UNITED STATESSECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549

FORM 10-Q

(Mark One)

|[X] |  | QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934
|--- |  | ---------------------------------------------------------------------------------------

|For the quarterly
      period ended | September 30,
2007
|------------------------------------ | ------------------

OR

|[   ] |  | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE
      ACT
|----- |  | ---------------------------------------------------------------------

|For the
      transition period from |  | to |  | 
|------------------------------------ |  | -- |  | 

|Commission File
      Number: | 0-51176 | 
|----------------------------- | ------- | 

|KENTUCKY FIRST FEDERAL BANCORP                        
|------------------------------------------------------
|(Exact name of registrant as specified in its charter)

|                                                                                        
|----------------------------------------------------------------------------------------
|United States of America                                                                
|(State or
      other jurisdiction of                                                   
|incorporation
      or organization)                                                    
|                                                                                        
|479 Main Street, Hazard,
      Kentucky41702                                            
|(Address of principal executive offices)(Zip Code)                                      
|                                                                                        
|(606)436-3860                                                                           
|(Registrants telephone number, including area code)                                    
|                                                                                        
|                                                                                        
|(Former name, former address and former fiscal year, if changed
      since last report)

|Indicate by check mark whether the registrant (1) has
      filed all reports required to be filed by Section 13 or 15(d) of the
      Securities Exchange Act of 1934 during the preceding 12 months or such
      shorter period that the issuer was requiredto
      file such reports and (2) has been subject to such filing requirements for
      the past ninety
      days:            
      Yes [ X] No [    ]
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                         
|Indicate by check mark whether the registrant is a large
      accelerated filer, an accelerated filer, or a non-accelerated filer. See
      definition of accelerated filer and larger accelerated filer in Rule
      12b-2 of the Exchange Act. (Check one):                                                                                                                                                       

Large accelerated filer
    
    
    Accelerated filer
    
    
    Non-accelerated filer
    X


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

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares
outstanding of each of the issuers classes of common stock, as of the latest
practicable date: At November 11, 2007, the latest practicable date, the
Corporation had 8,154,548 shares of $.01 par value common stock outstanding.

1

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|INDEX     
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|PART I  - 
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|PART II  -
|          
|SIGNATURES

2

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Kentucky First Federal Bancorp

CONSOLIDATED STATEMENTS OF FINANCIAL
CONDITION

(In thousands, except per share data)

|September
      30,                                                                       |      | June 30,
|----------------------------------------------------------------------------------------- | ---- | --------
|ASSETS                                                                                    | 2007 |         
|(Unaudited)                                                                               |      |         
|Cash and due from banks                                                                   | $    | 1,074   
|Interest-bearing deposits in other financial
      institutions                           |      | 168     
|****Cash and cash equivalents                                                             |      | 1,242   
|                                                                                         
|Interest-bearing deposits                                                                 |      | 100     
|Available-for-sale securities                                                             |      | 13,323  
|Held-to-maturity securities, at amortized cost-
      approximate                         |      | 59,146  
|****fair
      value of $57,861 and $57,835 at September 30, 2007                         |      |         
|****and June
      30, 2007, respectively                                                 |      |         
|Loans receivable                                                                          |      | 172,045 
|Allowance for loan losses                                                                 |      | (720    
|Loans receivable-net                                                                      |      | 171,325 
|                                                                                         
|Real estate acquired through foreclosure                                                  |      | 8       
|Office premises and equipment - at depreciated cost                                       |      | 2,727   
|Federal Home Loan Bank stock - at cost                                                    |      | 5,421   
|Accrued interest receivable                                                               |      | 1,224   
|Bank-owned life insurance                                                                 |      | 2,277   
|Goodwill                                                                                  |      | 14,507  
|Other intangible assets                                                                   |      | 579     
|Prepaid expenses and other assets                                                         |      | 255     
|Prepaid federal income taxes                                                              |      | 376     
|                                                                                         
|****Total assets                                                                          | $    | 272,510 
|                                                                                         
|**LIABILITIES AND SHAREHOLDERS
      EQUITY**                                            |      |         
|                                                                                         
|Deposits                                                                                  | $    | 139,851 
|Advances from the Federal Home Loan Bank                                                  |      | 68,738  
|Advances by borrowers for taxes and
      insurance                                       |      | 505     
|Accrued interest payable                                                                  |      | 498     
|Deferred federal income taxes                                                             |      | 916     
|Other liabilities                                                                         |      | 1,070   
|****Total liabilities                                                                     |      | 211,578 
|                                                                                         
|Commitments                                                                               |      | -       
|                                                                                         
|Shareholders equity                                                                      |      |         
|****Preferred stock, 500,000 shares authorized, $.01
      par                            |      |         
|****value; no shares issued                                                               |      | -       
|****Common
      stock, 20,000,000 shares authorized $.01                                 |      |         
|****par value; 8,596,064 shares issued                                                    |      | 86      
|****Additional paid-in capital                                                            |      | 35,488  
|****Retained
      earnings                                                               |      | 32,430  
|****Shares
      acquired by stock benefit plans                                          |      | (3,013  
|****Treasury
      shares at cost, 377,530 and 299,430 shares at September 30,
      2007 |      |         
|****and June 30, 2007,
      respectively                                                 |      | (3,873  
|****Accumulated other comprehensive loss                                                  |      | (186    
|****Total shareholders equity                                                            |      | 60,932  
|                                                                                         
|****Total liabilities and shareholders
      equity                                      | $    | 272,510 

See Notes to Consolidated Financial
Statements.

3

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Kentucky First Federal Bancorp

CONSOLIDATED STATEMENTS OF
EARNINGS

(Unaudited)(In thousands, except per share data)

|                                                               | Three months ended
|-------------------------------------------------------------- | ------------------
|                                                               | September 30,     
|                                                               | 2007              
|Interest income                                                |                   
|Loans                                                          | $                 
|Mortgage-backed
      securities                               |                   
|Investment
      securities                                    |                   
|Interest-bearing deposits
      and other                      |                   
|Total
      interest income                                    |                   
|                                                              
|Interest expense                                               |                   
|Deposits                                                       |                   
|Borrowings                                                     |                   
|Total
      interest expense                                   |                   
|                                                              
|Net interest income                                            |                   
|                                                              
|Provision for losses on loans                                  |                   
|                                                              
|Net interest income after provision
      for                  |                   
|losses on loans                                                |                   
|                                                              
|Other operating income                                         |                   
|Earnings on bank-owned life insurance                          |                   
|Loss on sale of real estate acquired through
      foreclosure |                   
|Other operating                                                |                   
|Total other income                                             |                   
|                                                              
|General, administrative and other expense                      |                   
|Employee compensation and
      benefits                       |                   
|Occupancy and
      equipment                                  |                   
|Franchise
      taxes                                          |                   
|Data
      processing                                          |                   
|Other
      operating                                          |                   
|Total general, administrative and other
      expense          |                   
|                                                              
|Earnings before income taxes                                   |                   
|                                                              
|Federal income taxes                                           |                   
|Current                                                        |                   
|Deferred                                                       |                   
|Total federal income taxes                                     |                   
|                                                              
|NET EARNINGS                                                   | $                 
|                                                              
|EARNINGS PER SHARE                                             |                   
|Basic                                                          | $                 
|Diluted                                                        | $                 
|                                                              
|DIVIDENDS PER SHARE                                            | $                 

See Notes to Consolidated Financial
Statements.

4

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Kentucky First Federal Bancorp

CONSOLIDATED STATEMENTS OF
COMPREHENSIVE INCOME

(Unaudited) (In thousands)

|                                                             | Three months ended
|------------------------------------------------------------ | ------------------
|                                                             | September 30,     
|                                                             | 2007              
|Net earnings                                                 | $                 
|                                                            
|Other comprehensive income, net of taxes
      (benefits):   |                   
|Unrealized holding gains (losses) on
      securities during |                   
|the period, net of taxes (benefits) of $52                   |                   
|and $91 during the respective periods                        |                   
|                                                            
|Comprehensive income                                         | $                 
|                                                            
|Accumulated comprehensive loss                               | $                 

See Notes to Consolidated Financial
Statements.

5

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Kentucky First Federal Bancorp

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the three months ended September 30,
(Unaudited)(In thousands)

|                                                                     | **2007** |         | **2006**
|-------------------------------------------------------------------- | -------- | ------- | --------
|Cash flows from operating activities:                                |          |         |         
|Net earnings for the period                                          | $        | 152     |         
|Adjustments to reconcile net earnings to net cash                    |          |         |         
|provided by operating activities:                                    |          |         |         
|Amortization of discounts and premiums on
      loans,               |          |         |         
|investments and mortgage-backed securities 
      net               |          | 1       |         
|Amortization of deferred loan origination
      fees                 |          | (7      | )       
|Amortization of purchase accounting
      adjustments-net            |          | (100    | )       
|Depreciation and amortization                                        |          | 36      |         
|Amortization of stock benefit plans                                  |          | 137     |         
|Loss on sale of real estate acquired through
      foreclosure       |          | -       |         
|Federal Home Loan Bank stock dividends                               |          | -       |         
|Bank-owned life insurance earnings                                   |          | (21     | )       
|Mortgage loans originated for sale                                   |          | (80     | )       
|Proceeds from sale of mortgage loans                                 |          | 80      |         
|Increase (decrease) in cash, due to changes
      in:                |          |         |         
|Accrued interest receivable                                          |          | (289    | )       
|Prepaid expenses and other assets                                    |          | 21      |         
|Accrued interest payable                                             |          | 133     |         
|Other liabilities                                                    |          | 65      |         
|Federal income taxes                                                 |          |         |         
|Current                                                              |          | 131     |         
|Deferred                                                             |          | (66     | )       
|Net
      cash provided by operating activities                      |          | 193     |         
|                                                                    
|Cash flows provided by (used in) investing activities:               |          |         |         
|Investment securities maturities, prepayments and
      calls:       |          |         |         
|Held to maturity                                                     |          | 459     |         
|Available for sale                                                   |          | 128     |         
|Proceeds from sale of real estate acquired through
      foreclosure |          | -       |         
|Loan principal repayments                                            |          | 12,391  |         
|Loan
      disbursements                                             |          | (17,553 | )       
|Purchase of office equipment                                         |          | (1      | )       
|Net used in investing activities                                     |          | (4,576  | )       
|                                                                    
|Cash flows provided by (used in) financing activities:               |          |         |         
|Net increase (decrease) in deposit accounts                          |          | 50      |         
|Proceeds from Federal Home Loan Bank advances                        |          | 6,850   |         
|Repayment of Federal Home Loan Bank
      advances                   |          | (3,111  | )       
|Advances by borrowers for taxes and insurance                        |          | 161     |         
|Dividends paid on common stock                                       |          | (263    | )       
|Purchase of shares for treasury                                      |          | (782    | )       
|Net cash
      provided by financing activities                      |          | 2,905   |         
|                                                                    
|Net decrease in cash and cash equivalents                            |          | (1,478  | )       
|                                                                    
|Cash and cash equivalents at beginning of period                     |          | 2,720   |         
|                                                                    
|Cash and cash equivalents at end of period                           | $        | 1,242   |         

See Notes to Consolidated Financial
Statements.

6

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Kentucky First Federal Bancorp

CONSOLIDATED STATEMENTS OF CASH FLOWS
(CONTINUED)

For the three months ended September 30,
(Unaudited) (In thousands)

|                                                  | 2007 |       | 2006
|------------------------------------------------- | ---- | ----- | ----
|Supplemental disclosure of cash flow information: |      |       |     
|Cash paid during the period for:                  |      |       |     
|Federal income taxes-net                          | $    | -     |     
|Interest on deposits and borrowings               | $    | 2,061 |     
|                                                 
|Transfers from loans to real estate acquired      |      |       |     
|through foreclosure, net                          | $    | -     |     

See Notes to Consolidated Financial
Statements

7

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Kentucky First Federal Bancorp

NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS

For the three month periods ended
September 30, 2007 and 2006

On March 2, 2005, First Federal Savings
and Loan Association of Hazard (First Federal of Hazard or the Association)
completed a Plan of Reorganization (the Plan or the Reorganization) pursuant
to which the Association reorganized into the mutual holding company form of
ownership with the incorporation of a stock holding company, Kentucky First
Federal Bancorp (the Company) as parent of the Association. Coincident with
the Reorganization, the Association converted to the stock form of ownership,
followed by the issuance of all the Associations outstanding stock to Kentucky
First Federal Bancorp. Completion of the Plan of Reorganization culminated with
Kentucky First Federal Bancorp issuing 4,727,938 common shares, or 55% of its
common shares, to First Federal Mutual Holding Company (First Federal MHC), a
federally chartered mutual holding company, with 2,127,572 common shares, or
24.8% of its shares offered for sale at $10.00 per share to the public and a
newly formed Employee Stock Ownership Plan (ESOP). The Company received net
cash proceeds of $16.1 million from the public sale of its common shares. The
Companys remaining 1,740,554 common shares were issued as part of the $31.4
million cash and stock consideration paid for 100% of the common shares of
Frankfort First Bancorp (Frankfort First) and its wholly-owned subsidiary,
First Federal Savings Bank of Frankfort (First Federal of Frankfort). The
acquisition was accounted for using the purchase method of accounting and
resulted in the recordation of goodwill and other intangible assets totaling
$15.4 million.

1.Basis of Presentation

The accompanying unaudited consolidated
financial statements, which represent the consolidated financial condition and
results of operations of the Company, were prepared in accordance with the
instructions for Form 10-Q and, therefore, do not include information or
footnotes necessary for a complete presentation of financial position, results
of operations and cash flows in conformity with accounting principles generally
accepted in the United States of America. However, in the opinion of management,
all adjustments (consisting of only normal recurring accruals) which are
necessary for a fair presentation of the consolidated financial statements have
been included. The results of operations for the three-month period ended
September 30, 2007, are not necessarily indicative of the results which may be
expected for an entire fiscal year. The consolidated balance sheet as of June
30, 2007, has been derived from the audited consolidated balance sheet as of
that date.

2.Principles of Consolidation

The consolidated financial statements
include the accounts of the Company, Frankfort First, and its wholly-owned
banking subsidiaries, First Federal of Hazard and First Federal of Frankfort
(collectively hereinafter the Banks). All intercompany transactions and
balances have been eliminated in consolidation.

3.Critical Accounting Policies

We consider accounting policies
involving significant judgments and assumptions by management that have, or
could have, a material impact on the carrying value of certain assets or on
income to be critical accounting policies. We consider the allowance for loan
losses and accounting for goodwill to be critical accounting policies.

The allowance for loan losses is the
estimated amount considered necessary to cover probable incurred credit losses
in the loan portfolio at the date of these interim financial statements. The
allowance is established through the provision for losses on loans which is
charged against income. In determining the allowance for loan losses, management
makes significant estimates and has identified this accounting policy as one of
the most critical for the Company.

8

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Kentucky First Federal Bancorp

NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS

For the three month periods ended
September 30, 2007 and 2006

3.Critical Accounting Policies(continued)

Management of the Banks perform a
monthly evaluation of the allowance for loan losses. Consideration is given to a
variety of factors in establishing this estimate including, but not limited to,
current economic conditions, delinquency statistics, geographic and industry
concentrations, the adequacy of the underlying collateral, the financial
strength of the borrower, results of internal loan reviews, volume and mix of
the loan portfolio and other relevant factors. This evaluation is inherently
subjective as it requires material estimates that may be susceptible to change.
Management considers the economic climate in the lending areas to be among the
factors most likely to have an impact on the level of the required allowance for
loan losses. However, in view of the fact that the Banks local economies are
diverse, without significant dependence on a single industry or employer, the
economic climate in the Banks market areas are considered to be stable, and
improving. Nevertheless, management continues to monitor and evaluate factors
which could have an impact on the required level of the allowance. Nationally,
management will watch for issues that may negatively affect a significant
percentage of homeowners in the Banks lending areas. These may include
significant increases in unemployment or significant depreciation in home
prices. Management reviews employment statistics periodically when determining
the allowance for loan losses and generally finds the unemployment rate in the
Banks lending areas to be acceptable in relation to historical trends. Given
the aforementioned indicators of economic stability, management does not foresee
in the near term, any significant increases in the required allowance for loan
losses related to economic factors. Finally, Company management has no current
plans to alter the type of lending offered or collateral accepted by the Banks,
but if such plans change or market conditions result in large concentrations of
certain types of loans, such as commercial real estate or high loan-to-value
ratio residential loans, management would respond with an increase in the
overall allowance for loan losses.

The allowance for loan losses analysis
has two components, specific and general allocations. Specific allocations are
made for loans that are determined to be impaired. Impairment is measured by
determining the present value of expected future cash flows or, for
collateral-dependent loans, the fair value of the collateral adjusted for market
conditions and selling expenses. The general allocation is determined by
segregating the remaining loans by type of loan, risk-weighting (if applicable)
and payment history. Historical loss experience, delinquency trends, general
economic conditions and geographic and industry concentrations are also
analyzed. This analysis establishes factors that are applied to the loan groups
to determine the amount of the general reserve. Actual loan losses may be
significantly more than the allowance established, which could have a material
negative effect on the Companys consolidated financial results.

The Company has recorded goodwill and
core deposit intangibles as a result of its acquisition of Frankfort First.
Goodwill represents the excess purchase price paid over the net book value of
the assets acquired in a merger or acquisition. Pursuant to SFAS No. 142,
Goodwill and Intangible Assets, goodwill is not amortized, but is tested for
impairment at the reporting unit annually or whenever an impairment indicator
arises. The evaluation involves assigning assets and liabilities to reporting
units and comparing the fair value of each reporting unit to its carrying value
including goodwill. If the fair value of a reporting unit exceeds its carrying
amount, goodwill is not considered impaired. However, if the carrying amount of
the reporting unit exceeds the fair value, goodwill is considered impaired. The
impairment loss equals the excess of carrying value over fair value.

Core deposit intangibles represent the
value of long-term deposit relationships and are amortized over their estimated
useful lives. The Company annually evaluates these estimated useful lives. If
the Company determines that events or circumstances warrant a change in these
estimated useful lifes, the Company will adjust the amortization of the core
deposit intangibles, which could affect future amortization expense.

9

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Kentucky First Federal Bancorp

NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS

For the three month periods ended
September 30, 2007 and 2006

4.Earnings Per Share

Basic earnings per share is computed
based upon the weighted-average common shares outstanding during the period less
shares in the Companys ESOP that are unallocated and not committed to be
released. Weighted average common shares deemed outstanding give effect to
301,262 unallocated ESOP shares for the three-month period ended September 30,
2007, and 319,152 unallocated ESOP shares for the three-month period ended
September 30, 2006.

|                                                           | Three months ended
|---------------------------------------------------------- | ------------------
|                                                           | September 30,     
|                                                           | 2007              
|Weighted-average common shares outstanding (basic)         | 7,817,377         
|Dilutive effect
      of assumed exercise of stock options | -                 
|Weighted-average common shares outstanding (diluted)       | 7,817,377         

There were 339,200 unexercised
options representing non-dilutive shares outstanding for the three month period
ended September 30, 2007.

5. Recent Accounting
Pronouncements

The Company or one of its subsidiaries
files income tax returns in the U.S. federal and Kentucky jurisdictions. With
few exceptions, the Company is no longer subject to U.S. federal, state and
local examinations by tax authorities for years before 2005.

The Company adopted the provisions of
the Financial Accounting Standards Board (FASB) Interpretation No. 48 (FIN 48),Accounting for Uncertainty in Income Taxes -
an interpretation of FASB Statement No. 109,
on July 1, 2007. FIN 48 prescribes a recognition threshold and measurement
attribute for the financial statement recognition and measurement of a tax
position taken or expected to be taken in a tax return. FIN 48 also provides
guidance on derecognition, classification, interest and penalties, accounting in
interim periods, disclosure and transition. The adoption of FIN 48 resulted in a
$250,000 increase to the beginning balance of retained earnings, with no impact
on the results of operations of the Company.

10

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Kentucky First Federal Bancorp

NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS

For the three month periods ended
September 30, 2007 and 2006

5.Recent Accounting Pronouncements(continued)

The following financial statement line
items for the quarter ended September 30, 2007 were affected by the change in
accounting principle.

|                        | September 30, 2007 (in thousands) 
|----------------------- | ----------------------------------
|                        | As Computed Pre- As Reported Under
|                        | FIN 48                            
|Balance Sheet           |                                   
|Refundable income taxes | $                                 
|Retained earnings       |                                   

In February 2007, the Financial
Accounting Standards Board (FASB) issued Statement of Financial Accounting
Standards No. 159, The Fair Value Option for Financial Assets and Financial
Liabilities  including an amendment of FASB Statement No. 115 (SFAS No. 159).
SFAS No. 159 permits us to choose to measure certain financial assets and
liabilities at fair value that are not currently required to be measured at fair
value (i.e. the Fair Value Option). Election of the Fair Value Option is made on
an instrument-by-instrument basis and is irrevocable. At the adoption date,
unrealized gains and losses on financial assets and liabilities for which the
Fair Value Option has been elected would be reported as a cumulative adjustment
to beginning retained earnings. If we elect the Fair Value Option for certain
financial assets and liabilities, we will report unrealized gains and losses due
to changes in their fair value in earnings at each subsequent reporting date.
SFAS No. 159 is effective as of July 1, 2008. We are currently evaluating the
potential impact of adopting SFAS No. 159 on our consolidated financial
statements.

In September 2006, the FASB issued
Statement of Financial Accounting Standards No. 157,Fair Value Measurements(FAS 157). FAS
157 enhances existing guidance for measuring assets and liabilities using fair
value. Prior to the issuance of FAS 157, guidance for applying fair value was
incorporated in several accounting pronouncements. FAS 157 provides a single
definition of fair value, together with a framework for measuring it, and
requires additional disclosure about the use of fair value to measure assets and
liabilities. FAS 157 also emphasizes that fair value is a market-based
measurement, not an entity-specific measurement, and sets out a fair value
hierarchy with the highest priority being quoted prices in active markets. Under
FAS 157, fair value measurements are disclosed by level within that hierarchy.
While FAS 157 does not add any new fair value measurements, it does change
current practice. Changes to practice include: (1) a requirement for an entity
to include its own credit standing in the measurement of its liabilities; (2) a
modification of the transaction price presumption; (3) a prohibition on the use
of block discounts when valuing large blocks of securities for broker-dealers
and investment companies; and (4) a requirement to adjust the value of
restricted stock for the effect of the restriction even if the restriction
lapses within one year. FAS 157 is effective for financial statements issued for
fiscal years beginning after November 15, 2007, or July 1, 2008 and interim
periods within those fiscal years. We are currently evaluating the potential
impact of adopting FAS 157 on our financial statements.

11

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Kentucky First Federal Bancorp

NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS

For the three month periods ended
September 30, 2007 and 2006

5.Recent Accounting Pronouncements(continued)

In September 2006, the FASB ratified a
consensus opinion by the EITF on EITF Issue 06-5,Accounting for Purchases of Life Insurance-Determining the Amount That
Could Be Realized in Accordance with FASB Technical Bulletin No. 85-4
(Accounting for Purchases of Life Insurance).The issue requires policy holders to consider other amounts included in
the contractual terms of an insurance policy, in addition to cash surrender
value, for purposes of determining the amount that could be realized under the
terms of the insurance contract. If it is probable that contractual terms would
limit the amount that could be realized under the insurance contract, those
contractual limitations should be considered when determining the realizable
amounts. The amount that could be realized under the insurance contract should
be determined on an individual policy (or certificate) level and should include
any amount realized on the assumed surrender of the last individual policy or
certificate in a group policy.

The Company holds several life
insurance policies, however, the policies do not contain any provisions that
would restrict or reduce the cash surrender value of the policies. The consensus
in EITF Issue 06-5 is effective for fiscal years beginning after December 15,
2006. The application of this guidance did not have a material adverse effect on
the Companys financial position or results of operations.

12

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Kentucky First Federal Bancorp

MANAGEMENTS DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking
Statements

Certain statements contained in this
report that are not historical facts are forward-looking statements that are
subject to certain risks and uncertainties. When used herein, the terms
anticipates, plans, expects, believes, and similar expressions as they
relate to Kentucky First Federal Bancorp or its management are intended to
identify such forward looking statements. Kentucky First Federal Bancorps
actual results, performance or achievements May materially differ from those
expressed or implied in the forward-looking statements. Risks and uncertainties
that could cause or contribute to such material differences include, but are not
limited to, general economic conditions, prices for real estate in the Companys
market areas, interest rate environment, competitive conditions in the financial
services industry, changes in law, governmental policies and regulations, and
rapidly changing technology affecting financial services.

Discussion of Financial Condition
Changes from June 30, 2007 to September 30, 2007

Assets: At September 30,
2007, the Companys assets totaled $272.5 million, an increase of $3.6 million,
or 1.3%, from total assets at June 30, 2007. The primary reason for the growth
in assets was an increase of $5.2 million, or 3.1%, in loans receivable, which
increased to $171.3 million at September 30, 2007. The increase in loans
receivable was composed primarily of variable rate real estate mortgage loans
and was primarily funded by an increase in short-term Federal Home Loan Bank
advances. It is anticipated that such advances will be repaid as the Companys
short-term, lower-yielding investment securities mature over the next three
years. Management has emphasized the origination and retention of adjustable
rate mortgage loans and, as the ability to make such loans changes with market
conditions, believes it is prudent to continue to originate such loans with the
funding that is available.

Cash and cash
equivalents: Cash and cash equivalents decreased by $1.5 million or
54.3%. It is the Companys preference to minimize the level of cash and cash
equivalents and invest liquidity into higher-yielding assets, when possible.
Cash was drawn down to partially fund the overall increase in loans which is
discussed more fully under Loans.

Loans: Loans receivable,
net, increased to $171.3 million at September 30, 2007, an increase of $5.2
million or 3.1% compared to the June 30, 2007, level. Management believes that
the successful redeployment of the Companys funds from lower-yielding cash,
cash equivalents and investment securities to higher-yielding mortgage loans is
important for the long-term success of the Company. The Company will continue to
emphasize loan originations to the extent that it is profitable and prudent.

Non-Performing Assets: At
September 30, 2007, the Company had approximately $1.2 million, or 0.7% of net
loans, in loans 90 days or more past due, compared to $968,000, or 0.6%, of net
loans at June 30, 2007. At September 30, 2007, the Companys allowance for loan
losses of $720,000 represented 60.2% of nonperforming loans and 0.4% of total
loans.

The Company had $1.5 million in loans
classified as substandard for regulatory purposes at September 30, 2007. On a
percentage basis, classified loans remained a constant 0.9% of net loans at June
30, 2007 and at September 30, 2007. Substandard assets included 31 single-family
home loans with loan-to-value ratios (percentage of loan balance to the value of
the loans collateral based on the original or an updated appraisal) ranging
from 10% to approximately 100%; two mortgage loans (first and second) secured by
a duplex (with an overall 70% loan-to-value ratio), and one single-family home
acquired through foreclosure. The real estate acquired through foreclosure had a
recorded investment and an estimated fair value of $8,000.

13

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Kentucky First Federal Bancorp

MANAGEMENTS DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

Discussion of Financial Condition
Changes from June 30, 2007 to September 30, 2007(continued)

Non-Performing Assets
(continued) At September 30, 2007, the Company had $698,000 in loans
classified as special mention. This category includes assets which do not
currently expose us to a sufficient degree of risk to warrant classification,
but do possess credit deficiencies or potential weaknesses deserving our close
attention. At September 30, 2007, no loans were classified as doubtful or loss
for regulatory purposes.

Investment and Mortgage-Backed
Securities: At September 30, 2007, the Companys investment and
mortgage-backed securities had decreased $435,000 or 0.6% to $72.6 million. This
decrease was due primarily to the repayment of principal on mortgage-backed
securities, which were partially offset by a net increase of $25,000 in the
market value of investments and mortgage-backed securities held as available for
sale. Approximately $47.9 million of the Companys investment and agency
securities are scheduled to mature within the next three years.

Liabilities: At September
30, 2007, the Companys liabilities totaled $211.6 million, an increase of $4.1
million, or 2.0%, from total liabilities at June 30, 2007. The increase in
liabilities was attributed primarily to a $3.6 million, or 5.5%, increase in
Federal Home Loan Bank advances, which increased to $68.7 million at September
30, 2007. Of these borrowings, approximately $24.1 million were short-term
advances which reprice no less frequently than monthly. Such advances were
utilized to fund the increase in loans during the period. Deposits totaled
$139.9 million at September 30, 2007 and June 30, 2007. In previous quarters
deposits had decreased partially in response to increases in market interest
rates. At times, the Company has chosen not to meet market rates if the deposits
cannot be invested profitably in interest-earning assets. In September 2007 the
Federal Open Market Committee reduced the Fed Funds Rate (the rate that banks
charge each other for overnight borrowings) by 50 basis points (bps) In
October 2007 the same body reduced the rate another 25 bps. As stated
previously, management anticipates reducing the level of Federal Home Loan Bank
advances as lower-yielding investment securities mature over the next three
years.

Shareholders Equity: At
September 30, 2007, the Companys shareholders equity totaled $60.9 million, a
decrease of $513,000 or 0.8% from the June 30, 2007 total. The primary reason
for the decrease in shareholders equity was the acquisition of $782,000 of
treasury shares at an average cost of $10.02 per share.

Comparison of Operating Results for
the Three Month Periods Ended September 30, 2007 and 2006

General

Net earnings totaled $152,000 for the
three months ended September 30, 2007, a decrease of $82,000, or 35.5% from the
$234,000 in net earnings for the same period in 2006. The decrease was primarily
attributable to a decline in net interest income.

Net Interest Income

Net interest income declined $177,000
or 12.5% to $1.3 million for the three month period ended September 30, 2007,
compared to the 2006 period. The decrease in net interest income was due
primarily to increased cost of funds. Although interest income increased by
$127,000, or 3.9%, to $3.3 million for the three month period ended September
30, 2007, interest expense increased $304,000 or 17.1% to $2.1 million for the
same period. The increase in interest expense was attributable to increased
costs for both deposits and advances.

14

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Kentucky First Federal Bancorp

MANAGEMENTS DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

Comparison of Operating Results for
the Three month Periods Ended September 30, 2007 and 2006(continued)

Net Interest Income(continued)

The increase in interest income was
attributed primarily to an increase in the volume of loans receivable. Interest
income from loans increased $170,000 or 7.1% to $2.6 million for the three month
period just ended. The average balance of loans receivable increased $709,000 or
7.4% to $169.0 million for the 2007 period compared to the prior year three
month period, while the average rate earned on loans receivable decreased only 2
bps to 6.07% for the recently ended quarter.

Interest expense on deposits increased
$198,000 or 17.9% to $1.3 million, and interest expense on advances increased
$106,000, or 15.7%, to $787,000 for the three-month 2007 period compared to the
prior year three-month period. The increase in interest expense on deposits was
due to an increase in the average rate paid on deposits, as the average balance
of deposits outstanding declined for the respective three month periods. The
average rate paid on deposits increased 62 bps to 3.73% for the three month
period ended September 30, 2007, while the average balance outstanding declined
1.5% to $139.9 million for the current period ended. The increase in interest
expense on advances was attributable both to increases in the average balance
outstanding and the average rate paid on those advances. The average balance of
advances outstanding increased $7.4 million, or 12.8%, to $65.4 million for the
three month period ended September 30, 2007. The average rate paid on advances
increased by 12 bps to 4.82% for the 2007 three month period. Net interest
margin decreased by 34 bps to 2.01% for the three months ended September 30,
2007, compared to 2.35% for the comparable 2006 period.

Provision for Losses on
Loans

The Company charges a provision for
losses on loans to earnings to bring the total allowance for loan losses to a
level considered appropriate by management based on historical experience, the
volume and type of lending conducted by the Banks, the status of past due
principal and interest payments, general economic conditions, particularly as
such conditions relate to the Banks market areas and other factors related to
the collectibility of the Banks loan portfolio. The Company recorded no
provision for losses on loans either of the three months ended September 30,
2007 or 2006. The lack of a provision for the periods was influenced by the
relatively stable level of nonperforming loans discussed above (See Critical
Accounting Policies and Nonperforming Assets). There can be no assurance that
the loan loss allowance will be adequate to absorb unidentified losses on loans
in the portfolio, which could adversely affect the Companys results of
operations.

Other Income

Other income totaled $45,000 for the
three months ended September 30, 2007, an increase of $9,000 from the same
period in 2006. The increase is attributable primarily to the absence of a 2006
loss on sale of real estate acquired through foreclosure of $10,000, which did
not reoccur in 2007.

15

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Kentucky First Federal Bancorp

MANAGEMENTS DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

Comparison of Operating Results for
the Three month Periods Ended September 30, 2007 and 2006(continued)

General, Administrative and Other
Expense

General, administrative and other
expense totaled $1.1 million for the three months ended September 30, 2007, a
decrease of $41,000, or 3.7%, compared to the same period in 2006. This decrease
was primarily due to a decrease in employee compensation and benefits. Employee
salaries decreased approximately $26,000 or 6.1% from the three month period
ended September 30, 2006 to the recently ended quarter, which was primarily the
result of retirements. Expenses recognized for the Companys Equity Incentive
Plan also decreased by approximately $12,000 or 11.2% from period to
period.

Federal Income Taxes

The provision for federal income taxes
totaled $67,000 for the three months ended September 30, 2007, a decrease of
$45,000, or 40.2%, compared to the same period in 2006. The effective tax rates
were 30.7% and 32.4% for the three month periods ended September 30, 2007 and
2006, respectively.

16

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Kentucky First Federal Bancorp

MANAGEMENTS DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

ITEM 3:Quantitative and Qualitative Disclosures About Market
Risk

There has been no material change in
the Companys market risk since the disclosure included under the heading
Managements Discussion and Analysis of Financial Condition and Results of
Operations  Asset and Liability Management in the Companys Form 10-K filed
September 28, 2007.

ITEM 4:Controls and Procedures

The Companys Chief Executive Officer
and Chief Financial Officer have evaluated the Companys disclosure controls and
procedures (as defined under Rules 13a-15(e) and 15d-15(e) of the Securities
Exchange Act of 1934, as amended) as of the end of the period covered by this
report. Based upon that evaluation, the Chief Executive Officer and Chief
Financial Officer have concluded that the Companys disclosure controls and
procedures are effective. During the quarterly period ended September 30, 2007,
there were no changes in the Companys internal control over financial reporting
which materially affected, or are reasonably likely to materially affect, the
Companys internal controls over financial reporting.

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Kentucky First Federal Bancorp

PART II

|ITEM 1.  |  | Legal
      Proceedings                                                                                           
|-------- |  | ------------------------------------------------------------------------------------------------------------------
|         |  |                                                                                                                   
|         |  | Not
  applicable.                                                                                                 
|         |  |                                                                                                                   
|ITEM 1A. |  | Risk Factors                                                                                                      
|         |  |                                                                                                                   
|         |  | The Registrants risk factors have not
      changed from those set forth in the Annual Report on Form
      10-K.
|         |  |                                                                                                                   
|ITEM 2.  |  | Unregistered Sales of Equity
      Securities and Use of Proceeds                                                 

(c) The following
table sets forth information regarding Companys repurchases of its common stock
during the quarter ended September 30, 2007.

|                        |                   |           |                  |                    | Total #
      of          |             |                          
|----------------------- | ----------------- | --------- | ---------------- | ------------------ | ------------------------- | ----------- | -------------------------
|                        |                   |           | Average          |                    | shares
      purchased    |             | Maximum # of
      shares
|                        | Total             |           | price
      paid |                    | as part of
      publicly |             | that may yet
      be    
|                        | # of
      shares |           | per
      share  |                    | announced
      plans     |             | purchased
      under    
|Period                  |                   | purchased |                  | (incl commissions) |                           | or programs |                          
|July 1-31, 2007         | 13,000            |           | $                | 10.15              |                           |             | 13,000                   
|August
      1-31, 2007 | 42,000            |           | $                | 9.92               |                           |             | 42,000                   
|September 1-30, 2007    | 23,100            |           | $                | 10.08              |                           |             | 23,100                   

(1) On March 13, 2007, the Company
announced a program to repurchase up to 150,000 shares of its Common Stock. This
program was terminated on August 17, 2007 when the Company completed the
repurchase of substantially all shares authorized under this program, and
announced another program to repurchase up to 150,000 shares of its Common
Stock.

|ITEM
    3.   |  | Defaults Upon Senior Securities                          
|------------- |  | ---------------------------------------------------------
|              |  |                                                          
|              |  | Not
      applicable.                                    
|              |  |                                                          
|ITEM
      4. |  | Submission of Matters to a Vote of Security
      Holders
|              |  |                                                          
|              |  | None.                                                    
|              |  |                                                          
|ITEM
      5. |  | Other Information                                        
|              |  |                                                          
|              |  | None.                                                    
|              |  |                                                          
|ITEM 6.       |  | Exhibits                                                 
|              |  |                                                          
|              |  |                                                          
|              |  |                                                          
|              |  |                                                          
|              |  |                                                          

18

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Kentucky First Federal Bancorp

SIGNATURES

Pursuant to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned thereunto duly authorized.

|      |  |                   |  | KENTUCKY FIRST FEDERAL BANCORP
|----- |  | ----------------- |  | ------------------------------
|      |  |                   |  |                               
|Date: |  | November 14, 2007 |  | By:                           
|      |  |                   |  |                               
|      |  |                   |  |                               
|      |  |                   |  |                               
|Date: |  | November 14, 2007 |  | By:                           
|      |  |                   |  |                               
|      |  |                   |  |                               

19

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