U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

(Mark One)

   [X]    Quarterly report under Section 13 or 15(d) of the Securities
            Exchange Act of 1934

              For the quarterly period ended   June 30, 2007
                                               --------------

   [ ]    Transition report under Section 13 or 15(d) of the Exchange Act

              For the transition period from __________  to  ___________


                    Commission File Number:   1-10526
                                            -----------


                           UNITED-GUARDIAN, INC.
-------------------------------------------------------------------------
         (Exact name of registrant as specified in its charter)


          Delaware                                11-1719724
-------------------------------      ------------------------------------
(State or other jurisdiction of      (I.R.S. Employer Identification No.)
 incorporation or organization)


                230 Marcus Boulevard, Hauppauge, New York 11788
-------------------------------------------------------------------------
                    (Address of principal executive offices)


                                 (631) 273-0900

-------------------------------------------------------------------------
                         (Registrant's telephone number)

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



     Indicate  by check  mark  whether  the  registrant  (1) filed  all  reports
required to be filed by Section 13 or 15(d) of the  Exchange Act during the past
12 months (or for such shorter  period that the  registrant was required to file
such reports), and (2) has been subject to such filing requirements for the past
90 days.

                                                                Yes [X]  No [ ]




                             Cover Page 1 of 2 Pages
<page>

     Indicate  by check mark  whether  the  registrant  is a shell  company  (as
defined in Rule 12b-2 of the Exchange Act.)

                                                                Yes [ ]  No [X]



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

     Indicate  by check mark  whether the  registrant  filed all  documents  and
reports  required  to be filed by Section  12, 13 or 15(d) of the  Exchange  Act
after the distribution of securities under a plan confirmed by a court.

                                                                Yes [ ]  No [ ]


                      APPLICABLE ONLY TO CORPORATE ISSUERS

     State the number of shares  outstanding of each of the issuer's  classes of
common equity, as of the latest practicable date:

                        4,946,439 shares of common stock,
                            par value $.10 per share,
                             (as of August 1, 2007)

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































                             Cover Page 2 of 2 Pages
<page>
                              UNITED-GUARDIAN, INC.

                                      INDEX

                                                                        Page No.
                                                                       ---------
Part I.  FINANCIAL INFORMATION

   Item 1 - Financial Statements

              Consolidated Statements of Income -  Three Months and Six
                Months ended June 30, 2007 and 2006 (unaudited).........     2

              Consolidated Balance Sheets -
                June 30, 2007 (unaudited) and December 31, 2006.........   3-4

              Consolidated Statements of Cash Flows - Six Months
                ended June 30, 2007 and 2006 (unaudited).............. .     5

              Consolidated Notes to (unaudited) Financial Statements....  6-13

   Item 2 - Management's Discussion and Analysis of Financial
              Condition and Results of Operations....................... 13-18

   Item 3 - Controls and Procedures.....................................    18

Part II. OTHER INFORMATION

   Item 1 - Legal Proceedings...........................................    18

   Item 2 - Changes in Securities and Use of Proceeds...................    18

   Item 3 - Defaults Upon Senior Securities.............................    18

   Item 4 - Submission of Matters to a Vote of Security Holders.........    18

   Item 5 - Other Information........................................... 18-19

   Item 6 - Exhibits and Reports On Form 8-K............................    19

Signatures..............................................................    19



















                                        1
<page>
                          Part I. FINANCIAL INFORMATION

ITEM 1. Financial Statements

                              UNITED-GUARDIAN, INC.
                        CONSOLIDATED STATEMENTS OF INCOME

                                   (UNAUDITED)

<table>
<caption>
                                                   SIX MONTHS ENDED             THREE MONTHS ENDED
                                                       JUNE 30,                      JUNE 30,
                                                  2007          2006            2007          2006
                                                 ------        ------          ------        ------
<S>                                           <C>           <C>             <C>           <C>
Revenue:
  Net sales                                   $ 7,244,933   $ 5,921,812     $ 3,017,507   $ 3,057,015
                                               ----------    ----------      ----------    ----------
Costs and expenses:
  Cost of sales                                 3,114,295     2,793,799       1,301,269     1,441,188
  Operating expenses                            1,479,617     1,374,458         749,411       733,334
                                               ----------    ----------      ----------    ----------
                                                4,593,912     4,168,257       2,050,680     2,174,522
                                               ----------    ----------      ----------    ----------
      Income from operations                    2,651,021     1,753,555         966,827       882,493


Other income (expense):
  Investment income                               285,436       195,102         160,043       114,679
  Loss on sale of marketable securities              -             (349)           -             (349)
  Gain on sale of equipment                         5,000           -             5,000          -
  Other                                               (42)         (227)           -             (227)
                                                 ---------    ----------       ---------    ----------
      Income before income taxes                2,941,415     1,948,081       1,131,870       996,596

Provision for income taxes                      1,046,100       675,700         396,600       346,200
                                                ---------     ---------       ---------     ---------
      Net income                              $ 1,895,315   $ 1,272,381     $   735,270   $   650,396
                                                =========     =========       =========     =========
Earnings per common share
   (basic and diluted)                        $       .38   $       .26     $       .15   $       .13
                                                =========     =========       =========     =========
Weighted average shares - basic                 4,943,422     4,941,167       4,944,547     4,942,139
                                                =========     =========       =========     =========
Weighted average shares - diluted               4,945,382     4,944,600       4,945,877     4,944,876
                                                =========     =========       =========     =========

</table>









                 See notes to consolidated financial statements

                                        2
<page>
                              UNITED-GUARDIAN, INC.
                           CONSOLIDATED BALANCE SHEETS

                                              JUNE 30,         DECEMBER 31,
                                                2007               2006
                                            ------------       -------------
              ASSETS                         (UNAUDITED)         (AUDITED)
Current assets:
     Cash and cash equivalents           $   3,291,118      $    3,027,486
     Temporary investments                     541,669             527,825
     Marketable securities                   7,402,913           7,346,653
     Accounts receivable, net of
       allowance for doubtful accounts
       of 47,000 at June 30, 2007
       and December 31, 2006,
       respectively                          1,260,942           1,421,788
     Inventories (net)                       1,262,496           1,923,068
     Prepaid expenses and other
        current assets                         253,026             165,288
     Deferred income taxes                     557,761             534,761
                                           -----------         -----------
              Total current assets          14,569,925          14,946,869
                                           -----------         -----------

Property, plant and equipment:
     Land                                       69,000              69,000
     Factory equipment and fixtures          3,187,780           3,119,797
     Building and improvements               2,283,717           2,161,418
     Waste disposal plant                      133,532             133,532
                                           -----------         -----------
                                             5,674,029           5,483,747
       Less: Accumulated depreciation        4,724,296           4,634,954
                                           -----------         -----------
                                               949,733             848,793
                                           -----------         -----------

Other assets                                   148,430             148,430
                                           -----------         -----------
                                        $   15,668,088      $   15,944,092
                                           ===========         ===========


















                 See notes to consolidated financial statements

                                        3
<page>
                              UNITED-GUARDIAN, INC.
                           CONSOLIDATED BALANCE SHEETS

                                              JUNE 30,         DECEMBER 31,
                                               2007                2006
                                          ---------------      ------------
                                            (UNAUDITED)         (AUDITED)
LIABILITIES AND
STOCKHOLDERS' EQUITY

Current liabilities:
   Dividends payable                       $     -             $1,087,271
   Accounts payable                           170,331             222,625
   Current loans payable                        7,988               7,988
   Taxes payable                              114,529              65,438
   Accrued expenses                           893,401             579,913
                                            ---------           ---------
         Total current liabilities          1,186,249           1,963,235
                                            ---------           ---------


 Loans payable                                 10,651              14,645
 Accrued pension liability                    675,847             706,162
 Deferred income taxes                         34,360              34,360
                                            ---------           ---------
                                              720,858             755,167
                                            ---------           ---------

Stockholders' equity:
   Common stock $.10 par value,
      authorized, 10,000,000 shares;
      5,008,639 and 5,004,339 shares
      issued, respectively, and
      4,946,439 and 4,942,139
      shares outstanding, respectively        500,864             500,434
   Capital in excess of par value           3,806,205           3,792,478
   Accumulated other comprehensive loss      (604,827)           (566,130)
   Retained earnings                       10,418,369           9,858,538
   Treasury stock, at cost; 62,200 shares    (359,630)           (359,630)
                                            ---------           ---------
         Total stockholders' equity        13,760,981          13,225,690
                                            ---------           ---------
                                         $ 15,668,088        $ 15,944,092
                                           ==========          ==========














                 See notes to consolidated financial statements

                                        4
<page>
                                  UNITED-GUARDIAN, INC.
                          CONSOLIDATED STATEMENTS OF CASH FLOWS
                                       (UNAUDITED)
                                                           SIX MONTHS ENDED
                                                               JUNE 30,
                                                             ------------
                                                        2007             2006
                                                      --------         --------
Cash flows provided by operating activities:

  Net income                                       $ 1,895,315      $ 1,272,381
  Adjustments to reconcile net income
    to net cash flows from operations:
      Depreciation and amortization                    103,367           94,512
      Gain on sale of equipment                         (5,000)            -
      Realized loss on sale of marketable securities      -                 349
      Provision for doubtful accounts                     -             (11,212)
      Reduction in inventory obsolescence                 -              19,000
      Increase (decrease) in cash resulting from
        changes in operating assets and liabilities:
          Accounts receivable                          160,846           36,286
          Inventories                                  660,572         (502,300)
          Prepaid expenses and other current
            and non-current assets                     (87,738)         (42,373)
          Accounts payable                             (52,294)          42,016
          Accrued pension costs                        (30,315)            -
          Accrued expenses and taxes payable           362,579          156,352
                                                    ----------       ----------
      Net cash provided by operating activities      3,007,332        1,065,011
                                                    ----------       ----------
Cash flows from investing activities:

   Acquisition of property, plant and equipment       (204,307)         (26,905)
   Proceeds from sale of equipment                       5,000             -
   Net change in temporary investments                 (13,844)        (303,219)
   Purchase of marketable securities                  (117,957)         (93,803)
   Proceeds form sale of marketable securities            -             600,374
                                                    ----------       ----------
      Net cash (used in) provided by investing
         activities                                   (331,108)         176,447
                                                    ----------       ----------
Cash flows from financing activities:

   Payment of long term debt                            (3,994)            -
   Proceeds from exercise of stock options              14,157           14,040
   Dividends paid                                   (2,422,755)      (2,321,926)
                                                    ----------       ----------
     Net cash used in financing activities          (2,412,592)      (2,307,886)
                                                    ----------       ----------

Net increase (decrease) in cash and cash
      equivalents                                      263,632       (1,066,428)

Cash and cash equivalents at beginning of period     3,027,486        3,425,593
                                                    ----------       ----------
Cash and cash equivalents at end of period         $ 3,291,118      $ 2,359,165
                                                    ==========       ==========

                 See notes to consolidated financial statements

                                        5
<page>
                              UNITED-GUARDIAN, INC.
                   CONSOLIDATED NOTES TO FINANCIAL STATEMENTS

     1. In the opinion of the  Registrant  (also  referred to hereinafter as the
"Company"),   the  accompanying   unaudited  financial  statements  contain  all
adjustments  (consisting of only normal recurring accruals) necessary to present
fairly the financial  position as of June 30, 2007 and the results of operations
for the six months and three months ended June 30, 2007 and 2006. The accounting
policies  followed  by the  Company  are set  forth in the  Company's  financial
statements  included  in its  Annual  Report on Form  10-KSB  for the year ended
December 31, 2006.

     2. The results of operations for the six months and three months ended June
30, 2007 and 2006 are not  necessarily  indicative of the results to be expected
for the full year.

     3.  Stock-Based  Compensation:   At  June  30,  2007,  the  Company  had  a
stock-based  compensation  plan for its employees and  Directors,  which is more
fully described in the Company's Annual Report on Form 10-KSB for the year ended
December 31, 2006.

     The Company  follows the  Financial  Accounting  Standards  Board  ("FASB")
Statement of Financial  Accounting  Standards  ("SFAS") No. 123R, which requires
that the fair value of all share-based  payments to employees,  including grants
of employee stock options, be recognized as expense in the financial statements.

     At June 30, 2007 the  Company had no  share-based  awards  outstanding  and
exercisable  and did not grant any options  during the six months ended June 30,
2007.

     As of June 30, 2007 there was no remaining  unrecognized  compensation cost
related to the non-vested  share-based  compensation  arrangements granted under
the Company's plans.

     The Company did not record any  compensation  expense during the six months
and three months ended June 30, 2007 and 2006 under the provisions of FAS 123R.

     The Company received proceeds of $14,157 from the exercise of options for a
total of 4,300 shares that were  exercised  during the six months ended June 30,
2007. The intrinsic value of those shares was $40,217.  For the six months ended
June 30, 2006 the Company  received  $14,040  from options  exercised  under all
share-based payment arrangements.

     4. Marketable Securities

                                                                    Unrealized
    June 30, 2007                        Cost        Fair Value     Gain/(Loss)
    ------------------                 ----------     ----------     -----------
     Available for Sale:
       U.S. Treasury and agencies      $3,001,026    $2,993,559     $    (7,467)
       Fixed income mutual funds        4,335,697     4,140,613        (195,084)
       Equity and other mutual funds      232,536       268,741          36,205
                                       ----------     -----------    -----------
                                       $7,569,259    $7,402,913     $  (166,346)
                                       ==========     ===========    ===========




                                        6
<page>
                                                                     Unrealized
    December 31, 2006                     Cost        Fair Value     Gain/(Loss)
    -----------------                  ----------     ----------     -----------
     Available for Sale:
       U.S. Treasury and agencies      $3,001,026     $3,003,399     $    2,373
       Fixed income mutual funds        4,220,084      4,091,754       (128,330)
       Equity and other mutual funds      230,192        251,500         21,308
                                       ----------     -----------    -----------
                                       $7,451,302     $7,346,653     $ (104,649)
                                       ==========     ===========    ===========

     5. Inventories - Net

     Inventories consist of the following:        June 30,      December 31,
                                                    2007            2006
                                                ----------      ----------
     Raw materials and work in process          $  409,403      $  313,319
     Finished products and fine chemicals          853,093       1,609,749
                                                ----------      ----------
                                                $1,262,496      $1,923,068
                                                ==========      ==========

     One of the Company's  pharmaceutical  products,  Renacidin  Irrigation,  is
currently  manufactured  for the  Company by a third  party  that had  relocated
production to a new facility,  necessitating the filing of an application by the
Company to the U.S. Food and Drug Administration  ("FDA") to begin production in
the new  facility.  While this  application  was pending  the Company  purchased
additional inventory,  which resulted in an increase of approximately $1 million
in the Company's  finished goods inventory at December 31, 2006 as compared with
December 31, 2005.  At June 30, 2007 the Company had  approximately  $475,000 of
Renacidin Irrigation  remaining.  In May, 2007 the Company received FDA approval
of its application.

     As of June 30,  2007,  and  December  31, 2006 the Company had  reserves of
$109,000 for slow moving and obsolete inventory.

     6. For purposes of the Statement of Cash Flows,  the Company  considers all
highly liquid  investments  purchased with a maturity of three months or less to
be cash equivalents.

Cash  payments for taxes  were  $997,010 and $551,122  for the six months  ended
June  30,    2007  and  2006,  respectively.    No   payments    were  made  for
interest  during these periods.

     The Company paid  dividends of $2,422,755 and $2,321,926 for the six months
ended June 30, 2007 and 2006, respectively.

     7. Income Taxes/FIN 48 Disclosure

     The  Company  adopted  the  provisions  of FIN 48 (see  "RECENT  ACCOUNTING
PRONOUNCEMENTS") on January 1, 2007. The implementation of FIN 48 did not result
in  any  adjustment  to the  Company's  beginning  tax  positions.  The  Company
continues to  fully recognize  its tax benefits which are  offset by a valuation







                                        7
<page>
allowance  to the extent that it is more likely than not that the  deferred  tax
assets  will not be  realized.  As of  January  1, 2007 and June 30,  2007,  the
Company did not have any unrecognized tax benefits.

     The Company files a consolidated  Federal income tax return in the U.S. The
Company  and its  subsidiaries  file  separate  income tax  returns i n New York
State.  The Internal  Revenue  Service  ("IRS") has examined the Company's  U.S.
income tax returns  through 2004.  The Company is subject to  examination by the
IRS for years 2005 and 2006 and by New York State for years 2003 through 2006.

     The  Company's  policy is to  recognize  interest  and  penalties  in Other
Expense.

     8. Comprehensive Income (Loss)

     The components of comprehensive income (loss) are as follows:
<table>
<caption>
                                                            Six months ended June 30,    Three months ended June 30,
                                                              2007            2006             2007            2006
                                                             ------          ------           ------          ------
<S>                                                       <C>             <C>            <C>             <C>
Net income                                                $1,895,315      $1,272,381     $  735,270      $  650,396
                                                          ----------      ----------     ----------      ----------
Other comprehensive income (loss):
   Unrealized gain (loss) on marketable
     securities during period .....................          (61,697)        (99,078)       (88,888)        (62,351)
   Less reclassification adjustment for net
     losses included in net income                              -                374           -                374
                                                           ----------      ----------     ----------      ----------
   Other comprehensive income gain (loss) before tax         (61,697)        (98,704)       (88,888)        (61,977)

Income tax expense (benefit) related to other
   comprehensive income ...........................          (23,000)        (37,800)       (33,100)        (24,000)
                                                          ----------      ----------     ----------      ----------
Other comprehensive income (loss), net of tax......          (38,697)        (60,904)       (55,788)        (37,977)
                                                          ----------      ----------     ----------      ----------
Comprehensive income net of tax ...................       $1,856,618      $1,211,477     $  679,482      $  612,419
                                                          ==========      ==========     ==========      ==========
</table>
     Accumulated other  comprehensive  income (loss) comprises  unrealized gains
and losses on marketable securities and liability for pension benefit net of the
related tax effect.

     At December 31, 2006, the Company included an adjustment to initially apply
SFAS 158 of  $500,481  in it's  2006  Comprehensive  Income  calculation  in the
Consolidated Statement of Stockholders' Equity. This amount should not have been
included in the December 31, 2006 comprehensive income calculation.  The Company
intends  to  correct  the  comprehensive  income  presentation  included  in the
Statement  of Changes in  Stockholders'  Equity for the year ended  December 31,
2006 in the next Form 10-KSB  filing.  This does not affect total  stockholder's
equity at  December  31,  2006.  The  Comprehensive  Income  for the year  ended
December 31, 2006 is as follows:






                                        8
<page>
                                            For the year ended December 31, 2006
                                            ------------------------------------
                                                  As Reported      As Revised
                                                  -----------      ----------
Adjustments to initially apply SFAS 158, net
of deferred income tax benefit of $297,800       $  (500,481)    $     -

Unrealized loss on marketable securities, net
of deferred income tax of $11,200                     18,716          18,716

Net Income                                         2,737,232       2,737,232
                                                   ---------       ---------
Comprehensive Income                             $ 2,255,467     $ 2,755,948
                                                   =========       =========

         9. Earnings Per Share

     The  following  table  sets  forth the  computation  of basic  and  diluted
earnings per share for the three and six months ended June 30, 2007 and 2006.
<table>
<caption>
                                                          Six months ended                Three months ended
                                                              June 30,                          June 30,
                                                         2007           2006              2007           2006
                                                        ------         ------            ------         ------
<S>                                                  <C>            <C>              <C>            <C>
Numerator:
   Net income                                        $1,895,315     $1,272,381        $  735,270     $  650,396
                                                      =========      =========         =========      =========
Denominator:
   Denominator for basic earnings
   per share (weighted average
   shares)                                            4,943,422      4,941,167         4,944,547      4,942,139

Effect of dilutive securities:
   Employee stock options                                 1,960          3,433             1,330          2,737
                                                      ---------      ---------         ---------      ---------

Denominator for diluted earnings
   per share (adjusted weighted-average
   shares) and assumed conversions                    4,945,382      4,944,600         4,945,877      4,944,876
                                                      =========      =========         =========      =========
Basic and diluted earnings per share                 $     0.38     $     0.26        $     0.15     $     0.13
                                                      =========      =========         =========      =========
</table>

     10. The Company  sponsors a  non-contributory  defined benefit plan for its
employees  and has  adopted  FAS 158 (see  "RECENT  ACCOUNTING  PRONOUNCEMENTS")
effective  December  31,  2006.  A  measurement  period from  October 1, 2005 to
October  1,  2006  has been  used for the year  ended  December  31,  2006.  The
following table sets forth the components of the projected net periodic  benefit
costs for the years ending December 31, 2007 and ended December 31, 2006.







                                        9
<page>
                                                       Projected
                                                         2007            2006
                                                       ---------      ---------
Service cost - benefit earned                          $ 126,132      $ 111,449
Interest cost - projected benefit obligation             144,358        158,489
Expected return on plan assets                          (137,632)      (162,412)
Amortization of net loss                                  49,051         61,444
Effects of special events                                   -            91,817
Amortization of prior service costs                        7,461          7,461
                                                       ---------      ---------
Net periodic benefit costs                             $ 189,370      $ 268,248
                                                       =========      =========

     The Company has made contributions totaling $125,000 to the plan in each of
the six-month periods ended June 30, 2007 and 2006. The Company expensed $94,685
and $88,246 for net  periodic  benefit  costs for the six months  ended June 30,
2007 and 2006, respectively.

     11.  The  Company  has  two  reportable  business  segments:  the  Guardian
Laboratories  Division  ("Guardian"),  which develops and manufactures  cosmetic
ingredients,  personal and health care products,  pharmaceuticals  and specialty
industrial   products;   and  Eastern  Chemical   Corporation   ("Eastern"),   a
wholly-owned  subsidiary  of the  Company,  which  distributes  a line  of  fine
chemicals, test solutions, dyes and reagents.

     The accounting policies used to develop segment  information  correspond to
those described in the summary of significant  accounting  policies as set forth
in the Annual Report for the year ended December 31, 2006.  Segment  earnings or
losses are based on earnings or losses from operations  before income taxes. The
reportable   segments  are  distinct   business  units  operating  in  different
industries.   They  are  separately   managed,   with  separate   marketing  and
distribution  systems.  The following  information about the two segments is for
the six and three months ended June 30, 2007 and 2006.
<table>
<caption>
                                                                 Six months ended June 30,
                                                     2007                                            2006
                                     ------------------------------------            ------------------------------------
                                     GUARDIAN       EASTERN         TOTAL            GUARDIAN       EASTERN         TOTAL
                                   ------------   ------------   -----------       ------------   ------------   -----------
<S>                                <C>            <C>            <C>               <C>            <C>            <C>
Revenues from external customers   $ 6,760,706    $   484,227    $ 7,244,933       $ 5,384,005    $   537,807    $ 5,921,812
Depreciation and amortization           43,988           -            43,988            42,247           -            42,247
Segment income before income
  taxes                              2,740,625        (11,527)     2,729,098         1,784,295         46,064      1,830,359
Segment assets                       2,853,295        517,993      3,371,288         3,022,098        540,685      3,562,783
Capital expenditure                     67,668           -            67,668            18,803            -           18,803












                                       10
<page>
Reconciliation to Consolidated Amounts
                                                                                  Six Months Ended June 30,
Income before income taxes                                           2007                                            2006
----------------------------                                     -----------                                     -----------
Total earnings for reportable segments                           $ 2,729,098                                     $ 1,830,359
Other income, net                                                    290,394                                         194,526
Corporate headquarters expense                                       (78,077)                                        (76,804)
                                                                  ----------                                      ----------
Consolidated earnings before income taxes                        $ 2,941,415                                     $ 1,948,081

                                                                  ==========                                      ==========
Assets
------
Total assets for reportable segments                             $ 3,371,288                                     $ 3,562,783
Corporate headquarters                                            12,296,800                                      10,561,413
                                                                  ----------                                      ----------
      Total consolidated assets                                  $15,668,088                                     $14,124,196
                                                                  ==========                                      ==========
</table>
<table>
                                                                 Three months ended June 30,
                                                      2007                                            2006
                                      ------------------------------------            ------------------------------------
                                      GUARDIAN       EASTERN         TOTAL            GUARDIAN       EASTERN         TOTAL
                                    ------------   ------------   -----------       ------------   ------------   -----------
 <S>                                <C>            <C>            <C>               <C>            <C>            <C>
 Revenues from external customers   $ 2,770,056    $   247,451    $ 3,017,507       $ 2,802,971    $   254,044    $ 3,057,015
 Depreciation and amortization           21,563           -            21,563            20,079           -            20,079
 Segment income before income
   taxes                                965,755         (3,777)       961,978           897,102         23,730        920,832


Reconciliation to Consolidated Amounts
                                                                                   Three Months Ended June 30,
  Income before income taxes                                           2007                                            2006
  ----------------------------                                     -----------                                     -----------
  Total earnings for reportable segments                           $   961,978                                     $   920,832
  Other income, net                                                    165,043                                         114,103
  Corporate headquarters expense                                         4,849                                         (38,339)
                                                                    ----------                                      ----------
  Consolidated earnings before income taxes                        $ 1,131,870                                     $   996,596
                                                                    ==========                                      ==========

Other Significant items
-----------------------
<caption>
                                                                    Six  months ended June 30,
                                                     2007                                           2006
                                   ------------------------------------------       -------------------------------------------
                                     Segment                     Consolidated          Segment                     Consolidated
                                      Totals       Corporate        Totals              Totals        Corporate       Totals
                                   ------------   ------------   -------------      -------------   ------------   -------------
<S>                                  <C>            <C>             <C>               <C>            <C>             <C>
Capital expenditures                 $ 67,668       $136,639        $204,307          $ 18,803       $  8,102        $ 26,905
Depreciation and amortization          43,988         59,379         103,367            42,247         52,265          94,512
</table>



                                       11
<page>
<table>
Geographic Information
----------------------
<caption>
                                                               Six Months Ended June 30,
                                                       2007                                2006
                                           ---------------------------         ---------------------------
                                             Revenues      Long-Lived            Revenues      Long-Lived
                                                             Assets                              Assets
                                           -----------    -------------        -----------    -------------
<S>                                        <C>           <C>                   <C>           <C>
United States                              $ 3,233,163   $      949,733        $ 2,413,974   $      880,873
France                                         704,673                             732,393
Other countries                              3,307,097                           2,775,445
                                           -----------    -------------        -----------    -------------
                                           $ 7,244,933   $      949,733        $ 5,921,812   $      880,873
                                           ===========    =============        ===========    =============


                                                     Revenues
                                           ---------------------------
                                               2007            2006
                                           -----------    -------------
Major Customers
---------------
Customer A (Guardian)**                    $ 3,057,229     $ 2,085,254
Customer B (Guardian)**                        557,001         607,277
All other customers                          3,630,703       3,229,281
                                           -----------     -----------
                                           $ 7,244,933     $ 5,921,812
                                           ===========     ===========
</table>
     ** At June 30, 2007  Customers A and B had balances  approximating  38% and
15% of net accounts receivable, respectively. At June 30, 2006 Customers A and B
had balances approximating 36% and 25% of net accounts receivable, respectively.


RECENT ACCOUNTING PRONOUNCEMENTS

     In September 2006, the FASB issued SFAS No. 157, "Fair Value Measurements",
to define  fair  value,  establish  a  framework  for  measuring  fair  value in
accordance with generally accepted accounting principles, and expand disclosures
about fair value  measurements.  SFAS No. 157 will be effective for fiscal years
beginning  after  November  15,  2007,  which for the  Company  will be the 2008
calendar (and fiscal) year.  The Company is assessing the impact the adoption of
SFAS No. 157 will have on the  Company's  consolidated  financial  position  and
results of operations.

     In September 2006, the FSAB issued SFAS No. 158, "Employers  Accounting for
Defined Benefit Pension and other  Postretirement  Plans". SFAS No. 158 improves
reporting   obligations   for  pensions  by  recognizing   the   over-funded  or
under-funded  status of plan as an asset or liability.  The Company  adopted the
initial   requirements   in  its  fiscal  year  ended  December  31,  2006.  The
pronouncement  does not change how the plan assets and  obligations are measured
under SFAS 87 and SFAS 106 nor does it change the  approach  for  measuring  the
annual benefit cost reported in earnings.  Rather,  it eliminates the provisions
that permit assets  and obligations to be  measured as of the date not more than


                                       12
<page>
three months prior to the balance sheet date,  instead requiring  measurement as
of the reporting  date,  which is effective for fiscal year ending  December 31,
2008  for  the  Company.  In  addition  the  pronouncement  requires  previously
unrecognized items, such as actuarial gains and unrecognized prior service costs
or  credits  to be  recognized  in the  balance  sheet as a  component  of other
comprehensive income (loss).

     In February  2007,  the FASB issued SFAS No. 159,  The Fair Value Option of
Financial  Assets and  Financial  Liabilities  (SFAS 159).  SFAS 159 provides an
option to report selected financial assets and financial  liabilities using fair
value.  The  standard  establishes  required  presentation  and  disclosures  to
facilitate  comparisons  with  companies  that use  different  measurements  for
similar assets and liabilities. SFAS 159 is effective for fiscal years beginning
after  November  15,  2007,  with  early  adoption  allowed  if SFAS 157 is also
adopted.  The Company is currently evaluating the impact of adopting SFAS 159 on
its consolidated financial statements.

     On  January  1,  2007,   the  Company   adopted  the   provisions  of  FASB
Interpretation  No. 48, "Accounting for Uncertainty in Income Taxes" ("FIN 48"),
an interpretation of FASB Statement No. 109,  "Accounting for Income Taxes." FIN
48  prescribes  a  recognition  threshold  and  measurement  attribute  for  the
financial  statement  recognition  and  measurement  of a tax position  taken or
expected  to be taken in a tax  return.  The  interpretation  requires  that the
Corporation  recognize the impact of a tax position in the financial  statements
if that position is more likely than not of being  sustained on audit,  based on
the  technical  merits  of  the  position.  FIN 48  also  provides  guidance  on
derecognition,  classification,  interest and  penalties,  accounting in interim
periods  and  disclosure.  In  accordance  with the  provisions  of FIN 48,  any
cumulative  effect  resulting  from the change in accounting  principle is to be
recorded as an adjustment to the opening balance of deficit. The adoption of FIN
48 did not result in a material  impact on the Company's  financial  position or
results of operations.

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

FORWARD LOOKING STATEMENTS

     Statements  made in this Form 10-QSB  which are not purely  historical  are
forward-looking  statements  with  respect  to  the  goals,  plans,  objectives,
intentions,  expectations,  financial condition,  results of operations,  future
performance  and  business of the  Company.  Forward-looking  statements  may be
identified  by the use of such words as  "believes,"  "may,"  "will,"  "should,"
"intends," "plans," "estimates," or "anticipates" or other similar expressions.

     Forward-looking  statements involve inherent risks and  uncertainties,  and
important  factors  (many of which are beyond our  control)  could cause  actual
results  to  differ  materially  from  those  set  forth in the  forward-looking
statements.  In addition to those specific risks and  uncertainties set forth in
the  Company's  reports  currently on file with the SEC, some other factors that
may affect the future results of operations of the Company are: the  development
of products that may be superior to those of the Company; changes in the quality
or  composition  of the  Company's  products;  lack of market  acceptance of the
Company's  products;  the  Company's  ability to develop new  products;  general
economic  or  industry  conditions;  intellectual  property  rights;  changes in
interest rates;  new legislation or regulatory  requirements;  conditions of the
securities  markets;  the  Company's  ability  to  raise  capital;   changes  in



                                       13
<page>
accounting accounting principals, policies or guidelines; financial or political
instability;  acts  of  war  or  terrorism;  and  other  economic,  competitive,
governmental,  regulatory  and  technical  factors that may affect the Company's
operations, products, services and prices.

     Accordingly,  results  actually  achieved may differ  materially from those
anticipated as a result of such forward-looking statements, and those statements
speak only as of the date they are made.  The Company  does not  undertake,  and
specifically disclaims, any obligation to update any forward-looking  statements
to reflect events or circumstances occurring after the date of such statements.

OVERVIEW

     The  Company  is a  Delaware  corporation  that  operates  in two  business
segments: Guardian and Eastern. Guardian conducts research, product development,
manufacturing  and marketing of cosmetic  ingredients,  personal and health care
products,  pharmaceuticals,  and  specialty  industrial  products.  The products
manufactured by Guardian are marketed through marketing partners,  distributors,
direct advertising, mailings, and trade exhibitions. Its most important personal
care  product  line is its  LUBRAJEL(R)  line of  water-based  moisturizing  and
lubricating  gels.  It  also  sells  two  pharmaceutical   products,  which  are
distributed primarily through drug wholesalers and surgical supply houses. There
are also indirect  sales to the Veteran's  Administration  and other  government
agencies in the United States, and to some hospitals and physicians.

     Guardian's  pharmaceutical products are distributed primarily in the United
States.  Its personal  care  products are  marketed  worldwide  primarily by its
marketing  partners,  the largest of which is International  Specialty  Products
Inc. ("ISP").  Approximately  one-half of Guardian's personal care products will
be sold to foreign customers, either directly or through its marketing partners.

     While the Company does have  competition in the marketplace for some of its
products,  many of its products or processes are either unique in their field or
have some unique  characteristics,  and therefore are not in direct  competition
with the products or processes of other pharmaceutical, chemical, or health care
companies. Guardian's research and development department is actively working on
the  development of new products to expand the Company's  personal care products
line.

     The  Company  has been issued  many  patents  and  trademarks,  and intends
whenever  possible  to make  efforts to obtain  patents in  connection  with its
product development program.

     Eastern  distributes a line of fine organic chemicals,  research chemicals,
test solutions,  indicators, dyes and reagents.  Eastern's products are marketed
through  advertising  in trade  publications  and  direct  mailings.  Since  the
Company's business  activities and marketing efforts over the past several years
have  focused  increasingly  on the Guardian  division,  the Company has reduced
Eastern's  inventory levels in order to make it more marketable in the event the
Company  decides  to sell it at some  future  date.  This has  resulted  in some
reduction in sales as compared with previous years.  Sales of this division have
also  declined  as a result  of  increased  competition  from  new and  existing
competitors.







                                       14
<page>
Critical Accounting Policies

     As disclosed in our Annual  Report on Form 10-KSB for the fiscal year ended
December 31, 2006, the  discussion  and analysis of our financial  condition and
results of operations are based on our consolidated financial statements,  which
have been  prepared  in  conformity  with  U.S.  generally  accepted  accounting
principles.  The preparation of those financial  statements  required us to make
estimates  and  assumptions  that  affect  the  amount of  assets,  liabilities,
revenues and expenses  reported in those financial  statements.  Those estimates
and assumptions can be subjective and complex,  and consequently  actual results
could differ from those estimates and assumptions.  Our most critical accounting
policies relate to revenue recognition, concentration of credit risk, inventory,
pension costs,  patents and other  intangible  assets,  and income taxes.  Since
December 31, 2006, there have been no significant changes to the assumptions and
estimates related to those critical accounting policies.

     The  following  discussion  and  analysis  covers  material  changes in the
financial condition of the Company since the year ended December 31, 2006, and a
comparison of the results of operations  for the six and three months ended June
30, 2007 and June 30,  2006.  This  discussion  and  analysis  should be read in
conjunction  with  "Management's  Discussion  and Analysis or Plan of Operation"
included  in the  Company's  Annual  Report on Form  10-KSB  for the year  ended
December 31, 2006.

RESULTS OF OPERATIONS

     Revenue
     -------

     For  the  six-month  period  ended  June  30,  2007,  consolidated  revenue
increased  $1,323,121 (25.6%) versus the comparable period in 2006. Guardian had
a sales  increase of  $1,376,701  (25.5%)  and  Eastern had a sales  decrease of
$53,580 (10.0%).

     For the  three-month  period  ended  June 30,  2007,  consolidated  revenue
decreased  $39,508 (1.3%) versus the comparable  period in 2006.  Guardian had a
sales  decrease of $32,915  (1.2%) and  Eastern  had a sales  decrease of $6,593
(2.6%).

     Guardian's  increase  in sales for the six months  ended June 30,  2007 was
primarily attributable to increases in sales in two product lines:

     (a)  Pharmaceuticals:  On March 1, 2007  Guardian  increased  prices on its
pharmaceutical  products, which resulted in customers purchasing unusually large
quantities  in  February  in  advance of the price  increase.  The result was an
increase in sales of $368,000  (32%) for the six months ended June 30, 2007 when
compared  with the same  period  in 2006.  The  Company  expects  sales of these
products to continue  to be lower than  average  each month until the end of the
third quarter while its  distributors  work off the additional  inventory,  then
gradually increase back to normal levels (based on what has happened after price
increases in the past).  The Company expects  pharmaceutical  sales for the full
year to be comparable to 2006.

     (b)  Personal  Care  Products:  For the six  months  ended  June  30,  2007
Guardian's sales of personal care products  increased by $1,012,000  (30%). That
increase was primarily  attributable  to increased sales to one of the Company's
marketing partners for distribution globally. Almost all of that increase in



                                       15
<page>
sales of personal  care  products was due to increases in sales of the Company's
extensive line of  Lubrajel-based  products.  The increase in sales was due to a
general increase in demand for these products.  The Company cannot yet determine
if such sales increases will continue for the balance of the year.

     In addition to the large increase in both  pharmaceutical and personal care
products  sales  there was also an increase  in sales of the  Company's  medical
(non-pharmaceutical)  products, which increased by $78,000 (10.0%) for the first
six months of 2007  compared  with the same period in 2006.  This  increase  was
attributable  to the  steadily  increasing  demand over the past three years for
these  products by the Company's  existing  customers as opposed to sales to any
new customers.

     Guardian's  decrease  in sales for the three  months  ended  June 30,  2007
compared to the same period in 2006 was primarily due to:

     (a) A decrease of $308,000 (52%) in the Company's  sales of  pharmaceutical
products,  which was the  result of the  additional  buying  that took  place in
February  because of the price  increase that went into effect on March 1st (see
details above).

     (b) A decrease of $75,000 (17%) in sales of its medical (non-pharmaceutical
products). The Company believes that this was attributable to normal variability
in the  buying  patterns  as  opposed  to any real  decline  in demand for these
products.

     These  decreases  (plus some other smaller  decreases) were almost entirely
offset by an increase of $390,000 (22%) in sales of the Company's  personal care
products.  The Company  believes  that this increase was primarily the result of
the timing of orders  rather than any  significant  increase in demand for these
products.

     The  decline  in  sales  of  the  Company's  Eastern  Chemical  Corporation
subsidiary is a result of the continuing implementation of management's previous
decision  to place more  emphasis  on,  and  resources  into,  the growth of the
Company's Guardian  Laboratories  division.  As a result,  inventory levels have
continued their planned  decline,  which has resulted in Eastern's  inability to
fill some orders  that it might have been able to fill in the past.  The Company
continues  to  closely  monitor   Eastern  and  evaluate  the   advisability  of
discontinuing that operation.

     Cost of Sales
     -------------

     Cost of sales as a percentage  of sales  decreased  4.2% from 47.2% for the
six months ended June 30, 2006 to 43.0% for the  comparable  period in 2007. For
the three months ended June 30, 2006  compared  with the three months ended June
30, 2007,  cost of sales as a percentage of sales decreased from 47.1% to 43.1%.
These  decreases  are  primarily due to (a) a decrease in the cost of one of the
Company's primary raw materials;  (b) the  implementation of a price increase in
March, 2007 on one of the Company's  pharmaceutical products; and (c) a positive
variance in overhead  absorption created by an increase in production during the
six and three months ended June 30, 2007 when  compared  with the same period in
2006.





                                       16
<page>
     Operating Expenses
     ------------------

     Operating  Expenses increased $105,159 (7.7%) for the six months ended June
30, 2007 compared with the comparable period in 2006. For the three months ended
June 30, 2007 operating expenses increased $16,077 (2.2%) when compared with the
comparable  period in 2006.  This  increase  was  attributable  to  increases in
medical costs,  legal fees,  Board of Director fees,  freight costs, and payroll
and payroll-related costs.

     Other Income
     ------------

     Other Income  increased  $95,868  (49.3%) for the six months ended June 30,
2007 and $50,940  (44.6%) for the three months ended June 30, 2007 when compared
with the  comparable  periods in 2006. The increase was mainly  attributable  to
higher investment income, which was the result of higher investment balances and
an increase in interest rates.

     Provision for Income Taxes
     --------------------------

     The  provision  for income  taxes  increased  $370,400  (54.8%) for the six
months ended June 30, 2007 when  compared  with the  comparable  period in 2006.
This increase is due to a $993,334  (51.0%) increase in earnings before taxes in
2007 compared to 2006.

     Provision for income taxes  increased  $50,400 (14.6%) for the three months
ended June 2007 when compared to the  comparable  period in 2006.  This increase
was due to a $135,274  (13.6%)  increase in earnings  before taxes for the three
months ended June 30, 2007 when compared with 2006.

     The Company's  effective  income tax rate  increased .9% from 34.7% for the
six months ended June 30, 2006 to 35.6% for the  comparable  period in 2007. The
Company's effective income taxes increased .3% from 34.7% to 35.0% for the three
months ended June 30, 2006 when compared to 2007.  Differences  in the effective
income tax rate from the statutory  federal  incometax rate arise primarily from
capital loss carryforwards, state taxes net of federal benefits, and foreign and
domestic production tax benefits.

LIQUIDITY AND CAPITAL RESOURCES

     Working capital increased by $400,042 from $12,983,634 at December 31, 2006
to $13,383,676  at June 30, 2007.  The current ratio  increased from 7.6 to 1 at
December  31, 2006 to 12.3 to 1 at June 30,  2007.  The  increase in the current
ratio was  primarily  due to the effect of a decrease in dividends  payable from
December 31, 2006 to June 31, 2007,  partially  offset by the increases in taxes
payable and accrued expenses.

     The  Company  has  no  commitments  for  any  further  significant  capital
expenditures during the remainder of 2007, and believes that its working capital
is and will continue to be sufficient to support its operating  requirements for
at least the next twelve months.







                                       17
<page>
     The Company generated cash from operations of $3,007,332 and $1,065,011 for
the six months ended June 30, 2007 and June 30, 2006, respectively. The increase
was  primarily  due to  increases  in net income  from  operations,  and accrued
expenses, offset by a decrease in inventory and accounts receivable

     During the  six-month  period  ended  June 30,  2007  $331,108  was used in
investing  activities,  primarily for building  improvements and the purchase of
equipment.  For the six-month  period ending June 30, 2006 $176,447 was provided
by investing activities, primarily from the sale of marketable securities.

     Cash used in financing activities was $2,412,592 and $2,307,886 for the six
months  ended June 30, 2007 and June 30,  2006,  respectively.  The  increase is
mainly due to an increase in  dividends  paid in the second  quarter of $.27 per
share in 2007 when compared to $.25 per share in 2006.

Item 3.  Controls and Procedures

  (a) Evaluation of Disclosure Controls and Procedures

     Within 90 days prior to the filing of this Quarterly  Report on Form 10-QSB
the  Company's  principal  executive  officer and  principal  financial  officer
evaluated the effectiveness of the design and operation of Company's  disclosure
controls and procedures (as defined in Rules  13a-14(c) and 15d-14(c)  under the
Securities  Exchange Act of 1934 (the  "Exchange  Act")) and concluded  that the
Company's  disclosure  controls  and  procedures  are  effective  to ensure that
information  required to be disclosed by the Company in reports that it files or
submits under the Exchange Act is accumulated and  communicated to the Company's
management,  including its officers,  as appropriate  to allow timely  decisions
regarding required disclosure, and are effective to ensure that such information
is  recorded,  processed,  summarized  and  reported  within  the  time  periods
specified in the Securities and Exchange Commission's rules and forms.

   (b) Changes in Internal Controls

     The Company's  principal  executive officer and principal financial officer
have also concluded there were no significant  changes in the Company's internal
controls or in other  factors that could  significantly  affect  these  controls
subsequent to the date of their  evaluation,  including any  corrective  actions
with regard to significant deficiencies and material weaknesses.

                           PART II - OTHER INFORMATION

ITEM 1 - LEGAL PROCEEDINGS: NONE

ITEM 2 - CHANGES IN SECURITIES AND USE OF PROCEEDS: NONE

ITEM 3 - DEFAULTS UPON SENIOR SECURITIES: NONE

ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS: NONE

ITEM 5 - OTHER INFORMATION:

     On July 10, 2007 the Company  received a letter from the Market  Regulation
Department of the National  Association of Securities  Dealers (the "NASD"),  on
behalf of the  American  Stock  Exchange,  advising the Company that the NASD is
conducting a review of trading activity in the Company's common stock from April
2,  2007  through  May 7,  2007.  In that  letter,  the NASD  requested  various
documents  and  information   related  to  the  Company's   subsequent  earnings
announcement on May 8, 2007.

                                       18
<page>
     Management  of the  Company is  cooperating  fully with this review and has
already  provided to the NASD the  information it requested,  and has offered to
provide any additional  information  that it needs.  The NASD letter states that
its  inquiry  should  not be  construed  as an  indication  that  the  NASD  has
determined  that any  violations  of American  Stock  Exchange  rules or federal
securities laws have occurred, or a reflection upon the merits of the securities
involved or upon any person who effected transactions in such securities.

ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K

     a. Exhibits

        31.1  Certification of Kenneth H. Globus, President and principal
              executive officer of the Company,  pursuant to Section 302 of the
              Sarbanes-Oxley Act of 2002

        31.2  Certification of Robert S. Rubinger, Chief Financial Officer of
              the Company, pursuant to Section 302 of the Sarbanes-Oxley Act of
              2002

        32.1  Certification  of  Kenneth  H.  Globus,  President  and  principal
              executive  officer of the Company,  pursuant to Section 906 of the
              Sarbanes-Oxley Act of 2002.

        32.2  Certification  of Robert S. Rubinger,  Chief Financial  Officer of
              the Company,  pursuant to Section 906 of the Sarbanes-Oxley Act of
              2002.

     b. Reports on Form 8-K

     There were two reports on Form 8-K filed  during the fiscal  quarter  ended
June 30, 2007. The first was filed on May 8, 2007 and related to the issuance of
an earnings  release by the Company on May 8, 2007.  The second was filed on May
18,  2007 and  related to the  declaration  of a $.27 per share  dividend by the
Company's Board of Directors on May 16, 2007.

                                   SIGNATURES

     In accordance with the requirements of the Securities Exchange Act of 1934,
the  Company  has duly  caused  this  report to be  signed on its  behalf by the
undersigned, thereunto duly authorized.


                                      UNITED-GUARDIAN, INC.
                                       (Registrant)

                                      By:  /S/ KENNETH H. GLOBUS
                                           ---------------------
                                           Kenneth H. Globus
                                           President

                                       By: /S/ ROBERT S. RUBINGER
                                           ----------------------
                                           Robert S. Rubinger
                                           Chief Financial Officer

Date:  August 8, 2007



                                       19