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

                                    FORM 10-Q

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

                For the Quarterly period ended December 31, 2003

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

                          Commission file number 0-7885

                      UNIVERSAL SECURITY INSTRUMENTS, INC.

             (Exact name of registrant as specified in its charter)

Maryland                                                        52-0898545
(State or other jurisdiction of                               (I.R.S. Employer
incorporation or organization)                               Identification No.)

7-A Gwynns Mill Court
Owings Mills, Maryland                                             21117
(Address of principal executive offices)                         (Zip Code)

Registrant's telephone number, including area code: (410) 363-3000

                                  Inapplicable
              (Former name, former address and former fiscal year
                         if changed from last report.)

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

Indicate  by check mark  whether  the  registrant  is an  accelerated  filer (as
defined in Rule 12b-2 of the Exchange Act. Yes    No X
                                              ---   ---

At February  12,  2004,  the number of shares  outstanding  of the  registrant's
common stock was 1,164,092.

<PAGE>


                               TABLE OF CONTENTS




Part I - Financial Information                                             Page
                                                                           ----

         Item 1.  Consolidated Financial Statements (unaudited):

                  Consolidated Balance Sheets at December 31, 2003
                  and March 31, 2003                                         3

                  Consolidated Statements of Earnings for the Three and
                  Nine Months Ended December 31, 2003 and 2002               4

                  Consolidated Statements of Cash Flows for the Nine
                  Months Ended December 31, 2003 and 2002                    5

                  Notes to Consolidated Financial Statements                 6

         Item 2.  Management's Discussion and Analysis of Financial
         -------  Condition and Results of Operations                        8

         Item 3.  Quantitative and Qualitative Disclosure About             12
         -------  Market Risk

         Item 4.  Controls and Procedures                                   12
         -------



Part II - Other Information

         Item 1.  Legal Proceedings                                         13
         -------

         Item 2.  Changes in Securities and Use of Proceeds                 13
         -------

         Item 6.  Exhibits and Reports on Form 8-K                          13
         -------

                  Signatures                                                14




                                       2
<PAGE>



                         PART I - FINANCIAL INFORMATION

<TABLE>
ITEM 1. FINANCIAL STATEMENTS

             UNIVERSAL SECURITY INSTRUMENTS, INC. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
                                  (unaudited)

<CAPTION>
                                 ASSETS                                     December 31, 2003      March 31, 2003
                                                                            -----------------      --------------

CURRENT ASSETS
<S>                                                                          <C>                     <C>
Cash                                                                         $   218,705             $   51,112
Accounts receivable:
  Trade (less allowance for doubtful accounts of $70,000 and $10,000
   at December 31 and March 31, 2003, respectively)                              482,798                207,539
Employees                                                                         14,113                 16,303
                                                                             -----------             ----------
                                                                                 496,911                223,842

Amount due from factor                                                         2,207,307                623,566
Inventory                                                                      2,844,327              3,224,229
Prepaid expenses                                                                 187,879                136,343
                                                                             -----------             ----------


TOTAL CURRENT ASSETS                                                           5,955,129              4,259,092

INVESTMENT IN HONG KONG JOINT VENTURE                                          4,651,661              3,831,583

PROPERTY, PLANT AND EQUIPMENT - NET                                               87,141                279,896

OTHER ASSETS                                                                      11,472                 11,472
                                                                             -----------             ----------

TOTAL ASSETS                                                                 $10,705,403             $8,382,043
                                                                             ===========             ==========

                  LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES
Accounts payable                                                             $ 1,283,601             $1,173,175
Accrued liabilities                                                              690,884                684,979
Current obligations under capital lease                                           19,095                 23,250
                                                                             -----------             ----------
TOTAL CURRENT LIABILITIES                                                      1,993,580              1,881,404
                                                                             -----------             ----------

LONG-TERM CAPITAL LEASE OBLIGATIONS                                                    -                  7,224

COMMITMENTS AND CONTINGENCIES                                                          -                      -

SHAREHOLDERS' EQUITY
Common stock, $.01 par value per share; authorized 20,000,000 shares; issued and
outstanding 1,163,592 and 1,121,982 shares at December 31,
2003 and March 31, 2003, respectively                                             11,636                 11,220
Additional paid-in capital                                                    11,190,636             11,059,381
Accumulated deficit                                                           (2,490,449)            (4,577,186)
                                                                             -----------             ----------
TOTAL SHAREHOLDERS' EQUITY                                                     8,711,823              6,493,415
                                                                             -----------             ----------
 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                                  $10,705,403             $8,382,043
                                                                             ===========             ==========


          See accompanying notes to consolidated financial statements.
</TABLE>

                                       3
<PAGE>


<TABLE>
              UNIVERSAL SECURITY INSTRUMENTS, INC. AND SUBSIDIARIES
                       CONSOLIDATED STATEMENTS OF EARNINGS
                                   (Unaudited)

<CAPTION>
                                                                Three Months Ended                    Nine Months Ended
                                                                   December 31,                          December 31,
                                                              2003              2002               2003               2002
                                                              ----              ----               ----               ----

<S>                                                        <C>              <C>                <C>                <C>
Net sales                                                  $3,838,192       $4,252,447         $13,258,624        $12,094,645
Cost of goods sold                                          2,607,525        2,962,846           8,992,005          8,435,672
                                                           ----------       ----------         -----------        -----------

GROSS PROFIT                                                1,230,667        1,289,601           4,266,619          3,658,973

Research and development expense                               68,130           83,657             198,607            216,637
Selling, general and administrative expense                 1,052,642        1,005,189           3,467,833          2,908,909
                                                           ----------       ----------         -----------        -----------

Operating income                                              109,895          200,755             600,179            533,427

Other income (expense):
   Interest expense                                           (26,884)         (40,040)            (90,256)          (113,310)
   Other                                                            -            8,350                   -              9,100
                                                           ----------       ----------         -----------        -----------

                                                              (26,884)         (31,690)            (90,256)          (104,210)
                                                           ----------       ----------         -----------        -----------

INCOME BEFORE EARNINGS FROM HONG KONG JOINT VENTURE            83,011          169,065             509,923            429,217

Earnings from Hong Kong Joint Venture:
   Equity in earnings of Hong Kong Joint Venture              441,713          600,636           1,694,983          1,652,766
   Cost allocatable to Hong Kong Joint Venture                (30,932)         (96,336)           (118,169)          (201,549)
                                                           ----------       ----------          ----------         ----------

NET INCOME                                                 $  493,792       $  673,365          $2,086,737         $1,880,434
                                                           ==========       ==========          ==========         ==========

Net income per common share amounts:
  Basic                                                         $0.44            $0.61               $1.85              $1.77
  Diluted                                                       $0.38            $0.55               $1.62              $1.65
Weighted average number of common shares
   Outstanding
  Basic                                                     1,135,707        1,110,149           1,128,775          1,059,708
  Diluted                                                   1,293,497        1,226,243           1,285,909          1,139,544




           See accompanying notes to consolidated financial statements

</TABLE>


                                       4
<PAGE>


<TABLE>
              UNIVERSAL SECURITY INSTRUMENTS, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (unaudited)

<CAPTION>
                                                                                      Nine Months Ended December 31,
                                                                                      ------------------------------
                                                                                          2003              2002
                                                                                          ----              ----
OPERATING ACTIVITIES
<S>                                                                                   <C>               <C>
Net income                                                                            $2,086,737        $1,880,434
Adjustments to reconcile net income to net cash (used in) provided by operating
activities:
   Depreciation and amortization                                                          25,058            28,798
   Stock issued in lieu of directors' fee                                                 10,000            30,000
   Gain on sale of land                                                                 (175,965)                -
   Earnings of the Hong Kong Joint Venture                                            (1,694,983)       (1,652,766)
   Change in allowance for doubtful accounts                                              60,000                 -
   Changes in operating assets and liabilities:
      Increase in accounts receivable and amounts due from factor                     (1,916,810)       (1,498,629)
      Decrease (increase) in inventories and prepaid expenses                            328,366        (1,117,513)
      Increase in accounts payable and accrued expenses                                  991,236         2,146,549
      Decrease in other assets                                                                 -             1,801
                                                                                      ----------        ----------

NET CASH (USED IN) OPERATING ACTIVITIES                                                 (286,361)         (181,326)

INVESTING ACTIVITIES:
    Purchase of property, plant and equipment                                             (6,336)           (4,165)
    Gross proceeds from sale of land                                                     350,000                 -
                                                                                      ----------        ----------
                                                                                                                 -

NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES                                      343,664            (4,165)

FINANCING ACTIVITIES:
    Proceeds from exercise of stock options                                              123,095            89,125
    Principal payments on capital lease                                                  (11,379)          (11,379)
    Retirement of common stock                                                            (1,426)                -
    Issue of common stock                                                                      -           250,000
                                                                                      ----------        ----------

NET CASH PROVIDED BY FINANCING ACTIVITIES                                                110,290           327,746
                                                                                      ----------        ----------

INCREASE IN CASH                                                                         167,593           142,255

Cash at beginning of period                                                               51,112            19,383
                                                                                      ----------        ----------

CASH AT END OF PERIOD                                                                 $  218,705        $  161,638
                                                                                      ==========        ==========

Supplemental information:
  Interest paid                                                                       $   90,256        $  113,310
  Income taxes paid                                                                            -                 -

Non-cash financing activities:
  Repayment of trade payables due the Hong Kong Joint Venture in lieu of cash            874,904         1,032,479
      distribution
  Issuance of 13,488 shares of common stock in satisfaction of amounts payable                 -            39,200
  Issuance of 567 shares in 2003 and 6,974 shares in 2002 of common stock
  as directors' fee                                                                   $   10,000        $   30,000


     See accompanying notes to condensed consolidated financial statements.


</TABLE>

                                       5
<PAGE>


              UNIVERSAL SECURITY INSTRUMENTS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

Statement of Management

The consolidated financial statements include the accounts of the Company and
its wholly owned subsidiaries. Significant intercompany accounts and
transactions have been eliminated in consolidation. In the opinion of the
Company's management, the interim consolidated financial statements include all
adjustments, consisting of only normal recurring adjustments, necessary for a
fair presentation of the results for the interim periods. Certain information
and footnote disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles in the United States of
America have been condensed or omitted. The interim consolidated financial
statements should be read in conjunction with the Company's March 31, 2003
audited financial statements filed with the Securities and Exchange Commission
on Form 10-K. The interim operating results are not necessarily indicative of
the operating results for the full fiscal year.

Accounts Receivable and Due from Factor

Accounts Receivable  represents sales made to non-factored  customers.  Due from
Factor represents  customers'  invoices sold to the factor for which the Company
has not received payment.

Inventories

Inventories  (consisting primarily of finished goods) are stated at the lower of
cost (first-in, first-out method) or market.

Income Taxes

No income tax expense  has been  provided  for the three and nine month  periods
ended  December  31,  2003 as a  result  of the  carryforward  of  prior  years'
operating losses.

Hong Kong Joint Venture

The Company  maintains a 50%  interest in a Hong Kong Joint  Venture with a Hong
Kong corporation  ("Joint  Venture") which has  manufacturing  facilities in the
People's  Republic  of  China,  for the  manufacturing  of  consumer  electronic
products. The following represents summarized balance sheet and income statement
information  of the Hong Kong Joint  Venture for the nine months ended  December
31, 2003 and 2002:

                                       2003                      2002
                                   -----------               -----------

  Net sales                        $18,862,545               $17,395,366
  Gross profit                       5,822,631                 5,958,635
  Net income                         3,319,731                 3,663,638
  Total current assets               7,215,778                 7,686,402
  Total assets                      12,248,733                10,225,111
  Total current liabilities          2,580,509                 2,731,171

During the nine  months  ended  December  31, 2003 and 2002,  respectively,  the
Company purchased $5,276,159 and $5,578,341 of products from the Hong Kong Joint
Venture.  At December 31, 2003 and 2002, the Company had amounts  payable to the
Hong Kong Joint Venture of $554,874 and $487,176,  respectively. The Company has
adjusted  its  equity in  earnings  of the Hong Kong  Joint  Venture  to reflect
elimination of intercompany profits.

In 2002, the Company  amended its  employment  agreements so that bonus payments
are  allocated   between  domestic   operations  and  Hong  Kong  Joint  Venture
operations.  The Company recorded  $30,932 and $118,169 of costs  allocatable to
the Hong Kong Joint Venture in the accompanying  statement of operations for the
three and nine months  ended  December 31, 2003 and $96,336 and $201,549 for the
same periods last year.



                                       6
<PAGE>

Net Income Per Common Share

Basic earnings per common share is computed based on the weighted average number
of common shares outstanding during the periods presented.  Diluted earnings per
common share is computed  based on the weighted  average number of common shares
outstanding  plus the effect of stock  options  and other  potentially  dilutive
common  stock  equivalents.  The  dilutive  effect  of stock  options  and other
potentially  dilutive common stock  equivalents is determined using the treasury
stock method based on the Company's average stock price.

A reconciliation  of the weighted average shares of common stock utilized in the
computation of basic and diluted earnings per share for the three and nine month
periods ended December 31, 2003 and 2002 is as follows:

<TABLE>
<CAPTION>
                                                Three Months Ended             Nine months Ended
                                                    December 31,                   December 31,
                                                2003          2002             2003           2002
                                                ----          ----             ----           ----

<S>                                          <C>           <C>              <C>             <C>
Weighted average number of common            1,135,707     1,110,149        1,128,775       1,059,708
shares outstanding for basic EPS

Shares issued upon the assumed                 157,790       116,094          157,134          79,836
exercise of outstanding stock options

Weighted average number of common            1,293,497     1,226,243        1,285,909       1,139,544
and common equivalent shares
outstanding for diluted EPS

</TABLE>

Stock Based Compensation

The Company uses the intrinsic value method as defined by Accounting  Principles
Board  Opinion  No. 25 to account for  stock-based  employee  compensation.  The
Company  has  adopted  the  disclosure   requirements  of  Financial  Accounting
Standards   Board  (FASB)   Statement  No.  123,   Accounting  for   Stock-Based
Compensation, as amended by FASB No. 148 during fiscal 2003. The following table
illustrates the effect on net income and earnings per share as if the fair value
based method had been  applied to all  outstanding  and unvested  awards in each
period.

<TABLE>
<CAPTION>
                                                             Three Months Ended           Nine months Ended
                                                                December 31,                 December 31,
                                                            2003            2002         2003            2002
                                                            ----            ----         ----            ----
<S>                                                      <C>            <C>           <C>             <C>
Net income, as reported                                  $493,792       $673,365      $2,086,737      $1,880,434
Deduct:  Total stock-based  employee  compensation
expense  determined  under fair value based method
for all awards, net of related tax effects
                                                          (21,009)       (20,985)        (63,028)        (62,954)
                                                         --------       --------      ----------      ----------
Pro forma net income                                     $472,783       $652,380      $2,023,709      $1,817,480
                                                         ========       ========      ==========      ==========
Earnings per share:
Basic - as reported                                         $0.44          $0.61           $1.85           $1.77
                                                            =====          =====           =====           =====
Basic - pro forma                                           $0.42          $0.59           $1.79           $1.72
                                                            =====          =====           =====           =====
Diluted - as reported                                       $0.38          $0.55           $1.62           $1.65
                                                            =====          =====           =====           =====
Diluted - pro forma                                         $0.37          $0.53           $1.57           $1.59
                                                            =====          =====           =====           =====
</TABLE>

Stockholders' Equity

During the nine months ended December 31, 2003, the Company  granted options for
the purchase of 8,000 shares to employees.  These options are  exercisable at an
average price of $14.04 per share, expiring in 2008, and vested over a four year
period from the date of grant.



                                       7
<PAGE>

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

RESULTS OF OPERATIONS

          This Quarterly  Report on Form 10-Q contains  certain  forward-looking
statements  reflecting the Company's  current  expectations  with respect to its
operations,  performance,  financial  condition,  and other developments.  These
forward-looking  statements  may generally be identified by the use of the words
"may", "will", "believes", "should", "expects", "anticipates",  "estimates", and
similar  expressions.  Such statements are necessarily  estimates reflecting the
Company's best judgment based upon current  information  and involve a number of
risks and  uncertainties.  While it is  impossible  to identify all such factors
which could cause actual results to differ materially from expectations are: (i)
the  Company's  and the Hong Kong  Joint  Venture's  ability,  respectively,  to
maintain operating  profitability,  (ii) competitive practices in the industries
in which  the  Company  competes,  (iii) the  Company's  dependence  on  current
management,  (iv) the  impact  of  current  and  future  laws  and  governmental
regulations  affecting the Company and the Hong Kong Joint Venture,  (v) general
economic  conditions,  (vi) other factors  which may be identified  from time to
time in the  Company's  Securities  and  Exchange  Commission  filings and other
public announcements, and (vii) currency fluctuations. There can be no assurance
that  these  and  other   factors   will  not  affect  the   accuracy   of  such
forward-looking statements.

General
-------

          The  Company is in the  business  of  marketing  safety  and  security
products which are primarily  manufactured through its 50%-owned Hong Kong Joint
Venture.  The Company's financial  statements detail sales and other operational
results of the Company only,  and report the financial  results of the Hong Kong
Joint  Venture as the  Company's  equity in the  earnings of the Hong Kong Joint
Venture.  Accordingly,  the following  discussion  and analysis of the three and
nine-month periods ended December 31, 2003 relate to the operational  results of
the Company  only.  A discussion  and analysis of the Hong Kong Joint  Venture's
operational results for the three and nine-month periods ended December 31, 2003
is presented below under the heading "Hong Kong Joint Venture."

Three Months Ended December 31, 2003 and 2002
---------------------------------------------

Sales.  Net sales for the three months ended  December 31, 2003 were  $3,838,192
compared to $4,252,447 for the comparable three months in the prior fiscal year,
a decrease of $414,255.  Net sales of safety  products  decreased by $375,092 as
compared to the quarter  ended  December 31, 2002.  Net sales of other  products
decreased by $39,163,  as compared to the quarter ended  December 31, 2002.  The
primary  reason for the  decrease in safety sales was the  Company's  previously
reported  voluntary  hold on sales of ground fault circuit  interrupters  (GFCI)
pending  resolution of the  Underwriters  Laboratories  (UL) testing issues (see
"Financial  Condition and Liquidity",  below),  which represented  approximately
$1,100,000  of the Company's  sales during the quarter ended  December 31, 2002,
partially  offset by an  increase  in smoke and carbon  monoxide  alarm sales of
approximately $725,000 in the 2003 period.

          Gross Profit and Gross Profit  Margin.  Gross profit is  calculated as
net sales less cost of goods sold,  and the gross profit margin is calculated as
net sales less cost of goods sold  expressed as a percentage  of net sales.  The
Company's gross profit  decreased from $1,289,601 for the quarter ended December
31, 2002,  to $1,230,667  for the  corresponding  2003 period,  primarily as the
result  of the  Company's  voluntary  hold  on GFCI  sales  in the  2003  period
partially  offset by an increase in smoke and carbon  monoxide alarm sales.  The
Company's  gross  profit  margin  increased  6%, to 32% of sales for the quarter
ended  December 31, 2003 from 30% for the  corresponding  quarter last year. The
increase  in gross  profit  margin  resulted  from a change in product  mix with
higher sales of smoke and carbon monoxide alarms through December 31, 2003.

          Expenses.  Selling,  general and administrative  expenses increased by
$47,453  from the  comparable  three months in the prior year  primarily  due to
implementing  the Company's  expansion in retail  marketing.  As a percentage of
sales, selling, general and administrative expenses were 27% for the three month
period ended December 31, 2003 and 24% for the three month period ended December
31, 2002.  The  increase in selling,  general and  administrative  expenses as a
percentage  of sales  was  mainly  due to the  lower  sales  resulting  from the
Company's voluntary hold on GFCI sales.



                                       8
<PAGE>

          Interest  Expense.  The  Company's  interest  expense  decreased  from
$40,040 for the quarter ended December 31, 2002 to $26,884 for the quarter ended
December 31, 2003. The lower interest expenses  resulted  primarily from reduced
borrowings from factor.

          Net  Income.  The Company  reported a net profit of  $493,792  for the
quarter  ended  December  31, 2003  compared  to net profit of $673,365  for the
corresponding  quarter of the prior  fiscal  year.  The primary  reasons for the
decrease  in net profit  were lower Hong Kong Joint  Venture  earnings,  and the
lower sales resulting from the Company's voluntary hold on GFCI sales.

Nine Months Ended December 31, 2003 and 2002

          Sales.  Net sales for the nine  months  ended  December  31, 2003 were
$13,258,624  compared to $12,094,645 for the comparable nine months in the prior
fiscal year, an increase of $1,163,979.  Net sales of safety products  increased
by $1,384,474 as compared to the quarter ended  December 31, 2002.  Net sales of
other  products  decreased  by  $220,495,  as compared to the nine months  ended
December  31,  2002.  The primary  reason for the  increase in safety  sales was
higher smoke alarm and carbon  monoxide alarm sales,  partially  offset by lower
GFCI sales.

          Gross  Profit and Gross  Profit  Margin.  The  Company's  gross profit
increased  from  $3,658,973  for the nine months ended  December  31,  2002,  to
$4,266,619 for the corresponding 2003 period, primarily as result of an increase
in smoke and carbon  monoxide  alarm sales,  partially  offset by the  Company's
voluntary  hold on GFCI sales in the 2003  period.  The  Company's  gross profit
margin increased 6%, to 32% of sales for the nine months ended December 31, 2003
from 30% for the  corresponding  period last year.  The increase in gross profit
margin  resulted  from a change in product  mix with  higher  sales of smoke and
carbon monoxide alarms through December 31, 2003.

          Expenses.  Selling,  general and administrative  expenses increased by
$558,924 from the  comparable  nine months in the prior year. As a percentage of
sales, selling,  general and administrative expenses were 26% for the nine month
period ended  December 31, 2003 and 24% for the nine month period ended December
31,  2002.  The  increase in selling,  general and  administrative  expenses was
mainly due to higher  commission and freight costs associated with the Company's
higher sales,  higher legal costs  associated  with  defending  patent and other
litigation  previously  reported,  listing on the American Stock  Exchange,  and
implementing the Company's  expansion in retail marketing.  These increases were
partially offset by $146,836,  which was the gain, net of selling expenses, from
the sale of a 1.5 acre parcel of land for gross sale proceeds of $350,000.

          Interest  Expense.  The  Company's  interest  expense  decreased  from
$113,310  for the nine months ended  December 31, 2002,  to $90,256 for the nine
months ended December 31, 2003. The lower interest expenses  resulted  primarily
from reduced borrowings from factor.

          Net Income.  The Company  reported a net profit of $2,086,737  for the
nine months ended December 31, 2003 compared to net profit of $1,880,434 for the
corresponding  period of the prior  fiscal  year.  The  primary  reasons for the
increase  in net profit were higher  Hong Kong Joint  Venture  earnings,  higher
gross profit from Company sales, and the gain on the sale of the 1.5 acre parcel
of land, partially offset by higher selling, general and administrative expenses
discussed above.

FINANCIAL CONDITION AND LIQUIDITY

          Cash needs of the Company are  currently met by funds  generated  from
operations and the Company's  Factoring Agreement which supplies both short-term
borrowings and letters of credit to finance  foreign  inventory  purchases.  The
Company's  maximum amount  available under the Factoring  Agreement is currently
$2,912,000, including due from factor of $2,207,307. However, based on specified
percentages  of the Company's  accounts  receivable  and inventory and letter of
credit  commitments,  at  December  31,  2003,  the  Company  had  approximately
$2,786,000  available under the Factoring Agreement as of December 31, 2003. The
interest rate under the Factoring Agreement on the uncollected factored accounts
receivable and any  additional  borrowings is equal to 1% in excess of the prime
rate of interest charged by the Company's  lender,  which was 5% at December 31,
2003. Borrowings are collateralized by all the Company's accounts receivable and
inventory.  On August 1, 2003,  the Company sold a 1.5 acre parcel of land which
until then had also secured the  borrowings  under the  Factoring  Agreement and
used the  proceeds  to reduce the  outstanding  principal  balance due under the
Factoring Agreement.



                                       9
<PAGE>

          Operating  activities  used cash of  $286,361  for the  quarter  ended
December 31, 2003. This was primarily due to an increase in accounts  receivable
and amount due from factor of  $1,916,810,  and equity in the earnings  from the
Company's  Hong Kong  Joint  Venture  of  $1,694,983,  which  were  offset by an
increase in accounts  payable and  accrued  expenses of  $991,236.  For the same
period  last year,  operating  activities  used cash of  $181,326.  The  Company
anticipates  that if sales  continue  to  increase,  the amount due from  factor
should increase.

          Investing activities provided cash of $343,664 in the current quarter.
For the same period last year,  investing  activities  used cash of $4,165.  The
primary  reason for the change was the sale of land for  $350,000.  The  Company
does  not  anticipate  any  significant  expenditures  for  the  acquisition  of
equipment.

          Financing  activities  provided  cash of $110,290  primarily  from the
exercise of employee  stock  options.  For the same period last year,  financing
activities  provided  cash of  $327,746,  primarily  from the issuance of common
stock for $250,000.

          The  Company   believes  that  funds  available  under  the  Factoring
Agreement,  distributions from the Hong Kong Joint Venture,  and working capital
provide the Company  with  sufficient  resources  to meet its  requirements  for
liquidity  and working  capital in the ordinary  course of its business over the
next twelve months.

          In August 2003, the Company announced that  Underwriters  Laboratories
(UL) had  identified  certain  GFCI units sold by the  Company,  as  potentially
hazardous  and  recommending  their  return.   (See  Part  II,  Item  1,  "Legal
Proceedings", below.) At that time, the Company voluntarily stopped sales of its
GFCI unit inventory.  The U.S. Consumer Product Safety  Commission  reviewed the
matter and closed its inquiry into the Company's GFCI units without recommending
a recall.  The costs,  if any, to the Company related to these GFCI units is not
presently determinable.  The Company is working towards a possible resolution of
any remaining UL concerns. The GFCI units accounted for approximately 20% of the
Company's  sales in the first nine months of the current year.  The Company will
continue  its  voluntary  hold on sales of these GFCI units  until the UL issues
have been resolved. The Company believes that increases in sales of other safety
products  (primarily smoke and carbon monoxide alarms) will partially offset the
loss of GFCI  sales.  The  Company has been  advised by its  supplier  that this
matter should be resolved by the end of the Company's fourth quarter, which ends
March 31, 2004.

HONG KONG JOINT VENTURE

          Net Sales.  Net sales of the Hong Kong Joint Venture for the three and
nine  months  ended  December  31,  2003  were   $5,783,901   and   $18,862,545,
respectively,  compared to $5,667,352  and  $17,395,366,  respectively,  for the
comparable periods in the prior fiscal year. The increase in sales was primarily
due to increased sales of smoke alarms to non-related  customers.  The Hong Kong
Joint  Venture  continues  to  develop  its  own  non-Universal   customer  base
worldwide.

          Net Income.  Net income for the three and nine months  ended  December
31, 2003 was $753,266  and  $3,319,731,  respectively,  compared to $970,811 and
$3,663,638, respectively, in the comparable periods last year.

          Gross  Margins.  Gross  margins of the Hong Kong Joint Venture for the
three month  period ended  December  31, 2003  decreased to 28% from 35% for the
2002 period.  For the nine month period ended  December 31, 2003,  gross margins
decreased  to 31% from 34% for the 2002  period.  The  decrease in gross  profit
margins was mainly due to a general  reduction in the per unit selling price for
DC photoelectric smoke alarms sold to European customers.

          Expenses.  Selling,  general and administrative expenses were $677,976
and  $2,248,257,  respectively,  for the  three  and nine  month  periods  ended
December 31,  2003,  compared to $984,075  and  $2,058,233,  in the prior year's
respective  periods.  As a  percentage  of  sales,  expenses  were  12% and 12%,
respectively,  for the three and nine month  periods  ended  December  31, 2003,
compared to 17% and 9%, respectively, for the three and nine month periods ended
December 31, 2002. The increase in selling,  general and administrative  expense
was due to  increases  in the Hong  Kong  Joint  Venture's  management  fees and
management bonuses for the nine months.

          Interest Income and Expense. Interest income, net of interest expense,
was $490 and $562,  respectively,  for the three and nine  month  periods  ended
December 31, 2003,  compared to interest  income,  net of interest  expense,  of
$6,631 and $2,487, respectively, for the prior year's periods.



                                       10
<PAGE>

          Liquidity. Cash needs of the Hong Kong Joint Venture are currently met
by funds  generated from  operations.  During the nine months ended December 31,
2003, working capital decreased by $947,513 from $5,582,782 on March 31, 2003 to
$4,635,269  on December  31,  2003.  The  primary  reason for the  decrease  was
investment in approximately $2,000,000 of fixed income securities.

CRITICAL ACCOUNTING POLICIES

          Management's  discussion  and analysis of the  Company's  consolidated
financial  statements  and results of  operations  are based upon the  Company's
Consolidated  Financial  Statement  included  as  part  of  this  document.  The
preparation of these consolidated  financial  statements  requires management to
make  estimates  and  judgments  that  affect  the  reported  amounts of assets,
liabilities,  revenues and expenses and related disclosures of contingent assets
and  liabilities.  On an ongoing basis,  the Company  evaluates these estimates,
including  those  related  to  bad  debts,   inventories,   income  taxes,   and
contingencies  and  litigation.  The Company bases these estimates on historical
experiences and on various other  assumptions that are believed to be reasonable
under  the  circumstances,  the  results  of which  form the  basis  for  making
judgments  about the  carrying  values of assets  and  liabilities  that are not
readily  available  from other  sources.  Actual  results  may differ from these
estimates under different assumptions or conditions.

          The Company believes the following critical accounting policies affect
management's more significant judgments and estimates used in the preparation of
its  consolidated  financial  statements.  For  a  detailed  discussion  on  the
application  on  these  and  other  accounting   policies  see  Note  A  to  the
consolidated  financial  statements  included in Item 8 of the Form 10-K for the
year ended  March 31,  2003.  Certain of our  accounting  policies  require  the
application of significant  judgment by management in selecting the  appropriate
assumptions  for  calculating  financial  estimates.   By  their  nature,  these
judgments are subject to an inherent  degree of  uncertainty  and actual results
could differ from these  estimates.  These judgments are based on our historical
experience,  terms  of  existing  contracts,  current  economic  trends  in  the
industry,  information provided by our customers, and information available from
outside sources, as appropriate. Our critical accounting policies include:

          The Company's  revenue  recognition  policies are in  compliance  with
Staff Accounting Bulletin No. 101, "Revenue Recognition in Financial Statements"
issued by the Securities and Exchange  Commission.  Revenue is recognized at the
time product is shipped and title passes  pursuant to the terms of the agreement
with the customer,  the amount due from the customer is fixed and collectibility
of the  related  receivable  is  reasonably  assured.  The  Company  establishes
allowances  to  cover  anticipated   doubtful  accounts  based  upon  historical
experience.

          Inventories  are  valued  at the  lower of  market  or  cost.  Cost is
determined on the first-in  first-out method. The Company has recorded a reserve
for obsolescence or unmarketable  inventory equal to the difference  between the
cost of inventory and the estimated  market value based upon  assumptions  about
future demand and market conditions. Management reviews the reserve quarterly.

          The Company  currently has significant  deferred tax assets  resulting
from tax credit  carryforwards,  net operating loss carryforwards and deductible
temporary  differences,  which will reduce taxable income in future periods. The
Company  has  provided a  valuation  allowance  on future tax  benefits  such as
foreign  tax  credits,  foreign net  operating  losses,  capital  losses and net
operating losses.

          A valuation allowance is required when it is more likely than not that
all or a portion  of a  deferred  tax  assets  will not be  realized.  Forming a
conclusion that a valuation allowance is not needed is difficult when there is a
negative  evidence  such as  cumulative  losses  and  losses  in  recent  years.
Cumulative  losses  weigh  heavily  in the  overall  assessment.  As a result of
management's assessment,  the Company established a full valuation allowance for
its remaining net deferred tax assets at March 31, 2003.

          The  Company is  subject  to  lawsuits  and other  claims,  related to
patents and other  matters.  Management is required to assess the  likelihood of
any adverse judgments or outcomes to these matters,  as well as potential ranges
of probable losses. A determination of the amount of reserves required,  if any,
for these  contingencies is based on a careful analysis of each individual issue
with the assistance of outside legal counsel.  The required  reserves may change
in the future due to new developments in each matter or changes in approach such
as a change in settlement strategy in dealing with these matters.




                                       11
<PAGE>

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

          No material  changes have occurred in the quantitative and qualitative
market risk  disclosures  of the Company as  presented in the  Company's  Annual
Report Form 10-K for the year ended March 31, 2003.


ITEM 4. CONTROLS AND PROCEDURES

          The Company  maintains a system of disclosure  controls and procedures
that is designed to provide  reasonable  assurance  that  information,  which is
required to be  disclosed by the Company in the reports that it files or submits
under the  Securities and Exchange Act of 1934, as amended,  is accumulated  and
communicated  to management in a timely manner.  The Company's  Chief  Executive
Officer and Chief  Financial  Officer have  evaluated  this system of disclosure
controls and  procedures as of the end of the period  covered by this  quarterly
report,  and  believe  that  the  system  is  operating  effectively  to  ensure
appropriate  disclosure.  There have been no changes in the  Company's  internal
control over financial reporting during the most recent fiscal quarter that have
materially  affected,  or  are  reasonably  likely  to  materially  affect,  the
Company's internal control over financial reporting.






                                       12
<PAGE>

                           PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

          In the Company's  Quarterly  Report on Form 10-Q for the quarter ended
September 30, 2003, the Company reported on the Underwriters  Laboratories  (UL)
action with respect to certain  ground fault  circuit  interrupter  (GFCI) units
manufactured  by  Shanghai  Meihao  Electric,  including  GFCI units sold by the
Company.  The Company reported that the U.S.  Consumer Product Safety Commission
(CPSC) reviewed GFCI test results and closed its inquiry into the Company's GFCI
units  without  recommending  a recall.  The  Company  has been  advised  by the
manufacturer  that this matter  should be  resolved by the end of the  Company's
fourth quarter, which ends March 31, 2004.

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS.

          On October 23, 2003, the Company issued 567 shares of its Common Stock
to one of its  directors  in lieu of an annual  $10,000  director's  fee.  These
shares  were  issued  pursuant  to  an  exemption  from  registration  from  the
Securities Act of 1933 pursuant to Section 4(2) and Regulation D thereunder.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

(a)      Exhibits:

Exhibit No.

3.1       Articles of Incorporation  (incorporated by reference to the Company's
          Quarterly  Report on Form 10-Q for the period ended December 31, 1988,
          File No. 0-7885)
3.2       Articles  Supplementary,  filed  October  14,  2003  (incorporated  by
          reference to Exhibit 3.1 to the Company's  Current  Report on Form 8-K
          filed October 31, 2002, file No. 0-7885)
3.3       Bylaws,  as amended  (incorporated  by  reference  to Exhibit 3 to the
          Company's Form 8-A/A filed July 24, 2003)
10.1      Non-Qualified Stock Option Plan, as amended (incorporated by reference
          to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the
          period ended September 30, 2003, File No. 0-7885)
10.2      Hong  Kong  Joint  Venture  Agreement,  as  amended  (incorporated  by
          reference to Exhibit 10.1 to the Company's  Annual Report on Form 10-K
          for the year ended March 31, 2003, File No. 0-7885)
10.3      Amended  Factoring  Agreement  with CIT Group  (successor  to Congress
          Talcott,  Inc.) dated November 14, 1999  (incorporated by reference to
          Exhibit 10.3 to the Company's  Annual Report on Form 10-K for the year
          ended March 31, 2003, File No. 0-7885)
10.4      Amendment  to  Factoring  Agreement  with CIT Group  (incorporated  by
          reference to Exhibit 10.4 to the  Company's  Quarterly  Report on Form
          10-Q for the period ended September 30, 2002, File No. 0-7885)
10.5      Lease  between  Universal  Security  Instruments,  Inc.  and  National
          Instruments  Company  dated  October  21,  1999  for  its  office  and
          warehouse  located at 7-A Gwynns Mill Court,  Owings  Mills,  Maryland
          21117  (incorporated  by reference to Exhibit  10.19 to the  Company's
          Annual  Report on Form 10-K for the Fiscal Year Ended March 31,  2000,
          File No. 0-7885)
10.6      Amended and Restated Employment  Agreement dated April 1, 2003 between
          the Company and Harvey B.  Grossblatt  (incorporated  by  reference to
          Exhibit 10.8 to the Company's  Annual Report on Form 10-K for the year
          ended March 31, 2003, File No. 0-7885)
31.1      Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer*
31.2      Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer*
32.1      Section 1350 Certifications*
99.1      Press Release dated February 12, 2004*
*Filed herewith

(b)      Reports on Form 8-K:

          On November 12, 2003,  the  Registrant  filed a Current Report on Form
8-K, with an amendment thereto filed on December 19, 2003, reporting, under Item
4, the change in  independent  auditor by the  Registrant's  50%-owned Hong Kong
Joint Venture.





                                       13
<PAGE>

                                   SIGNATURES

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

                                           UNIVERSAL SECURITY INSTRUMENTS, INC.
                                           (Registrant)


Date: February 12, 2004                    By:      /s/ Harvey B. Grossblatt
                                              ----------------------------------
                                              Harvey B. Grossblatt
                                              President, Chief Financial Officer




                                       14
<PAGE>

                                                                    Exhibit 31.1
                                                                    ------------

                                  CERTIFICATION


          I, Stephen C. Knepper, certify that:

          1. I have  reviewed  this  Quarterly  Report on Form 10-Q of Universal
Security Instruments, Inc.;

          2. Based on my  knowledge,  this  report  does not  contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not misleading with respect to the period covered by this report;

          3.  Based  on  my  knowledge,  the  financial  statements,  and  other
financial  information  included in this report,  fairly present in all material
respects the financial  condition,  results of operations  and cash flows of the
Registrant as of, and for, the periods presented in this report;

          4. The Registrant's other certifying officer and I are responsible for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Registrant and have:

               (a)  Designed such disclosure controls and procedures,  or caused
                    such disclosure controls and procedures to be designed under
                    our  supervision,   to  ensure  that  material   information
                    relating  to  the  Registrant,  including  its  consolidated
                    subsidiaries,  is made  known to us by others  within  those
                    entities,  particularly  during  the  period  in which  this
                    report is being prepared;

               (b)  Evaluated the  effectiveness of the Registrant's  disclosure
                    controls  and  procedures  and  presented in this report our
                    conclusions   about  the  effectiveness  of  the  disclosure
                    controls and procedures, as of the end of the period covered
                    by this report based on such evaluation; and

               (c)  Disclosed  in this  report  any  change in the  Registrant's
                    internal  control over  financial  reporting  that  occurred
                    during the  Registrant's  most recent  fiscal  quarter  (the
                    Registrant's  fourth fiscal quarter in the case of an annual
                    report)  that  has  materially  affected,  or is  reasonably
                    likely  to  materially  affect,  the  Registrant's  internal
                    control over financial reporting; and

          5. The  Registrant's  other  certifying  officer and I have disclosed,
based  on  our  most  recent  evaluation  of  internal  control  over  financial
reporting,  to the Registrant's auditors and the audit committee of Registrant's
board of directors (or persons performing the equivalent function):

               (a)  All significant  deficiencies and material weaknesses in the
                    design or  operation  of  internal  control  over  financial
                    reporting  which are reasonably  likely to adversely  affect
                    the Registrant's ability to record,  process,  summarize and
                    report financial information; and

               (b)  Any fraud, whether or not material, that involves management
                    or  other  employees  who  have a  significant  role  in the
                    Registrant's internal control over financial reporting.


Date: February 12, 2004                           /s/ Stephen C. Knepper
                                            ------------------------------------
                                            Stephen C. Knepper
                                            Chief Executive Officer


<PAGE>


                                                                    Exhibit 31.2
                                                                    ------------

                                  CERTIFICATION


          I, Harvey B. Grossblatt, certify that:

          1. I have  reviewed  this  Quarterly  Report on Form 10-Q of Universal
Security Instruments, Inc.;

          2. Based on my  knowledge,  this  report  does not  contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not misleading with respect to the period covered by this report;

          3.  Based  on  my  knowledge,  the  financial  statements,  and  other
financial  information  included in this report,  fairly present in all material
respects the financial  condition,  results of operations  and cash flows of the
Registrant as of, and for, the periods presented in this report;

          4. The Registrant's other certifying officer and I are responsible for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Registrant and have:

               (a)  Designed such disclosure controls and procedures,  or caused
                    such disclosure controls and procedures to be designed under
                    our  supervision,   to  ensure  that  material   information
                    relating  to  the  Registrant,  including  its  consolidated
                    subsidiaries,  is made  known to us by others  within  those
                    entities,  particularly  during  the  period  in which  this
                    report is being prepared;

               (b)  Evaluated the  effectiveness of the Registrant's  disclosure
                    controls  and  procedures  and  presented in this report our
                    conclusions   about  the  effectiveness  of  the  disclosure
                    controls and procedures, as of the end of the period covered
                    by this report based on such evaluation; and

               (c)  Disclosed  in this  report  any  change in the  Registrant's
                    internal  control over  financial  reporting  that  occurred
                    during the  Registrant's  most recent  fiscal  quarter  (the
                    Registrant's  fourth fiscal quarter in the case of an annual
                    report)  that  has  materially  affected,  or is  reasonably
                    likely  to  materially  affect,  the  Registrant's  internal
                    control over financial reporting; and

          5. The  Registrant's  other  certifying  officer and I have disclosed,
based  on  our  most  recent  evaluation  of  internal  control  over  financial
reporting,  to the Registrant's auditors and the audit committee of Registrant's
board of directors (or persons performing the equivalent function):

               (c)  All significant  deficiencies and material weaknesses in the
                    design or  operation  of  internal  control  over  financial
                    reporting  which are reasonably  likely to adversely  affect
                    the Registrant's ability to record,  process,  summarize and
                    report financial information; and

               (d)  Any fraud, whether or not material, that involves management
                    or  other  employees  who  have a  significant  role  in the
                    Registrant's internal control over financial reporting.


Date: February 12, 2004                          /s/ Harvey B. Grossblatt
                                            ------------------------------------
                                            Harvey B. Grossblatt
                                            Chief Financial Officer


<PAGE>
                                                                    Exhibit 32.1
                                                                    ------------




                           SECTION 1350 CERTIFICATIONS


          In  connection  with  the  Quarterly  Report  of  Universal   Security
Instruments,  Inc. (the  "Company") on Form 10-Q for the period ending  December
31, 2003 as filed with the Securities and Exchange  Commission and to which this
Certification  is an exhibit (the  "Report"),  the  undersigned  hereby certify,
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

          (1)       The Report fully complies with the  requirements  of section
                    13(a) or 15(d) of the Securities Exchange Act of 1934; and

          (2)       The information  contained in the Report fairly presents, in
                    all material respects, the financial condition and result of
                    operations of the Company for the periods reflected therein.



Date: February 12, 2004                            /s/ Stephen C. Knepper
                                            ------------------------------------
                                            Stephen C. Knepper
                                            Chief Executive Officer


                                                  /s/ Harvey B. Grossblatt
                                            ------------------------------------
                                            Harvey B. Grossblatt
                                            Chief Financial Officer


<PAGE>

                                                                    Exhibit 99.1
                                                                    ------------

                                                           For Immediate Release
                                          Contact:  Harvey Grossblatt, President
                                            Universal Security Instruments, Inc.
                                                          410-363-3000, Ext. 224
                                                                              or
                                                          Don Hunt, Jeff Lambert
                                             Lambert, Edwards & Associates, Inc.
                                                                    616-233-0500


         Universal Security Instruments Announces Third-Quarter Results
         --------------------------------------------------------------
              Company Posts 11th Consecutive Profitable Quarter and
            Joint Venture Receives Regulatory Approval for Australia


OWINGS  MILLS,  MD,  February 12, 2004 - Universal  Security  Instruments,  Inc.
(AMEX:  UUU) today announced results for its third quarter and nine months ended
December 31, 2003.

The  Owings  Mills,  MD-based  designer  and  marketer  of safety  and  security
equipment  posted net earnings  for the quarter of $493,792,  or $0.44 per basic
share ($0.38 per diluted share),  on net sales of $3,838,192,  compared with net
earnings of $673,365, or $0.61 per basic share ($0.55 per diluted share), on net
sales of $4,252,447 for last year's third quarter.

For the nine months  ended  December  31,  2003,  sales rose 10% to  $13,258,624
versus  $12,094,645 for the same period last year. The Company reported that net
earnings  rose 11% to  $2,086,737,  or $1.85 per basic share  ($1.62 per diluted
share), compared to net earnings of $1,880,434,  or $1.77 per basic share ($1.65
per diluted share), for the same period last year.

The Company noted that while sales of its core smoke and carbon  monoxide  alarm
products increased for the quarter,  overall third quarter results were affected
by Universal's  voluntary hold on sales of its ground fault circuit  interrupter
(GFCI) units.  Universal  cited ongoing market share gains in the retail channel
and electrical  distribution businesses as contributing to the increase in smoke
and carbon  monoxide  alarm sales.  The third quarter  marked the Company's 11th
consecutive quarter of profitability.

As previously  announced,  Underwriters  Laboratories (UL) identified  potential
problems with the GFCI units  manufactured by Shanghai Meihao Electric,  Inc. As
one of several companies distributing these units, Universal voluntarily stopped
sales in August. The manufacturer of the GFCI units has advised the Company that
it is working  closely with UL and expects to have this matter  resolved  during
the fourth quarter which ends March 31, 2004.

Steve Knepper,  chairman of the board and chief  executive  officer of Universal
Security Instruments commented,  "Our third quarter results reflect the strength
we have developed  within our core product  lines,  as we were basically able to
hold our sales levels  despite not shipping any GFCI units.  Also, we have begun
initial  shipments  of the  highly  anticipated  combination  smoke  and  carbon
monoxide  alarms and expect them to be a  significant  addition to our expanding
product line.  Additionally,  our 50%-owned Hong Kong joint venture has recently
received  regulatory  approval  to sell  AC/DC  smoke  alarms to the  retail and
electrical distribution markets in Australia."

The  Company  said it was very  encouraged  by the  sales  increase  of its core
products.  This  increase  in  sales,  coupled  with  the  addition  of our  new
combination  smoke and carbon monoxide  alarms,  reinforces our need for the new
250,000  square-foot  manufacturing  facility  the Hong Kong  joint  venture  is
expected to open in late spring.

UNIVERSAL SECURITY  INSTRUMENTS,  INC.  (www.universalsecurity.com),  founded in
1969, is a  Maryland-based  manufacturer  and  worldwide  marketer of safety and
security products directly and through its 50%-owned Hong Kong Joint Venture.


<PAGE>


                                      (2)

                      UNIVERSAL SECURITY INSTRUMENTS, INC.
                        CONSOLIDATED STATEMENT OF INCOME
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                 Three Months Ended December 31,
                                                                                     2003               2002
                                                                                     ----               ----

<S>                                                                               <C>                <C>
Sales                                                                             $3,838,192         $4,252,447

Net income*                                                                          493,792            673,365

Income per share
      Basic                                                                              .44                .61
      Diluted                                                                            .38                .55

Weighted average number of common shares outstanding
      Basic                                                                        1,135,707          1,110,149
      Diluted                                                                      1,293,497          1,226,243


                                                                                  Nine Months Ended December 31,
                                                                                     2003               2002
                                                                                     ----               ----

Sales                                                                            $13,258,624        $12,094,645

Net income*                                                                        2,086,737          1,880,434

Income per share
      Basic                                                                             1.85               1.77
      Diluted                                                                           1.62               1.65

Weighted average number of common shares outstanding
          Basic                                                                    1,128,775          1,059,708
          Diluted                                                                  1,285,909          1,139,544
</TABLE>

     * Due to the tax benefit carryforward of prior years' operating losses,
                         no tax liability was incurred.

                 ----------------------------------------------

Statements  contained in this press  release that are not  historical  facts are
forward-looking  statements  as that term is defined in the  Private  Securities
Litigation Reform Act of 1995.  Although  UNIVERSAL SECURITY  INSTRUMENTS,  INC.
believes that the expectations reflected in such forward-looking  statements are
reasonable;   the   forward-looking   statements   are   subject  to  risks  and
uncertainties  that could cause actual results to differ  materially  from those
projections.