**UNITED        STATES**

**SECURITIES        AND EXCHANGE COMMISSION**

**WASHINGTON,        DC 20549**

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**FORM        10-QSB**

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**[X]    Quarterly        Report under Sections 13 or 15(d) of **

**the        Securities Exchange Act of 1934 for the quarterly period ended**
**September        30, 2005**

**[  ]            Transition Report under Sections 13 or 15(d) of the Securities Exchange Act        of        1934**

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**Key        Hospitality Acquisition Corporation**

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** **
** **

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|                                                                                                                                                                                                                                 | PAGE                       |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------|
|                                                                                                                                                                                                                                 |                       |
| PART                  I - FINANCIAL INFORMATION                                                                                                                                                                                      | F-1                        |
| ITEM                  1. Financial Statements                                                                                                                                                                                        | F-1                        |
| Condensed                  Balance Sheet as of September 30, 2005 (unaudited)                                                                                                                                                        | F-1                        |
| Condensed                  Statement of Operations for the three months ended September 30,                  2005 and                  the period from April 25, 2005 (Inception) to September 30, 2005                  (unaudited) | F-2                        |
| Condensed                  Statement of Cash Flows for the period from April 25, 2005 (inception)                  to                  September 30, 2005 (unaudited)                                                                | F-3                        |
| Condensed                  Notes to Financial Statements                                                                                                                                                                             | F-4                  - F-6 |
| ITEM                  2. Management’s Discussion and Analysis or Plan of                  Operation                                                                                                                            | 1                          |
| ITEM                  3. Controls and Procedures                                                                                                                                                                                     | 2                          |
| PART                  II - OTHER INFORMATION                                                                                                                                                                                         | 3                          |
| ITEM                  1. Legal Proceedings                                                                                                                                                                                           | 3                          |
| ITEM                  2. Unregistered Sales of Equity Securities and Use of                  Proceeds                                                                                                                                | 3                          |
| ITEM                  3. Defaults Upon Senior Securities                                                                                                                                                                             | 3                          |
| ITEM                  4. Submission of Matters to a Vote of Security Holders                                                                                                                                                         | 3                          |
| ITEM                  5. Other Information                                                                                                                                                                                           | 3                          |
| ITEM                  6. Exhibits and Reports on Form 8-K                                                                                                                                                                            | 3                          |
| Signatures                                                                                                                                                                                                                           | 4-7                        |

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**PART        I **
** **
**—        FINANCIAL INFORMATION**

| **ITEM                1.   ** | **Financial                  Statements** |
|-----------------------------------------|-------------------------------------------|

**KEY        HOSPITALITY ACQUISITION CORPORATION**

**BALANCE        SHEET **

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|                                                                                                                                                          |   | **September                    30, 2005****(unaudited)** |    |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------------|---------|
| **ASSETS**                                                                                                                                                    |   |                                                     |    |
|                                                                                                                                                          |   |                                                     |    |
| **Current                    asset**                                                                                                                          |   |                                                     |    |
| Cash                                                                                                                                                          |   | $                                                        | 2,805   |   |
|                                                                                                                                                          |   |                                                     |    |   |
| Other                    assets, deferred offering costs                                                                                                      |   |                                                     | 174,792 |   |
|                                                                                                                                                          |   | $                                                        | 177,597 |   |
|                                                                                                                                                          |   |                                                     |         |   |
| **LIABILITIES                    AND STOCKHOLDERS’ EQUITY**                                                                                             |   |                                                     |         |   |
|                                                                                                                                                          |   |                                                     |         |   |
| **Current                    liabilities**                                                                                                                    |   |                                                     |         |   |
| Accrued                    expenses                                                                                                                           |   | $                                                        | 9,924   |   |
| Notes                    payable, stockholders                                                                                                                |   |                                                     | 145,000 |   |
| Total                    current liabilities                                                                                                                  |   |                                                     | 154,924 |   |
|                                                                                                                                                          |   |                                                     |         |   |
|                                                                                                                                                          |   |                                                     |    |   |
| **Stockholders’                    equity**                                                                                                             |   |                                                     |         |   |
| Preferred                    stock, $.001 par value, authorized 1,000,000 shares; none                    issued                                              |   |                                                     |         |   |
| Common                    stock, $.001 par value, authorized 50,000,000 shares; issued                    and                    outstanding 1,499,995 shares |   |                                                     | 1,500   |   |
| Paid-in                    capital in excess of par                                                                                                           |   |                                                     | 23,500  |   |
| Deficit                    accumulated during the development stage                                                                                           |   |                                                     | (2,327  | ) |
| Total                    stockholders’ equity                                                                                                           |   |                                                     | 22,673  |   |
|                                                                                                                                                          |   | $                                                        | 177,597 |   |

*See        accompanying notes to condensed financial statements.*

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**KEY          HOSPITALITY ACQUISITION CORPORATION**

**STATEMENT          OF OPERATIONS **

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|                                                     |   |   | **Three                  months ended****September                  30, 2005****(unaudited)** |   |   | **For                  the period from****April                  25, 2005****(inception)                  to****September                  30, 2005****(unaudited)** |   |
|----------------------------------------------------------|--------|--------|-----------------------------------------------------------------------------------------------|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                     |   |   |                                                                                          |   |   |                                                                                                                                                                 |   |
| **Formation                  and operating costs**       |   | **$**  | 250                                                                                           |   | **$**  | 2,327                                                                                                                                                                |   |
|                                                     |   |   |                                                                                          |   |   |                                                                                                                                                                 |   |
| **Net                  loss**                            |   | **$**  | 250                                                                                           |   | **$**  | 2,327                                                                                                                                                                |   |
|                                                     |   |   |                                                                                          |   |   |                                                                                                                                                                 |   |
| **Weighted                  average shares outstanding** |   |   | 1,499,995                                                                                     |   |   | 1,499,995                                                                                                                                                            |   |
|                                                     |   |   |                                                                                          |   |   |                                                                                                                                                                 |   |
| **Net                  loss per common share**           |   | **$**  | **—**                                                                                   |   | **$**  | **—**                                                                                                                                                          |   |

*See        accompanying notes to condensed financial statements*

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**KEY            HOSPITALITY ACQUISITION CORPORATION**

**STATEMENT            OF CASH FLOWS **

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|                                                                                 |   |   | **For                    the period from****April                    25, 2005****(inception)                    to****September                    30, 2005****(unaudited)** |   |
|--------------------------------------------------------------------------------------|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
| **Cash                    flows from operating activities**                          |   |   |                                                                                                                                                                         |   |
| Net                    loss                                                          |   | $      | (2,327                                                                                                                                                                       | )      |
| Increase                    in cash attributable to change in                        |   |   |                                                                                                                                                                         |   |
| accrued                    expenses                                                  |   |   | 2,327                                                                                                                                                                        |   |
|                                                                                 |   |   |                                                                                                                                                                         |   |
| **Net                    cash provided by operating activities**                |   |   | -                                                                                                                                                                            |   |
|                                                                                 |   |   |                                                                                                                                                                         |   |
|                                                                                 |   |   |                                                                                                                                                                         |   |
| **Cash                    flows from financing activities**                     |   |   |                                                                                                                                                                         |   |
| Proceeds                    from notes payable, stockholders                         |   |   | 145,000                                                                                                                                                                      |   |
| Proceeds                    from sale of common stock                                |   |   | 25,000                                                                                                                                                                       |   |
| Payments                    of deferred offering costs                               |   |   | (167,195                                                                                                                                                                     | )      |
|                                                                                 |   |   |                                                                                                                                                                         |   |
| **Net                    cash provided by financing activities**                |   |   | 2,805                                                                                                                                                                        |   |
|                                                                                 |   |   |                                                                                                                                                                         |   |
| **Net                    increase in cash**                                     |   |   | 2,805                                                                                                                                                                        |   |
|                                                                                 |   |   |                                                                                                                                                                         |   |
| **Cash,**beginning                    of period                                      |   |   |                                                                                                                                                                         |   |
|                                                                                 |   |   |                                                                                                                                                                         |   |
| **Cash,**end                    of period                                            |   | $      | 2,805                                                                                                                                                                        |   |
|                                                                                 |   |   |                                                                                                                                                                         |   |
| **Supplemental                    schedule of non-cash financing activities:**  |   |   |                                                                                                                                                                         |   |
| Accrual                    of deferred offering costs                                |   | $      | 7,597                                                                                                                                                                        |   |

*See        accompanying notes to condensed financial statements*

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**KEY          HOSPITALITY ACQUISITION CORPORATION**

**NOTES          TO CONDENSED FINANCIAL STATEMENTS **

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| **1.  ** | **Basis                  of presentation** |
|--------------------|--------------------------------------------|

| **2.  ** | **Nature                  of operations and summary of significant accounting                  policies** |
|--------------------|-----------------------------------------------------------------------------------------------------------|

*Nature        of Operations*

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**KEY          HOSPITALITY ACQUISITION CORPORATION**

**NOTES          TO CONDENSED FINANCIAL STATEMENTS **

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| **2.  ** | **Nature                  of operations and summary of significant accounting policies                  (continued)** |
|--------------------|-----------------------------------------------------------------------------------------------------------------------|

*Common        Stock*

*Loss        Per Common Share*

*Use        of Estimates*

| **3.  ** | **Proposed                  public offering** |
|--------------------|-----------------------------------------------|

| **4.  ** | **Notes                  payable, stockholders** |
|--------------------|--------------------------------------------------|

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**KEY          HOSPITALITY ACQUISITION CORPORATION**

**NOTES          TO CONDENSED FINANCIAL STATEMENTS **

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| **5.  ** | **Commitments                  and contingencies** |
|--------------------|----------------------------------------------------|

| **6.  ** | **Preferred                  stock** |
|--------------------|--------------------------------------|

| **7.  ** | **Subsequent                  events** |
|--------------------|----------------------------------------|

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| **ITEM                2.   ** | **MANAGEMENT’S                  DISCUSSION AND ANALYSIS OR PLAN OF                  OPERATION** |
|-----------------------------------------|-------------------------------------------------------------------------------------------------------|

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| **ITEM                3.   ** | **CONTROLS                  AND PROCEDURES** |
|-----------------------------------------|----------------------------------------------|

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**PART        II - **
**OTHER        INFORMATION**

| **ITEM                1.   ** | **LEGAL                  PROCEEDINGS** |
|-----------------------------------------|----------------------------------------|

| **ITEM                2.   ** | **UNREGISTERED                  SALES OF EQUITY SECURITIES AND USE OF                  PROCEEDS** |
|-----------------------------------------|---------------------------------------------------------------------------------------------------|

| **ITEM                3.   ** | **DEFAULTS                  UPON SENIOR SECURITIES** |
|-----------------------------------------|------------------------------------------------------|

| **ITEM                4.   ** | **SUBMISSION                  OF MATTERS TO A VOTE OF SECURITY                  HOLDERS** |
|-----------------------------------------|-------------------------------------------------------------------------------------------|

| **ITEM                5.   ** | **OTHER                  INFORMATION** |
|-----------------------------------------|----------------------------------------|

| **ITEM                6.   ** | **EXHIBITS                  AND REPORTS ON FORM 8-K** |
|-----------------------------------------|-------------------------------------------------------|

| **Exhibit                No.** | **Description                of                Exhibits**                       |
|--------------------------------|---------------------------------------------------------------------------------|
|                           |                                                                            |
| 31.1                      | Section                  302 Certification of Principal Executive Officer  |
| 31.2                      | Section                  302 Certification of Principal Financial Officer  |
| 32.1                      | Section                  906 Certification                                 |

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**SIGNATURES**

|                                        |                                                                                   |                                        |
|---------------------------------------------|----------------------------------------------------------------------------------------|---------------------------------------------|
|                                        | **KEY                  HOSPITALITY ACQUISITION CORPORATION**                           |
|                                   |                                                                              |                                   |
| Date:                December 2, 2005  | By:                                                                          | /s/ Jeffrey                S. Davidson |
|                                        | Jeffrey                  S. Davidson                                                   |
|                                        | Co-Chairman                  of the Board and Chief                  Executive Officer |

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