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 September 26, 2008

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

       For the transition period from ________________ to _______________

                           Commission File No. 0-5278

                                 IEH CORPORATION
             (Exact name of registrant as specified in its charter)

                New York                                       13-5549348
   (State or other jurisdiction of                         (I.R.S. Employer
    incorporation or organization)                      Identification Number)

               140 58th Street, Suite 8E, Brooklyn, New York 11220
                     (Address of principal executive office)

       Registrant's telephone number, including area code: (718) 492-4440

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

      Check whether the Issuer: (1) has filed all reports required to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days.

            Yes |X|    No |_|

      Indicate by check mark whether the registrant is a large accelerated
filer, an accelerated filer, a non-accelerated filer, or a smaller reporting
company. See the definitions of "large accelerated filer," "accelerated filer"
and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

         Large accelerated filer |_|         Accelerated filer |_|

         Non-accelerated filer |_|           Smaller Reporting Company |X|
     (Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). YES |_| NO |X|

2,303,468 shares of Common Shares, par value $.01 per share, were outstanding as
of September 26, 2008.

<PAGE>

                                 IEH CORPORATION

                                    CONTENTS

<TABLE>
<CAPTION>
                                                                                     Page
                                                                                    Number
                                                                                    ------
<S>                                                                                     <C>
Part I -    FINANCIAL INFORMATION

ITEM 1-     FINANCIAL STATEMENTS

            Balance Sheets as of September 26, 2008 (Unaudited) and
            March 28, 2008                                                               3

            Statement of Operations (Unaudited) for the six and the three
            months ended September 26, 2008 and September 28, 2007.                      5

            Statement of Cash Flows (Unaudited) for the six months ended
            September 26, 2008 and September 28, 2007.                                   6

            Notes to Financial Statements (Unaudited)                                    8

ITEM 2 -    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            FINANCIAL CONDITION AND RESULTS OF OPERATIONS                               19

ITEM 3 -    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT                              27
            MARKET RISK

ITEM 4 -    CONTROLS AND PROCEDURES                                                     27

PART II -   OTHER INFORMATION

ITEM 1 -    LEGAL PROCEEDINGS                                                           28

ITEM 1A -   RISK FACTORS                                                                29

ITEM 2 -    UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS                 30

ITEM 3 -    DEFAULTS UPON SENIOR SECURITIES                                             30

ITEM 4 -    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                         30

ITEM 5 -    OTHER INFORMATION                                                           30

ITEM 6 -    EXHIBITS                                                                    30
</TABLE>


                                     - 1 -
<PAGE>

<TABLE>
<S>                                                                                     <C>
SIGNATURES                                                                              31

EXHIBITS

Exhibit 31.1  Certification Pursuant to Section 302 of the Sarbanes Oxley Act           32

Exhibit 31.2  Certification Pursuant to Section 302 of the Sarbanes Oxley Act           33

Exhibit 32.1  Certification Pursuant to Section 906 of the Sarbanes Oxley Act           34

Exhibit 32.2  Certification Pursuant to Section 906 of the Sarbanes Oxley Act           35
</TABLE>


                                     - 2 -
<PAGE>

                                 IEH CORPORATION

                                 BALANCE SHEETS

                   As of September 26, 2008 and March 28, 2008

<TABLE>
<CAPTION>
                                                                             Sept. 26,          March 28,
                                                                               2008               2008
                                                                           ------------       ------------
                                                                           (Unaudited)
<S>                                                                        <C>                <C>
                                     ASSETS

CURRENT ASSETS:
  Cash                                                                     $    142,200       $     29,136
  Accounts receivable, less allowance for doubtful accounts of
    $11,562 at September 26, 2008 and March 28, 2008                          1,248,778          1,180,220
  Inventories (Note 3)                                                        2,118,700          1,986,367
  Prepaid expenses and other current assets (Note 4)                             40,942             24,137
                                                                           ------------       ------------

          Total Current Assets                                                3,550,620          3,219,860
                                                                           ------------       ------------

PROPERTY, PLANT AND EQUIPMENT, less accumulated
   depreciation and amortization of $6,844,649 at September 26, 2008
   and $6,756,178 at March 28, 2008 (Note 5)                                  1,146,656          1,172,379
                                                                           ------------       ------------
                                                                              1,146,656          1,172,379
                                                                           ------------       ------------

OTHER ASSETS:
  Other assets                                                                   24,846             24,784
                                                                           ------------       ------------
                                                                                 24,846             24,784
                                                                           ------------       ------------

        Total Assets                                                       $  4,722,122       $  4,417,023
                                                                           ============       ============
</TABLE>

              The accompanying notes should be read in conjunction
                         with the financial statements.


                                     - 3 -
<PAGE>

                                 IEH CORPORATION

                                 BALANCE SHEETS

                   As of September 26, 2008 and March 28, 2008


<TABLE>
<CAPTION>
                                                                           Sept. 26,          March 28,
                                                                             2008               2008
                                                                         ------------       ------------
                                                                                           (Unaudited)
<S>                                                                      <C>                <C>
                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
   Accounts receivable financing (Note 6)                                $    195,936       $    513,378
   Loans payable- officers (Note 8)                                                --             17,000
   Accrued corporate income taxes                                              11,234             22,103
   Accounts payable                                                           447,060            584,938
   Workers compensation insurance assessment-
     current portion (Note 13)                                                 20,268                 --
   Other current liabilities (Note 7)                                         175,731            191,719
                                                                         ------------       ------------

          Total Current Liabilities                                           850,229          1,329,138
                                                                         ------------       ------------

LONG TERM LIABILITIES:
   Workers compensation insurance assessment less-
     current portion (Note 13)                                                 81,094                 --
                                                                         ------------       ------------

        Total Long Term Liabilities                                            81,094                 --
                                                                         ------------       ------------

          Total Liabilities                                                   931,323          1,329,138
                                                                         ------------       ------------

STOCKHOLDERS' EQUITY:
   Common stock, $.01 par value; 10,000,000 shares authorized;
     2,303,468 shares issued and outstanding at September 26, 2008
     and March 28, 2008                                                        23,035             23,035
   Capital in excess of par value                                           2,744,573          2,744,573
   Retained earnings (Note 10)                                              1,023,191            320,277
                                                                         ------------       ------------
          Total Stockholders' Equity                                        3,790,799          3,087,885
                                                                         ------------       ------------

          Total Liabilities and Stockholders' Equity                     $  4,722,122       $  4,417,023
                                                                         ============       ============
</TABLE>

              The accompanying notes should be read in conjunction
                         with the financial statements.


                                     - 4 -
<PAGE>

                                 IEH CORPORATION

                             STATEMENT OF OPERATIONS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                        Six Months Ended                   Three Months Ended
                                                        ----------------                   ------------------
                                                 Sept. 26,          Sept. 28,          Sept. 26,          Sept. 28,
                                                   2008               2007               2008               2007
                                               ------------       ------------       ------------       ------------
<S>                                            <C>                <C>                <C>                <C>
REVENUE, net sales                             $  5,230,328       $  3,576,485       $  2,652,855       $  1,807,809
                                               ------------       ------------       ------------       ------------

COSTS AND EXPENSES

Cost of products sold                             3,611,750          2,637,921          1,907,359          1,367,400
Selling, general and administrative                 745,294            601,698            378,464            302,077
Interest expense                                     38,486            115,144             17,277             53,604
Depreciation and amortization                        90,160            100,680             44,280             50,340
                                               ------------       ------------       ------------       ------------
                                                  4,485,690          3,455,443          2,347,380          1,773,421
                                               ------------       ------------       ------------       ------------

OPERATING INCOME                                    744,638            121,042            305,475             34,388

OTHER INCOME                                            276                152                219                125
                                               ------------       ------------       ------------       ------------

INCOME BEFORE INCOME TAXES                          744,914            121,194            305,694             34,513

PROVISION FOR INCOME TAXES                           42,000             21,207             18,000              7,007
                                               ------------       ------------       ------------       ------------

NET INCOME                                     $    702,914       $     99,987       $    287,694       $     27,506
                                               ============       ============       ============       ============

BASIC AND DILUTED EARNINGS PER SHARE           $        .31       $        .04       $        .13       $        .01
                                               ============       ============       ============       ============

WEIGHTED AVERAGE NUMBER OF COMMON SHARES
OUTSTANDING (in thousands)                            2,303              2,303              2,303              2,303
                                               ============       ============       ============       ============
</TABLE>

              The accompanying notes should be read in conjunction
                         with the financial statements.


                                     - 5 -
<PAGE>

                                 IEH CORPORATION

                             STATEMENT OF CASH FLOWS
                           Increase (Decrease) in Cash
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                      Six Months Ended
                                                              --------------------------------
                                                                Sept. 26,           Sept. 28,
                                                                  2008                2007
                                                              ------------        ------------
<S>                                                           <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income                                                    $    702,914        $     99,987
                                                              ------------        ------------

Adjustments to reconcile net income to net cash used in
  operating activities:
Depreciation                                                        90,160             100,680

Changes in assets and liabilities:
(Increase) in accounts receivable                                  (68,558)           (198,740)
(Increase) in inventories                                         (132,333)           (109,168)
(Increase) in prepaid expenses and other current assets            (16,804)            (36,990)
(Increase) in other assets                                             (62)               (106)
 Increase (decrease) in accounts payable                          (137,879)            239,215
 Increase (decrease) in other current liabilities                  (15,988)             77,835
 Increase (decrease) in accrued corporate income taxes             (10,869)             11,432
 Increase in workers compensation assessment payable               101,362                  --
(Decrease) in due to pension plan payable                               --             (20,000)
                                                              ------------        ------------

          Total adjustments                                       (190,971)             64,158
                                                              ------------        ------------

NET CASH PROVIDED BY OPERATING ACTIVITIES                          511,943             164,145

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

CASH FLOWS FROM INVESTING ACTIVITIES:

Acquisition of fixed assets                                        (64,437)            (97,120)
                                                              ------------        ------------

NET CASH USED BY INVESTING ACTIVITIES                         $    (64,437)       $    (97,120)
                                                              ============        ============
</TABLE>

              The accompanying notes should be read in conjunction
                         with the financial statements.


                                     - 6 -
<PAGE>

                                 IEH CORPORATION

                             STATEMENT OF CASH FLOWS
                           Increase (Decrease) in Cash
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                 Six Months Ended
                                                        --------------------------------
                                                          Sept. 26,           Sept. 28,
                                                            2008                2007
                                                        ------------        ------------
<S>                                                     <C>                 <C>
CASH FLOWS FROM FINANCING ACTIVITIES:
   Principal payments on notes payable                  $         --        $     (1,568)
  (Payment) from accounts receivable financing              (317,442)            (63,940)
  (Repayment) of loans payable - officers                    (17,000)            (33,600)
                                                        ------------        ------------

NET CASH (USED) BY FINANCING ACTIVITIES                     (334,442)            (99,108)
                                                        ------------        ------------

INCREASE (DECREASE) IN CASH                                  113,064             (32,083)

CASH, beginning of period                                     29,136              34,908
                                                        ------------        ------------

CASH, end of period                                     $    142,200        $      2,825
                                                        ============        ============

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during the three months for:

     Interest                                           $     32,752        $     16,330
                                                        ============        ============

     Income Taxes                                       $     36,440        $      4,085
                                                        ============        ============
</TABLE>

              The accompanying notes should be read in conjunction
                         with the financial statements.


                                     - 7 -
<PAGE>

                                 IEH CORPORATION

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

Note 1-     INTERIM RESULTS AND BASIS OF PRESENTATION:

            The accompanying unaudited financial statements as of September 26,
            2008 and September 28, 2007 and for the six months then ended have
            been prepared in accordance with generally accepted accounting
            principles for interim financial information and with the
            instructions to Form 10-Q. In the opinion of management, the
            unaudited financial statements have been prepared on the same basis
            as the annual financial statements and reflect all adjustments,
            which include only normal recurring adjustments, necessary to
            present fairly the financial position as of September 26, 2008 and
            September 28, 2007 and the results of operations and cash flows for
            the six months then ended. The financial data and other information
            disclosed in these notes to the interim financial statements related
            to these periods are unaudited. The results for the six months ended
            September 26, 2008, are not necessarily indicative of the results to
            be expected for any subsequent quarter or the entire fiscal year.
            The balance sheet at March 28, 2008 has been derived from the
            audited financial statements at that date.

            Certain information and footnote disclosures normally included in
            financial statements prepared in accordance with generally accepted
            accounting principles have been condensed or omitted pursuant to the
            rules and regulations of the Securities and Exchange Commission (the
            "SEC"). The Company believes, however, that the disclosures in this
            report are adequate to make the information presented not misleading
            in any material respect. The accompanying financial statements
            should be read in conjunction with the audited financial statements
            of IEH Corporation as of March 28, 2008 and notes thereto included
            in the Company's report on Form 10-KSB as filed with the SEC.

Note 2 -    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

            Description of Business:

            The Company is engaged in the design, development, manufacture and
            distribution of high performance electronic printed circuit
            connectors and specialized interconnection devices. Electronic
            connectors and interconnection devices are used in providing
            electrical connections between electronic component assemblies. The
            Company develops and manufactures connectors, which are designed for
            a variety of high technology and high performance applications, and
            are primarily utilized by those users who require highly efficient
            and dense (the space between connection pins with the connector)
            electrical connections.

            The Company is continuously redesigning and adapting its connectors
            to meet and keep pace with developments in the electronics industry
            and has, for example, developed connectors for use with
            flex-circuits now being used in aerospace programs, computers,
            air-borne communications systems, testing systems and other areas.
            The Company also services its connectors to meet specified product
            requirements.


                                     - 8 -
<PAGE>

                                 IEH CORPORATION

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

Note 2 -    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (continued)

            Revenue Recognition:

            Revenues are recognized at the shipping date of the Company's
            products. The Company has historically adopted the shipping terms
            that title to merchandise passes to the customer at the shipping
            point (FOB Shipping Point). At this juncture, title has passed, the
            Company has recognized the sale, inventory has been relieved, and
            the customer has been invoiced. The Company does not offer any
            discounts, credits or other sales incentives.

            The Company's policy with respect to customer returns and allowances
            as well as product warranty is as follows:

            The Company will accept a return of defective product within one
            year from shipment for repair or replacement at the Company's
            option. If the product is repairable, the Company at its own cost,
            will repair and return it to the customer. If unrepairable, the
            Company will either offer an allowance against payment or will
            reimburse the customer for the total cost of product. The Company's
            experience has been that a loss from returns is extremely remote.
            Accordingly, the Company's management does not believe that an
            allowance for loss from returns is necessary.

            Most of the Company's products are custom ordered by customers for a
            specific use. The Company provides engineering services as part of
            the relationship with its customers in developing the custom
            product. The Company is not obligated to provide such engineering
            service to its customers. The Company does not charge separately for
            these services.

            Inventories:

            Inventories are stated at cost, on a first-in, first-out basis,
            which does not exceed market value.

            The Company manufactures products pursuant to specific technical and
            contractual requirements. The Company historically purchases
            material in excess of its requirements to avail itself of favorable
            pricing as well as the possibility of receiving additional orders
            from customers. This excess may result in material not being used in
            subsequent periods, which may result in this material being deemed
            obsolete.

            The Company annually reviews its purchase and usage activity of its
            inventory of parts as well as work in process and finished goods to
            determine which items of inventory have become obsolete within the
            framework of current and anticipated orders. The Company based upon
            historical experience has determined that if a part has not been
            used and purchased or an item of finished goods has not been sold in
            three years, it is deemed to be obsolete. The Company estimates
            which materials may be obsolete and which products in work in
            process or finished goods may be sold at less than cost. A periodic
            adjustment, based upon historical experience is made to inventory in
            recognition of this impairment.


                                     - 9 -
<PAGE>

                                 IEH CORPORATION

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

Note 2 -    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (continued)

            Concentration of Credit Risk:

            The Company maintains cash balances at one financial institution.
            Amounts on deposit are insured by the Federal Deposit Insurance
            Corporation up to $100,000 in the aggregate. The Company had
            $142,200 on deposit as of September 26, 2008 which exceeded the FDIC
            insured limits at the time. On October 3, 2008 the Emergency
            Economic Stabilization Act of 2008 (the "2008 Act") was enacted. The
            2008 Act temporarily raised the deposit insurance coverage to
            $250,000 until December 31, 2009. Pursuant to the 2008 Act,
            subsequent to December 31, 2009 the FDIC insurance limits will
            return to $100,000. As of March 28, 2008 the Company had no
            uninsured balances.

            Property, Plant and Equipment:

            Property, plant and equipment is stated at cost less accumulated
            depreciation and amortization. The Company provides for depreciation
            and amortization using the Double Declining Balance method over the
            estimated useful lives (5-7 years) of the related assets.

            Maintenance and repair expenditures are charged to operations, and
            renewals and betterments are capitalized. Items of property, plant
            and equipment, which are sold, retired or otherwise disposed of, are
            removed from the asset and accumulated depreciation or amortization
            accounts. Any gain or loss thereon is either credited or charged to
            operations.

            Income Taxes:

            The Company follows the policy of treating investment tax credits as
            a reduction in the provision for federal income tax in the year in
            which the credit arises or may be utilized. Deferred income taxes
            arise from temporary differences resulting from different
            depreciation methods used for financial and income tax purposes. The
            Company has adopted Statement of Financial Accounting Standards
            (SFAS) No. 109, "Accounting for Income Taxes".

            Net Income Per Share:

            The Company has adopted the provisions of SFAS No. 128, "Earnings
            Per Share", which requires the disclosure of "basic" and "diluted"
            earnings (loss) per share. Basic earnings per share is computed by
            dividing net income by the weighted average number of common shares
            outstanding during each period. Diluted earnings per share is
            similar to basic earnings per share except that the weighted average
            number of common shares outstanding is increased to reflect the
            dilutive effect of potential common shares, such as those issuable
            upon the exercise of stock or warrants, as if they had been issued.
            For the three months ended September 26, 2008 and September 28,
            2007, there were no items of potential dilution that would impact on
            the computation of diluted earnings or loss per share.


                                     - 10 -
<PAGE>

                                 IEH CORPORATION

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

Note 2 -    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (continued)

            Fair Value of Financial Instruments: (continued)

            SFAS 133, "Accounting for Derivative Instruments and Hedging
            Activities," requires that an entity recognize all derivatives as
            either assets or liabilities in the statements of financial position
            and measure those instruments at fair value.

            The respective carrying value of certain on-balance-sheet financial
            instruments approximates their fair values. These financial
            instruments include cash, accounts receivable, accounts payable and
            borrowings. Fair values were assumed to approximate carrying values
            for these financial instruments since they are short-term in nature
            and their carrying amounts approximate fair value or they were
            receivable or payable on September 26, 2008.

            Use of Estimates:

            The preparation of financial statements in conformity with generally
            accepted accounting principles requires management to make estimates
            and assumptions that affect the reported amounts of assets and
            liabilities, revenues and expenses, and disclosure of contingent
            assets and liabilities at the date of the financial statements.
            Actual amounts could differ from those estimates.

            Impairment of Long-Lived Assets:

            SFAS No. 144, "Accounting for The Impairment or Disposal of
            Long-Lived Assets," requires that long-lived assets and certain
            identifiable intangibles to be held and used by an entity be
            reviewed for impairment whenever events or changes in circumstances
            indicate that the carrying amount of an asset may not be
            recoverable. The Company has adopted SFAS No. 144. There were no
            long-lived asset impairments recognized by the Company for the three
            months ended September 26, 2008 and September 28, 2007,
            respectively.

            Reporting Comprehensive Income:

            The Company has adopted the provisions of SFAS No. 130, "Reporting
            Comprehensive Income". This Statement established standards for
            reporting and display of comprehensive income and its components
            (revenues, expenses, gains and losses) in an entity's financial
            statements. This Statement requires an entity to classify items of
            other comprehensive income by their nature in a financial statement
            and display the accumulated balance of other comprehensive income
            separately from retained earnings and additional paid-in capital in
            the equity section of a statement of balance sheet. There were no
            material items of comprehensive income to report for the six months
            ended September 26, 2008 and September 28, 2007, respectively.


                                     - 11 -
<PAGE>

                                 IEH CORPORATION

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

Note 2 -    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (continued)

            Segment Information:

            The Company has adopted the provisions of SFAS No. 131, "Disclosures
            About Segment of An Enterprise and Related Information." This
            Statement requires public enterprises to report financial and
            descriptive information about its reportable operating segments and
            establishes standards for related disclosures about product and
            services, geographic areas, and major customers. The adoption of
            SFAS No. 131 did not affect the Company's presentation of its
            results of operations or financial position.

            Research and Development:

            The Company provides personalized engineering services to its
            customers by designing connectors for specific customer
            applications. The employment of electromechanical engineers is the
            anticipated cornerstone of the Company's future growth. The Company
            maintains a testing laboratory where its engineers experiment with
            new connector designs based on changes in technology and in an
            attempt to create innovative, more efficient connector designs.

            The Company did not expend any funds on customer sponsored research
            and development during the three months ended September 26, 2008 and
            September 28, 2007. In addition the Company did not receive any
            revenues related to customer sponsored research and development
            activities during the three months ended September 26, 2008 and
            September 28, 2007.

            Effect of New Accounting Pronouncements:

            Effective April 1, 2007, the Company adopted the provisions of
            Financial Accounting Standards Board Interpretation No.48 ("FIN
            48"), "Accounting for Uncertainty in Income Taxes- an interpretation
            of FASB Statement No. 109", which clarifies the accounting for
            uncertainty in income taxes recognized in an entity's financial
            statements in accordance with FASB Statement No.109, "Accounting for
            Income Taxes". FIN 48 prescribes a recognition threshold and
            measurement attribute for the financial statement disclosures of tax
            positions taken or expected to be taken in an income tax filing. The
            evaluation of a tax position is a two step process. The first step
            requires an entity to determine whether it is more likely than not
            that a tax position will be sustained upon examination based upon
            the technical merits of the position. The second step requires an
            entity to recognize in the financial statements each tax position
            that meets the more likely than not criteria, measured at the
            largest amount of benefit that has a greater than fifty percent
            likelihood of being recognized. FIN 48 also provides guidance on
            de-recognition, classification, interest and penalties, accounting
            for interim periods, disclosure and transition.

            The Company believes that with its adoption of FIN 48, that the
            income tax positions taken by it did not have a material effect on
            the financial statements for the six months ended September 26,
            2008.

            In December 2006, the FASB issued SFAS No. 157, "Fair Value
            Measurements", which enhances existing guidance for measuring assets
            and liabilities using fair value. This Standard provides a single
            definition of fair value, together with a framework for measuring
            it, and requires additional disclosure about the use of fair value
            to measure assets and liabilities.


                                     - 12 -
<PAGE>

                                 IEH CORPORATION

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

Note 2 -    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (continued)

            Effect of New Accounting Pronouncements: (continued)

            SFAS No. 157 is effective for financial statements issued for fiscal
            years beginning after November 15, 2007, and interim periods within
            those fiscal years. The Company does not believe that SFAS No. 157
            will have a material impact on its financial statements.

            In February 2007, the FASB issued SFAS No. 159 ("SFAS 159"), "The
            Fair Value Option for Financial Assets and Financial Liabilities",
            providing companies with an option to report selected financial
            assets and liabilities at fair value. This Standard's objective is
            to reduce both complexity in accounting for financial instruments
            and the volatility in earnings caused by measuring related assets
            and liabilities differently. It also requires entities to display
            the fair value of those assets and liabilities for which the Company
            has chosen to use fair value on the face of the balance sheet. SFAS
            No. 159 is effective for fiscal years beginning after November 15,
            2007. The Company does not believe that SFAS No. 159 will have a
            material impact on its financial statements.

Note 3 -    INVENTORIES:

            Inventories are stated at cost, on a first-in, first-out basis,
            which does not exceed market value.

            The Company manufactures products pursuant to specific technical and
            contractual requirements. The Company historically purchases
            material in excess of its requirements to avail itself of favorable
            pricing as well as the possibility of receiving additional orders
            from customers. This excess may result in material not being used in
            subsequent periods, which may result in this material being deemed
            obsolete.

            The Company annually reviews its purchase and usage activity of its
            inventory of parts as well as work in process and finished goods to
            determine which items of inventory have become obsolete within the
            framework of current and anticipated orders. The Company based upon
            historical experience has determined that if a part has not been
            used and purchased or an item of finished goods has not been sold in
            three years, it is deemed to be obsolete. The Company estimates
            which materials may be obsolete and which products in work in
            process or finished goods may be sold at less than cost. A periodic
            adjustment, based upon historical experience is made to inventory in
            recognition of this impairment.

            Inventories are comprised of the following:

                                     Sept. 26,          March 28,
                                       2008               2008
                                   ------------       ------------
            Raw materials          $    989,583       $    927,774
            Work in progress            841,050            788,519
            Finished goods              288,067            270,074
                                   ------------       ------------

                                   $  2,118,700       $  1,986,367
                                   ============       ============


                                     - 13 -
<PAGE>

                                 IEH CORPORATION

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

Note 4 -    PREPAID EXPENSES AND OTHER CURRENT ASSETS:

            Prepaid expenses and other current assets are comprised of the
            following:

                                                   Sept. 26,      March 28,
                                                      2008           2008
                                                  -----------    -----------

            Prepaid insurance                     $     6,343    $    16,348
            Prepaid corporate taxes                     7,681          7,681
            Other current assets                       26,918            108
                                                  -----------    -----------
                                                  $    40,942    $    24,137
                                                  ===========    ===========

Note 5 -    PROPERTY, PLANT AND EQUIPMENT:

            Property, plant and equipment are as follows:

                                                   Sept. 26,      March 28,
                                                      2008           2008
                                                  -----------    -----------

            Computers                             $   220,880    $   212,321
            Leasehold improvements                    585,831        585,831
            Machinery and equipment                 4,938,131      4,903,733
            Tools and dies                          2,084,667      2,063,187
            Furniture and fixture                     155,935        155,935
            Website development cost                    7,550          7,550
                                                  -----------    -----------

                                                    7,992,994      7,928,557
            Less: accumulated depreciation
            and amortization                        6,846,338      6,756,178
                                                  -----------    -----------

                                                  $ 1,146,656    $ 1,172,379
                                                  ===========    ===========

Note 6 -    ACCOUNTS RECEIVABLE FINANCING:

            The Company entered into an accounts receivable financing agreement
            whereby it can borrow up to eighty percent of its eligible
            receivables (as defined in the agreement) at an interest rate of 2
            1/2 % above JP Morgan Chase's publicly announced rate of 5.0% at
            September 26, 2008. However, the agreement does stipulate that the
            minimum interest rate is 12% per annum. The agreement has an initial
            term of one year and will automatically renew for successive
            one-year terms, unless terminated by the Company or the lender upon
            receiving sixty days prior notice. The loan is secured by the
            Company's accounts receivable and inventories. The balance due under
            this agreement as of September 26, 2008 was $195,936. The balance
            due as of March 28, 2008 was $513,378.


                                     - 14 -
<PAGE>

                                 IEH CORPORATION

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

Note 7 -    OTHER CURRENT LIABILITIES:

            Other current liabilities are comprised of the following:

                                                   Sept. 26,      March 28,
                                                      2008           2008
                                                  -----------    -----------

            Payroll and vacation accruals         $   127,755    $   172,215
            Sales commissions                          22,073         16,504
            Other                                      25,903          3,000
                                                  -----------    -----------
                                                  $   175,731    $   191,719
                                                  ===========    ===========

Note 8 -    RELATED PARTIES TRANSACTIONS:

            One of the Company's officers has periodically loaned the Company
            money on a non-interest bearing basis in order to finance working
            capital requirements. As of March 28, 2008, the amount due to this
            officer was $17,000. During the six months ended September 26, 2008,
            the Company fully repaid this officer.

Note 9 -    PENSION PLAN-SALARIED PERSONNEL:

            On June 30, 1995, the Company applied to the Pension Benefit
            Guaranty Corporation ("PBGC") to have the PBGC assume all of the
            Company's responsibilities and liabilities under its Salaried
            Pension Plan (the "Salaried Pension Plan"). On April 26, 1996, the
            PBGC determined that the Salaried Pension Plan did not have
            sufficient assets available to pay benefits, which were and are
            currently due under the terms of such Plan.

            The PBGC further determined that pursuant to the provisions of the
            Employment Retirement Income Security Act of 1974, as amended
            ("ERISA"), that the Salaried Pension Plan must be terminated in
            order to protect the interests of the Plan's participants.
            Accordingly, the PBGC proceeded pursuant to ERISA to have the
            Salaried Pension Plan terminated and the PBGC appointed as statutory
            trustee, and to have July 31, 1995 established as the Salaried
            Pension Plan's termination date.

            The Company and the PBGC negotiated a settlement on the entire
            matter and on July 2, 2001, an agreement was reached whereby the
            Company's liability to the PBGC was reduced to $244,000. The Company
            will make monthly payments to the PBGC as follows:

                 September 1, 2003 to August 1, 2004           $2,000 per month
                 September 1, 2004 to August 1, 2006           $3,000 per month
                 September 1, 2006 to August 1, 2007           $4,000 per month

            Additionally, the Company had made balloon payments of $25,000 each
            on January 1, 2004, May 1, 2004, May 1, 2005 and January 1, 2006.


                                     - 15 -
<PAGE>

                                 IEH CORPORATION

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

Note 9 -    PENSION PLAN-SALARIED PERSONNEL: (continued)

            The Company also granted the PBGC a lien on the Company's machinery
            and equipment.

            As a result of this agreement the amount due the PBGC was restated
            to $244,000. As of August 31, 2007, the Company had satisfied its
            obligation to the PBGC and the resultant lien was released.

Note 10-    CHANGES IN STOCKHOLDERS' EQUITY:

            Retained earnings increased by $702,914, which represents the net
            income for the six months ended September 26, 2008.

Note 11-    2002 EMPLOYEE STOCK OPTION PLAN:

            Under this Plan, the exercise price of an option designated as an
            Incentive Stock Option shall not be less than the fair market value
            of the Company's common stock on the day the option is granted. In
            the event an option designated as an incentive stock option is
            granted to a ten percent (10%) shareholder, such exercise price
            shall be at least 110 Percent (110%) of the fair market value or the
            Company's common stock and the option must not be exercisable after
            the expiration of five years from the day of the grant.

            Exercise prices of non-incentive stock options may be less than the
            fair market value of the Company's common stock.

            The aggregate fair market value of shares subject to options granted
            to a participant(s), which are designated as incentive stock
            options, and which become exercisable in any calendar year, shall
            not exceed $100,000. As of September 26, 2008 no options had been
            granted under this Plan.

Note 12 -   CASH BONUS PLAN:

            In 1987, the Company adopted a cash bonus plan (the "Cash Bonus
            Plan") for executive officers. Contributions to the Cash Bonus Plan
            are made by the Company only after pre-tax operating profits exceed
            $150,000 for a fiscal year, and then to the extent of 10% of the
            excess of the greater of $150,000 or 25% of pre-tax operating
            profits. The Company accrued $46,200 for the six months ended
            September 26, 2008. For the year ended March 28, 2008, the
            contribution was $33,100.

Note 13-    WORKERS COMPENSATION INSURANCE ASSESSMENT

            On September 15, 2008, the Company was notified by the State of New
            York Workers' Compensation Board (the "Board") that the Trade
            Industry Workers' Compensation Trust for Manufacturers (the "Trust")
            had defaulted. As a member of this self-insured group, the Company
            was assessed on an estimated basis by the Board for its allocable
            share necessary to discharge all liabilities of the Trust.


                                     - 16 -
<PAGE>

                                 IEH CORPORATION

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

Note 13  -  WORKERS COMPENSATION INSURANCE ASSESSMENT: (continued)

            The estimated assessment pertains to the years 2002 through 2006.
            The Company was advised that there may be an additional assessment
            for the year 2007 and that the estimated assessments for the year
            2002 through 2006 are subject to additional review and adjustment.

            The amount assessed for the years 2002 through 2006 was $101,362.
            The amount assessed each year is detailed as follows:

                      2002     $   16,826
                      2003         24,934
                      2004         31,785
                      2005         14,748
                      2006         13,069
                               ----------
                               $  101,362
                               ==========

            The Company does have the option of paying this assessment as a lump
            sum amount or paying off the assessment over a sixty month period.
            The Company has elected the deferral option, and will be making
            monthly payments of $1,689 for 59 months, and $1,711 for the 60th
            and final month. The Company has recorded this assessment as a
            charge to Cost of Sales in the quarter ended September 26, 2008. As
            of September 26, 2008, the current portion of this assessment
            liability was $20,268 and the long-term portion was $81,094.

Note 14 -   COMMITMENTS:

            The Company leases its facility under a renewed tenure lease
            agreement, which expires on August 23, 2011. The Company is
            obligated under this lease at minimum annual rentals as follows:

            Fiscal year ending March:

                  2009             $     84,192
                  2010                  168,384
                  2011                  112,256
                                   ------------
                                   $    364,832
                                   ============

            The rental expense for the six months ended September 26, 2008 and
            September 28, 2007 was $72,534 each.


                                     - 17 -
<PAGE>

                                 IEH CORPORATION

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

Note 14 -   COMMITMENTS: (continued)

            The Company has a collective bargaining multi-employer pension plan
            (the "Multi-Employer Plan") with the United Auto Workers of America,
            Local 259 (the "UAW"). Contributions are made by the Company in
            accordance with a negotiated labor contract and are based on the
            number of covered employees employed per month. With the passage of
            the Multi-Employer Pension Plan Amendment Act of 1990 (the "1990
            Act"), the Company may become subject to liabilities in excess of
            contributions made under the collective bargaining agreement.
            Generally, these are contingent upon termination, withdrawal, or
            partial withdrawal from the Multi-Employer Plan.

            The Company has not taken any action to terminate, withdraw or
            partially withdraw from the Multi-Employer Plan, nor does it intend
            to do so in the future. Under the 1990 Act, liabilities would be
            based upon the Company's proportional share of the Multi-Employer
            Plan's unfunded vested benefits which is currently not available.
            The amount of accumulated benefits and net assets of such Plan also
            is not currently available to the Company. The total contributions
            charged to operations under the provisions of the Multi-Employer
            Plan were $45,281 and $36,318 for the six months ended September 26,
            2008 and September 28, 2007, respectively.

            In 1992, the Company had been in arrears with respect to its
            contributions to the Multi-Employer Plan in the amount of $186,467.
            The Company and the UAW entered into a verbal agreement whereby the
            Company would continue making current contributions as well as
            making periodic payments to satisfy the outstanding arrears
            obligation to the Multi-Employer Plan. The outstanding obligation
            was satisfied by the Company on July 12th, 2007. Under the terms of
            this verbal agreement, the Company was not obligated to pay interest
            until the arrears was satisfied.

            The UAW and the Company agreed in October 2007 that the total amount
            of interest due would be $85,000. The Company paid the $85,000 to
            the UAW in October 2007 and satisfied its indebtedness.


                                     - 18 -
<PAGE>

                                 IEH CORPORATION

   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
                                   OPERATIONS

Forward Looking Statements

This report contains forward looking statements within the meaning of Section
21E of the Securities and Exchange Act of 1934, as amended (the "1934 Act") and
Section 27A of the Securities Act of 1933 (the "1933 Act"). Statements contained
in this report which are not statements of historical facts may be considered
forward-looking information with respect to plans, projections, or future
performance of the Company as defined under the Private Securities litigation
Reform Act of 1995. These forward-looking statements are subject to risks and
uncertainties which could cause actual results to differ materially from those
projected. The words "anticipate", "believe", "estimate", "expect", "objective",
and "think" or similar expressions used herein are intended to identify
forward-looking statements. The forward-looking statements are based on the
Company's current views and assumptions and involve risks and uncertainties that
include, among other things, the effects of the Company's business, actions of
competitors, changes in laws and regulations, including accounting standards,
employee relations, customer demand, prices of purchased raw material and parts,
domestic economic conditions, including housing starts and changes in consumer
disposable income, and foreign economic conditions, including currency rate
fluctuations. Some or all of the facts are beyond the Company's control.

Except as may be required by applicable law, we do not undertake or intend to
update or revise our forward-looking statements, and we assume no obligation to
update any forward-looking statements contained in this report as a result of
new information or future events or developments. Thus, you should not assume
that our silence over time means that actual events are bearing out as expressed
or implied in such forward-looking statements. You should carefully review and
consider the various disclosures we make in this report and our other reports
filed with the SEC that attempt to advise interested parties of the risks,
uncertainties and other factors that m ay affect our business. The following
discussion and analysis should be read in conjunction with the financial
statements and related footnotes which provide additional information concerning
the Company's financial activities and condition.

Critical Accounting Policies

The Financial Statements have been prepared in accordance with accounting
principles generally accepted in the United States of America, which require the
Company to make estimates and assumptions that affect the reported amounts of
assets and liabilities at the date of the Financial Statements, and revenues and
expenses during the periods reported. Actual results could differ from those
estimates. The Company believes the following are the critical accounting
policies, which could have the most significant effect on the Company's reported
results and require the most difficult, subjective or complex judgments by
management.

o     Impairment of Long-Lived Assets:
      The Company reviews its long-lived assets for impairment whenever events
      or circumstances indicate that the carrying amount of an asset may not be
      recoverable. If the sum of the expected cash flows, undiscounted and
      without interest, is less than the carrying amount of the asset, an
      impairment loss is recognized as the amount by which the carrying amount
      of the asset exceeds its fair value. The Company makes estimates of its
      future cash flows related to assets subject to impairment review.

o     Inventory Valuation:
      Raw materials and supplies are valued at the lower of first-in, first-out
      cost or market. Finished goods and work in process are valued at the lower
      of actual cost, determined on a specific identification basis, or market.
      The Company estimates which materials may be obsolete and which products
      in work in process or finished goods may be sold at less than cost, and
      adjusts their inventory value accordingly. Future periods could include
      either income or expense items if estimates change and for differences
      between the estimated and


                                     - 19 -
<PAGE>

                                 IEH CORPORATION

   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
                             OPERATIONS (continued)

Critical Accounting Policies (continued)

      actual amount realized from the sale of inventory.

o     Income Taxes:
      The Company records a liability for potential tax assessments based on its
      estimate of the potential exposure. Due to the subjectivity and complex
      nature of the underlying issues, actual payments or assessments may differ
      from estimates. Income tax expense in future periods could be adjusted for
      the difference between actual payments and the Company's recorded
      liability based on its assessments and estimates.

o     Revenue Recognition:
      Revenues are recognized at the shipping date of the Company's products.
      The Company has historically adopted the shipping terms that title
      merchandise passes to the customer at the shipping point (FOB Shipping
      Point). At this juncture, title has passed, the Company has recognized the
      sale, inventory has been relieved, and the customer has been invoiced. The
      Company does not offer any discounts, credits or other sales incentives.

      The Company's policy with respect to customer returns and allowances as
      well as product warranty is as follows:

      The Company will accept a return of defective product within one year from
      shipment for repair or replacement at the Company's option. If the product
      is repairable, the Company at its own cost will repair and return it to
      the customer. If unrepairable, the Company will either offer an allowance
      against payment or will reimburse the customer for the total cost of the
      product.

      Most of the Company's products are custom ordered by customers for a
      specific use. The Company provides engineering services as part of the
      relationship with its customers in developing the custom product. The
      Company is not obligated to provide such engineering service to its
      customers. The Company does not charge separately for these services.

o     Research & Development:
      The Company provides personalized engineering services to its customers by
      designing connectors for specific customer applications. The employment of
      electromechanical engineers is the anticipated cornerstone of the
      Company's future growth. The Company maintains a testing laboratory where
      its engineers experiment with new connector designs based on changes in
      technology and in an attempt to create innovative, more efficient
      connector designs.


                                     - 20 -
<PAGE>

                                 IEH CORPORATION

   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
                             OPERATIONS (continued)

Results of Operations

Comparative Analysis-Six Months Ended September 26, 2008 and September 28, 2007

The following table sets forth for the periods indicated, percentages for
certain items reflected in the financial data as such items bear to the revenues
of the Company:

              Relationship to Total Revenues

<TABLE>
<CAPTION>
                                                                Sept. 26,       Sept. 28,
                                                                  2008            2007
                                                               -----------     -----------
<S>                                                            <C>             <C>
            Operating Revenues (in thousands)                  $     5,230     $     3,576
                                                               -----------     -----------

            Operating Expenses:
              (as a percentage of Operating Revenues)

                  Costs of Products Sold                             69.05%          73.76%
                  Selling, General and Administrative                14.25%          16.82%
                  Interest Expense                                     .74%           3.22%
                  Depreciation and amortization                       1.72%           2.82%
                                                               -----------     -----------

                         TOTAL COSTS AND EXPENSES                    85.76%          96.62%
                                                               -----------     -----------

            Operating Income (loss)                                  14.24%           3.38%

            Other Income                                               .01%             --
                                                               -----------     -----------

            Income (loss) before Income Taxes                        14.25%           3.38%

            Income Taxes                                               .80%            .59%
                                                               -----------     -----------

            Net Income (loss)                                        13.45%           2.79%
                                                               ===========     ===========
</TABLE>

Operating revenues for the six months ended September 26, 2008 amounted to
$5,230,328 reflecting a 46.24% increase versus the six months ended September
28, 2007 revenues of $3,576,485. The sharp increase in revenues can be
attributed to a dramatic increase in commercial aerospace spending, new
customers in the medical device manufacturing sector as well as internal
production efficiencies.

Cost of products sold amounted to $3,611,750 for the six months ended September
26, 2008, or 69.05% of operating revenues. This reflected a $973,829 or 36.92%
increase in the cost of products sold from $2,637,921 or 73.76% of operating
revenues for the six months ended September 28, 2007. The increase in cost of
product sold is due primarily to an assessment for workers compensation from the
State of New York due to the default of the self-insured workers compensation
insurance trust of which the Company was a participant (see Note 13 to our
financial statements) and the increase in costs related to the increase in
revenues recorded during the quarter ended September 26, 2008.


                                     - 21 -
<PAGE>

                                 IEH CORPORATION

   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
                             OPERATIONS (continued)

Comparative Analysis-Six Months Ended September 26, 2008 and September 28, 2007
(continued)

Selling, general and administrative expenses were $745,294 or 14.25% of
operating revenues for the six months ended September 26, 2008 compared to
$601,698 or 16.82.% of operating revenues for the six months ended September 28,
2007. This category of expenses increased by $143,596 or 23.87% from the prior
year. The increase can be attributed to an increase in salaries to sales
personnel, commissions and travel expenses.

Interest expense was $38,486 or the six months ended September 26, 2008 or .74%
of operating revenues. For the fiscal six months ended September 28, 2007,
interest expense was $115,144 or 3.22% of operating revenues. The decrease of
$76,658 or 66.58% reflects primarily management's commitment to apply revenues
to reduce the Company's debt.

Depreciation and amortization of $90,160 or 1.72% of operating revenues was
reported for the six months ended September 26, 2008. This reflects a decrease
of $10,520 from the comparable six month period ended September 28, 2007 of
$100,680 or 2.82% of operating revenues. The reduction in depreciation is the
result of assets being written off prior to the six months ended September 26,
2008.

The Company reported net income of $702,914 for the six months ended September
26, 2008 representing basic earnings of $.31 per share as compared to net income
of $99,987 or $.04 per share for the six months ended September 28, 2007. The
increase in net income for the current six month period can be attributed
primarily to the increased revenue recorded during the current quarter.


                                     - 22 -
<PAGE>

                                 IEH CORPORATION

   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
                             OPERATIONS (continued)

Comparative Analysis-Three Months Ended September 26, 2008 and September 28,
2007

The following table sets forth for the periods indicated, percentages for
certain items reflected in the financial data as such items bear to the revenues
of the Company:

              Relationship to Total Revenues

<TABLE>
<CAPTION>
                                                            Sept. 26,        Sept. 28,
                                                              2008             2007
                                                           -----------     -----------
<S>                                                        <C>             <C>
            Operating Revenues (in thousands)              $     2,653     $     1,808
                                                           -----------     -----------

            Operating Expenses:
              (as a percentage of Operating Revenues)

                    Costs of Products Sold                       71.90%          75.64%
                    Selling, General and Administrative          14.27%          16.71%
                    Interest Expense                               .65%           2.96%
                    Depreciation and amortization                 1.67%           2.78%
                                                           -----------     -----------

                           TOTAL COSTS AND EXPENSES              88.49%          98.09%
                                                           -----------     -----------

            Operating Income (loss)                              11.51%           1.91%

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

            Income (loss) before Income Taxes                    11.51%           1.91%

            Income Taxes                                           .68%            .39%
                                                           -----------     -----------

            Net Income (loss)                                    10.83%           1.52%
                                                           ===========     ===========
</TABLE>

Operating revenues for the three months ended September 26, 2008 amounted to
$2,652,855 reflecting a 46.74% increase versus the three months ended September
28, 2007 revenues of $1,807,809. The increase in revenues is due to an increase
in commercial sales orders during the current quarter.

Cost of products sold amounted to $1,907,359 for the three months ended
September 26, 2008, or 71.90% of operating revenues. This reflected a $539,959
or 39.48% increase in the cost of products sold from $1,367,400 or 75.64% of
operating revenues for the three months ended September 28, 2007. The increase
in cost of product sold is due primarily to an assessment for workers
compensation from the State of New York due to the default of the self-insured
workers compensation insurance trust of which the Company was a participant (see
Note 13 to our financial statements) and the increase in costs related to the
increase in revenues recorded during the quarter ended September 26, 2008.


                                     - 23 -
<PAGE>

                                 IEH CORPORATION

   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
                             OPERATIONS (continued)

Comparative Analysis-Three Months Ended September 26, 2008 and September 28,
2007 (continued)

Selling, general and administrative expenses were $378,464 or 14.27% of
operating revenues for the three months ended September 26, 2008 compared to
$302,077 or 16.71% of operating revenues for the three months ended September
28, 2007. This category of expenses increased by $76,387 or 25.29% from the
prior year. The increase can be attributed to an increase in sales salaries,
commissions and travel.

Interest expense was $17,277 for the three months ended September 26, 2008 or
..65% of operating revenues. For the fiscal three months ended September 28,
2007, interest expense was $53,604 or 2.96% of operating revenues. The decrease
of $36,327 or 67.77% reflects primarily management's commitment to reduce the
Company's debt.

Depreciation and amortization of $44,280 or 1.67% of operating revenues was
reported for the three months ended September 26, 2008. This reflects a decrease
of $6,060 or 12.04% from the prior three months ended September 28, 2007 of
$50,340 or 2.78% of operating revenues.

The Company reported net income of $287,694 for the three months ended September
26, 2008 representing basic earnings of $.13 per share as compared to a net
income of $27,506 or $.01 per share for the three months ended September 28,
2007. The increase in net income for the current three month period can be
attributed primarily to the increased revenue recorded during the current
quarter.

Liquidity and Capital Resources

The Company reported working capital of $2,700,391 as of September 26, 2008
compared to a working capital of $1,890,722 as of March 28, 2008. The increase
in working capital of $809,669 was attributable to the following items:

        Net income                                   $702,914
        Depreciation and amortization                  90,160
        Capital expenditures                          (64,437)
        Other transactions                             81,032

As a result of the above, the current ratio (current assets to current
liabilities) was 4.18 to 1 at September 26, 2008 as compared to 2.42 to 1 at
March 28, 2008. Current liabilities at September 26, 2008 were $850,229 compared
to $1,329,138 at March 28, 2008.

The Company reported $64,437 in capital expenditures for the six months ended
September 26, 2008 and reported depreciation of $90,160 for the same six month
period.

The net income of $702,914 for the six months ended September 26, 2008 resulted
in an increase in stockholders' equity to $3,790,799 as compared to
stockholders' equity of $3,087,885 at March 28, 2008.

The Company has an accounts receivable financing agreement with a factor, which
bears interest at 2.5% above prime.


                                     - 24 -
<PAGE>

                                 IEH CORPORATION

   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
                             OPERATIONS (continued)

Liquidity and Capital Resources (continued)

However, the agreement does stipulate that the minimum interest rate is 12% per
annum. At September 26, 2008 the amount outstanding with the factor was $195,936
as compared to $513,378 at March 28, 2008. The loan is secured by the Company's
accounts receivables and inventories. The factor provides discounted funds based
upon the Company's accounts receivables, these funds provide the primary source
of working capital for operations.

In the past two fiscal years, management has been reviewing its collection
practices and policies for outstanding receivables and has revised its
collection procedures to a more aggressive collection policy. As a consequence
of this new policy the Company's experience is that its customers have been
remitting payments on a more consistent and timely basis. The Company reviews
the collectability of all accounts receivable on a monthly basis. The reserve is
less than 2% of average gross accounts receivable and is considered to be
conservatively adequate.

One of the Company's officers has periodically loaned the Company money on a
non-interest bearing basis in order to finance working capital requirements. As
of March 28, 2008 the amount due to this officer was $17,000. During the six
months ended September 26, 2008, the Company fully repaid this officer.

The Company has the Multi-Employer Plan with the UAW. Contributions are made by
the Company in accordance with a negotiated labor contract and are based on the
number of covered employees employed per month. With the passage of the Act, the
Company may become subject to liabilities in excess of contributions made under
the collective bargaining agreement. Generally, these are contingent upon
termination, withdrawal, or partial withdrawal from the Multi-Employer Plan. The
Company has not taken any action to terminate, withdraw or partially withdraw
from the Multi-Employer Plan, nor does it intend to do so in the future. Under
the Act, liabilities would be based upon the Company's proportional share of the
Multi-Employer Plan's unfunded vested benefits which is currently not available.
The amount of accumulated benefits and net assets of such Plan also is not
currently available to the Company. The total contributions charged to
operations under the provisions of the Multi-Employer Plan were $45,281 and
$36,318 for the six months ended September 26, 2008 and September 28, 2007,
respectively.

In 1992, the Company had been in arrears with respect to its contributions to
the Multi-Employer Plan in the amount of $186,467. The Company and the UAW
entered into a verbal agreement whereby the Company would continue making
current contributions as well as making periodic payments to satisfy the
outstanding arrears obligation to the Multi-Employer Plan. The outstanding
obligation was satisfied by the Company on July 12th, 2007. Under the terms of
this verbal agreement, the Company was not obligated to pay interest until the
arrears was satisfied.

The UAW and the Company agreed in October 2007 that the total amount of interest
due would be $85,000. The Company paid the $85,000 to the UAW in October 2007
and satisfied its indebtedness.

On June 30, 1995, the Company applied to the PBGC to have the PBGC assume all of
the Company's responsibilities and liabilities under its Salaried Pension Plan.
On April 26, 1996, the PBGC determined that the Salaried Pension Plan did not
have sufficient assets available to pay benefits, which were and are currently
due under the terms of such Plan.


                                     - 25 -
<PAGE>

                                 IEH CORPORATION

   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
                             OPERATIONS (continued)

Liquidity and Capital Resources (continued)

The PBGC further determined that pursuant to the provisions of the ERISA that
the Salaried Pension Plan must be terminated in order to protect the interests
of such Plan's participants. Accordingly, the PBGC proceeded pursuant to ERISA
to have the Salaried Pension Plan terminated and the PBGC appointed as statutory
trustee and to have July 31, 1995 established as the Salaried Pension Plan's
termination date.

The Company and the PBGC agreed to the terms of a settlement of the matter. The
agreement is effective July 2, 2001. Under the agreement, the Company and the
PBGC agreed on a total sum of $244,000. The Company has agreed to make payments
as follows:

           September 1, 2003 to August 1, 2004         $2,000 per month
           September 1, 2004 to August 1, 2006         $3,000 per month
           September 1, 2006 to August 1, 2007         $4,000 per month

Additionally, the Company had made balloon payments of $25,000 each on January
1, 2004, May 1, 2004, May 1, 2005 and January 1, 2006.

The Company granted the PBGC a lien on the Company's machinery and equipment.

As a result of this agreement the amount due the PBGC was restated to $244,000.
As of August 31, 2007, the Company had satisfied its obligation to the PBGC and
the resultant lien was released.

On September 21, 2001, the Company's shareholders approved the adoption of the
Company's 2002 Employee Stock Option Plan to provide for the grant of options to
purchase up to 750,000 shares of the Company's common stock to all employees,
including senior management. No options have been granted under the Employee
Option Plan to date.

Options granted to employees under the 2002 Employee Stock Option Plan may be
designated as options which qualify for incentive stock option treatment under
Section 422A of the Internal Revenue Code, or option which do not so qualify.

Under this Plan, the exercise price of an option designated as an Incentive
Stock Option shall not be less than the fair market value of the Company's
common stock on the day the option is granted. In the event an option designated
as an incentive stock option is granted to a ten percent (10%) share holder,
such exercise price shall be at least 110 Percent (110%) of the fair market
value or the Company's common stock and the option must not be exercisable after
the expiration of five years from the day of the grant. Exercise prices of
non-incentive stock options may be less than the fair market value of the
Company's common stock. The aggregate fair market value of shares subject to
options granted to its participants, which are designated as incentive stock
options, and which become exercisable in any calendar year, shall not exceed
$100,000. As of September 26, 2008, no options had been granted under the Plan.

In 1987, the Company adopted the Cash Bonus Plan for executive officers.
Contributions to the Cash Bonus Plan are made by the Company only after pre-tax
operating profits exceed $150,000 for a fiscal year, and then to the extent of
10% of the excess of the greater of $150,000 or 25% of pre-tax operating
profits.


                                     - 26 -
<PAGE>

                                 IEH CORPORATION

   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
                             OPERATIONS (continued)

Liquidity and Capital Resources (continued)

The Company accrued $46,200 for the six months ended September 26, 2008. For the
year ended March 28, 2008, the contribution was $33,100.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We do not believe that any of our financial  instruments  have  significant risk
associated with market  sensitivity.  For more information on these  investments
see Note 2 to our  financial  statements  included in this Form 10-Q. We are not
exposed to significant  financial  market risks from changes in foreign currency
exchange rates and are only minimally  impacted by changes in interest rates. We
have not used, and currently do not contemplate using, any derivative  financial
instruments.

Interest Rate Risk

At any time,  fluctuations in interest rates could affect  interest  earnings on
our cash and  marketable  securities.  We believe  that the  effect,  if any, of
reasonably  possible  near  term  changes  in  interest  rates on our  financial
position,  results  of  operations,  and  cash  flows  would  not  be  material.
Currently, we do not hedge these interest rate exposures.  The primary objective
of our investment activities is to preserve capital. We have not used derivative
financial instruments in our investment portfolio.

As of September 26, 2008,  our  unrestricted  cash was $142,200 of which $97,420
was in an interest  bearing money market account with and the balance of $44,780
was maintained in non-interest  bearing checking  accounts used to pay operating
expenses.

ITEM 4. CONTROLS AND PROCEDURES

      Based on an evaluation of the  effectiveness of the Company's  "disclosure
controls and  procedures" (as defined in Rules 13a-15(e) and 15d-15(e) under the
1934 Act) the Company's Chief Executive Officer and Chief Financial Officer (who
is also our controller and principal  accounting  officer) concluded that, as of
the end of the  period  covered  by this  Report  on Form  10-Q,  the  Company's
disclosure  controls and procedures are effective to ensure that all information
required to be  disclosed by the Company in this Report that it files or submits
under the 1934 Act is, recorded, processed, and reported within the time periods
specified  within  the  SEC's  rules and  forms  and that  such  information  is
accumulated  and  communicated  to our  management,  including our President and
Chief  Financial   Officer,   to  allow  timely  decisions   regarding  required
disclosure.

      Our management,  including our President and Chief Financial Officer, does
not expect that our disclosure  controls and procedures or our internal controls
will  prevent  all errors and all fraud.  A control  system,  no matter how well
conceived and operated,  can provide only  reasonable,  not absolute,  assurance
that the  objectives  of the control  system are met.  Further,  the design of a
control  system must reflect the fact that there are resource  constraints,  and
the benefits of controls must be considered relative to their costs.  Because of
the inherent  limitations in all control systems,  no evaluation of controls can
provide  absolute  assurance that all control issues and instances of fraud,  if
any, within our company have been detected.  Our management,  however,  believes
our  disclosure  controls  and  procedures  are in  fact  effective  to  provide
reasonable assurance that the objectives of the control system are met.


                                     - 27 -
<PAGE>

                                 IEH CORPORATION

ITEM 4. CONTROLS AND PROCEDURES (continued)

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial  reporting (as
defined in Rule 13a-15(f) under the 1934 Act) during the quarter ended September
26,  2008  that have  been  materially  affected,  or are  reasonably  likely to
materially affect our internal controls over financial reporting.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

The Company is not involved in any legal  proceedings  which may have a material
effect upon the Company, its financial condition or operations.

ITEM 1A. RISK FACTORS

      As provided  for under the  Private  Securities  Litigation  Reform Act of
1995, we wish to caution shareholders and investors that the following important
factors,  among  others  discussed  throughout  this  Report  on Form 10-Q and a
restated  description  of the risk factors  associated  with our business is set
forth below.  This  description  includes any material changes to and supersedes
the  description  of the risk factors  associated  with our business  previously
disclosed  in Part I,  Item 1A of our  Annual  Report  on Form 10-K for the year
ended March 28, 2008. You should  carefully  consider the risks described below,
together with all of following risk factors and the other  information  included
in this report,  in considering  our business  herein as well as the information
included in other reports and prospects.  The risks and uncertainties  described
below  are  not  the  only  ones  facing  our  Company.   Additional  risks  and
uncertainties  not presently  known to us or that we currently  deem  immaterial
also may impair our business  operations,  financial  condition and/or operating
results.  If any of the  matters  or events  described  in the  following  risks
actually  occurs,  our  business,  financial  condition or results of operations
could be harmed.  In such case,  the  trading  price of our common  stock  could
decline,  and you may  lose all or part of your  investment  due to any of these
risks.

Risks Related to Our Business

Failure to increase our revenue and keep our expenses  consistent  with revenues
could prevent us from achieving and maintaining profitability.

We  have  generated  net  income  of  $  603,865,   $200,693  and  $  1,137,622,
respectively,  for the fiscal  years  ended March 28,  2008,  March 30, 2007 and
March 31, 2006 and $702,914 for the six months ended September 26, 2008. We have
expended,  and will  continue  to be required  to expend,  substantial  funds to
pursue product development projects, enhance our marketing and sales efforts and
to effectively maintain business operations. Therefore, we will need to generate
higher revenues to achieve and maintain profitability and cannot assure you that
we will be profitable in any future period.

Our capital  requirements  are  significant and we have  historically  partially
funded our operations through the financing of our accounts receivable.

We have an  existing  accounts  receivable  financing  agreement  with a  factor
whereby we can borrow up to eighty  percent of our  eligible  receivables  at an
interest rate of 2 1/2 % above JP Morgan Chase's publicly announced


                                     - 28 -
<PAGE>

                                 IEH CORPORATION

ITEM 1A. RISK FACTORS (continued)

interest  rate. No assurances  can be given that this  financing  agreement will
continue into the future. If we unable to continue with this agreement, our cash
flow might adversely be affected.

Our  success  is  dependent  on  the  performance  of  our  management  and  the
cooperation,  performance  and  retention  of our  executive  officers  and  key
employees.

      Our business and operations are substantially dependent on the performance
of our senior management team and executive officers.  If our management team is
unable to  perform  it may  adversely  impact  our  results  of  operations  and
financial  condition.  We do not maintain "key person" life  insurance on any of
our executive officers. The loss of one or several key employees could seriously
harm our business.  Any  reorganization or reduction in the size of our employee
base could  harm our  ability to attract  and retain  other  valuable  employees
critical to the success of our business.

If  we  lose  key   personnel  or  fail  to  integrate   replacement   personnel
successfully, our ability to manage our business could be impaired.

      Our  future  success  depends  upon  the  continued  service  of  our  key
management,  technical,  sales, finance, and other critical personnel. We cannot
assure  you that we will be able to retain  them.  Key  personnel  have left our
Company  in the past and  there  likely  will be  additional  departures  of key
personnel  from time to time in the future.  The loss of any key employee  could
result  in  significant  disruptions  to  our  operations,  including  adversely
affecting the timeliness of product releases, the successful  implementation and
completion of Company initiatives,  the effectiveness of our disclosure controls
and  procedures  and our internal  control  over  financial  reporting,  and the
results of our  operations.  In addition,  hiring,  training,  and  successfully
integrating  replacement sales and other personnel could be time consuming,  may
cause additional disruptions to our operations,  and may be unsuccessful,  which
could negatively impact future revenues.

Our  reported  financial  results  could be  adversely  affected  by  changes in
financial  accounting  standards  or by the  application  of  existing or future
accounting standards to our business as it evolves.

      As a result of the enactment of the  Sarbanes-Oxley  Act and the review of
accounting  policies  by the  SEC  and  national  and  international  accounting
standards  bodies,  the frequency of accounting  policy changes may  accelerate.
Possible  future changes to accounting  standards,  could  adversely  affect our
reported results of operations.

Risks Related to Our Common Stock

Our stock price is volatile and could decline.

      The price of our common  stock has been,  and is likely to continue to be,
volatile.  For  example,  our stock price during the fiscal year ended March 28,
2008 traded as low as $1.60 per share and as high as $2.90 per share. During the
six month period  ended  September  26,  2008,  our stock traded in the range of
$1.91 per share to $6.96 per  share.  We  cannot  assure  you that your  initial
investment  in our common  stock will not  fluctuate  significantly.  The market
price of our common stock may fluctuate significantly in response to a number of
factors, some of which are beyond our control, including:

      o     quarterly variations in our operating results;

      o     announcements we make regarding significant contracts, acquisitions,
            dispositions, strategic partnerships, or joint ventures;

      o     additions or departures of key personnel;

      o     the introduction of competitive offerings by existing or new
            competitors;


                                     - 29 -
<PAGE>

                                 IEH CORPORATION

ITEM 1A. RISK FACTORS (continued)

      o     uncertainty about and customer confidence in the current economic
            conditions and outlook;

      o     reduced demand for any of our products; and

      o     sales of our common stock.

      In addition, the stock market in general, and companies whose stock is
listed on The NASDAQ Global Market, have experienced extreme price and volume
fluctuations that have often been disproportionate to the operating performance
of these companies. Broad market and industry factors may negatively affect the
market price of our common stock, regardless of our actual operating
performance.

Since we have not paid dividends on our common stock, you may not receive income
from this investment.

      We have not paid any dividends on our common stock since our inception and
do not contemplate or anticipate paying any dividends on our common stock in the
foreseeable future. Earnings, if any, will be used to finance the development
and expansion of our business

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

Not applicable

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

None

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

None

ITEM 5.  OTHER MATTERS.

None

ITEM 6.  EXHIBITS.

(a) Exhibits

Exhibit 31.1  Certification Pursuant to Section 302 of the Sarbanes Oxley Act

Exhibit 31.2  Certification Pursuant to Section 302 of the Sarbanes Oxley Act

Exhibit 32.1  Certification Pursuant to Section 906 of the Sarbanes Oxley Act

Exhibit 32.2  Certification Pursuant to Section 906 of the Sarbanes Oxley Act

(b) Reports on Form 8-K during Quarter

None


                                     - 30 -
<PAGE>

                                   SIGNATURES

      In accordance  with the  requirements  of the Exchange Act, the Registrant
has duly  caused  this  Report on Form  10-Q to be  signed on its  behalf by the
undersigned, thereunto duly authorized.

                                        IEH CORPORATION
                                        (Registrant)


November 10, 2008                       /s/ Michael Offerman
                                        --------------------
                                        Michael Offerman
                                        President (Principal Executive Officer)


November 10, 2008                       /s/ Robert Knoth
                                        ----------------
                                        Robert Knoth
                                        Chief Financial Officer/Controller/
                                        Principal Accounting Officer


                                     - 31 -