and                fairly reflect the transactions and dispositions of our                assets; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Provide                reasonable assurance that transactions are recorded as necessary                to permit                preparation of financial statements in accordance with US GAAP, and                that                our receipts and expenditures are being made only in accordance with                authorizations of our management and directors; and provide reasonable                assurance regarding prevention or timely detection of unauthorized                acquisition, use or disposition of our assets that could have a material                effect on our consolidated financial                statements. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

*Changes      in Internal Control Over Financial Reporting.*

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**PART      II**

**OTHER      INFORMATION**

**ITEM      1. LEGAL PROCEEDINGS **

**ITEM      1A. RISK FACTORS **

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

**ITEM      3.**
**DEFAULTS      UPON SENIOR SECURITIES**

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

**ITEM      5.**
**OTHER      INFORMATION**

**ITEM      6. EXHIBITS **

| **Exhibit                Number** |   | **Description**                                                                                                                                                                                                                                                                                         |
|-----------------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                              |   |                                                                                                                                                                                                                                                                                                    |
| 3.1                               |   | Certificate                of Incorporation of the registrant (incorporated by reference to                Exhibit                3.1 to the registrant’s Registration Statement on Form S-4 filed with the                Securities and Exchange Commission on October 4,                2006). |

----

| 3.2    |   | By-laws                of the registrant (incorporated by reference to Exhibit 3.2 to the                registrant’s Registration Statement on Form S-4 filed with the Securities                and Exchange Commission on October 4, 2006).                                                                                                                                                                                                                                                         |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 4.1    |   | Notes                Purchase Agreement, dated February 5, 2007, by and between the registrant                and Citadel Equity Fund Ltd. (incorporated by reference to Exhibit                4.1 to                the registrant’s Current Report on Form 8-K filed with the Securities and                Exchange Commission on February 9, 2007).                                                                                                                                               |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 4.2    |   | Share                Pledge Agreement, dated February 8, 2007, by and among Citadel Equity                Fund                Ltd., The Bank of New York, Guoshen Tu, Zhiqun Li and Whitehorse                Technology Limited (incorporated by reference to Exhibit 4.2 to the                registrant’s Current Report on Form 8-K filed with the Securities and                Exchange Commission on February 9, 2007).                                                                        |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 4.3    |   | Form                of the Notes (incorporated by reference to Exhibit 4.3 to the registrant’s                Current Report on Form 8-K filed with the Securities and Exchange                Commission on February 9, 2007).                                                                                                                                                                                                                                                                        |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 4.4    |   | Notes                Purchase Agreement, dated February 16, 2007, by and among the registrant,                Safetech, CSST HK, CSST PRC, Golden, Cheng Feng and Citadel Equity                Fund                Ltd. (incorporated by reference to Exhibit 4.1 to the registrant’s Current                Report on Form 8-K filed with the Securities and Exchange Commission                on                February 16, 2007).                                                                |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 4.5    |   | Indenture,                dated February 16, 2007, among the registrant, Safetech, CSST HK                and The                Bank of New York (incorporated by reference to Exhibit 4.2 to the                registrant’s Current Report on Form 8-K filed with the Securities and                Exchange Commission on February 16, 2007).                                                                                                                                                      |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 4.6    |   | Investor                Rights Agreement, dated February 16, 2007, among the registrant,                Safetech,                CSST HK, CSST PRC, Golden, Cheng Feng, Guoshen Tu, Zhiqun Li, Whitehorse                Technology Limited and Citadel Equity Fund Ltd. (incorporated by                reference                to Exhibit 4.3 to the registrant’s Current Report on Form 8-K filed with                the Securities and Exchange Commission on February 16,                2007). |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 4.7    |   | Supplemental                Indenture, dated March 29, 2007, among the Company, Safetech, CSST-HK                and                The Bank of New York. (incorporated by reference to Exhibit 4.1 to                the                registrant’s Current Report on Form 8-K filed with the Securities and                Exchange Commission April 2, 2007).                                                                                                                                      |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 4.8    |   | Amendment                to the Investor Rights Agreement, dated March 29, 2007, among the                Company,                Safetech, CSST-HK, CSST-PRC, Golden, Cheng Feng, Mr. Tu, Ms. Li,                Whitehorse and Citadel. (incorporated by reference to Exhibit 4.2                to the                registrant’s Current Report on Form 8-K filed with the Securities and                Exchange Commission April 2, 2007).                                                      |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 10.1   |   | China                Security & Surveillance Technology, Inc. 2007 Equity Incentive Plan                (incorporated by reference to Exhibit 99.1 to the registrant’s Current                Report on Form 8-K filed with the Securities and Exchange Commission                on                February 13, 2007).                                                                                                                                                                            |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |

----

| 10.2   |   | Equity                Purchase Agreement, dated April 2, 2007, by and among the registrant,                China Safetech Holdings Limited, Chain Star Investments Limited and                Zheng                Huang.*    |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                          |
| 31.1   |   | Certification                of Principal Executive Officer filed pursuant to Section 302 of the                Sarbanes-Oxley Act of 2002.*                                                                                  |
|   |   |                                                                                                                                                                                                                          |
| 31.2   |   | Certification                of Principal Financial Officer filed pursuant to Section 302 of the                Sarbanes-Oxley Act of 2002.*                                                                                  |
|   |   |                                                                                                                                                                                                                          |
| 32.1   |   | Certification                of Principal Executive Officer furnished pursuant to 18 U.S.C. Section                1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act                of                2002.* |
|   |   |                                                                                                                                                                                                                          |
| 32.2   |   | Certification                of Principal Financial Officer furnished pursuant to 18 U.S.C. Section                1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act                of                2002.* |

----

**SIGNATURES      **

|         |                                                                  |                                   |
|--------------|-----------------------------------------------------------------------|----------------------------------------|
|         | **China                Security & Surveillance Technology, Inc.** |
|    |                                                             |                              |
|              | By:                                                         | /s/ Guoshen              Tu  |
|         | Guoshen              Tu                                               |
|         | Principle              Executive Officer                              |

|   |                                     |                                          |
|--------|------------------------------------------|-----------------------------------------------|
|        | By:                            | /s/ Terence              Yap   |
|   | Terence              Yap                 |
|   | Principle              Financial Officer |

----

**EXHIBIT      INDEX**

| **Exhibit                Number** |   | **Description**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|-----------------------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 3.1                               |   | Certificate                of Incorporation of the registrant (incorporated by reference to                Exhibit                3.1 to the registrant’s Registration Statement on Form S-4 filed with the                Securities and Exchange Commission on October 4, 2006).                                                                                                                                                                                                                     |
|                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 3.2                               |   | By-laws                of the registrant (incorporated by reference to Exhibit 3.2 to the                registrant’s Registration Statement on Form S-4 filed with the Securities                and Exchange Commission on October 4, 2006).                                                                                                                                                                                                                                                         |
|                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 4.1                               |   | Notes                Purchase Agreement, dated February 5, 2007, by and between the registrant                and Citadel Equity Fund Ltd. (incorporated by reference to Exhibit                4.1 to                the registrant’s Current Report on Form 8-K filed with the Securities and                Exchange Commission on February 9, 2007).                                                                                                                                               |
|                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 4.2                               |   | Share                Pledge Agreement, dated February 8, 2007, by and among Citadel Equity                Fund                Ltd., The Bank of New York, Guoshen Tu, Zhiqun Li and Whitehorse                Technology Limited (incorporated by reference to Exhibit 4.2 to the                registrant’s Current Report on Form 8-K filed with the Securities and                Exchange Commission on February 9, 2007).                                                                        |
|                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 4.3                               |   | Form                of the Notes (incorporated by reference to Exhibit 4.3 to the registrant’s                Current Report on Form 8-K filed with the Securities and Exchange                Commission on February 9, 2007).                                                                                                                                                                                                                                                                        |
|                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 4.4                               |   | Notes                Purchase Agreement, dated February 16, 2007, by and among the registrant,                Safetech, CSST HK, CSST PRC, Golden, Cheng Feng and Citadel Equity                Fund                Ltd. (incorporated by reference to Exhibit 4.1 to the registrant’s Current                Report on Form 8-K filed with the Securities and Exchange Commission                on                February 16, 2007).                                                                |
|                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 4.5                               |   | Indenture,                dated February 16, 2007, among the registrant, Safetech, CSST HK                and The                Bank of New York (incorporated by reference to Exhibit 4.2 to the                registrant’s Current Report on Form 8-K filed with the Securities and                Exchange Commission on February 16, 2007).                                                                                                                                                      |
|                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 4.6                               |   | Investor                Rights Agreement, dated February 16, 2007, among the registrant,                Safetech,                CSST HK, CSST PRC, Golden, Cheng Feng, Guoshen Tu, Zhiqun Li, Whitehorse                Technology Limited and Citadel Equity Fund Ltd. (incorporated by                reference                to Exhibit 4.3 to the registrant’s Current Report on Form 8-K filed with                the Securities and Exchange Commission on February 16,                2007). |
|                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 4.7                               |   | Supplemental                Indenture, dated March 29, 2007, among the Company, Safetech, CSST-HK                and                The Bank of New York. (incorporated by reference to Exhibit 4.1 to                the                registrant’s Current Report on Form 8-K filed with the Securities and                Exchange Commission April 2, 2007).                                                                                                                                      |
|                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |

----

| 4.8    |   | Amendment                to the Investor Rights Agreement, dated March 29, 2007, among the                Company,                Safetech, CSST-HK, CSST-PRC, Golden, Cheng Feng, Mr. Tu, Ms. Li,                Whitehorse and Citadel. (incorporated by reference to Exhibit 4.2                to the                registrant’s Current Report on Form 8-K filed with the Securities and                Exchange Commission April 2, 2007). |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.1   |   | China                Security & Surveillance Technology, Inc. 2007 Equity Incentive Plan                (incorporated by reference to Exhibit 99.1 to the registrant’s Current                Report on Form 8-K filed with the Securities and Exchange Commission                on                February 13, 2007).                                                                                                                       |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.2   |   | Equity                Purchase Agreement, dated April 2, 2007, by and among the registrant,                China Safetech Holdings Limited, Chain Star Investments Limited and                Zheng                Huang.*                                                                                                                                                                                                                              |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 31.1   |   | Certification                of Principal Executive Officer filed pursuant to Section 302 of the                Sarbanes-Oxley Act of 2002.*                                                                                                                                                                                                                                                                                                            |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 31.2   |   | Certification                of Principal Financial Officer filed pursuant to Section 302 of the                Sarbanes-Oxley Act of 2002.*                                                                                                                                                                                                                                                                                                            |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 32.1   |   | Certification                of Principal Executive Officer furnished pursuant to 18 U.S.C. Section                1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act                of                2002.*                                                                                                                                                                                                                           |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 32.2   |   | Certification                of Principal Financial Officer furnished pursuant to 18 U.S.C. Section                1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act                of                2002.*                                                                                                                                                                                                                           |

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