| **UNITED                    STATES****SECURITIES                    AND EXCHANGE COMMISSION**Washington,                    D.C. 20549 |
|----------------------------------------------------------------------------------------------------------------------------------------|

**FORM          10-QSB**

| Nevada                                                                            | 20-2597168                                           |
|-----------------------------------------------------------------------------------|------------------------------------------------------|
| (State                    or other jurisdiction of incorporation or organization) | (IRS                    Employer Identification No.) |

|   | 86-0791-2189878 |
|--------|-----------------|

**APPLICABLE          ONLY TO ISSUERS INVOLVED IN BANKRUPTCY**

**PROCEEDINGS          DURING THE PRECEDING FIVE YEARS**

**APPLICABLE          ONLY TO CORPORATE ISSUERS**

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**WALLACE        MOUNTAIN RESOURCES CORP.**

**Index**

|                                                             | Page                    Number                                                                                                                                                                                                                                       |
|------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                             |                                                                                                                                                                                                                                                                 |
| PART                    I. FINANCIAL INFORMATION                 |                                                                                                                                                                                                                                                                 |
|                                                             |                                                                                                                                                                                                                                                                 |   |
| Item                    1.                                       | Financial                    Statements                                                                                                                                                                                                                              |   |
|                                                             |                                                                                                                                                                                                                                                                 |   |
|                                                             | Balance                    Sheet as of September 30, 2006 (unaudited) and as of March 30,                    2006                    (audited)                                                                                                                       | 2 |
|                                                             |                                                                                                                                                                                                                                                                 |   |
|                                                             | Statements                    of Income for the three and six month periods ended September                    30, 2006 and                    2005, and the period from inception to September 30, 2006                    (unaudited)                              | 3 |
|                                                             |                                                                                                                                                                                                                                                                 |   |
|                                                             | Statements                    of Cash Flows for the three month and six month periods ended                    September                    30, 2006 and 2005, and the period from inception to September                    30, 2006                    (unaudited) | 4 |
|                                                             |                                                                                                                                                                                                                                                                 |   |
|                                                             | Notes                    to Consolidated Financial Statements (unaudited)                                                                                                                                                                                            | 5 |
|                                                             |                                                                                                                                                                                                                                                                 |   |
| Item                    2.                                       | Management's                    Discussion and Analysis or Plan of Operations                                                                                                                                                                                        | 9 |
|                                                             |                                                                                                                                                                                                                                                                 |   |
| Item                    3.                                       | Controls                    and Procedures                                                                                                                                                                                                                           | 13 |
|                                                             |                                                                                                                                                                                                                                                                 |   |
| PART                    II. OTHER                    INFORMATION | 14                                                                                                                                                                                                                                                                   |
|                                                             |                                                                                                                                                                                                                                                                 |   |
| Item                    5.                                       | Other                    Information                                                                                                                                                                                                                                 | 14 |
|                                                             |                                                                                                                                                                                                                                                                 |   |
| Item                    6.                                       | Exhibits                                                                                                                                                                                                                                                             | 15 |
|                                                             |                                                                                                                                                                                                                                                                 |   |
| SIGNATURES                                                       | 15                                                                                                                                                                                                                                                                   |

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**ITEM      1. FINANCIAL STATEMENTS**

**WALLACE      MOUNTAIN RESOURCES CORP**

**BALANCE      SHEET**

**AS      OF SEPTEMBER 30, 2006**

**(UNAUDITED)**

|                                                                                                                                                                                                                                                                          |   | UnauditedAs                    of September                  30, 2006  |    | AuditedAs                  ofMarch 31, 2006  |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------|---------|---------------------------------------------------|--------|
|                                                                                                                                                                                                                                                                          |   |                                                                        |    |                                              |   |
| ASSETS                                                                                                                                                                                                                                                                        |   |                                                                        |    |                                              |   |
|                                                                                                                                                                                                                                                                          |   |                                                                        |    |                                              |   |
| Current                  assets                                                                                                                                                                                                                                               |   |                                                                        |    |                                              |   |
| Cash                                                                                                                                                                                                                                                                          |   | $                                                                           | 29,781  |                                              | $      | 30,494 |   |
| Prepaid                  expenses                                                                                                                                                                                                                                             |   |                                                                        | — |                                              |   | 3,000 |   |
| Total                  current assets                                                                                                                                                                                                                                    |   |                                                                        | 29,781  |                                              |   | 33,494 |   |
|                                                                                                                                                                                                                                                                          |   |                                                                        |    |                                              |   |   |   |
| Total                  assets                                                                                                                                                                                                                                                 |   | $                                                                           | 29,781  |                                              | $      | 33,494 |   |
|                                                                                                                                                                                                                                                                          |   |                                                                        |    |                                              |   |   |   |
| LIABILITIES                  AND STOCKHOLDERS' EQUITY                                                                                                                                                                                                                         |   |                                                                        |    |                                              |   |   |   |
|                                                                                                                                                                                                                                                                          |   |                                                                        |    |                                              |   |   |   |
| Current                  liabilities                                                                                                                                                                                                                                          |   |                                                                        |    |                                              |   |   |   |
| Accounts                  payable                                                                                                                                                                                                                                             |   | $                                                                           | 2,170   |                                              | $      | 125 |   |
| Loan                  payable to a director                                                                                                                                                                                                                                   |   | $                                                                           | — |                                              |   | 1,123 |   |
| Total                  current liabilities                                                                                                                                                                                                                               |   |                                                                        | 2,170   |                                              |   | 1,248 |   |
|                                                                                                                                                                                                                                                                          |   |                                                                        |    |                                              |   |   |   |
| Total                  liabilities                                                                                                                                                                                                                                       |   |                                                                        | 2,170   |                                              |   | 1,248 |   |
|                                                                                                                                                                                                                                                                          |   |                                                                        |    |                                              |   |   |   |
| Stockholders'                  equity                                                                                                                                                                                                                                         |   |                                                                        |    |                                              |   |   |   |
|                                                                                                                                                                                                                                                                          |   |                                                                        |    |                                              |   |   |   |
| Common                    stock; $.001 par value; 75,000,000 sharesauthorized,                    3,400,000 shares issued and outstandingas                    of March 31, 2006 and 3,460,000 shares issued andoutstanding                    as of September 30, 2006  |   |                                                                        | 3,460   |                                              |   | 3,400 |   |
| Additional                  paid-in capital                                                                                                                                                                                                                                   |   |                                                                        | 55,540  |                                              |   | 49,600 |   |
| Accumulated                  deficit                                                                                                                                                                                                                                          |   |                                                                        | (31,389 | )                                                 |   | (20,754 | ) |
| Total                  stockholders' equity                                                                                                                                                                                                                              |   |                                                                        | 27,611  |                                              |   | 32,246 |   |
| Total                  liabilities and stockholders' equity                                                                                                                                                                                                              |   | $                                                                           | 29,781  |                                              | $      | 33,494 |   |

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**WALLACE      MOUNTAIN RESOURCES CORP.**

**STATEMENTS      OF INCOME **

**FOR      THE THREE AND SIX MONTH PEERIODS ENDED SEPTEMBER 30, 2006 AND      2005**

**AND      THE PERIOD FROM INCEPTION to SEPTEMBER 30, 2006 **

**(UNAUDITED)**

|                                                                                                |   | UnauditedJuly                      1, 2006throughSeptember                  30,2006  |      | Unaudited                        July                      1, 2005throughSeptember                  30,2005  |   | Unaudited                        April                      1, 2006throughSeptember                  30, 2006  |   | UnauditedApril                      1, 2005throughSeptember                  30,2005  |      | UnauditedPeriod                          fromMarch                          30, 2005(Date                      of inception)throughSeptember                  30,2006  |   |
|-----------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------|-----------|-------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------|-----------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                                |   |                                                                                      |      |                                                                                                              |   |                                                                                                                |   |                                                                                       |      |                                                                                                                                                                        |   |
| Revenue                                                                                             |   | $                                                                                         | —   |                                                                                                              | $      | —                                                                                                             |   | $                                                                                          | —   |                                                                                                                                                                        | $      | — |   | $ | — |   |
|                                                                                                |   |                                                                                      |      |                                                                                                              |   |                                                                                                                |   |                                                                                       |      |                                                                                                                                                                        |   |   |   |   |   |   |
| Operating                  expenses                                                                 |   |                                                                                      |      |                                                                                                              |   |                                                                                                                |   |                                                                                       |      |                                                                                                                                                                        |   |   |   |   |   |   |
| Professional                  fees                                                             |   |                                                                                      | 1,500     |                                                                                                              |   | 1,350                                                                                                               |   |                                                                                       | 4,500     |                                                                                                                                                                        |   | 3,700 |   |   | 10,772 |   |
| General                  and administrative                                                    |   |                                                                                      | 533       |                                                                                                              |   | 2,736                                                                                                               |   |                                                                                       | 6,135     |                                                                                                                                                                        |   | 12,615 |   |   | 20,616 |   |
|  Total                  operating expenses                                                     |   |                                                                                      | 2,033     |                                                                                                              |   | 4,086                                                                                                               |   |                                                                                       | 10,635    |                                                                                                                                                                        |   | 16,315 |   |   | 31,389 |   |
|                                                                                                |   |                                                                                      |      |                                                                                                              |   |                                                                                                                |   |                                                                                       |      |                                                                                                                                                                        |   |   |   |   |   |   |
|  Loss                  from operations                                                         |   |                                                                                      | (2,033    | )                                                                                                                 |   | (4,086                                                                                                              | )      |                                                                                       | (10,635   | )                                                                                                                                                                           |   | (16,315 | ) |   | (31,389 | ) |
|                                                                                                |   |                                                                                      |      |                                                                                                              |   |                                                                                                                |   |                                                                                       |      |                                                                                                                                                                        |   |   |   |   |   |   |
| Other                  income (expenses):                                                           |   |                                                                                      |      |                                                                                                              |   |                                                                                                                |   |                                                                                       |      |                                                                                                                                                                        |   |   |   |   |   |   |
| Other                  expense                                                                 |   |                                                                                      | —   |                                                                                                              |   | —                                                                                                             |   |                                                                                       | —   |                                                                                                                                                                        |   | — |   |   | — |   |
| Interest                  expense                                                              |   |                                                                                      | —   |                                                                                                              |   | —                                                                                                             |   |                                                                                       | —   |                                                                                                                                                                        |   | — |   |   | — |   |
|  Total                  other income (expenses)                                                |   |                                                                                      | —   |                                                                                                              |   | —                                                                                                             |   |                                                                                       | —   |                                                                                                                                                                        |   | — |   |   | — |   |
|                                                                                                |   |                                                                                      |      |                                                                                                              |   |                                                                                                                |   |                                                                                       |      |                                                                                                                                                                        |   |   |   |   |   |   |
|  Loss                  before provision for income taxes                                       |   |                                                                                      | (2,033    | )                                                                                                                 |   | (4,086                                                                                                              | )      |                                                                                       | (10,635   | )                                                                                                                                                                           |   | (12,229 | ) |   | (31,389 | ) |
| Provision                  for income taxes                                                         |   |                                                                                      | —   |                                                                                                              |   | —                                                                                                             |   |                                                                                       | —   |                                                                                                                                                                        |   | — |   |   | — |   |
|                                                                                                |   |                                                                                      |      |                                                                                                              |   |                                                                                                                |   |                                                                                       |      |                                                                                                                                                                        |   |   |   |   |   |   |
| Net                  loss                                                                           |   | $                                                                                         | (2,033    | )                                                                                                                 | $      | (4,086                                                                                                              | )      | $                                                                                          | (10,635   | )                                                                                                                                                                           | $      | (12,229 | ) | $ | (31,389 | ) |
|                                                                                                |   |                                                                                      |      |                                                                                                              |   |                                                                                                                |   |                                                                                       |      |                                                                                                                                                                        |   |   |   |   |   |   |
| Basic                  and diluted loss per common share                                            |   | $                                                                                         | (0.00     | )                                                                                                                 | $      | (0.00                                                                                                               | )      | $                                                                                          | (0.00     | )                                                                                                                                                                           | $      | (0.00 | ) | $ | (0.01 | ) |
|                                                                                                |   |                                                                                      |      |                                                                                                              |   |                                                                                                                |   |                                                                                       |      |                                                                                                                                                                        |   |   |   |   |   |   |
| Basic                  and diluted weighted averagecommon                  shares outstanding  |   |                                                                                      | 3,401,304 |                                                                                                              |   | 2,600,000                                                                                                           |   |                                                                                       | 3,400,656 |                                                                                                                                                                        |   | 2,565,027 |   |   | 3,024,945 |   |

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**WALLACE      MOUNTAIN RESOURCES CORP.**

**STATEMENTS      OF CASH FLOWS**

**FOR      THE THREE AND SIX MONTH PEERIODS ENDED SEPTEMBER 30, 2006 AND      2005**

**AND      THE PERIOD FROM INCEPTION to SEPTEMBER 30, 2006 **

**(UNAUDITED)**

|                                                              |   | UnauditedApril                      1, 2006throughSeptember                  30, 2006  |    | UnauditedApril                      1, 2005throughSeptember                  30, 2005  |   | UnauditedPeriod                        from March                      30, 2005(Date                    of inception)throughSeptember                    30, 2006  |   |
|-------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------|---------|---------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                              |   |                                                                                        |    |                                                                                        |   |                                                                                                                                                                    |   |
| Cash                  flows from operating activities:            |   |                                                                                        |    |                                                                                        |   |                                                                                                                                                                    |   |
| Net                  loss                                         |   | $                                                                                           | (10,635 | )                                                                                           | $      | (16,315                                                                                                                                                                 | )      | $ | (31,389 | ) |
| Adjustments                  to reconcile net loss to             |   |                                                                                        |    |                                                                                        |   |                                                                                                                                                                    |   |   |   |   |
| Changes                  in operating assets and liabilities:     |   |                                                                                        |    |                                                                                        |   |                                                                                                                                                                    |   |   |   |   |
| Change                  in prepaid expenses                       |   |                                                                                        | 3,000   |                                                                                        |   | —                                                                                                                                                                 |   |   | — |   |
| Change                  in accounts payable                       |   |                                                                                        | 2,045   |                                                                                        |   |                                                                                                                                                                    |   |   | 2,170 |   |
| Change                  in loan payable to a director             |   |                                                                                        | (1,123  | )                                                                                           |   | 4,018                                                                                                                                                                   |   |   | — |   |
| Net                  cash used by operating activities       |   |                                                                                        | (6,713  | )                                                                                           |   | (12,297                                                                                                                                                                 | )      |   | (29,219 | ) |
|                                                              |   |                                                                                        |    |                                                                                        |   |                                                                                                                                                                    |   |   |   |   |
| Cash                  flows from investing activities:            |   |                                                                                        |    |                                                                                        |   |                                                                                                                                                                    |   |   |   |   |
| Purchase                  of property and equipment               |   |                                                                                        | — |                                                                                        |   | —                                                                                                                                                                 |   |   | — |   |
| Net                  cash used by investing activities       |   |                                                                                        | — |                                                                                        |   | —                                                                                                                                                                 |   |   | — |   |
|                                                              |   |                                                                                        |    |                                                                                        |   |                                                                                                                                                                    |   |   |   |   |
| Cash                  flows from financing activities:            |   |                                                                                        |    |                                                                                        |   |                                                                                                                                                                    |   |   |   |   |
| Proceeds                  from issuance of common stock           |   |                                                                                        | 6,000   |                                                                                        |   | 8,000                                                                                                                                                                   |   |   | 59,000 |   |
| Net                  cash provided by financing activities   |   |                                                                                        | 6,000   |                                                                                        |   | 8,000                                                                                                                                                                   |   |   | 59,000 |   |
|                                                              |   |                                                                                        |    |                                                                                        |   |                                                                                                                                                                    |   |   |   |   |
| Net                  increase in cash                             |   |                                                                                        | (713    | )                                                                                           |   | (4,297                                                                                                                                                                  | )      |   | 29,781 |   |
|                                                              |   |                                                                                        |    |                                                                                        |   |                                                                                                                                                                    |   |   |   |   |
| Cash,                  beginning of period                        |   |                                                                                        | 30,494  |                                                                                        |   | 5,000                                                                                                                                                                   |   |   | -— |   |
|                                                              |   |                                                                                        |    |                                                                                        |   |                                                                                                                                                                    |   |   |   |   |
| Cash,                  end of period                              |   | $                                                                                           | 29,781  |                                                                                        | $      | 703                                                                                                                                                                     |   | $ | 29,781 |   |
|                                                              |   |                                                                                        |    |                                                                                        |   |                                                                                                                                                                    |   |   |   |   |
| Supplementary                  cash flow information:             |   |                                                                                        |    |                                                                                        |   |                                                                                                                                                                    |   |   |   |   |
| Cash                  payments for income taxes                   |   | $                                                                                           | — |                                                                                        | $      | —                                                                                                                                                                 |   | $ | — |   |
| Cash                  payments for interest                       |   | $                                                                                           | — |                                                                                        | $      | —                                                                                                                                                                 |   | $ | — |   |

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| 1. | DESCRIPTION                      OF BUSINESS, HISTORY AND SUMMARY OF SIGNIFICANT                      POLICIES |
|----|----------------------------------------------------------------------------------------------------------------|

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| 1. | DESCRIPTION                  OF BUSINESS, HISTORY AND SUMMARY OF SIGNIFICANT POLICIES (cont) |
|----|----------------------------------------------------------------------------------------------|

|                                                                                                                                                                                                            |   |    |  2006 |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------|------------|--------|
| Net                    loss, as reported                                                                                                                                                                        |   | $  | (2,033     | )      |
| Add:                      Stock-based employee compensation expenseincluded                      in reported loss, net of related tax effects                                                                   |   |    | —    |   |
| Deduct:                        Total stock-based employee compensationexpense                        determined under fair value based methodsfor                        all awards, net of related tax effects |   |    | —    |   |
|      Pro                    forma net loss                                                                                                                                             |   | $  | (2,033     | )      |
|      Net                    loss per common share:                                                                                                                                     |   |    |       |   |
|          Basic                    and fully diluted loss per share, as reported                                                                                    |   | $       | (0.00      | )      |
|          Basic                    and fully diluted loss per share, pro forma                                                                                      |   | $       | (0.00      | )      |

*Accounting        for Certain Hybrid Financial Instruments*
*Accounting        for Derivative Instruments and Hedging Activities*
*Accounting        for Transfers and Servicing of Financial Assets and Extinguishments of        Liabilities*

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| 1. | DESCRIPTION                  OF BUSINESS, HISTORY AND SUMMARY OF SIGNIFICANT POLICIES (cont) |
|----|----------------------------------------------------------------------------------------------|

*Accounting        for Servicing of Financial Assets *

| 2. | PROPERTY                  AND EQUIPMENT |
|----|-----------------------------------------|

| 3. | STOCKHOLDER’S                  EQUITY |
|----|---------------------------------------------|

| 4. | RELATED                  PARTY TRANSACTIONS |
|----|---------------------------------------------|

| 5. | STOCK                  OPTIONS AND WARRANTS |
|----|---------------------------------------------|

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| 5. | STOCK                  OPTIONS AND WARRANTS (cont) |
|----|----------------------------------------------------|

| 6. | LITIGATION |
|----|------------|

| 7. | SUBSEQUENT                  EVENTS |
|----|------------------------------------|

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**ITEM      2.**
**MANAGEMENT'S      DISCUSSION AND ANALYSIS OR PLAN OF OPERATION**

**Critical      Accounting Policies**

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|                                                                                                                                                                                                            |   |    | 2006        |    |   |   |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------|-------------|---------|--------|--------|--------|
| Net                  loss, as reported                                                                                                                                                                          |   | $       | (2,033      | )       |   |   |   |
| Add:                  Stock-based employee compensation expense included in reported                  loss,net                  of related tax effects                                                          |   |    | —     |    |   |        |   |
|                                                                                                                                                                                                            |   |    |        |    |   |   |   |
| Deduct:                  Total stock-based employee compensation expense determined                  underfair                  value based methods for all awards, net of related tax                  effects |   |    | —     |    |   |        |   |
|      Pro                  forma net loss                                                                                                                                               |   | $  | (2,033      | )       |   |   |   |
|      Net                  loss per common share:                                                                                                                                       |   |    |        |    |   |   |   |
|          Basic                  and fully diluted loss per share, as reported                                                                                      |   | $       | (0.00       | )  |   |   |   |
|          Basic                  and fully diluted loss per share, pro forma                                                                                        |   | $  |  (0.00 | )  |   |   |   |

*Accounting      for Certain Hybrid Financial Instruments*
*Accounting      for Derivative Instruments and Hedging Activities*
*Accounting      for Transfers and Servicing of Financial Assets and Extinguishments of      Liabilities*

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*Accounting      for Servicing of Financial Assets *

**Forward      Looking Statements**

*1995      *
*15(d)      *

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**ITEM      3. CONTROLS AND PROCEDURES**

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**PART      II - OTHER INFORMATION**

**ITEM      5. OTHER INFORMATION**

**Subsequent      Event**

| Li                  Songyan    | Director,                  Chairman of the Board |
|--------------------------------|--------------------------------------------------|
| Xiong                  Junhong | Chief                  Executive Officer         |
| Yan                  Liang Fan | Chief                  Financial Officer         |
| Zhou                  Feng     | Corporate                  Secretary             |

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**ITEM      6. EXHIBITS**

| Exhibit                  No. |   | Description                                                                             |
|------------------------------|--------|-----------------------------------------------------------------------------------------|
| 31.1                         |   | Sec.                  302 Certification of Principal Executive Officer                  |
| 31.2                         |   | Sec.                  302 Certification of Principal Financial Officer                  |
| 32.1                         |   | Sec.                  906 Certification of Principal Executive Officer                  |
| 32.2                         |   | Sec.                  906 Certification of Principal Financial                  Officer |

**SIGNATURES**

|                           |                                                                            |                                |
|--------------------------------|---------------------------------------------------------------------------------|-------------------------------------|
|                           | Wallace              Mountain              Resources Corp., Registrant          |
|                      |                                                                       |                           |
| November              20, 2006 | By:                                                                   | /s/ Xiong              Junhong |
|                           | Xiong              Junhong                                                      |
|                           | Chief              Executive Officer (Principal Executive              Officer) |

|                           |                                                                                           |                                             |
|--------------------------------|------------------------------------------------------------------------------------------------|--------------------------------------------------|
|                           | Wallace              Mountain              Resources Corp., Registrant                         |
|                      |                                                                                      |                                        |
| November              20, 2006 | By:                                                                                  | /s/ Yan              Liang              Fan |
|                           | Yan              Liang Fan                                                                     |
|                           | Chief              Financial Officer (Principal Financial and Accounting              Officer) |

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