**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington,
      DC 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, 2007**





**or**





o**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: 000-30781**





**MANGOSOFT,
      INC.**


(Exact
      name of small business issuer as specified in its charter)








**Nevada**
            **87-0543565**(State
                or other jurisdiction
            (IRS
                Employer Identification No.)of
                incorporation or organization)







**29
                Riverside St., Ste A Box 8****Nashua,
                NH**
            **03062**(Address
                of principal executive offices)
            (Zip
                code)





**Issuer’s
      telephone number: (603) 324-0400**





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 o





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act). Yes o No
x





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




**Common
                Stock**
            **3,413,038
                Shares**$0.001
                Par Value
            (Outstanding
                on May 15, 2007)




Transitional
      Small Business Disclosure Format (check one) Yes o No x







**MANGOSOFT,
      INC. AND SUBSIDIARY**





**INDEX
      TO FORM 10-QSB**





PagePART
                I.           FINANCIAL
                INFORMATIONITEM
                1 - Condensed Consolidated Financial Statements
                (unaudited):Balance
                Sheets as of March 31, 2007 and December 31, 2006
            3Statements
                of Operations for the Three Months Ended March 31, 2007 and 2006
            4Statements
                of Cash Flows for the Three Months Ended March 31, 2007 and 2006
            5Notes
                to Unaudited Condensed Consolidated Financial Statements
            6ITEM
                2 - Management’s Discussion and Analysis of Financial Condition and
                Results of Operations
            9ITEM
                3 - Controls and Procedures
            16PART
                II.           OTHER
                INFORMATIONITEM
                1 - Legal Proceedings
            17ITEM
                6 - Exhibits and Reports on Form 8-K
            18Signature
            20Officer
                Certification
            21







2





**MANGOSOFT,
      INC. AND SUBSIDIARY**





**CONDENSED
      CONSOLIDATED BALANCE SHEETS**




**March
                31,**
            
            **December
                31,****2007**
            
            **2006****(Unaudited)****ASSETS**Current
                Assets:Cash
                and cash equivalents
            
            $
            906,199
            
            $
            125,348Accounts
                receivable
            
            
            7,997
            
            
            20,900Total
                assets
            
            $
            914,196
            
            $
            146,248**LIABILITIES
                AND STOCKHOLDERS’ EQUITY (DEFICIT)**Current
                Liabilities:Accounts
                payable
            
            $
            21,863
            
            $
            51,738Accrued
                compensation
            
            
            3,894
            
            
            7,788Other
                accrued expenses and current liabilities
            
            
            37,471
            
            
            54,243Total
                current liabilities
            
            
            63,228
            
            
            113,769Long
                Term Liabilities:Note
                payable
            
            
            -
            
            
            250,000Total
                liabilities
            
            
            63,228
            
            
            363,769Commitments
                and contingenciesStockholders’
                Equity (Deficit):Preferred
                stock - $.001 par value; authorized, 5,000,000shares;
                issued and outstanding, 20,000
            
            
            20
            
            
            20Common
                  stock - $.001 par value, authorized 15,000,000 shares in March
                  2007 and
                  3,703,704 shares in December 2006; issued and outstanding, 3,413,038
                  in
                  March 2007 and 1,013,038 in December 2006
            
            
            3,413
            
            
            1,013Additional
                paid-in capital
            
            
            89,904,757
            
            
            88,725,694Accumulated
                deficit
            
            
            (89,057,222
            )
            
            (88,944,248
            )Total
                stockholders' equity (deficit)
            
            
            850,968
            
            
            (217,521
            )Total
                liabilities and stockholders' equity (deficit)
            
            $
            914,196
            
            $
            146,248




See
      notes
      to the unaudited condensed consolidated financial statements.




3




**MANGOSOFT,
      INC. AND SUBSIDIARY**





**CONDENSED
      CONSOLIDATED STATEMENTS OF OPERATIONS**





**Three
                Months Ended March 31,****2007**
            
            **2006****(Unaudited)**Service
                revenues
            
            $
            61,931
            
            $
            70,507Costs
                and expenses:Cost
                of services
            
            
            64,742
            
            
            66,756General
                and administrative
            
            
            119,298
            
            
            90,719Loss
                from operations
            
            
            (122,109
            )
            
            (86,968
            )Interest
                income
            
            
            9,135
            
            
            3,190Net
                loss
            
            $
            (112,974
            )
            $
            (83,778
            )Net
                loss per share - basic and diluted
            
            $
            (0.04
            )
            $
            (0.08
            )Weighted
                average shares outstanding - basic and diluted
            
            
            3,146,371
            
            
            1,013,038







See
      notes
      to the unaudited condensed consolidated financial statements.


4


**MANGOSOFT,
      INC. AND SUBSIDIARY**





**CONSOLIDATED
      STATEMENTS OF CASH FLOWS**





**Three
                Months Ended March 31,****2007**
            
            **2006****(Unaudited)**CASH
                FLOWS FROM OPERATING ACTIVITIES:Net
                loss
            
            $
            (112,974
            )
            $
            (83,778
            )Adjustments
                to reconcile net loss to net cash used byoperating
                activities:Increase
                (decrease) in cash from the change in:Accounts
                receivable
            
            
            12,903
            
            
            2,836Accounts
                payable
            
            
            (29,875
            )
            
            (6,296
            )Accrued
                compensation
            
            
            (3,894
            )
            
            (3,894
            )Other
                accrued expenses
            
            
            (10,309
            )
            
            489Net
                cash used in operating activities
            
            
            (144,149
            )
            
            (90,643
            )CASH
                FLOWS FROM INVESTING ACTIVITIES:Investment
                maturities
            
            
            -
            
            
            2,403Interest
                receivable
            
            
            -
            
            
            1,135Net
                cash provided by investing activities
            
            
            -
            
            
            3,538CASH
                FLOWS FROM FINANCING ACTIVITIES:Net
                Proceeds from Private Placement of Common Stock
            
            
            925,000
            
            
            -Net
                cash provided by financing activities
            
            
            925,000
            
            
            -NET
                INCREASE IN CASH AND CASH EQUIVALENTS
            
            
            780,851
            
            
            (87,105
            )CASH
                AND CASH EQUIVALENTS, BEGINNING OFPERIOD
            
            
            125,348
            
            
            480,662CASH
                AND CASH EQUIVALENTS, END OF PERIOD
            
            $
            906,199
            
            $
            393,557




SUPPLEMENTAL
                DISCLOSURE OF NON CASH ACTIVITIES:In
                connection with the Private Placement sale of Common Stock on January
                10,
                2007, the bridge financing note payable to an investor and related
                party
                in the amount of $250,000 and accrued interest in the amount of $6,463
                was
                converted into 500,000 shares of Common
                Stock.





See
      notes
      to the unaudited condensed consolidated financial statements.




5
 
 **MANGOSOFT,
          INC. AND SUBSIDIARY**
 
 **NOTES
          TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 
 **1.**
                **NATURE
                    OF BUSINESS AND BASIS OF
                    PRESENTATION**
 
 MangoSoft,
          Inc. and subsidiary (the "Company") markets, sells and supports Internet
          business software and services that improve the utility and effectiveness
          of
          Internet-based business applications. The Company’s software solutions address
          the networking needs of small businesses, workgroups and large enterprises.
          The
          Company is engaged in a single operating segment of the computer software
          industry.
  The
          accompanying unaudited condensed consolidated financial statements have
          been
          prepared on the same basis as the annual financial statements. In the opinion
          of
          management, all significant adjustments, which are normal, recurring in
          nature
          and necessary for a fair presentation of the financial position, cash flows
          and
          results of the operations of the Company, have been consistently recorded.
          The
          operating results for the interim periods presented are not necessarily
          indicative of expected performance for the entire year. Certain amounts
          from the
          prior year have been reclassified to conform to the current year
          presentation.
 
 The
          unaudited information should be read in conjunction with the audited financial
          statements of the Company and the notes thereto for the year ended December
          31,
          2006 included in the Company’s Annual Report on Form 10-KSB filed with the
          Securities and Exchange Commission.
 
 As
          shown
          in the unaudited condensed consolidated financial statements, during the
          three
          months ended March 31, 2007 and 2006, the Company incurred net losses of
          $112,974 and $83,778 respectively. Cash used in operations during the three
          months ended March 31, 2007 and 2006 was $144,059 and $90,643, respectively.
          These factors, among others, raise significant doubt about the Company’s ability
          to continue as a going concern. The unaudited condensed consolidated financial
          statements do not include any adjustments relating to the recoverability
          and
          classification of assets or the amounts and classification of liabilities
          that
          might be necessary should the Company be unable to continue as a going
          concern.
          The Company’s continuation as a going concern is dependent upon its ability to
          generate sufficient cash flow and meet its obligations on a timely basis
          and
          ultimately attain profitability.
 
 On
          September 11, 2006, Mangosoft Corp. assigned the ownership and legal titles
          of
          twelve of its patents and applications with no recorded value to Mangosoft
          Intellectual Property, Inc., (a wholly owned subsidiary), Pursuant to the
          agreement, Mangosoft Corp. assigned the entire right, title, and interest
          in and
          to the following applications to Mangosoft Intellectual Property,
          Inc.:
  **Title**
                **Application
                    No./Patent No.**
                **Filing
                    Date/Issue Date**System
                    For Tracking Data
                08/848,970
                05/02/97Method
                    For Scheduling Thread Execution On A Limited Number Operating
                    System
                09/069,352
                04/29/98Internet-Based
                    Shared File Service With Native PC Client Access And Semantics
                    And
                    Distributed Access Control
                09/704,050
                11/01/00Internet-Based
                    Shared File Service With Native PC Client Access And
                    Semantics
                09/704,262
                11/01/00Dynamic
                    Directory Service
                10/704,327
                11/07/03Internet-Based
                    Shared File Service With Native PC Client Access And Semantics
                    And
                    Distributed Version Control
                11/285,423
                11/21/05System
                    and Method For Providing Highly Available Data Storage Using
                    Globally
                    Addressable Memory
                5,909,540
                06/01/99Remote
                    Access And Geographically Distributed Computers In A Globally
                    Addressable
                    Storage Environment
                5,987,506
                11/16/99Shared
                    Client-Side Web Caching Using Globally Addressable Memory
                6,026,474
                02/15/00Dynamic
                    Directory Service
                6,647,393
                11/11/03Distributed
                    Virtual Web Cache Implemented Entirely in Software
                6,760,756
                07/06/04Internet-Based
                    Shared File Service With Native PC Client Access And
                    Semantics
                7,058,696
                06/06/06
 
 6
 
 On
          January 10, 2007, the Company announced the sale of an aggregate of 2,400,000
          shares of common stock, par value $.001 per share to a group of investors
          led by
          current stockholders. Through the private placement of its common stock,
          the
          Company raised aggregate gross proceeds of $1,200,000. One of the investors
          in
          the offering provided bridge financing to the Company on September 20,
          2006 in
          the principal amount of $250,000. This principal amount and accrued interest
          of
          $6,463, was automatically converted into a subscription for Common Stock
          pursuant to the offering. The Company intends to utilize the net proceeds
          of the
          private placement to pay past due expenses and to fund its various patent
          litigations
  **2.**
                  **NET****LOSS
                      PER SHARE**
 
 Basic
          net
          loss per share is computed by dividing net loss by the weighted average
          number
          of common shares outstanding for the period. Diluted net loss per share
          reflects, in addition to the weighted average number of common shares,
          the
          potential dilution if stock options and warrants outstanding were exercised
          and/or converted into common stock, unless the effect of such equivalent
          shares
          was antidilutive.
 
 For
          the
          three months ended March 31, 2007 and 2006, the effect of stock options
          and
          other potentially dilutive shares were excluded from the calculation of
          diluted
          net loss per common share as their inclusion would have been antidilutive.
 
 **3.**
                **REVENUE
                    RECOGNITION**
 
 The
          Company records revenue upon delivery if pervasive evidence of an arrangement
          exists, the price is fixed and determinable, delivery has occurred and
          collection is probable. Revenue for sales to distributors is recognized
          upon
          sales to end users. Service revenue is recognized as services are
          performed.
 
 **4.**
                **STOCK-BASED
                    COMPENSATION**
 
 The
          Company currently has one stock-based compensation plan, which is described
          more
          fully in Note 8 in the Company’s Annual Report on Form 10-KSB for the period
          ended December 31, 2006, as filed on March 30, 2007. As amended, this plan
          provides for the issuance of up to 296,297 shares of common stock to employees,
          officers, directors and consultants in the form of nonqualified and incentive
          stock options, restricted stock grants or other stock-based awards, including
          stock appreciation rights. The stock options are exercisable as specified
          at the
          date of grant and expire no later than ten years from the date of grant.
          As of
          March 31, 2007, there were 179,652 remaining options available under this
          plan.
  7
 Effective
          January 1, 2006, the Company adopted the fair value recognition provisions
          of Statement of Financial Accounting Standards (“SFAS”)
          No. 123(R), *Share-Based Payment* (“SFAS
          123R”), using the modified-prospective-transition method. Under this transition
          method, compensation cost to be recognized for the first three months of
          2006
          would include: (a) compensation cost for all stock-based payments granted,
          but not yet vested as of January 1, 2006, based on the grant-date fair
          value estimated in accordance with the original provisions of SFAS No. 123, *Accounting
          for Stock Based Compensation* ,
          and
          (b) compensation cost for all stock-based payments granted subsequent to
          January 1, 2006, based on the grant-date fair value estimated in accordance
          with the provisions of SFAS 123R. Results
          for prior periods have not been restated. There were no unvested stock
          based
          payments at January 1, 2006 and there were no stock based payments granted
          during the three months ended March 31, 2007 and 2006.
 
  8
 
 **ITEM
          2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND** **RESULTS
          OF OPERATIONS**
 
 This
          Quarterly Report on Form 10-QSB contains forward-looking statements within
          the
          safe harbor provisions of the Private Securities Litigation Reform Act
          of 1995.
          Any statements in this Quarterly Report that are not statements of historical
          facts are forward-looking statements, which involve risks and uncertainties.
          Without limiting the foregoing, the words “believes,” “anticipates,” “plans,”
“expects,” and similar expressions are intended to identify forward-looking
          statements. Our actual results may differ materially from those indicated
          in the
          forward-looking statements as a result of the factors set forth elsewhere
          in
          this Quarterly Report on Form 10-QSB, including under “Risk Factors.” You should
          read the following discussion and analysis together with our condensed
          consolidated financial statements for the periods specified and the related
          notes included herein. Further reference should be made to our Annual Report
          on
          Form 10-KSB for the period ended December 31, 2006 filed with the Securities
          and
          Exchange Commission.
 
 **Overview**
 
 We
          market, sell and support Internet business software and services that improve
          the utility and effectiveness of Internet-based business applications.
          Our
          software solutions address the networking needs of small businesses, workgroups
          and large enterprises. Our products and services enhance the performance
          of PC
          networks and deliver improved service utilizing existing equipment. We
          no longer
          develop new software products or services.
  Mangomind SM is a
          multi-user, business-oriented, peer-to-peer file sharing system, allowing
          individual users to collaborate over the Internet across organizational
          boundaries in a safe and secure manner. The architecture is a blend of
          the
          manageability of client/server with the autonomy, clustering, and caching
          optimizations of peer-to-peer. The user experience is one of easy file
          sharing
          with colleagues through what looks like an ordinary LAN shared drive.
          Mangomind SM provides
          the secure file sharing benefits of a VPN without additional hardware and
          configuration complexities. Mangomind SM is sold
          as both a service and a standalone software product.
 
 fileTRUST SM is an
          online data storage service we purchased from Bank of America (formerly
          FleetBoston) in February 2002 for approximately $427,000, of which $175,000
          was
          paid in cash and the balance in our common stock and warrants to purchase
          our
          common stock at $14.31 per share. fileTRUST SM users
          can access their stored files from any Internet-connected system. The
          fileTRUST SM service
          compliments our Mangomind SM service
          by providing customers with a lower cost online storage system. In conjunction
          with our purchase of fileTRUST SM ,
          we
          executed a two-year enterprise license agreement with Bank of America (formerly
          FleetBoston) for the internal use of fileTRUST SM by Bank
          of America (formerly FleetBoston), which expired in February 2004. The
          terms and
          conditions of this agreement provided for automatic renewals on a month-to-month
          basis.
 
 **Critical
          Accounting Policies**
 
 Our
          accounting policies are fully described in Note 2 to our consolidated financial
          statements. The following describes the application of accounting principles
          that have significant impact on our consolidated financial
          statements:
 
 *Going
          Concern Assumption* - The
          consolidated financial statements do not include any adjustments relating
          to the
          recoverability and classification of assets or the amounts and classification
          of
          liabilities that might be necessary should we be unable to continue as
          a going
          concern. If the consolidated financial statements were prepared on liquidation
          basis, the carrying value of our assets and liabilities would be adjusted
          to net
          realizable amounts. In addition, the classification of the assets and
          liabilities would be adjusted to reflect the liquidation basis of
          accounting.
 
 9
 *Revenue
          Recognition* - We
          recognize revenue generated from product sales when persuasive evidence
          of an
          arrangement exists, the price is fixed and determinable, delivery has occurred
          and collection is probable. We recognize revenue generated from the sale
          of the
          Mangomind SM and
          fileTRUST SM services
          as the service is provided. We recognize revenue generated from the sale
          of the
          Mangomind SM product
          over the period of the first year’s maintenance agreement when persuasive
          evidence of the arrangement exists, the price is fixed and determinable,
          delivery and any required installation has been completed and collection
          is
          probable.
 
 *Stock-based
          Compensation* - As
          part of our compensation programs offered to our employees, we grant stock
          options. In addition, we have engaged third-party consultants and advisors
          and
          have compensated them in the form of stock options. Compensation for stock
          options issued to employees is generally measured as the difference between
          the
          exercise price of the options granted and the fair value of our common
          stock on
          the date of grant. Compensation for stock options issued to third-party
          consultants and advisors is measured at the fair value on the date of grant,
          determined using the Black-Scholes valuation model. Because of the cashless
          exercise feature of the stock options granted in 1999 and the repricing
          of
          options granted in 2000 and 2003, we are required to remeasure the compensation
          related to these awards at each reporting date. As the quoted market price
          of
          our common stock fluctuates, our reported operating expenses will continue
          to
          fluctuate. These fluctuations can be significant.
 
 *Deferred
          Taxation* -
          Because of the significant operating losses incurred and projected future
          operating losses, we have provided a full valuation allowance against the
          deferred tax assets created by our net operating loss
          carryforwards.
 
 **Costs
          and Expenses**
 
 *Cost
          of services* - Cost
          of services consist solely of the expenses we incur to administer and service
          the Mangomind SM and
          fileTRUST SM services.
          These expenses consist primarily of salaries and related personnel costs,
          the
          cost of our outsourced data center, the license royalties we pay to our
          e-security software provider for the encryption used in the
          Mangomind SM service
          and the fees we pay to Built Right Networks to manage our billable services
          infrastructure.
 
 *Engineering
          and Development Expenses* -
          Engineering and development expenses consist primarily of costs related
          to the
          design, development, testing, deployment and enhancement of our products
          and
          services. We have expensed our engineering and development costs as incurred.
          At
          March 31, 2007, there were no full time employees performing engineering
          or
          development on our products and services. We have outsourced the maintenance
          of
          our billable services infrastructure as well as product and customer support
          to
          Built Right Networks.
 
 *Other
          Operating Expenses* --
          Selling and marketing expenses consist primarily of costs incurred to market
          our
          products and services such as the costs of attending and presenting at
          trade
          shows. General and administrative expenses consist primarily of salaries
          and
          related personnel costs and other general corporate costs such as facility
          costs, commercial and general liability insurance, accounting and legal
          expenses
          and other costs typical of a publicly held corporation. At March 31, 2007,
          there
          were no full time employees performing selling and marketing activities.
          Our
          remaining employee is performing general and administrative
          activities.
  10
 *Reduction
          in Force* - We
          have reduced our work force on four occasions since April 23, 2001 due
          to
          adverse economic conditions and our need to conserve capital. At March
          31, 2007,
          we had one employee, working in a general and administrative
          capacity.
 
 **Results
          of Operations - Three Months Ended March 31, 2007 and 2006**
 
 Revenues
          for the three months ended March 31, 2007 decreased $8,576 or 12% to $61,931
          from $70,507 for the comparable period in 2006. No customer accounted for
          more
          than 10% of our revenues for either period.
 
 We
          recognized $59,063 from the sale of our Mangomind SM service
          and $2,868 from the sale of our fileTRUST SM service
          during the three months ended March 31, 2007. During the comparable period
          in
          2006, we recognized $66,042 from the sale of the Mangomind SM service
          and $4,465 from the sale of our fileTRUST SM service.
  Cost
          of
          services for the three months ended March 31, 2007 decreased $2,014 or
          3% to
          $64,742 compared to $66,756 for the comparable period in 2006. The decrease
          in
          the cost of delivering our services was primarily a result of our continued
          reductions and our switch to a lower cost data center. In response to our
          loss
          of Bank of America (formerly FleetBoston) as a customer, we have instituted
          cost
          reductions to lessen the adverse effects of the loss of the Bank of America
          (formerly FleetBoston) revenues, including restructuring our business
          relationships with key vendors such as Built Right Networks.
 
 There
          was
          no engineering and development expense for the three months ended March
          31, 2007
          and 2006. During the three months ended March 31, 2007 and 2006, we had
          no
          employees performing engineering or development activities
 
 For
          the
          three months ended March 31, 2007, other operating expenses including selling
          and marketing and general and administrative expenses increased $28,579
          or 31%
          to $119,298 compared with $90,719 for the comparable period in 2006. The
          increase in other operating expenses was due primarily to legal costs incurred
          in pursuit of patents and in defense of our patents combined with a reduction
          of
          public relations, legal and other corporate consultants and facility rent
          in
          addition to reductions in our marketing, selling and general and administrative
          personnel associated with our work force reductions. During the three months
          ended March 31, 2007 and 2006, our one (1) full-time employee was working
          in a
          general and administrative capacity.
 
 There
          was
          no stock-based compensation recorded for the three-month period ended March
          31,
          2007 and 2006.
 
 Our
          loss
          from operations increased $35,141 to $122,109 for the three months ended
          March
          31, 2007 compared with a loss from operations of $86,968 for the comparable
          period in 2006 as a result of the above factors.
 
 Interest
          income increased $5,945 to $9,135 for the three months ended March 31,
          2007
          compared to $3,190 for the comparable period in 2006 due to the availability
          of
          working capital.
  11
 
 **Financial
          Condition, Liquidity and Capital Resources**
 
 We
          were
          formed in June 1995 and, since our formation, have raised approximately
          $75,425,000 in financing from private placements of debt and equity securities.
          In addition to the financing we received through the sale of our securities,
          we
          have, at times, depended upon loans from stockholders and directors and
          credit
          from suppliers to meet interim financing needs. Borrowings from stockholders
          and
          directors have generally been refinanced with new debt instruments or converted
          into additional equity. At March 31, 2007, approximately $63,000 in additional
          financing was provided through accounts payable, accrued expenses and other
          trade credit, a significant portion of which is past due.
 
 On
          January 10, 2007, the Company completed the sale of an aggregate of 2,400,000
          shares of common stock, par value $.001 per share to a group of investors
          led by
          current stockholders. Through the private placement of its common stock,
          the
          Company raised aggregate gross proceeds of $1,200,000. One of the investors
          in
          the offering provided bridge financing to the Company on September 20,
          2006 in
          the principal amount of $250,000. This principal amount and accrued interest
          of
          $6,463 was automatically converted into a subscription for Common Stock
          pursuant
          to the offering. The Company intends to utilize the net proceeds of the
          private
          placement to pay past due expenses and to fund its various patent
          litigations
 
 At
          March
          31, 2007, we had a cash balance of approximately $906,000 and working capital
          of
          approximately $851,000. We do not have any commercial commitments or off
          balance
          sheet financing. Our commitments are described in Note 9 to our consolidated
          financial statements.
 
 We
          did
          not make any capital expenditures during the three months ended March 31,
          2007.
 
 We
          have
          significantly modified our operations and reduced our work force on four
          separate occasions since April 2001. We currently have one (1) employee,
          working
          in a general and administrative capacity. We outsource the management of
          our
          billable services infrastructure, software code base, customer support
          and
          reseller channel management to Built Right Networks for approximately $21,000
          per month, under an agreement, which can be cancelled with a ninety (90)
          day
          notice.
 
 Unless
          we
          can generate significant on-going revenue, we will need additional sources
          of
          equity or debt financing. Although we have been successful in raising past
          financing, there can be no assurances that additional financing will be
          available to us on commercially reasonable terms, or at all.
 
 As
          shown
          in the unaudited consolidated financial statements, during the three months
          ended March 31, 2007 and 2006, we incurred a net loss of $112,974 and $83,778,
          respectively. Cash used in operations during the three months ended March
          31,
          2007 and 2006 was $144,149 and $90,643, respectively. The factors, among
          others,
          raise significant doubt about our ability to continue as a going concern.
          Our
          continuation as a going concern is dependent upon our ability to generate
          sufficient cash flow and meet our obligations on a timely basis and ultimately
          attain profitability.
 
 
 **OFF-BALANCE
          SHEET ARRANGEMENTS**
 
 We
          do not
          have any commercial commitments or off-balance sheet financing. Our commitments
          are described in Note 9 to our consolidated financial statements filed
          on Form
          10-KSB for the period ended December 31, 2006, as reported to the Securities
          and
          Exchange Commission.
  12
  **Risk
          Factors**
 
 *We
          Have A Limited Operating History And A History Of Substantial Operating
          Losses.*
 
 We
          have a
          history of substantial operating losses and an accumulated deficit of
          $89,057,222 as of March 31, 2007. For the three months ended March 31,
          2007, our
          loss from operations was $122,109. For the year ended December 31, 2006
          our
          income from operations was $125,751 predominantly due to the settlement
          of
          accrued legal fees in the amount of $677,777. We have historically experienced
          cash flow difficulties primarily because our expenses have exceeded our
          revenues. We expect to incur additional operating losses. These factors,
          among
          others, raise significant doubt about our ability to continue as a going
          concern. If we are unable to generate sufficient revenue from our operations
          to
          pay expenses or we are unable to obtain additional financing on commercially
          reasonable terms, our business, financial condition and results of operations
          will be materially and adversely affected.
 
 *We
          Will Need Additional Financing.*
 
 We
          may
          require additional capital to finance our future operations. We can provide
          no
          assurance that we will obtain additional financing sufficient to meet our
          future
          needs on commercially reasonable terms or otherwise.
 
 *Our
          Success Depends On Our Outsourced Services Agreement.*
 
 Effective
          September 30, 2002, we outsourced the management of our internal information
          systems, billable services infrastructure, software code base, customer
          support
          and reseller channel management to Built Right Networks under our September
          30,
          2002 Information Management Services Agreement (the “Outsourced Services
          Agreement”). The principals of Built Right Networks are all former MangoSoft
          employees. Our contract represents a large majority of Built Right Networks’
revenue. We can provide no assurance that Built Right Networks will remain
          solvent or can retain their key personnel. Built Right Network’s inability to
          retain key personnel or to remain solvent would have a material and adverse
          effect on our business, financial condition and results of
          operations.
 
 *Our
          Performance Depends On Market Acceptance Of Our Products.*
 
 We
          expect
          to derive a substantial portion of our future revenues from the sales of
          Mangomind SM and
          fileTRUST SM .
          Due to
          our small size and need to conserve capital, our selling and marketing
          activities for these products and services is limited. If markets for our
          products fail to develop, develop more slowly than expected, are subject
          to
          substantial competition or react negatively to Bank of America’s (formerly
          FleetBoston) termination of its February 2002 enterprise license agreement
          with
          us, our business, financial condition and results of operations will be
          materially and adversely affected.
 
 *We
          Depend On Strategic Marketing Relationships.*
 
 We
          expect
          our future marketing efforts will focus in part on developing business
          relationships with technology companies that seek to augment their businesses
          by
          offering our products to their customers. Our inability to enter into and
          retain
          strategic relationships, or the inability of such technology companies
          to
          effectively market our products, could materially and adversely affect
          our
          business, operating results and financial condition.
  13
 
 *There
          May Be Limited Liquidity In Our Common Stock And Its Price May Be Subject
          to
          Fluctuation.*
 
 Our
          common stock is currently traded on the OTC Bulletin Board and there is
          only a
          limited market for our common stock. We can provide no assurances that
          we will
          be able to have our common stock listed on an exchange or quoted on Nasdaq
          or
          that it will continue to be quoted on the OTC Bulletin Board. If there
          is no
          trading market for our common stock, the market price of our common stock
          will
          be materially and adversely affected.
 
 *SEC
          Rules Concerning Sales Of Low-Priced Securities May Hinder Re-Sales Of
          Our
          Common Stock*
 
 Because
          our common stock has a market price that is less than five dollars per
          share,
          our common stock is not listed on an exchange or quoted on Nasdaq and is
          traded
          on the OTC Bulletin Board. Brokers and dealers who handle trades in our
          common
          stock are subject to certain SEC disclosure rules when effecting trades
          in our
          common stock, including disclosure of the following: the bid and offer
          prices of
          our common stock, the compensation of the brokerage firm and the salesperson
          handling a trade and legal remedies available to the buyer. These requirements
          may hinder re-sales of our common stock and may adversely affect the market
          price of our common stock.
 
 *Rapidly
          Changing Technology And Substantial Competition May Adversely Affect Our
          Business.*
 
 Our
          business is subject to rapid changes in technology. We can provide no assurances
          that research and development by competitors will not render our technology
          obsolete or uncompetitive. We compete with a number of computer hardware
          and
          software design companies that have technologies and products similar to
          those
          offered by us and have greater resources, including more extensive research
          and
          development, marketing and capital than us. We can provide no assurances
          that we
          will be successful in marketing our existing products and developing and
          marketing new products in such a manner as to be effective against our
          competition. If our technology is rendered obsolete or we are unable to
          compete
          effectively, our business, operating results and financial condition will
          be
          materially and adversely affected.
  *Litigation
          Concerning Intellectual Property Could Adversely Affect Our
          Business.*
  We
          rely
          on a combination of trade secrets, copyright and trademark law, contractual
          provisions, confidentiality agreements and certain technology and security
          measures to protect our trademarks, patents, proprietary technology and
          know-how. However, we can provide no assurance that our rights in our
          intellectual property will not be infringed upon by competitors or that
          competitors will not similarly make claims against us for infringement.
          If we
          are required to be involved in litigation involving intellectual property
          rights, our business, operating results and financial condition will be
          materially and adversely affected.
 
 *Defects
          In Our Software Products May Adversely Affect Our Business.*
 Complex
          software such as the software developed by MangoSoft may contain defects
          when
          introduced and also when updates and new versions are released. Our introduction
          of software with defects or quality problems may result in adverse publicity,
          product returns, reduced orders, uncollectible or delayed accounts receivable,
          product redevelopment costs, loss of or delay in market acceptance of our
          products or claims by customers or others against us. Such problems or
          claims
          may have a material and adverse effect on our business, financial condition
          and
          results of operations.
 
 14
  *We
          Have Limitations On The Effectiveness Of Our Internal
          Controls.*
 
 We
          have
          one full-time employee. This employee is engaged in general and administrative
          capacities. A complete set of internal controls is not possible in an
          organization of this size. Management does not expect that its disclosure
          controls or its internal controls will prevent all errors and intentional
          misrepresentations. 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, if any, within the organization have been
          detected.
  
 
 15
 **ITEM
          3. CONTROLS AND PROCEDURES**
 
 We
          have
          significantly reduced our work force on several occasions during 2001 and
          2002.
          At March 31, 2007 and 2006, we had one (1) employee, Mr. Dale Vincent,
          our
          President, Chief Executive Officer and sole director. A complete set of
          internal
          controls including segregation of duties is not possible in an organization
          of
          this size. However, we have implemented control procedures surrounding
          the
          maintenance of our accounting and financial systems and the safeguarding
          of our
          assets. Further, all transactions entered into outside the normal course
          of our
          day-to-day operations must be approved by Mr. Vincent.
 
 Our
          principal executive and financial officer has evaluated the effectiveness
          of our
          disclosure controls and procedures (as defined in Rules 13a-15(e) and
          15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange
          Act”)), as of the end of the period covered by this Annual Report on
          Form 10-KSB. Based on such evaluation, our principal executive and
          financial officer has concluded that as of such date, our disclosure controls
          and procedures were designed to ensure that information required to be
          disclosed
          by us in reports that we file or submit under the Exchange Act is recorded,
          processed, summarized and reported within the time periods specified in
          applicable SEC rules and forms and were effective.
 
 There
          was
          no change in our internal control over financial reporting (as defined
          in
          Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during
          the quarter ended March 31, 2007 that has materially affected, or is
          reasonably likely to materially affect, our internal control over financial
          reporting.
   16
 
 **PART
          II - OTHER INFORMATION**
 
 **ITEM
          1. LEGAL PROCEEDINGS**
 
 On
          November 22, 2002, the Company filed a complaint in the United States District
          Court of New Hampshire, against Oracle Corporation for infringement of
          U.S.
          Patent No. 6,148,377 and U.S. Patent No. 5,918,229. The complaint seeks
          unspecified monetary damages and injunctive relief and awards for interest,
          costs and attorneys’ fees.
 
 On
          May
          15, 2003, Oracle Corporation filed a complaint in the United States District
          Court, Northern District of California, against the Company and Built Right
          Networks for infringement of a patent held by Oracle Corporation. The complaint
          seeks unspecified monetary damages and injunctive relief and awards for
          interest, costs and attorneys’ fees.
 
 On
          July
          2, 2003, the Company filed a complaint in the United States District Court,
          Northern District of California, against Oracle Corporation, Sun Microsystems,
          Inc., Dell Computer Corporation and Electronic Arts, Inc. for infringement
          of
          U.S. Patent No. 6,148,377 and U.S. Patent No. 5,918,229. The complaint
          seeks
          unspecified monetary damages and injunctive relief and awards for interest,
          costs and attorneys’ fees.
  On
          March
          14, 2006, the U,S., District Court in New Hampshire ruled in favor of Oracle’s
          motion for summary judgment that did it did not infringe U.S. Patent No.
          6,148,377 held by Mangosoft, Inc. Mangosoft had sued Oracle in 2002, claiming
          infringement of its patent on shared memory technology as described above.
 
 On
          September 22, 2006, the Company through its subsidiary Mangosoft Intellectual
          Property, Inc., filed a civil action in the United States District Court
          for the
          Eastern District of Texas alleging patent infringement against eBay, Inc.
          of San
          Jose and its subsidiaries Skype Technologies SA and Skype Software Sarl
          of
          Luxembourg. The Complaint alleges that each of the defendants have infringed,
          and continue to infringe, U.S. Patent No. 6,647,393 entitled "Dynamic Directory
          Service" in violation of one or more provisions of 35 U.S.C. section 271.
          The
          complaint seeks damages for willful infringement as well as injunctive
          relief.
 
 On
          October 26, 2006 Mangosoft Inc. was successful in its motion for summary
          judgment of non-infringement of United States Patent No. 6,371,790 in an
          action
          brought by Oracle International Corp. Oracle's motion for summary adjudication
          of patent validity, along with Mangosoft's motion to amend its final contentions
          of patent invalidity, and Oracle's motion to preclude Mangosoft from asserting
          a
          defense of inequitable conduct were denied by the United States District
          Chief
          Judge.
 
 On
          March
          29, 2007 the Company filed a Notice of Appeal in the United States District
          Court for the District of New Hampshire in the case of Mangosoft,
          Inc., et al. v. Oracle Corporation ,
          C.A.
          No. 02-545-M. By filing the Notice of Appeal, Mangosoft has commenced an
          appeal
          in the United States Court of Appeals for the Federal Circuit challenging,
          among
          other things, the District Court’s claim construction Order of September 21,
          2004, the District Court’s order granting defendant Oracle Corporation’s motion
          for summary judgment of non-infringement entered on March 14, 2006, and
          the
          District Court’s entry of final judgment entered on March 29, 2007.
 
 Other
          than the matters listed above, there are no material pending legal proceedings,
          other than the routine litigation occurring in the normal course of operations,
          to which we are party or of which any of our properties are
          subject.
 
 17
 
 **ITEM
          6.**  **EXHIBITS
          AND REPORTS ON FORM 8-K**
 
 **(a)**
                **Exhibits:**
 
 **Number**
                **Description
                    of Exhibit**2.1
                Agreement
                    and Plan of Merger by and among First American Clock Co., MangoSoft
                    Corporation and MangoMerger Corp., dated as of August 27,1999.
                    (1)3.1
                Articles
                    of Incorporation, as amended. (2)3.2
                By-laws.
                    (2)4.1
                Rights
                    Plan. (6)10
                Lease
                    of Westborough Office Park, Building Five, dated November 10,
                    1995.
                    (3)14
                Code
                    of Ethics. (7)21
                Subsidiary
                    of the Registrant. (2)31.1
                Certification
                    of Principal Executive Officer required by Rule 13a 14(a) or
                    Rule 15-d14
                    (a) of the Securities Exchange Act of 1934, as adopted pursuant
                    to Section
                    302 of the Sarbanes-Oxley Act of 2002.32.1
                Certification
                    of Chief Executive Officer pursuant to 18 U.S.C. Section 1350,
                    as adopted
                    pursuant to Section 906 of the Sarbanes-Oxley Act of
                    2002.99.1
                1999
                    Incentive Compensation Plan, as amended and restated on May 1,
                    2000.
                    (1)99.2
                Form
                    of Subscription Agreement for purchase of common stock, dated
                    as of March
                    20, 2000. (1)99.3
                Form
                    of Warrant Agreement. (1)99.4
                Asset
                    Purchase Agreement, dated February 11, 2002, between MangoSoft,
                    Inc. and
                    Fleet National Bank. (4)99.5
                Warrant
                    Agreement, dated February 11, 2002, between MangoSoft, Inc. and
                    Fleet
                    National Bank. (4)99.6
                Information
                    Management Services Agreement, dated September30,
                    2002, between MangoSoft, Inc. and Built Right Networks LLC.
                    (5)99.7
                Rights
                    Agreement, dated March 14, 2003, between MangoSoft, Inc. and
                    Interwest
                    Transfer Co., Inc. (6)
   (1)
                Filed
                    as an exhibit to our Current Report on Form 8-K for an event
                    dated
                    September 7, 1999 and hereby incorporated by reference
                    thereto.
 (2)
                Filed
                    as an exhibit to our Registration Statement on Form 10-SB, filed
                    June 9,
                    2000, and hereby incorporated by reference
                    thereto.
 (3)
                Filed
                    as an exhibit to our Quarterly Report filed November 9, 1999
                    for the
                    quarter ended September 30, 1999 and hereby incorporated by reference
                    thereto.
 (4)
                Filed
                    as an exhibit to our Quarterly Report filed August 14, 2002 for
                    the
                    quarter ended June 30, 2002 and hereby incorporated by reference
                    thereto.
 (5)
                Filed
                    as an exhibit to our Current Report on Form 8-K for an event
                    dated
                    September 30, 2002 and hereby incorporated by reference
                    thereto.
 (6)
                Filed
                    as an exhibit to our Current Report on Form 8-K for an event
                    dated March
                    21, 2003, as amended on July 25, 2003, and hereby incorporated
                    by
                    reference thereto.
 (7)
                Filed
                    as an exhibit to our Annual Report filed on March 26, 2004 for
                    the year
                    ended December 31, 2003 and hereby incorporated by reference
                    thereto.
  18
 
 **(b)
          Reports on Form 8-K:**
 
 On
          January 17, 2007, Form 8-K was filed indicating the private placement of
          its
          common stock, par value $.001 per share, raising aggregate gross proceeds
          of
          $1,200,000 through the sale of 2,400,000 shares of Common Stock.
 
 
 19
 
 **SIGNATURE**
 
 In
          accordance with the requirements of the Securities Exchange Act of 1934,
          the
          registrant has duly caused this report to be signed on its behalf by the
          undersigned, thereunto duly authorized.
 
 May
                    15, 2007
                MANGOSOFT,
                    INC./S/*Dale
                    Vincent*Dale
                    Vincent
                  Chief
                    Executive Officer
                  (Principal
                    Financial and AccountingOfficer)
 
 
  20