|  Florida                                                            |   | 59-3087128                                      |
|--------------------------------------------------------------------------|--------|-------------------------------------------------|
|  (State                of other jurisdiction                of      |   |                   (IRS Employer       |
|  incorporation                or                organization)  |   |                   Identification No.) |

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|                                                                                                                                                            |   | PAGE   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|
| PART              I FINANCIAL INFORMATION                                                                                                                       |   |   |
|                                                                                                                                                            |   |   |
| Item                1 Financial Statements                                                                                                                      |   |   |
|                                                                                                                                                            |   |   |
| Condensed                Balance Sheets as of March 31, 2007 (Unaudited) and December 31,                2006                                                   |   | 3      |
|                                                                                                                                                            |   |   |
| Condensed                Statements of Income (Unaudited) for the three months ended March                31, 2007                and 2006                      |   | 4      |
|                                                                                                                                                            |   |   |
| Condensed                Statements of Stockholders’ Equity for the year ended December 31, 2006                and the three months ended March 31, 2007 |   | 5      |
|                                                                                                                                                            |   |   |
| Condensed                Statements of Cash Flows (Unaudited) for the three months ended March                31,                2007 and 2006                  |   | 6      |
|                                                                                                                                                            |   |   |
| Notes                to Condensed Financial Statements (Unaudited)                                                                                              |   | 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     |

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|                                                                                                   |   | **March                  31** |          | **December                  31** |   |
|--------------------------------------------------------------------------------------------------------|--------|-------------------------------|---------------|----------------------------------|--------|
|                                                                                                   |   | **2007**                      |          | **2006**                         |   |
|                                                                                                   |   | **(Unaudited)**               |          |                             |   |
| **Assets**                                                                                             |   |                          |          |                             |   |   |   |
| Current                  assets:                                                                       |   |                          |          |                             |   |   |   |
| Cash                                                                                                   |   | **$**                         | **312,223**   |                             | $      | 331,793 |   |
| Accounts                  receivable, net of reserve for doubtful accounts of                  $50,000 |   |                          | **295,687**   |                             |   | 286,473 |   |
| Current                  portion of deferred income taxes                                              |   |                          | **70,281**    |                             |   | 70,281 |   |
| Prepaid                  expenses and other current assets                                             |   |                          | **1,457**     |                             |   | 2,914 |   |
| Total                  current assets                                                                  |   |                          | **679,648**   |                             |   | 691,461 |   |
|                                                                                                   |   |                          |          |                             |   |   |   |
| Property                  and equipment:                                                               |   |                          |          |                             |   |   |   |
| Land                                                                                                   |   |                          | **150,000**   |                             |   | 150,000 |   |
| Building                  and building improvements                                                    |   |                          | **735,318**   |                             |   | 735,318 |   |
| Equipment,                  furniture and fixtures                                                     |   |                          | **443,275**   |                             |   | 432,572 |   |
| Vehicles                                                                                               |   |                          | **71,512**    |                             |   | 71,512 |   |
|                                                                                                   |   |                          | **1,400,105** |                             |   | 1,389,402 |   |
| Less                  accumulated depreciation and amortization                                        |   |                          | **419,320**   |                             |   | 400,840 |   |
| Net                  property and equipment                                                            |   |                          | **980,785**   |                             |   | 988,562 |   |
|                                                                                                   |   |                          |          |                             |   |   |   |
| Other                  assets                                                                          |   |                          | **5,000**     |                             |   | 5,000 |   |
| Deferred                  income taxes, less current portion                                           |   |                          | **329,842**   |                             |   | 332,735 |   |
| Total                  assets                                                                          |   | **$**                         | **1,995,275** |                             | $      | 2,017,758 |   |
| **Liabilities                  and stockholders’ equity**                                        |   |                          |          |                             |   |   |   |
| Current                  liabilities:                                                                  |   |                          |          |                             |   |   |   |
| Accounts                  payable and accrued expenses                                                 |   | **$**                         | **34,655**    |                             | $      | 57,793 |   |
| Accrued                  salaries                                                                      |   |                          | **33,078**    |                             |   | 21,775 |   |
| Current                  portion of deferred revenue                                                   |   |                          | **133,333**   |                             |   | 133,333 |   |
| Current                  portion of long-term debt                                                     |   |                          | **47,328**    |                             |   | 45,989 |   |
| Current                  portion of capital lease obligation                                           |   |                          | **4,029**     |                             |   | 3,906 |   |
| Total                  current liabilities                                                             |   |                          | **252,423**   |                             |   | 262,796 |   |
|                                                                                                   |   |                          |          |                             |   |   |   |
| Deferred                  revenue, less current portion                                                |   |                          | **21,667**    |                             |   | 25,000 |   |
| Long-term                  debt, less current portion                                                  |   |                          | **707,289**   |                             |   | 719,312 |   |
| Capital                  lease obligation, less current portion                                        |   |                          | **1,185**     |                             |   | 1,882 |   |
| Total                  liabilities                                                                     |   |                          | **982,564**   |                             |   | 1,008,990 |   |
|                                                                                                   |   |                          |          |                             |   |   |   |
| Stockholders’                  equity                                                            |   |                          | **1,012,711** |                             |   | 1,008,768 |   |
| Total                  liabilities and stockholders’ equity                                      |   | **$**                         | **1,995,275** |                             | $      | 2,017,758 |   |

*See      accompanying Notes to Condensed Financial Statements.*

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|                                                       |   | **Three                months ended** |        |
|------------------------------------------------------------|--------|---------------------------------------|-------------|
|                                                       |   | **March                31**           |        |
|                                                       |   | **2007**                              |        | **2006** |   |
| Revenues                                                   |   | **$**                                 | **583,365** |   | $ | 591,335 |   |
|                                                       |   |                                  |        |   |   |   |   |
| Operating                expenses:                         |   |                                  |        |   |   |   |   |
| Salaries                                                   |   |                                  | **317,268** |   |   | 316,114 |   |
| Depreciation                and amortization               |   |                                  | **18,480**  |   |   | 19,078 |   |
| General                and administrative                  |   |                                  | **228,711** |   |   | 170,246 |   |
| Total                operating expenses                    |   |                                  | **564,459** |   |   | 505,438 |   |
|                                                       |   |                                  |        |   |   |   |   |
| Operating                income                            |   |                                  | **18,906**  |   |   | 85,897 |   |
|                                                       |   |                                  |        |   |   |   |   |
| Interest                expense                            |   |                                  | **12,070**  |   |   | 14,048 |   |
|                                                       |   |                                  |        |   |   |   |   |
| Income                before income taxes                  |   |                                  | **6,836**   |   |   | 71,849 |   |
|                                                       |   |                                  |        |   |   |   |   |
| Deferred                income tax expense                 |   |                                  | **(2,893**  | **)** |   | (27,873 | ) |
|                                                       |   |                                  |        |   |   |   |   |
| Net                income                                  |   | **$**                                 | **3,943**   |   | $ | 43,976 |   |
|                                                       |   |                                  |        |   |   |   |   |
| Basic                and diluted earnings per common share |   | **$**                                 | **0.00**    |   | $ | 0.00 |   |

*See      accompanying Notes to Condensed Financial Statements.*

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|                                                            |   | **Number                of****Shares****Issued                and****Outstanding** |           |  **Common****Stock** |   | **Additional****Paid-in****Capital** |   | **Accumulated****Deficit** |          | **Total****Stockholders’****Equity** |   |
|-----------------------------------------------------------------|--------|------------------------------------------------------------------------------------|----------------|---------------------------|--------|--------------------------------------|--------|----------------------------|---------------|--------------------------------------------|--------|
| Balance                at January 1, 2006                       |   |                                                                               | 19,634,821     |                      | $      | 196,348                              |   | $                          | 1,958,578     |                                       | $      | (1,258,207 | ) | $ | 896,719 |   |
| Stock                issued for services                        |   |                                                                               | 546,046        |                      |   | 5,460                                |   |                       | 39,258        |                                       |   | - |   |   | 44,718 |   |
| Net                income for 2006                              |   |                                                                               | -              |                      |   | -                                    |   |                       | -             |                                       |   | 67,331 |   |   | 67,331 |   |
| Balance                at December 31, 2006                     |   |                                                                               | 20,180,867     |                      |   | 201,808                              |   |                       | 1,997,836     |                                       |   | (1,190,876 | ) |   | 1,008,768 |   |
| Net                income for three months ended March 31, 2007 |   |                                                                               | **-**          |                      |   | **-**                                |   |                       | **-**         |                                       |   | **3,943** |   |   | **3,943** |   |
| Balance                at March 31, 2007                        |   |                                                                               | **20,180,867** |                      | **$**  | **201,808**                          |   | **$**                      | **1,997,836** |                                       | **$**  | **(1,186,933** | **)** | **$** | **1,012,711** |   |

*See      accompanying Notes to Condensed Financial Statements.*

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|                                                                                                            |   | **Three                months ended****March                31** |        |
|-----------------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------|-------------|
|                                                                                                            |   | **2007**                                                         |        | **2006** |   |
| **Operating                activities**                                                                         |   |                                                             |        |   |   |   |   |
| Net                income                                                                                       |   | **$**                                                            | **3,943**   |   | $ | 43,976 |   |
| Adjustments                to reconcile net income to net cash provided by operating                activities: |   |                                                             |        |   |   |   |   |
| Depreciation                and amortization                                                                    |   |                                                             | **18,480**  |   |   | 19,078 |   |
| Deferred                income tax expense                                                                      |   |                                                             | **2,893**   |   |   | 27,873 |   |
| Services                paid with stock                                                                         |   |                                                             | -           |   |   | 22,579 |   |
| Changes                in operating assets and liabilities:                                                     |   |                                                             |        |   |   |   |   |
| Accounts                receivable                                                                              |   |                                                             | **(9,214**  | **)** |   | 15,056 |   |
| Prepaid                expenses and other assets                                                                |   |                                                             | **1,457**   |   |   | - |   |
| Accounts                payable and accrued expenses                                                            |   |                                                             | **(23,138** | **)** |   | (34,123 | ) |
| Accrued                salaries                                                                                 |   |                                                             | **11,303**  |   |   | 9,226 |   |
| Deferred                revenue                                                                                 |   |                                                             | **(3,333**  | **)** |   | - |   |
| Net                cash provided by operating activities                                                        |   |                                                             | **2,391**   |   |   | 103,665 |   |
|                                                                                                            |   |                                                             |        |   |   |   |   |
| **Investing                activities**                                                                         |   |                                                             |        |   |   |   |   |
| Purchases                of property and equipment                                                              |   |                                                             | **(10,703** | **)** |   | (16,500 | ) |
|                                                                                                            |   |                                                             |        |   |   |   |   |
| **Financing                activities**                                                                         |   |                                                             |        |   |   |   |   |
| Net                repayments on line of credit                                                                 |   |                                                             | -           |   |   | (52,094 | ) |
| Principal                payments on long-term debt and capital lease obligation                                |   |                                                             | **(11,258** | **)** |   | (10,655 | **)** |
| Net                cash used in financing activities                                                            |   |                                                             | **(11,258** | **)** |   | (62,749 | ) |
|                                                                                                            |   |                                                             |        |   |   |   |   |
| Net                (decrease) increase in cash                                                                  |   |                                                             | **(19,570** | **)** |   | 24,416 |   |
|                                                                                                            |   |                                                             |        |   |   |   |   |
| Cash                at beginning of period                                                                      |   |                                                             | **331,793** |   |   | 196,893 |   |
| Cash                at end of period                                                                            |   | **$**                                                            | **312,223** |   | $ | 221,309 |   |
| **Supplemental                disclosure of cash flow information**                                             |   |                                                             |        |   |   |   |   |
|  Cash              paid for interest during the period                                                     |   | **$**                                                            | **12,070**  |   | $ | 14,048 |   |

*See      accompanying Notes to Condensed Financial Statements.*

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**1.      Basis of Presentation**

**2.      Recent Accounting Pronouncements**

*Accounting      for Uncertainty in Income Taxes (an interpretation of FASB Statement      No. 109) *

**3.      Employee Stock Options**

*)*
*      Share-Based Payment *

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**4.**
**Commitments      and Contingencies**

**5.  **
**Earnings      per Share**

|                                                |   | **Three                months ended** |           |
|-----------------------------------------------------|--------|---------------------------------------|----------------|
|                                                |   | **March                31**           |           |
|                                                |   | **2007**                              |           | **2006** |   |
| Basic                and diluted:                   |   |                                  |           |   |   |   |   |
| Net                income                           |   | **$**                                 | **3,943**      |   | $ | 43,976 |   |
| Average                shares outstanding           |   |                                  | **20,180,867** |   |   | 19,704,082 |   |
| Basic                and diluted earnings per share |   | **$**                                 | **0.00**       |   | $ | 0.00 |   |

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|                                              |                                                                                                                                                                                  |                                             |
|---------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------|
|                                              | Diversified                Product Inspections, Inc.(Registrant)                                                                                                                      |
|                                         |                                                                                                                                                                             |                                        |
| Date: May              14,              2007 |                                                                                                                                                                                  | /s/ John              Van              Zyll |
|                                              | John                Van ZyllPresident,                Chief Executive Officer and Chairman(Principal                Executive Officer andPrincipal                Accounting Officer) |

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