SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                   Form 10-QSB

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

For the quarterly period ended March 31, 2005

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

For the transition period from _____ to _____

Commission File number: 0-25429

                      Diversified Product Inspections, Inc.
                     ---------------------------------------
                     (Exact name of small business issuer as
                            specified in its charter)


          Florida                                        65-0832025
----------------------------------                -----------------------
(State of other jurisdiction of                        (IRS Employer
incorporation or organization)                       Identification No.)

                           1059 East Tri-County Blvd.
                            Oliver Springs, TN 37830
                  --------------------------------------------
                    (Address of principal executive offices)

                                 (865) 482-8480
                           ---------------------------
                           (Issuer's telephone number)

                                 Not applicable
              -----------------------------------------------------
              (Former name, former address, and former fiscal year,
                          if changed since last report)

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

      As of May 10, 2005, there were 19,135,920 shares of common stock, $0.01
par value, issued and outstanding.

<PAGE>

                                                   INDEX TO FORM 10-QSB
                                                                            PAGE
PART I         FINANCIAL INFORMATION

Item 1     Financial Statements

               Condensed Balance Sheets as of
               March 31, 2005 (unaudited) and December 31, 2004               3

               Condensed Statements of Operations (unaudited) for
               the three months ended March 31, 2005 and 2004                 4

               Condensed Statements of Stockholders' Equity
               From January 1, 2004 to March 31, 2005                         5

               Condensed Statements of Cash Flows (unaudited) for
               the three months ended March 31, 2005 and 2004                 6

               Notes to Condensed Financial Statements                        7

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

Item 3         Controls and Procedures                                       10

PART II        OTHER INFORMATION                                             11

SIGNATURES                                                                   12

CAUTIONARY STATEMENT FOR PURPOSES OF THE "SAFE HARBOR" STATEMENT UNDER THE
PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

      This Form 10-QSB includes "forward-looking statements" within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. All statements, other than
statements of historical facts, included or incorporated by reference in this
Form 10-QSB which address activities, events or developments which the Company
expects or anticipates will or may occur in the future, including such things as
future capital expenditures (including the amount and nature thereof), finding
suitable merger or acquisition candidates, expansion and growth of the Company's
business and operations, and other such matters are forward-looking statements.
These statements are based on certain assumptions and analyses made by the
Company in light of its experience and its perception of historical trends,
current conditions and expected future developments as well as other factors it
believes are appropriate in the circumstances. However, whether actual results
or developments will conform with the Company's expectations and predictions is
subject to a number of risks and uncertainties, general economic market and
business conditions; the business opportunities (or lack thereof) that may be
presented to and pursued by the Company; changes in laws or regulation; and
other factors, most of which are beyond the control of the Company.
Consequently, all of the forward-looking statements made in this Form 10-QSB are
qualified by these cautionary statements and there can be no assurance that the
actual results or developments anticipated by the Company will be realized or,
even if substantially realized, that they will have the expected consequence to
or effects on the Company or its business or operations. The Company assumes no
obligations to update any such forward-looking statements.

<PAGE>

                         Part I - FINANCIAL INFORMATION

Item 1. Financial Statements.

                      Diversified Product Inspections, Inc.

                            Condensed Balance Sheets

<TABLE>
<CAPTION>
                                                                  March 31    December 31
                                                                    2005          2004
                                                               ---------------------------
                                                                (Unaudited)
<S>                                                            <C>            <C>
Assets
Current assets:
   Cash                                                        $    161,760   $    328,048
   Accounts receivable, net of reserve for doubtful accounts
     of $25,000 in 2005 and 2004                                    121,309        146,272
   Current portion of deferred income taxes                          32,038         27,656
   Prepaid expenses and other current assets                          8,954         13,007
                                                               ------------   ------------
 Total current assets                                               324,061        514,983

Property and equipment:
   Land                                                             150,000             --
   Building and building improvements                               735,318             --
   Equipment, furniture and fixtures                                382,446        336,208
   Vehicles                                                          88,200         88,200
   Leasehold improvements                                                --         22,727
                                                               ------------   ------------
                                                                  1,355,964        447,135
   Less accumulated depreciation and amortization                   286,028        278,030
                                                               ------------   ------------
   Net property and equipment used in operations                  1,069,936        169,105

   Land, building and improvements not presently used
     in operations                                                       --        836,318
                                                               ------------   ------------
Net property and equipment                                        1,069,936      1,005,423

Other assets                                                          5,000             --
Deferred income taxes, less current portion                         434,123        374,746
                                                               ------------   ------------
Total assets                                                   $  1,833,120   $  1,895,152
                                                               ============   ============


Liabilities and stockholders' equity
Current liabilities:
   Accounts payable and accrued expenses                       $     97,018   $     44,026
   Accrued salaries                                                  18,995         29,019
   Current portion of notes payable                                  32,979         25,248
                                                               ------------   ------------
Total current liabilities                                           148,992         98,293

Notes payable, less current portion                                 794,047        804,021
                                                               ------------   ------------
Total liabilities                                                   943,039        902,314

Stockholders' equity                                                890,081        992,838
                                                               ------------   ------------
Total liabilities and stockholders' equity                     $  1,833,120   $  1,895,152
                                                               ============   ============
</TABLE>

See accompanying Notes to Condensed Financial Statements.


                                       3
<PAGE>

                      Diversified Product Inspections, Inc.

                 Condensed Statements of Operations (Unaudited)



                                                        Three months ended
                                                             March 31
                                                         2005         2004
                                                      ----------------------

Revenues                                              $ 365,405    $ 590,251

Operating expenses:
   Salaries                                             277,552      304,709
   Depreciation and amortization                         15,689       17,000
   General and administrative                           223,508      240,202
                                                      ---------    ---------
 Total operating expenses                               516,749      561,911
                                                      ---------    ---------

 Operating (loss) income                               (151,344)      28,340

 Interest expense                                       (15,172)      (5,745)
                                                      ---------    ---------

(Loss) income before income taxes                      (166,516)      22,595

Deferred income tax benefit (expense)                    63,759      (12,292)
                                                      ---------    ---------

Net (loss) income                                     $(102,757)   $  10,303
                                                      =========    =========

 Basic and diluted (loss) earnings per common share   $   (0.01)   $    0.00
                                                      =========    =========


See accompanying Notes to Condensed Financial Statements.


                                       4
<PAGE>

                      Diversified Product Inspections, Inc.

            Condensed Statements of Stockholders' Equity (Unaudited)


<TABLE>
<CAPTION>
                                                      Number of
                                                       Shares                        Additional                          Total
                                                      Issued and       Common          Paid-in       Accumulated     Stockholders'
                                                     Outstanding        Stock          Capital         Deficit           Equity
                                                    -------------   -------------   -------------   -------------    -------------
<S>                                                 <C>             <C>             <C>             <C>              <C>
Balance at January 1, 2004                             14,961,457   $     149,615   $   1,620,328   $  (1,141,428)   $     628,515
                                                    -------------   -------------   -------------   -------------    -------------
   Stock issued for convertible debt                    4,173,857          41,738         294,808              --          336,546
   Net income for 2004                                         --              --              --          27,777           27,777
                                                    -------------   -------------   -------------   -------------    -------------
Balance at December 31, 2004                           19,135,314         191,353       1,915,136      (1,113,651)         992,838
   Net loss for three months ended March 31, 2005              --              --              --        (102,757)        (102,757)
                                                    -------------   -------------   -------------   -------------    -------------
Balance at March 31, 2005                              19,135,314   $     191,353   $   1,915,136   $  (1,216,408)   $     890,081
                                                    =============   =============   =============   =============    =============
</TABLE>


         See accompanying Notes to Condensed Financial Statements.


                                       5
<PAGE>

                      Diversified Product Inspections, Inc.

                 Condensed Statements of Cash Flows (Unaudited)


<TABLE>
<CAPTION>
                                                                       Three months ended
                                                                            March 31
                                                                       2005            2004
                                                                   ------------    ------------
<S>                                                                <C>             <C>
Operating activities
Net (loss) income                                                  $   (102,757)   $     10,303
Adjustments to reconcile net (loss) income to net cash (used in)
   provided by operating activities:
     Depreciation and amortization                                       15,689          17,000
     Deferred tax (benefit) expense                                     (63,759)         12,292
     Loss on disposal of assets                                             284             916
     Changes in operating assets and liabilities:
       Accounts receivable                                               24,963         145,890
       Prepaid expenses and other assets                                   (947)         (1,370)
       Accounts payable and accrued expenses                             52,992         (48,458)
       Accrued salaries                                                 (10,024)         13,732
       Deferred revenue                                                      --         (25,000)
                                                                   ------------    ------------
Net cash (used in) provided by operating activities                     (83,559)        125,305

Investing activities
Proceeds from disposal of vehicles                                           --          10,500
Purchases of property and equipment                                     (80,486)        (15,663)
                                                                   ------------    ------------
Net cash used in investing activities                                   (80,486)         (5,163)

Financing activities
Principal payments on notes payable and capital
   lease obligation                                                      (2,243)        (16,400)
                                                                   ------------    ------------

Net (decrease) increase in cash                                        (166,288)        103,742

Cash at beginning of period                                             328,048         296,409
                                                                   ------------    ------------
Cash at end of period                                              $    161,760    $    400,151
                                                                   ============    ============


  Supplemental disclosure of cash flow information

Cash paid for interest during the period                           $     10,907    $      5,745
                                                                   ============    ============
</TABLE>


  See accompanying Notes to Condensed Financial Statements.


                                       6
<PAGE>

                      Diversified Product Inspections, Inc.

               Notes to Condensed Financial Statements (Unaudited)

                                 March 31, 2005



1.  Basis of Presentation

The accompanying unaudited condensed financial statements of Diversified
Products Inspections, Inc. (the "Company") have been prepared in accordance with
accounting principles generally accepted in the United States of America for
interim financial information and pursuant to the rules and regulations of the
Securities and Exchange Commission. Accordingly, they do not include all of the
information and footnotes required by accounting principles generally accepted
in the United States of America for complete financial statements. In the
opinion of management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included. Operating
results for the three-month period ended March 31, 2005 are not necessarily
indicative of the results that may be expected for the year ended December 31,
2005.

The balance sheet at December 31, 2004 has been derived from the audited
financial statements at that date but does not include all of the information
and footnotes required by accounting principles generally accepted in the United
States of America for complete financial statements.

For further information, refer to the financial statements and footnotes thereto
included in the Company's annual report on Form 10-KSB for the year ended
December 31, 2004.

2.  Employee Stock Options

The Company accounts for its stock options under the intrinsic value method in
accordance with Accounting Principles Board Opinion No. 25, Accounting for Stock
Issued to Employees, ("APB 25") and related interpretations. The Company has
adopted the disclosure-only provisions of the Financial Accounting Standards
Board ("FASB") Statement No. 123, Accounting for Stock-Based Compensation ("FAS
123") as amended by FASB Statement No. 148, Accounting for Stock-Based
Compensation - Transition and Disclosure ("FAS 148"). Had the Company elected to
adopt the fair value recognition provisions of FAS123, pro forma net income and
earnings per share would be as follows:

                                         Three months ended
                                              March 31
                                          2005         2004
                                       ----------------------
Basic:
   Net (loss) income, as reported      $(102,757)   $  10,303
   Employee compensation, net of tax      (6,465)      (6,465)
                                       ----------------------
   Total                               $(109,222)   $   3,838
                                       ======================

 Earnings per share:
   Basic and undiluted, as reported    $   (0.01)   $    0.00
                                       ======================
   Basic and undiluted, pro forma      $   (0.01)   $    0.00
                                       ======================


                                       7
<PAGE>

                      Diversified Product Inspections, Inc.

         Notes to Condensed Financial Statements (Unaudited) (continued)



3. Commitments and Contingencies

The Company currently leases its former office and warehouse under an agreement
classified as an operating lease. An early termination of this lease, which is
currently set to expire on December 31, 2005 and provides for monthly payments
of $18,125, is currently being negotiated between the Company and the landlord.
The Company has made required lease payments through March 31, 2005.

4. Earnings per Share

Basic earnings per share assumes no dilution and is computed by dividing income
available to common stockholders by the weighted average number of common stock
outstanding during each period. Diluted earnings per share reflect, in periods
in which they have a dilutive effect, the effect of common shares issuable upon
the exercise of stock options or warrants, using the treasury stock method of
computing such effects and contingent shares, or conversion of convertible debt.
The following table sets forth the computation of basic and diluted earnings per
share for the periods indicated:
                                                    Three months ended
                                                          March 31
                                                     2005            2004
                                                 ------------    ------------
Basic:
   Net (loss) income                             $   (102,757)   $     10,303
   Average shares outstanding                      19,135,134      14,961,457
                                                 ------------    ------------
   Basic (loss) earnings per share               $      (0.01)   $       0.00
                                                 ============    ============

Diluted:
   Net income                                    $   (102,757)   $     10,303
   Add interest on convertible debt                        --           2,700
                                                 ------------    ------------
   Total                                         $   (102,757)   $     13,003
                                                 ============    ============

   Average shares outstanding                      19,135,134      14,961,457
   Effect of dilutive stock options - based on
     treasury stock method                          1,655,602       2,980,417
   Assumed conversion of 6% convertible debt               --       1,992,022
                                                 ------------    ------------
   Total                                         $ 20,790,736    $ 19,933,896
                                                 ============    ============
   Diluted earnings per share                    $      (0.01)   $       0.00
                                                 ============    ============

5.  Subsequent Event

During April 2005, the Company entered into an agreement with a financial
institution for a $100,000 revolving line of credit. Under the terms of this
agreement, any borrowings bear interest at the financial institutions prime rate
and is secured by the Company's land and building. This line of credit is due on
demand. At April 26, 2005, the Company had made no borrowings under this
agreement.


                                       8
<PAGE>

Item 2. Management`s Discussion and Analysis or Plan of Operation.

Introduction

This Quarterly Report on Form 10-QSB for the period ended March 31, 2005 should
be read in conjunction with our unaudited financial statements included as part
of this Form 10-QSB Report. This report contains forward-looking statements
which are described and defined below.

General

We specialize in conducting investigations and laboratory analysis of a wide
variety of products to determine the cause and origin of product failures. Our
primary customers consist of national insurance companies that are interested in
pursuing claims to which they have become subrogated. Subrogation is a legal
principle, which provides that, to the extent an insurer has paid for a loss,
the insurer receives the policyholder's right to recover from any third party
that caused the loss. We have accumulated a large database of known defective
products that includes photos and other documentation that are used in our
clients' investigations. Additionally, we provide for the storage of evidence
collected during an investigation, until our customer requests that it be
disposed.


Results of Operations

Three Months Ended March 31, 2005 Compared to Three Months Ended March 31, 2004

Our revenues decreased from $590,251 for the three months ended March 31, 2004
to $365,405 for the three months ended March 31, 2005, or by approximately
38.1%. This decrease is primarily due to our move to a new office and warehouse
location during the quarter that caused us to miss approximately one month of
inspection services during the location transition. We anticipate that
comparable revenues in the second quarter will return to a level more consistent
with 2004. We also had $25,000 of use agreement revenues in 2004 that were not
recognized in 2005 due to disagreements with our customer over contractual
terms.

Our total operating expenses for the three-months ended March 31, 2005 were
$516,749, a decrease of $45,162, or approximately 8.0% compared to the same
period in 2004. Salary expense decreased by $27,157, or approximately 8.9%
primarily due to our efforts to reduce personnel to a level more appropriate for
2005 revenues. General and administrative expenses decreased by $16,694 or
approximately 6.9% primarily as a result of a general decrease in the need for
professional services during the current period offset somewhat by the costs
associated with our move to a new location.

As a result of the reduction in our revenues and, to a lesser extent, operating
expenses, our net income of $10,303 for the three months ended March 31, 2004
decreased $113,060 to a net loss of $102,757 for the three months ended March
31, 2005.

Financial Position

Our net accounts receivable decreased by $24,963, or 17.1%, between December 31,
2004 and


                                       9
<PAGE>

March 31, 2005, primarily as a result of our successful efforts in collecting
past due amounts and lower revenues in the current quarter. Our accounts payable
and accrued expenses increased by $52,992, or 120.4%, between December 31, 2004
and March 31, 2005, primarily due to timing of liabilities associated with
building and equipment improvements at our new office and warehouse. These
improvements totaled approximately $70,000 during the three months ended March
31, 2005. We also made additional computer and software acquisitions with a
total cost of approximately $10,000. As a result of these items combined with
our net loss for the quarter, our cash balance has decreased by approximately
$166,000 between December 31, 2004 and March 31, 2005.

Liquidity and Capital Resources

During April 2005, we entered into a $100,000 revolving credit agreement with a
local bank, payable on demand, bearing interest at the bank's prime rate,
secured by a deed of trust on our new office and warehouse. This loan will fund
the costs of our move and improvements to our new office and warehouse. We
anticipate that our internal cash flow will be sufficient to fund operations for
the next 12 months.

We are not aware of any material trend, event or capital commitment, which would
potentially adversely affect our liquidity. In the event such a trend develops,
we believe that we will have sufficient funds available to satisfy working
capital needs through lines of credit and the funds expected from equity sales.

Critical Accounting Policies

The preparation of financial statements and related disclosures requires
management to make judgments, assumptions and estimates that affect the amounts
in the financial statements and accompanying notes. Management's Discussion and
Analysis or Plan of Operation contained in Item 6 of the Company's Annual Report
on Form 10-KSB for the year ended December 31, 2004, describes these critical
accounting policies.


Item 3.  Controls and Procedures.

DISCLOSURE CONTROLS AND PROCEDURES

The Company's Chief Executive Officer is also its Chief Accounting Officer and
Chief Financial Officer. He is primarily responsible for the accuracy of the
financial information that is presented in this Quarterly Report on Form 10-QSB.
He has, within 90 days of the filing date of this Quarterly Report, evaluated
the Company's disclosure controls and procedures, as defined in the rules of the
SEC, and has determined that such controls and procedures were effective in
ensuring that material information relating to the Company was made known to him
during the period covered by this Quarterly Report.


                                       10
<PAGE>

INTERNAL CONTROLS

To meet his responsibility for financial reporting, the CEO/CFO has established
internal controls and procedures which he believes are adequate to provide
reasonable assurance that the Company's assets are protected from loss.

There were no significant changes in the Company's internal controls or in other
factors that could significantly affect internal controls subsequent to the date
of the CEO/CFO's most recent evaluation.



                           PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

The Company knows of no legal proceedings to which it is a party or to which any
of its property is the subject which are pending, threatened or contemplated or
any unsatisfied judgments against the Company.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

         None

Item 3. Defaults Upon Senior Securities

         None

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

         None.

Item 5. Other Information

         None

Item 6. Exhibits.


      31.1  Certification of Chief Financial Officer pursuant to Section 302 of
            Sarbanes-Oxley Act.

      32.1  Certification of Chief Executive Officer pursuant to 18 U.S.C.
            Section 1350, as adopted pursuant to Section 906 of Sarbanes-Oxley
            Act.


                                       11
<PAGE>

                                   SIGNATURES

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

                               Diversified Product Inspections, Inc.
                                           (Registrant)


Date: May 13, 2005                 /s/ John Van Zyll
                                   ---------------------------------------
                                       John Van Zyll
                               President, Chief Executive Officer and Chairman
                               (Principal Executive Officer and
                               Principal Accounting Officer)


                                       12