----

----

| T | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|--------------------------------------------------------------------------------------|

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

| CALIFORNIA               | 95-3927330               |
|--------------------------|--------------------------|
| (State of Incorporation) | (I.R.S. Employer ID No.) |

| Title of Each Class: | Name of Each Exchange on Which Registered: |
|----------------------|--------------------------------------------|
| Common Stock         | The NASDAQ Stock Market LLC                |

----

| PART III |                                                                                           |   |
|----------|------------------------------------------------------------------------------------------------|--------|
| Item 10. | Directors, Executive Officers and Corporate Governance                                         | 3      |
| Item 11. | Executive Compensation                                                                         | 4      |
| Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | 11     |
| Item 13. | Certain Relationships and Related Transactions, and Director Independence                      | 12     |
| Item 14. | Principal Accountant Fees and Services                                                         | 12     |
|     | Signatures                                                                                     | 14     |
|     | Exhibit Index                                                                                  | 15     |

----

| Name                       |   | Age |   | Position                                            |
|------------------------------------------------------------------------------------------------------------------------------------------|--------|-----|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| William J. Gervais                                                                                                                       |   | 67  |   | Chief Executive Officer, President and Director                                                                                                                                                                                                                            |
| Richard A. Nelson                                                                                                                        |   | 67  |   | Vice President — Engineering, Secretary and Director                                                                                                                                                                                                                 |
| Stanley W. Corker                                                                                                                        |   | 59  |   | Director                                                                                                                                                                                                                                                                   |
| Carl W. Gromada                                                                                                                          |   | 69  |   | Director                                                                                                                                                                                                                                                                   |
| Robert A. Meyer                                                                                                                          |   | 65  |   | Director                                                                                                                                                                                                                                                                   |
| Robert E. Rich                                                                                                                           |   | 60  |   | Director                                                                                                                                                                                                                                                                   |

----

----

| Name and Principal Position                                                                                                                                                                                                                                                   |   | Fiscal 2010Base Salary |   | Percent Changeversus Fiscal2009 Base Salary |    | Fiscal 2011Base Salary |   | Percent Changeversus Fiscal2010 Base Salary |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------|--------|---------------------------------------------|---------|------------------------|--------|---------------------------------------------|
| William J. Gervais                                    Chief Executive Officer and President    |   | $157,500               | (1)    |                                        | (10.0   | %)                     |   | $157,500                                    |   |   | ─ |
| Nidhi H. Andalon                                    Vice President and Chief Financial Officer |   | $150,000               |   |                                        | 7.1     | %                      |   | $150,000                                    |   |   | ─ |
| Randy Johnson                                    Vice President and General Manager, N2Power   |   | $180,000               |   |                                        | ─ |                   |   | $180,000                                    |   |   | ─ |
| Richard A. Nelson                                    Vice President of Engineering             |   | $153,000               | (1)    |                                        | (10.0   | %)                     |   | $153,000                                    |   |   | ─ |
| Robert K. Covey                                    Vice President of Marketing                 |   | $165,600               | (1)    |                                        | (10.0   | %)                     |   | $165,600                                    |   |   | ─ |

| (1)   | As a cost-saving measure, the base salaries of Mr. Gervais, Mr. Nelson and Mr. Covey were reduced by 10% for an indefinite period, effective as of July 2009. |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Submitted by the members of the Compensation Committee |
|--------------------------------------------------------|
| Stanley W. Corker (Chairman)                           |
| Carl W. Gromada                                        |
| Robert A. Meyer                                        |

----

| Name and Principal Position                                    |   | Year   |    | Salary (1)($)                                                                                                         |   | Bonus (1)($) |          | Grant DateFair Valueof OptionAwards (2)($) |    | All OtherCompensation (3) ($)                                                                                                            |   | Total($) |
|----------------------------------------------------------------|--------|--------|---------|----------------------------------------------------------------------------------------------------------------------------|--------|-------------------|---------------|-------------------------------------------------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------|
| William J. GervaisChief Executive Officer and President        |   | 2010   |    |                    $158,170 |   |              | $—      |                                            |    |                        $— |   |     | $3,102 |   |   | $161,272 |   |
|                                                           | 2009   |   | 178,838 |                                                                                                                       |   | —           |          |                                            | — |                                                                                                                                               |   | 2,254    |   |   | 181,092 |   |
|                                                           | 2008   |   | 195,000 |                                                                                                                       |   |  —     |          |                                            | — |                                                                                                                                               |   | 3,867    |   |   | 198,867 |   |
| Nidhi H. Andalon (4)Vice President and Chief Financial Officer |   | 2010   |    | 150,010                                                                                                                    |   |              |  — |                                            |    | —                                                                                                                                            |   |     | 919 |   |   | 150,929 |   |
|                                                           | 2009   |   | 130,276 |                                                                                                                       |   |  —     |          |                                            | — |                                                                                                                                               |   | 1,275    |   |   | 131,551 |   |
| Randy Johnson (5)Vice President and General Manager, N2Power   |   | 2010   |    | 180,003                                                                                                                    |   |              | 3,600         |                                            |    | —                                                                                                                                            |   |     | 573 |   |   | 184,176 |   |
| Richard A. NelsonVice President of Engineering                 |   | 2010   |    | 153,658                                                                                                                    |   |              |  — |                                            |    | —                                                                                                                                            |   |     | 3,147 |   |   | 156,805 |   |
|                                                           | 2009   |   | 171,273 |                                                                                                                       |   |  —     |          |                                            | — |                                                                                                                                               |   | 5,730    |   |   | 177,003 |   |
|                                                           | 2008   |   | 169,998 |                                                                                                                       |   |  —     |          |                                            | — |                                                                                                                                               |   | 6,274    |   |   | 176,272 |   |
| Robert K. CoveyVice President of Marketing                     |   | 2010   |    | 166,297                                                                                                                    |   |              |  — |                                            |    | —                                                                                                                                            |   |     | 2,501 |   |   | 168,798 |   |
|                                                           | 2009   |   | 183,467 |                                                                                                                       |   |  —     |          |                                            | — |                                                                                                                                               |   | 5,123    |   |   | 188,590 |   |
|                                                           | 2008   |   | 175,303 |                                                                                                                       |   |  —     |          |                                            | — |                                                                                                                                               |   | 4,445    |   |   | 179,748 |   |

| (1) | The amounts shown in these columns reflect salary and bonuses earned by the named executive officers for each of the fiscal years indicated. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | The amounts shown in this column represent the fair value of stock options at the date of grant.  No options were granted to any of our named executive officers during the last three fiscal years.  For information regarding the calculation of the grant date fair value of stock options, refer to note 9 of the Qualstar financial statements included in Item 8 of this report. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | The amounts shown above under “All Other Compensation” represent matching contributions under our 401(k) plan, and premiums for disability and life insurance. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (4)   | Ms. Andalon was appointed our Chief Financial Officer effective January 19, 2009 and Vice President effective March 25, 2010. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------|

| (5)   | Mr. Johnson was appointed our Vice-President and General Manager, N2Power effective March 25, 2010. |
|-----------------|-----------------------------------------------------------------------------------------------------|

----

| Name                                                                                                                                                                                                        |   | Grant Date |   | All Other Option Awards:Number of SecuritiesUnderlying Options (1) (#) |   | Exercise orBase Price ofOption Awards($ / Sh) |   | Grant Date FairValue of OptionAwards (2)($) |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------|--------|--------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------|--------|--------------------------------------------------|
| William J. Gervais                                                                                                                                                                                          |   | —    |   | —                                                                                    |   | —                                                      |   | —                                          |
| Nidhi H. Andalon                                 |   | —    |   | —                                                                                    |   | —                                                      |   | —                                          |
| Randy Johnson                                    |   | —    |   | —                                                                                    |   | —                                                      |   | —                                          |
| Richard A. Nelson                                |   | —    |   | —                                                                                    |   | —                                                      |   | —                                          |
| Robert K. Covey                                  |   | —    |   | —                                                                                    |   | —                                                      |   | —                                          |

| (1) | No options were granted to any of our named executive officers during fiscal year 2010.  Stock options granted to the named executive officers typically vest over four years at the rate of 25% of the number of shares as of each anniversary of the date of grant, provided that the executive is still employed by Qualstar on the vesting date. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | The amounts shown in this column represent the full grant date fair value of stock options granted, computed in accordance with FASB Accounting Standards Codification Topic 718, and does not necessarily correspond to the actual value that will be realized by the named executive officers.  For information regarding the calculation of the grant date fair value of stock options, refer to note 9 of the Qualstar financial statements included in Item 8 of this report. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|               |   | Option Awards                                         |
|--------------------|--------|-------------------------------------------------------|
|               |   | Number of SecuritiesUnderlying UnexercisedOptions (#) |   | OptionExercisePrice($) |   |   |   |
|               |   | OptionExpirationDate                                  |
|               |
| Name               |   | Exercisable                                           |   | Unexercisable (1) |
| William J. Gervais |   | —                                               |   |   | — |   |   | — |   |   | — |   |
| Nidhi H. Andalon   |   | 16,000                                                |   |   | — |   |   | $3.02 |   |   | 06/14/2016 |   |
| Randy Johnson      |   | 6,000                                                 |   |   | 6,000 |   |   | $3.10 |   |   | 03/25/2018 |   |
| Richard A. Nelson  |   | —                                               |   |   | — |   |   | — |   |   | — |   |
| Robert K. Covey    |   | 20,000                                                |   |   | — |   |   | 5.94 |   |   | 01/03/2012 |   |

| (1)   | Stock options granted to the named executive officers vest over four years at the rate of 25% of the options as of each anniversary of the date of grant, provided that the executive is still employed by Qualstar on the vesting date.  The amounts shown in this column represent the remaining unvested portion of each option grant. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|               |   | Option Awards                                               |
|--------------------|--------|-------------------------------------------------------------|
| Name               |   | Number of SharesAcquired on Exercise(#) |   | Value Realizedon Exercise (1)($) |
| William J. Gervais |   | —                                                     |   | — |
| Nidhi H. Andalon   |   | —                                                     |   | — |
| Randy Johnson      |   | —                                                     |   | — |
| Richard A. Nelson  |   | —                                                     |   | — |
| Robert K. Covey    |   | —                                                     |   | — |

| (1) | The value realized on exercise of option awards represents the market price per share of common stock on the date of exercise, less the stock option exercise price per share, multiplied by the number of stock options exercised. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Name              |   | Fees Earned orPaid in Cash (1) ($) |   | Grant Date FairValue of OptionAwards (2)(3)($) |    | Total($) |
|-------------------|--------|--------------------------------------------------------|--------|-----------------------------------------------------|---------|----------|
| Stanley W. Corker |   | $18,750                                                |   |                                                | — |     |   | $18,750 |   |
| Carl W. Gromada   |   | 17,250                                                 |   |                                                | — |     |   | 17,250 |   |
| Robert A. Meyer   |   | 18,750                                                 |   |                                                | — |     |   | 18,750 |   |
| Robert E. Rich    |   | 11,500                                                 |   |                                                | — |     |   | 11,500 |   |

| (1) | The amounts shown in this column represent the amount of cash compensation earned in fiscal year 2010 for service on the Board of Directors and any committees of the Board on which the director was a member in fiscal 2010. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | No stock options were granted to our directors during fiscal 2010.  Stock options granted to our directors typically vest over four years at the rate of 25% of the shares as of each anniversary of the date of grant. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | As of June 30, 2010, each of our non-employee directors named in the above table held unexercised stock options for 24,000 shares of our common stock. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Name               | Option Awards (1) |
|--------------------|------------------------|
| William J. Gervais | —                |
| Nidhi H. Andalon   | —                |
| Randy Johnson      | —                |
| Richard A. Nelson  | —                |
| Robert K. Covey    | —                |

| (1) | The amounts in this column represent the aggregate gain each named executive officer would have realized if all unvested stock options that were held by him or her on June 30, 2010 accelerated and became immediately vested in full on that date.  The amount of gain was calculated based on the difference between the exercise price of each unvested option and the closing price of our common stock on that date, which was $1.87 per share. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| ·   | each person (or group of affiliated persons) who we know beneficially owns more than 5% of our common stock; |
|--------------------|--------------------------------------------------------------------------------------------------------------|

| ·   | each of our directors; |
|--------------------|------------------------|

| ·   | each of the named executive officers; and |
|--------------------|-------------------------------------------|

| ·   | all of our directors and executive officers as a group. |
|--------------------|---------------------------------------------------------|

|                                                                                    |   | CommonShares |   | OptionsExercisableWithin 60 |    | BeneficialOwnership  |
|-----------------------------------------------------------------------------------------|--------|--------------|--------|-----------------------------|---------|---------------------------|
| Name                                                                                    |   | Owned        |   | Days (1)               |    | Number                    |   | Percent |
|                                                                                    |   |         |   |                        |    |                      |   |   |   |   |   |   |
| Dimensional Fund Advisors, LP (2)   6300 Bee Cave Road, Austin, TX 78746 |   | 961,187      |   |                        | — |                      |   | 961,187 |   |   | 7.8 | % |
| Porter Orlin LLC (3)   665 Fifth Avenue, Floor 34, New York, NY 10103    |   | 1,016,851    |   |                        | — |                      |   | 1,016,851 |   |   | 8.3 | % |
| Stanley W. Corker                                                                       |   | 18,940       |   |                        | 24,000  |                      |   | 42,940 |   |   | * |   |
| Carl Gromada                                                                            |   | 48,271       |   |                        | 24,000  |                      |   | 72,271 |   |   | * |   |
| Robert A. Meyer                                                                         |   | —      |   |                        | 24,000  |                      |   | 24,000 |   |   | * |   |
| Robert E. Rich                                                                          |   | 131,400      |   |                        | 24,000  |                      |   | 155,400 |   |   | 1.3 | % |
| William J. Gervais                                                                      |   | 3,121,150    |   |                        | — |                      |   | 3,121,150 |   |   | 25.5 | % |
| Nidhi H. Andalon                                                                        |   | —      |   |                        | 16,000  |                      |   | 16,000 |   |   | * |   |
| Randy Johnson                                                                           |   | —      |   |                        | 6,000   |                      |   | 6,000 |   |   | * |   |
| Richard A. Nelson                                                                       |   | 1,836,106    |   |                        | — |                      |   | 1,836,106 |   |   | 15.0 | % |
| Robert K. Covey                                                                         |   | 48,280       |   |                        | 20,000  |                      |   | 68,280 |   |   | * |   |
| All directors and officers as a group (9 persons)                                       |   | 5,204,147    |   |                        | 138,000 |                      |   | 5,342,147 |   |   | 43.1 | % |

| (1) | Represents shares that may be acquired upon exercise of stock options which are either currently vested or will vest within 60 days of October 20, 2010. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Based on information contained in reports filed with the Securities and Exchange Commission, Dimensional Fund Advisors, LP, an investment adviser, beneficially owns 961,187 shares as of December 31, 2009. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Based on information contained in reports filed with the Securities and Exchange Commission, Porter Orlin LLC, an investment adviser, beneficially owns 1,016,851 shares as of December 31, 2009. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|               |   | Fiscal2010 |    |   | Fiscal2009 |   |
|--------------------|--------|------------|---------|--------|------------|--------|
| Audit Fees         |   | $          | 130,237 |   |       | $      | 136,090 |   |
| Audit-related fees |   |       | — |   |       |   | — |   |
| Tax fees           |   |       | 5,000   |   |       |   | — |   |
| All other fees     |   |       | — |   |       |   | — |   |
| Total fees         |   | $          | 135,237 |   |       | $      | 136,090 |   |

----

----

|                                                 |   | QUALSTAR CORPORATION |                                                     |
|------------------------------------------------------|--------|----------------------|----------------------------------------------------------|
|                                                 |   |                 |                                                     |   |
|                                                 |   |                 |                                                     |   |
| Date: October 28, 2010      |   | By:        | /s/ William J. Gervais                                   |   |
|                                                 |   |                 | William J. Gervais,Chief Executive Officer and President |   |

| Signature                         |   | Title                         |   | Date             |
|-----------------------------------|--------|-------------------------------|--------|------------------|
|                              |   |                          |   |             |
|                              |   |                          |   |             |
| /s/  WILLIAM J. GERVAIS |   | Chief Executive Officer,      |   | October 28, 2010 |
| William J. Gervais                |   | President and Director        |   |             |
|                              |   | (principal executive officer) |   |             |
|                              |   |                          |   |             |
|                              |   |                          |   |             |
| /s/  NIDHI H. ANDALON   |   | Chief Financial Officer       |   | October 28, 2010 |
| Nidhi H. Andalon                  |   | (principal financial officer) |   |             |
|                              |   |                          |   |             |
|                              |   |                          |   |             |
| /s/  RICHARD A. NELSON  |   | Vice President, Engineering   |   | October 28, 2010 |
| Richard A. Nelson                 |   | Secretary and Director        |   |             |
|                              |   |                          |   |             |
|                              |   |                          |   |             |
| /s/  CARL W. GROMADA    |   | Director                      |   | October 28, 2010 |
| Carl W. Gromada                   |   |                          |   |             |
|                              |   |                          |   |             |
|                              |   |                          |   |             |
| /s/  STANLEY W. CORKER  |   | Director                      |   | October 28, 2010 |
| Stanley W. Corker                 |   |                          |   |             |
|                              |   |                          |   |             |
|                              |   |                          |   |             |
| /s/  ROBERT E. RICH     |   | Director                      |   | October 28, 2010 |
| Robert E. Rich                    |   |                          |   |             |
|                              |   |                          |   |             |
|                              |   |                          |   |             |
| /s/  ROBERT A. MEYER    |   | Director                      |   | October 28, 2010 |
| Robert A. Meyer                   |   |                          |   |             |

----

| Exhibit No. |   | Description                                                                                                             |
|-------------|--------|-------------------------------------------------------------------------------------------------------------------------|
| 3.1(1)      |   | Restated Articles of Incorporation.                                                                                     |
| 3.2(4)      |   | Bylaws, as amended and restated January 14, 2000.                                                                       |
| 3.3(4)      |   | Amendment to Bylaws, adopted December 21, 2007.                                                                         |
| 10.1(1)*    |   | 1998 Stock Incentive Plan, as amended and restated.                                                                     |
| 10.2(1)     |   | Form of Indemnification Agreement.                                                                                      |
| 10.3(2)     |   | Lease agreement between Strategic Performance Fund-II, Inc. and Qualstar Corporation, dated September 20, 2000.         |
| 10.4(6)     |   | Amendment to Lease Agreement between Strategic Performance Fund-II, Inc. and Qualstar Corporation, dated June 30, 2009. |
| 10.45(5)*   |   | 2008 Stock Incentive Plan                                                                                               |
| 14.1(3)     |   | Code of Business Conduct and Ethics                                                                                     |
| 23.1        |   | Consent of Independent Registered Public Accounting Firm (SingerLewak, LLP).                                            |
| 23.2        |   | Consent of Independent Registered Public Accounting Firm (Ernst & Young, LLP).                                      |
| 31.1        |   | Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                 |
| 31.2        |   | Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                 |
| 32.1        |   | Certification of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                 |
| 32.2        |   | Certification of Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                 |

| (1) | Incorporated by reference to the designated exhibits to Qualstar’s registration statement on Form S-1 (Commission File No. 333-96009), declared effective by the Commission on June 22, 2000. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | Incorporated by reference to the designated exhibit to Qualstar’s Report on Form 10-Q for the fiscal quarter ended September 30, 2000.                                                        |
| (3) | Incorporated by reference to the designated exhibit to Qualstar’s Report on Form 10-K for the fiscal year ended June 30, 2004.                                                                |
| (4) | Incorporated by reference to the designated exhibit to Qualstar’s Report on Form 10-Q for the fiscal quarter ended December 31, 2007.                                                         |
| (5) | Incorporated by reference to Exhibit 10.1 to Qualstar’s report on Form 10-Q/A for the fiscal quarter ended March 31, 2009                                                                     |
| (6) | Incorporated by reference to the designated exhibit to Qualstar’s Report on Form 10-K for the fiscal year ended June 30, 2009.                                                                |
| *   | Each of these exhibits constitutes a management contract, compensatory plan or arrangement required to be filed as an exhibit to this report pursuant to Item 15(b) of this report.                 |