ONSCREEN
      TECHNOLOGIES, INC.




UNITED
      STATES SECURITIES AND EXCHANGE COMMISSION


WASHINGTON,
      D.C. 20549





FORM
      10-QSB




QUARTERLY
      REPORT UNDER SECTION 13 OR 15(D)


OF
      THE
      SECURITIES EXCHANGE ACT OF 1934





For
      quarter ended March 31, 2007





Commission
      File Number 0-29195




ONSCREEN
      TECHNOLOGIES, INC.


(Name
      of
      Small Business Issuer in Its Charter)





Colorado
            (3990)
            84-1463284(State
                or jurisdiction of
              incorporation
                or organization)
            (Primary
                Standard Industrial Classification Code Number)
            (I.R.S.
                Employer Identification No.)




600
      NW
      14 th Avenue,
      Suite 100


Portland,
      Oregon 97209


(503)
      417-1700


(Address
      and Telephone Number of Principal Executive Offices and Principal Place of
      Business)





Russell
      L. Wall, CEO/President


OnScreen
      Technologies, Inc.


600
      NW
      14 th Avenue,
      Suite 100


Portland,
      Oregon 97209


(503)
      417-1700


(Name,
      Address and Telephone Number of Agent for Service)





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 for such shorter period that the registrant was required
      to file such reports), and (2) has been subject to such filing requirements
      for
      the past 90 days.




Yes x No
o





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act).




YES
oNO
x





As
      of May
      10, 2007, there were 149,716,312 shares of the Company's common stock
      outstanding, 75,543 shares of Series A Convertible Preferred Stock outstanding
      and no shares of Series B Convertible Preferred Stock outstanding.




1


ONSCREEN
      TECHNOLOGIES, INC.




INDEX





Part
                IPageItem
                1
            Financial
                Statements
            3Condensed
                Balance Sheets (unaudited)
            3Condensed
                Statements of Operations (unaudited)
            4Condensed
                Statements of Cash Flows (unaudited)
            5Notes
                to the Condensed Financial Statements (unaudited)
            7Item
                2
            Management’s
                  Discussion and Analysis ofFinancial Condition and Results of
                  Operations
            12Overview
            12Intellectual
                Property
            13Critical
                Accounting Policies
            13Liquidity
                and Capital Resources
            14Results
                of Operations
            16Item
                3
            Controls
                and Procedures
            17Part
                IIItem
                1
            Legal
                Proceedings.
            18Item
                2
            Changes
                in Securities
            18Item
                3
            Defaults
                Upon Senior Securities
            19Item
                4
            Submission
                of Matters to a Vote of Security Holders
            19Item
                5
            Other
                Information
            19Item
                6
            Exhibits
                and Reports on Form 8-K
            19Signatures
            20Exhibits





2


**PART
      I. FINANCIAL INFORMATION**





**ITEM
      1. FINANCIAL STATEMENTS**




**ONSCREEN
      TECHNOLOGIES, INC.**


**CONDENSED
      BALANCE SHEETS**




**March
                31, 2007**
            
            **December
                31, 2006****(Unaudited)****Assets****Current
                Assets**Cash
                and cash equivalents
            
            $
            45,832
            
            $
            570,501Accounts
                receivable, net of allowance of $6,333 at March 31, 2007 and December
                31,
                2006
            
            
            14,557
            
            
            11,295Inventory
            
            
            2,182,702
            
            
            2,125,735Prepaid
                expenses and other current assets
            
            
            126,533
            
            
            141,474**Total
                Current Assets**
            
            
            **2,369,624**
            
            
            **2,849,005****Property
                and Equipment, net of accumulated depreciation of $133,459 at March
                31,
                2007 and $119,057 at December 31, 2006**
            
            
            **87,837**
            
            
            **102,239****Other
                Assets**Note
                Receivable
            
            
            107,500
            
            
            115,000Technology
                rights, net of accumulated amortization of $392,366 at March 31,
                2007 and
                $332,843 at December 31, 2006
            
            
            4,500,377
            
            
            4,509,900Patent
                Costs
            
            
            613,463
            
            
            582,965Other
                assets
            
            
            21,993
            
            
            22,173**Total
                Other Assets**
            
            
            **5,243,333**
            
            
            **5,230,038****Total
                Assets**
            
            $
            **7,700,794**
            
            **$**
            **8,181,282****Liabilities
                and Stockholders’ Equity****Current
                Liabilities**Accounts
                payable and other payables
            
            $
            545,334
            
            $
            480,960Preferred
                Stock Dividends Payable
            
            
            27,353
            
            
            27,353Accrued
                expenses
            
            
            152,342
            
            
            132,914Accrued
                Compensation
            
            
            73,673
            
            
            85,000Deferred
                Revenue
            
            
            7,990
            
            
            8,260Convertible
                note payable, net of discounts of $69,461 at March 31, 2007 and $52,439
                at
                December 31, 2006
            
            
            1,030,539
            
            
            947,561**Total
                Current Liabilities**
            
            
            **1,837,231**
            
            
            **1,682,048****Long
                term note payable, net of discounts of $191,460 at March 31, 2007
                and
                $253,303 at December 31, 2006**
            
            
            **508,540**
            
            
            **396,697****Total
                Liabilities**
            
            
            **2,345,771**
            
            
            **2,078,745****Commitments
                (Note 7)**
            
            
            -
            
            
            -**Stockholders'
                Equity**Preferred
                stock, par value $0.001; 10,000,000 shares authorized Convertible
                Series
                A, Preferred stock, 5,000,000 shares authorized, 75,543 shares and
                90,543
                shares outstanding at March 31, 2007 and December 31, 2006, respectively;
                liquidation preference of $75,543 at March 31, 2007
            
            
            76
            
            
            91Convertible
                Series B preferred stock, 30,000 shares authorized, no shares issued
                at
                March 31, 2007 and December 31, 2006, respectively.
            
            
            -
            
            
            -Common
                stock, par value $0.001; 200,000,000 shares authorized, 149,353,818
                and
                147,127,238 shares issued and outstanding at March 31, 2007 and December
                31, 2006, respectively
            
            
            149,354
            
            
            147,127Common
                stock issuable, at par value, (13,500 shares at March 31,
                2007)
            
            
            13
            
            
            -Additional
                paid-in capital
            
            
            49,151,383
            
            
            48,926,371Accumulated
                deficit
            
            
            (43,945,803
            )
            
            (42,971,052
            )**Total
                Stockholders' Equity**
            
            
            **5,355,023**
            
            
            **6,102,537****Total
                Liabilities and Stockholders' Equity**
            
            $
            **7,700,794**
            
            **$**
            **8,181,282**





See
      accompanying notes to financial statements




3


**ONSCREEN
      TECHNOLOGIES, INC.**


**CONDENSED
      STATEMENTS OF OPERATIONS**


**(UNAUDITED)**




**For
                the three months ended March 31,****2007**
            
            **2006****Revenues**
            
            $
            **49,393**
            
            $
            **27,230****Cost
                of Revenues**
            
            
            **51,225**
            
            
            **52,082****Gross
                Loss**
            
            
            **(1,832**
            **)**
            
            **(24,852**
            **)****Operating
                Expenses**Selling,
                general and administrative
            
            
            442,358
            
            
            2,398,763Research
                and development
            
            
            359,097
            
            
            596,928Restructuring
                costs
            
            
            -
            
            
            13,967**Total
                Operating Expenses**
            
            
            **801,455**
            
            
            **3,009,658****Loss
                from Operations**
            
            
            **(803,287**
            **)**
            
            **(3,034,510**
            **)****Other
                Income (Expense)**Other
                income
            
            
            12,902
            
            
            16,374Settlement
                gain (loss), net
            
            
            -
            
            
            107,160Intrinsic
                value of convertible debt and amortization of debt
                discount
            
            
            (132,607
            )
            
            (1,914,926
            )Interest
                expense
            
            
            (51,759
            )
            
            (286,967
            )**Total
                Other Income (Expense), Net**
            
            
            **(171,464**
            **)**
            
            **(2,078,359**
            **)****Net
                Loss**
            
            
            **(974,751**
            **)**
            
            **(5,112,869**
            **)**Preferred
                Stock Dividends
            
            
            -
            
            
            (49,927
            )**Net
                Loss Available to Common Stockholders**
            
            $
            **(974,751**
            **)**
            $
            **(5,162,796**
            **)**Basic
                and Diluted Loss Per Common Share Available to Common
                Stockholders
            
            $
            **(0.01**
            **)**
            $
            **(0.07**
            **)**Weighted
                average basic and diluted common shares outstanding
            
            
            **147,728,670**
            
            
            **77,843,502**





See
      accompanying notes to financial statements





4




**ONSCREEN
      TECHNOLOGIES, INC.**


**CONDENSED
      STATEMENTS OF CASH FLOWS**


**UNAUDITED**





**For
                the three months ended**
              **March
                31,****2007**
            
            **2006****CASH
                FLOWS FROM OPERATING ACTIVITIES:**Net
                Loss
            
            $
            (974,751
            )
            $
            (5,112,869
            )Adjustments
                to reconcile net loss to net cash used in operating
                activities:Stock,
                warrants and notes issued for compensation and services
            
            
            3,292
            
            
            790,157Non-cash
                interest expense, including intrinsic value of convertible debt and
                amortization of debt discount
            
            
            132,607
            
            
            1,914,926Non-cash
                gain on settlement, net
            
            
            -
            
            
            (150,016
            )Amortization
                of technology rights
            
            
            59,523
            
            
            5,000Amortization
                of deferred consulting and compensation
            
            
            -
            
            
            258,223Amortization
                of deferred financing fees
            
            
            -
            
            
            63,509Compensation
                expense payable in common stock
            
            
            6,250
            
            
            141,116Depreciation
            
            
            14,402
            
            
            31,765**(Increase)
                decrease in assets:**Accounts
                receivable and other receivables
            
            
            4,238
            
            
            11,893Inventory
            
            
            (56,967
            )
            
            (531,131
            )Prepaid
                expenses and other current assets
            
            
            14,941
            
            
            (44,685
            )Deposits
                and other assets
            
            
            180
            
            
            63,640**Increase
                (decrease) in liabilities:**Accounts
                payable and accrued expenses
            
            
            72,205
            
            
            479,727**NET
                CASH USED IN OPERATING ACTIVITIES**
            
            
            (724,080
            )
            
            (2,078,745
            )**CASH
                FLOWS FROM INVESTING ACTIVITIES:**Investment
                in technology rights
            
            
            (50,000
            )
            
            (800,000
            )Investment
                in patents
            
            
            (30,498
            )
            
            (27,880
            )Purchase
                of property and equipment
            
            
            
            
            
            (3,649
            )**NET
                CASH USED IN INVESTING ACTIVITIES**
            
            
            (80,498
            )
            
            (831,529
            )**CASH
                FLOWS FROM FINANCING ACTIVITIES:**Proceeds
                from notes and loans payable
            
            
            277,500
            
            
            4,918,950Payments
                on notes and loans payable
            
            
            
            
            
            (250,000
            )Proceeds
                from exercise of warrants and options
            
            
            2,409**NET
                CASH PROVIDED BY FINANCING ACTIVITIES**
            
            
            279,909
            
            
            4,668,950NET
                INCREASE IN CASH AND CASH EQUIVALENTS
            
            
            (524,669
            )
            
            1,758,676Cash
                and Cash Equivalents at Beginning of Year
            
            
            570,501
            
            
            727,141**CASH
                AND CASH EQUIVALENTS AT END OF PERIODS**
            
            **$**
            **45,832**
            
            **$**
            **2,485,817****(continued)**




5


**ONSCREEN
      TECHNOLOGIES, INC.**


**CONDENSED
      STATEMENTS OF CASH FLOWS (continued)**


**UNAUDITED**




For
                the three months ended March 31,2007
            
            2006SUPPLEMENTAL
                DISCLOSURE OF CASH FLOW INFORMATION:Income
                taxes paid
            
            $
            -
            
            $
            -Interest
                paid
            
            $
            51,759
            
            $
            171,001SUPPLEMENTAL
                    DISCLOSURE OF NON-CASH INVESTING AND FINANCING
                    ACTIVITIES:Conversion
                of Series A convertible preferred stock to common stock
            
            $
            15
            
            $
            24Discount
                on debt of convertible notes payable
            
            $
            87,786
            
            $
            2,609,798Accounts
                payable converted to notes payable
            
            $
            -
            
            $
            375,475Conversion
                of debt to common stock
            
            $
            127,500
            
            $
            9,037,898Technology
                rights acquired through issuance of warrants
            
            $
            -
            
            $
            3,520,243Common
                stock issued for deferred consulting and compensation and accrued
                liabilities payable in common stock
            
            $
            1,333
            
            $
            645,892Other
                comprehensive loss from unrealized loss (gain)
            
            $
            -
            
            $
            (2,303
            )




See
      accompanying notes to financial statements




6


**ONSCREEN
      TECHNOLOGIES, INC.**





**NOTES
      TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**


**(Unaudited)**





**NOTE
      1 BASIS OF PRESENTATION AND GOING CONCERN**





OnScreen
      Technologies, Inc. (sometimes hereafter referred to as “OnScreenTM” or “the
      Company”) has developed and is commercializing innovative thermal management
      solutions capable of revolutionizing the LED display, semiconductor and
      electronic packaging industries. Utilizing its patent-pending thermal
      technologies and architecture, the Company has developed advanced, proprietary
      LED display solutions and cooling applications. The Company is primarily focused
      on commercialization of its innovative thermal cooling technology, WayCool,
      and
      the commercial adoption of its sign display platform product under the names
      RediAlertTM and Living WindowTM. Additionally, the Company is continuing efforts
      towards development and commercialization of its Tensile
      technology.





The
      accompanying financial statements have been prepared on the assumption that
      the
      Company will continue as a going concern. As reflected in the accompanying
      financial statements, the Company has a net loss of $974,751 and cash used
      in
      operations of $724,080 for the three months ended March 31, 2007. The ability
      of
      the Company to continue as a going concern is dependent on the Company's ability
      to bring the OnScreenTM products to market, generate increased sales, obtain
      positive cash flow from operations and raise additional capital. The financial
      statements do not include any adjustments that may result from the outcome
      of
      this uncertainty.





The
      Company is continuing to raise additional capital for the commercialization
      of
      its OnScreenTM technology product lines which the Company believes should provide
      sufficient cash to meet its funding requirements to bring the OnScreenTM
technology product lines into production during 2007. As the Company continues
      to expand and develop its technology and product lines, additional funding
      may
      be required. The Company has experienced negative cash flows from operations
      and
      incurred net losses in the past and there can be no assurance as to the
      availability or terms upon which additional financing and capital might be
      available, if needed.





The
      accompanying unaudited financial statements have been prepared in accordance
      with accounting principles generally accepted in the United States of America
      and the rules and regulations of the United States Securities and Exchange
      Commission for interim financial information which includes condensed financial
      statements. Accordingly, they do not include all the information and footnotes
      necessary for a comprehensive presentation of financial position and results
      of
      operations and should be read in conjunction with the Company’s Annual Report,
      Form 10-KSB for the year ended December 31, 2006.





It
      is
      management's opinion that all material adjustments (consisting of normal
      recurring adjustments) have been made which are necessary for a fair financial
      statement presentation. The results for the interim period are not necessarily
      indicative of the results to be expected for the year.





**NOTE
      2 USE OF ESTIMATES**





The
      preparation of financial statements in conformity with accounting principles
      generally accepted in the United States of America requires management to make
      estimates and assumptions that affect the reported amounts of assets and
      liabilities and disclosure of contingent assets and liabilities at the date
      of
      the financial statements and the reported amounts of revenues and expenses
      during the reporting period. Actual results could differ from those estimates.
      Significant estimates in 2007 and 2006 include estimates used to review the
      Company’s long-lived assets for impairment, inventory valuation, valuations of
      non-cash capital stock issuances, valuations of derivatives and the valuation
      allowance on deferred tax assets.





7





**NOTE
      3 LOSS PER COMMON SHARE**





Common
      stock equivalents in the three-month periods ended March 31, 2007 and 2006
      were
      anti-dilutive due to the net losses sustained by the Company during these
      periods, thus the diluted weighted average common shares outstanding in these
      periods are the same as the basic weighted average common shares
      outstanding.





At
      March
      31, 2007, 33,862,096 potential common stock shares are issuable upon the
      exercise of warrants and options and conversion of debt to common stock. These
      are excluded from computing the diluted net loss per share as the effect of
      such
      shares would be anti-dilutive.





**NOTE
      4 INCOME TAXES**





The
      Company has not recognized an income tax benefit for its operating losses
      generated in the three-month periods ended March 31, 2007 and 2006 based on
      uncertainties concerning its ability to generate taxable income in future
      periods. The tax benefits for the three-month periods ended March 31, 2007
      and
      2006 is offset by a valuation allowance established against deferred tax assets
      arising from operating losses and other temporary differences, the realization
      of which could not be considered more likely than not. In future periods, tax
      benefits and related deferred tax assets will be recognized when management
      considers realization of such amounts to be more likely than not. ****





**NOTE
      5 STOCK-BASED EMPLOYEE COMPENSATION**





On
      January 1, 2006, the Company implemented Statement of Financial Accounting
      Standard 123 (revised 2004) (“SFAS 123(R)”), “Share-Based
      Payment” which replaced SFAS 123 “Accounting for Stock-Based Compensation” and
      superseded APB Opinion No. 25, “Accounting for Stock Issued to Employees.” SFAS
      123(R) requires the fair value of all stock-based employee compensation awarded
      to employees to be recorded as an expense over the related vesting period.
      The
      statement also requires the recognition of compensation expense for the fair
      value of any unvested stock option awards outstanding at the date of adoption.
      During 2006, all employee stock compensation is recorded at fair value using
      the
      Black Scholes Pricing Model. In adopting SFAS 123(R), the Company used the
      modified prospective application (“MPA”). MPA requires the Company to account
      for all new stock compensation to employees using fair value and for any portion
      of awards prior to January 1, 2006 for which the requisite service has not
      been
      rendered and the options remain outstanding as of January 1, 2006, the Company
      recognized the compensation cost for that portion of the award the requisite
      service was rendered on or after January 1, 2006. The fair value for these
      awards is determined based on the grant-date.





On
      August
      25, 2005, the Board of Directors approved the 2005 Equity Incentive Plan (“2005
      Plan”) for 2,000,000 shares of the Company’s common stock. The 2005 Plan
      provides for the issuance of stock options to attract, retain and motivate
      employees, to encourage employees, directors and independent contractors to
      acquire an equity interest in the Company, to make monetary payments to certain
      employees based upon the value of the Company’s stock and provide employees,
      directors and independent contractors with an incentive to maximize the success
      of the Company and to further the interest of the shareholders. The 2005 Plan
      provides for the issuance of Incentive Stock Options and Non Statutory Options.
      The Administrator of the plan shall determine the exercise price per share
      at
      the time an option is granted but the exercise price shall not be less than
      the
      fair market value on the date the options is granted. Stock options granted
      under the 2005 Plan have a maximum duration of 10 years.





8




On
      June
      26, 2000, the Company’s Board of Directors adopted the OnScreen Technologies,
      Inc. 2000 Stock Option Plan (the “Plan”). The Plan provides for the issuance of
      incentive stock options (ISO’s) to any individual who has been employed by the
      Company for a continuous period of at least six months. The Plan also provides
      for the issuance of Non Statutory Options (NSO’s) to any employee who has been
      employed by the Company for a continuous period of at least six months, any
      director, or consultant to the Company. The Company may also issue reload
      options as defined in the plan. The total number of common shares of common
      stock authorized and reserved for issuance under the Plan is 600,000 shares.
      The
      Board shall determine the exercise price per share in the case of an ISO at
      the
      time an option is granted and such price shall be not less than the fair market
      value or 110% of fair market value in the case of a ten percent or greater
      stockholder. In the case of an NSO, the exercise price shall not be less than
      the fair market value of one share of stock on the date the option is granted.
      Unless otherwise determined by the Board, ISO’s and NSO’s granted under the Plan
      have a maximum duration of 10 years.





The
      following information is presented for the non-vested stock options for the
      three months ended March 31, 2007:




Number
                of Shares
            
            Weighted
                Avg. Grant-date Fair ValueNon-vested
                stock options at December 31, 2006
            
            
            485,000
            
            $
            0.45Granted
                during the period
            
            
            -
            
            
            -Vested
                during the period
            
            
            (10,000
            )
            $
            0.30Forfeited
                during period
            
            
            (425,000
            )Non-vested
                stock options at March 31, 2007
            
            
            50,000
            
            $
            0.36





The
      following information is presented for the stock option activity for the three
      months ended March 31, 2007:




#
                of shares
            
            Weighted
                Average Exercise Price
            
            Weighted
                Average Remaining Contract Life
            
            Aggregate
                Intrinsic ValueOutstanding
                at December 31, 2006:
            
            
            5,463,500
            
            $
            0.14Forfeited
            
            
            (572,500
            )
            $
            0.16Granted
            
            
            -
            
            $
            0.00Outstanding
                at March 31, 2007
            
            
            4,891,000
            
            $
            0.13
            
            
            9.3.2
                years
            
            $
            16,790Outstanding
                exercisable at March 31, 2007
            
            
            4,841,000
            
            $
            0.13
            
            
            9.3.2
                years
            
            $
            16,790





9




The
      fair
      value of each stock option is estimated on the date of grant using a Black
      Scholes Pricing Model. The fair value of options granted during 2006 was
      estimated using the following approximate assumptions: dividend yield of 0%,
      expected volatilities of 130% -202%, risk-free interest rates of 4.4% - 4.8%,
      and expected lives of 3 - 5 years. There have been no options granted during
      2007.





In
      accordance with SFAS 123(R), during the three months ended March 31, 2007,
      the
      Company recognized compensation expense of $3,292 for the fair value of stock
      options over the vesting period. Due to the Company’s net loss position, there
      was no tax effect recognized.





At
      March
      31, 2007, the Company has $9,739 of unrecognized compensation costs related
      to
      non-vested awards and the Company expects to recognize this expense by the
      end
      of 2007.




**NOTE
      6 NOTES PAYABLE**





At
      December 31, 2006 eighteen month secured convertible promissory notes totaling
      $1,650,000 were outstanding. During the three months ended March 31, 2007,
      the
      Company entered into eighteen-month secured convertible promissory notes
      totaling $177,500. Interest accrues at 12% per annum, payable monthly, until
      the
      maturity of these notes at which time the principal is due. The note holder
      has
      the right to convert the note to the Company’s common stock at the greater of a
      per share price equal to 80% of the average closing bid price of the stock
      for
      10 days preceding the conversion date or $0.20. During the three months ended
      March 31, 2007, note holders converted $127,500 of the notes into the Company’s
      common stock. Unamortized debt discount as of March 31, 2007 is
      $260,921.





During
      March 2007, the Company entered into a twenty four month secured promissory
      note
      and received proceeds of $100,000. Interest accrues at 12% per annum, payable
      monthly, until the maturity of this note at which time the principal is
      due.





**NOTE
      7 TECHNOLOGY RIGHT AND LICENSE AGREEMENT**





On
      January 8, 2007, the Company reached an agreement with the inventor of the
      WayCool technology to purchase from him the cooling solution designed for the
      solar industry for a purchase price of $50,000. Conditions of the agreement
      reached between the two parties included fulfillment by the inventor of all
      obligations required to obtain a filing of the provisional application for
      the
      patent and to provide technical advice to implement the cooling
      solution.





**NOTE
      8 COMMITMENTS**





On
      January 1, 2007, the Company entered into an agreement with a consultant to
      provide research and development services. For these services, the Company
      pays
      a monthly fee of $5,000 over a one-year period.





**NOTE
      9 PREFERRED STOCK**





During
      the three months ended March 31, 2007, the Company converted 15,000 shares
      of
      the Company’s Series A convertible preferred stock into 75,000 shares of the
      Company’s common stock at the request of certain Series A convertible preferred
      stock holders.





10




**NOTE
      10 OTHER EQUITY TRANSACTIONS**





During
      the three months ended March 31, 2007, the Company issued 82,938 shares of
      its
      common stock to an employee in accordance with his employment agreement. These
      shares were valued at $25,000 using a thirty-day average price at December
      31,
      2006, in accordance with the employee’s employment agreement.





During
      the three months ended March 31, 2007, the Company was to issue 500 shares
      of
      its Series B Convertible Preferred stock and 125,000 shares of its Series A
      Convertible Preferred stock to the CFO in accordance with the employee’s
      employment agreement. The 125,000 shares of Series A Convertible Preferred
      stock
      was valued at $1.00 per share based on contemporaneous cash sales. The 500
      shares of Series B Convertible Preferred stock was valued at $270 per share
      based on contemporaneous cash sales. The total value of these shares of $260,000
      was expensed over the term of the employee’s employment agreement. In lieu of
      the Convertible A and B Preferred stock, the Company issued 1,250,000 of its
      Common Stock.





During
      the three months ended March 31, 2007, the Company issued 578,704 shares of
      its
      common stock and warrants for 47,296 shares of its common stock in relation
      to
      the conversion of promissory notes.





During
      the three months ended March 31, 2007, the Company issued 239,938 shares of
      its
      common stock in relation to the exercise of warrants.





During
      the three months ended March 31, 2007, the Company recorded compensation expense
      of $3,292 for stock options that the requisite service was performed during
      the
      first quarter of 2007. The compensation expense is recorded over the vesting
      period based upon fair market value of the options using the Black Scholes
      option model in accordance with SFAS 123(R).





The
      Company also recorded $6,250 of compensation expense for stock that is to be
      issued based upon employment agreements that the requisite service had been
      performed.




**NOTE
      11 SUBSEQUENT EVENTS**





During
      April 2007, the Company entered into a secured promissory note with a board
      member for $80,000. Interest on this note accrues at the rate of 12% per annum
      and is payable monthly. The note is payable in one installment no more than
      sixty days after the receipt of funds by the Company or upon receipt of funds
      from an investment group.





During
      April 2007, the Company entered into a twenty four month secured promissory
      note
      and received proceeds of $200,000. Interest accrues at 12% per annum, payable
      monthly, until the maturity of this note at which time the principal is
      due.





During
      May 2007, the Company entered into a twenty four month secured promissory note
      and received proceeds of $200,000. Interest accrues at 12% per annum, payable
      monthly, until the maturity of this note at which time the principal is
      due.





11




During
      May 2007, warrants for 250,000 shares of its common stock at a price of $0.01
      were exercised.





During
      May 2007, the Company converted accrued dividends of approximately $19,800
      into
      98,994 shares of the Company’s common stock at per share price of $0.20 for the
      shareholder who elected to convert accrued dividends to common
      shares.





**Item
      2. Management’s Discussion and Analysis of Financial Condition and** **Results
      of Operations.**





**General**





Management’s
      discussion and analysis contains various “forward looking statements.” Such
      statements consist of any statement other than a recitation of historical fact
      and can be identified by the use of forward-looking terminology such as “may,”
“expect,” “anticipate,” “estimate,” or “continue” or use of negative or other
      variations or comparable terminology.





The
      Company cautions that these statements are further qualified by important
      factors that could cause actual results to differ materially from those
      contained in the forward-looking statements, that these forward-looking
      statements are necessarily speculative, and there are certain risks and
      uncertainties that could cause actual events or results to differ materially
      from those referred to in such forward-looking statements.





**Overview**





OnScreen
      Technologies, Inc. (sometimes hereafter referred to as “OnScreenTM” or “the
      Company”) has developed and is commercializing innovative thermal management
      solutions capable of revolutionizing the LED display, semiconductor and
      electronic packaging industries. Utilizing its patent-pending thermal
      technologies and architecture, the Company has developed highly advanced,
      proprietary LED display solutions and cooling applications that provide
      increased performance and are less expensive to install and support than
      competing products and technologies.





The
      Company is primarily focused on commercialization of its innovative thermal
      cooling technology, WayCool, and the commercial adoption of its sign display
      platform product under the name RediAlertTM. Additionally, the Company is
      continuing efforts towards development and commercialization of its Tensile
      technology. The Company’s sign display product lines utilize the OnScreenTM
direct view LED (light emitting diode) sign display technology (sometimes
      referred to as the “OnScreenTM LED architecture” or “OnScreenTM LED technology”).
      The Company’s plan is to focus all of its resources on the commercialization of
      its technology.





The
      Company’s LED products are specially designed to provide display solutions into
      vertical markets including commercial and government. The OnScreenTM LED
      architecture provides a platform for the production of LED display products
      in
      the current market that is lighter than competitive products and provides a
      corresponding reduction in wind loading. These architectural benefits yield
      products that could be easy to install, are portable and require less support
      infrastructure, which opens new markets for LED message display
      products.





The
      Company’s RediAlertTM Rapid Dispatch Emergency Signs product line provides the
      world’s first truly portable LED product for Emergency Response and commercial
      advertising using the OnScreenTM LED sign technology. Powered by battery and
      transported by any vehicle, these products give highly visible emergency
      information or advertising messages in less than five minutes of set up time.
      The Company began shipping the RediAlertTM product line during the third quarter
      of 2006.





12




The
      Company does not expect to record any significant growth in revenues until
      the
      WayCool technology is commercialized and its RediAlertTM product line is fully
      deployed nationwide.





During
      the three months ended March 31, 2007, the Company continued to incur
      significant losses from operations. The Company incurred a net loss of $974,751
      for the three months ended March 31, 2007. This net loss of $974,751 is
      significantly lower than for the same period last year when the Company recorded
      a net loss of $5,112,869 primarily due to reduced headcount, decrease in
      operating expenses, lower non-cash charges of approximately $1,189,000 for
      compensation and services expense including amortization of deferred
      compensation related to equity given or to be given to employees and consultants
      for services provided, and $1,782,319 of non-cash amortization of the intrinsic
      value of convertible debt and the debt discount.





Management
      has continued to raise the capital needed to fund the development and marketing
      of the Company’s OnScreenTM products during 2007. During the three months ended
      March 31, 2007 the Company received proceeds of $177,500 from secured
      convertible notes and $100,000 from secured promissory notes. These funds will
      assist the Company to continue to develop its OnScreenTM products and technology
      and continue the Company’s operations until the Company brings the OnScreenTM
products fully to market. However, the Company anticipates expanding and
      developing its technology and product lines which will require additional
      funding.





Intellectual
      Property




The
      Company relies on various intellectual property laws and contractual
      restrictions to protect its proprietary rights in products, logos and services.
      These include confidentiality, invention assignment and nondisclosure agreements
      with the Company’s employees, contractors, suppliers and strategic partners. The
      confidentiality and nondisclosure agreements with employees, contractors and
      suppliers are in perpetuity or for a sufficient length of time so as to not
      threaten exposure of proprietary information. In addition, the Company intends
      to pursue the registration of its trademarks and service marks in the U.S.
      and
      internationally.





The
      Company continues to file and protect its intellectual property rights,
      trademarks and products through continued filings with the US Patent and
      Trademark Office and, as applicable, internationally.





CRITICAL
      ACCOUNTING POLICIES





The
      preparation of financial statements in conformity with accounting principles
      generally accepted in the United States of America requires management to make
      estimates and assumptions that have a significant impact on the results the
      Company will report in the Company's financial statements. Some of the Company's
      accounting policies require the Company to make difficult and subjective
      judgments, often as a result of the need to make estimates of matters that
      are
      inherently uncertain. Actual results may differ from these estimates under
      different assumptions or conditions.





13




Asset
      Impairment




The
      Company reviews its long-lived assets for impairment whenever events or changes
      in circumstances indicate that the carrying amount of the asset exceeds its
      fair
      value and may not be recoverable. In performing the review for recoverability,
      the Company estimates the future cash flows expected to result from the use
      of
      the asset and its eventual disposition. If the sum of the expected future cash
      flows (undiscounted and without interest charges) is less than the carrying
      amount of the asset, an impairment loss is recognized as the excess of the
      carrying amount over the fair value. Otherwise, an impairment loss is not
      recognized. Management estimates the fair value and the estimated future cash
      flows expected. Any changes in these estimates could impact whether there was
      impairment and the amount of the impairment.





Valuation
      of Non-Cash Capital Stock Issuances




The
      Company values its stock transactions based upon the fair value of the equity
      instruments. Various methods can be used to determine the fair value of the
      equity instrument. The Company may use the fair value of the consideration
      received, the quoted market price of the stock or a contemporaneous cash sale
      of
      the common or preferred stock. Each of these methods may produce a different
      result. Management uses the method it determines most appropriately reflects
      the
      stock transaction. If a different method was used it could impact the expense
      and equity stock accounts.





Patent
      Costs




The
      Company estimates the patents it has filed have a future beneficial value to
      the
      Company, thus it capitalizes the costs associated with filing for its patents.
      At the time the patent is approved, the patent costs associated with the patent
      will be amortized over the useful life of the patent. If the patent is not
      approved, at that time the costs will be expensed. A change in the estimate
      of
      the patent having a future beneficial value to the Company will impact the
      other
      assets and expense accounts of the Company.





Revenue
      Recognition




The
      recognition of the Company’s revenues requires judgment, including whether a
      sale includes multiple elements, and if so, whether vendor-specific objective
      evidence (VSOE) of fair value exists for those elements. Customers receive
      certain elements of our products over a period of time. These elements include
      installation and training services. The ability to identify VSOE for those
      elements and the fair value of the respective elements could materially impact
      the amount of earned and unearned revenue. Also, the Company offers an extended
      warranty for which the revenues are initially recorded as deferred revenue
      and
      recorded to revenue ratably over the applicable warranty period. The Company
      does not have any history as to the costs expected to be incurred in performing
      these services. Therefore, revenues may be recorded that are not in proportion
      to the costs expected to be incurred in performing these services.





**Liquidity
      and Capital Resources**




General




The
      Company’s cash and cash equivalents balance at March 31, 2007 is $45,832. The
      Company has a working capital balance at March 31, 2007 of $600,445. The Company
      has funded its operations and investments in equipment through cash from
      operations, equity financings and borrowing from private parties as well as
      related parties.





Cash
      used in operations




The
      Company’s operating requirements generated a negative cash flow from operations
      of $724,080 for the three months ended March 31, 2007 versus $2,078,745 for
      the
      same period last year. The significant decrease in cash used in operations
      is a
      result of reduced headcount and lower operating expenses.





14




During
      the first three months of 2007, the Company has not used stock and warrants
      as a
      form of payment to certain vendors, consultants and employees. For the first
      three months of 2006, the Company recorded a total of approximately $1,189,000
      for compensation and services expense including amortization of deferred
      compensation related to equity given or to be given to employees and consultants
      for services provided.





As
      the
      Company focuses on the OnScreenTM technology during 2007, it will continue to
      fund research and development related to the OnScreenTM products as well as sales
      and marketing efforts related to these products. The Company does not expect
      to
      record much revenue in 2007 until its RediAlert TM product
      line is fully deployed nationwide. The RediAlert TM product
      line began shipping during the third quarter of 2006.





Capital
      Expenditures and Investments




During
      the first three months of 2007, the Company had no investment in fixed assets
      versus approximately $4,000 of expenditures incurred during the first quarter
      of
      2006. During the remainder of 2007, the Company does not anticipate any
      significant capital expenditures.





The
      Company invested $30,498 in patent costs and $50,000 in technology rights during
      the first three months of 2007. The Company expects its investment in patent
      costs will continue throughout 2007 as it invests in patents to protect the
      rights to use its OnScreen TM product
      developments. During the first three months of 2006, the Company invested
      $800,000 in technology rights and $27,880 in patent costs.





Financing
      activities




During
      the first three months of 2007, the Company received $177,500 of proceeds from
      secured convertible notes and $100,000 of proceeds from secured promissory
      notes. During the first quarter of 2007, the Company converted $127,500 of
      convertible secured notes into 591,204 shares of its common stock. The Company
      plans on raising the capital needed to fund the further development and
      marketing of the Company’s products.




Recap
      of liquidity and capital resources




The
      report of our independent registered public accounting firm on our financial
      statements as of December 31, 2006 contains an explanatory paragraph expressing
      uncertainty with respect to our ability to continue as a going concern. The
      Company currently is not generating significant revenues to fund operations
      and
      had an accumulated deficit of $43,945,803 at March 31, 2007. The Company
      currently does not have enough working capital to continue operations for the
      next 12 months.





The
      Company is seeking to raise additional capital for the commercialization of
      its
      OnScreenTM technology product lines which the Company believes will provide
      sufficient cash to meet its short-term working capital requirements for the
      next
      twelve months. As the Company continues to expand and develop its technology
      and
      product lines, additional funding may be required. The Company will attempt
      to
      raise these funds through borrowing instruments or issuing additional equity.





15




Management
      expects the OnScreen TM LED and
      WayCool technologies to be commercialized during 2007 and 2008. The Company
      cannot assure that it will generate material revenues by that date or that
      its
      revenues will be sufficient to cover all operating and other expenses of the
      Company. If revenues are not sufficient to cover all operating and other
      expenses, the Company will require additional funding. There is no assurance
      the
      Company will be able to raise such additional capital. The failure to raise
      additional capital or generate product sales in the expected time frame will
      have a material adverse effect on the Company.





**Results
      of Operations**





Revenue




During
      the three months ended March 31, 2007, revenue was $49,393 and $27,230 for
      the
      same period during 2006. The revenue for the three months ended March 31, 2007
      is comprised of $30,000 from RediAlert TM products, $14,823 from Living Window TM products
      and related add-ons and $4,570 from sale of wireless modems. For the three
      months ended March 31, 2006, the Company recorded $27,230 from Living
      Window TM products
      and related add-ons.





The
      Company began shipping its RediAlert TM product
      during late July 2006. As the RediAlert TM product
      penetrates the marketplace, the Company expects its revenues will increase
      during 2007 compared to the prior year.





Cost
      of revenue




The
      cost
      of revenue for the three months ended March 31, 2007 and 2006 was $51,225 and
      $52,082, respectively. While the Company’s is introducing its new products and
      until it sells larger volumes to get economies of scale, it expects the cost
      of
      sales to fluctuate between periods as a percentage of its revenues.





Selling,
      General and Administrative Expenses




Selling,
      General and Administrative (SG&A) expenses includes such items as wages,
      consulting, general office expenses, business promotion expenses and costs
      of
      being a public company including legal and accounting fees, insurance and
      investor relations.





SG&A
      expenses decreased from $2,398,763 for the three months ended March 31, 2006
      to
      $442,358 for the same period during 2007. This decrease of $1,956,405 is
      primarily the result of lower non-cash expenses of approximately $1 million
      as
      well as the reduction in staff and overhead expenditures versus prior year.





Research
      and Development




The
      research and development costs are related to the OnScreenTM technology to which
      the Company acquired the licensing rights. The decrease of $237,831 in research
      and development during the three months ended March 31, 2007, compared to the
      same period in 2006 is a result of a decrease in non-cash compensation for
      research and development consulting services and reduction in headcount. During
      the three months ended March 31, 2006, the Company recorded approximately
      $189,000 of non-cash compensation for research and development consulting
      services provided to the Company while no non-cash compensation was recorded
      during the first quarter of 2007. The Company anticipates decreasing its
      expenditures in research and development during the remainder of 2007 compared
      to 2006.





Restructuring
      Costs




The
      Company recorded no restructuring costs during the first three months ended
      March 31, 2007 while it incurred $13,967 of restructuring costs during 2006
      related to the move from Florida to Oregon.




16




Other
      Income




The
      investment Income remained relatively unchanged during the three months ended
      March 31, 2007 compared to the same period in 2006. The Company does not expect
      this item to be significant during the balance of 2007.





Settlement
      Gain (Loss), Net




The
      Company did not have any significant gain (loss) during the three months ended
      March 31, 2007.





The
      Company recorded $107,160 of a net settlement gain for the three months ended
      March 31, 2006 arising from settlements reached with Capitol City Trailers
      and
      Mobile Magic. During 2005, the Company reached a settlement with Capitol City
      Trailers regarding the use of one of its trucks. For the three month ended
      March
      31, 2006, the Company had received $12,500, which was recorded as a settlement
      gain. During the first quarter of 2006, the Company reached a settlement with
      Mobile Magic where Mobile Magic agreed to pay $175,000 as settlement of the
      Company’s claim against it. Due to the financial condition of Mobile Magic, the
      Company had not recorded a receivable of $175,000 for the remaining amount.
      The
      Company also had recorded approximately $150,000 as a payable to Mobile Magic
      who was constructing a truck that the Company never received. As part of the
      agreement the Company does not owe the $150,000 and recorded a settlement gain
      for this amount during the first quarter of 2006. This was offset by legal
      fees
      of $44,158.





Intrinsic
      value of convertible debt and amortization of debt discount




The
      Company recorded for the three months ended March 31, 2007 and 2006 an expense
      of $132,607 and $1,914,926, respectively for the intrinsic value of convertible
      debt and the amortization of debt discount. The lower expense of $1,782,319
      was
      due to a significant reduction in convertible debt.





Interest
      Expense




The
      interest expense of $51,759 for the three months ended March 31, 2007 is for
      the
      interest on the secured convertible notes payable and a secured promissory
      note
      in the amount of $100,000. As of March 31, 2007, the Company converted all
      of
      the secured convertible notes except $1,700,000.




The
      interest expense for the three months ended March 31, 2006 was
      $286,967.





Preferred
      Stock Dividends




No
      preferred dividend expense was recorded by the Company during the three months
      ended March 31, 2007 as all Series A and Series B Convertible Preferred
      shareholders accepted during 2006 the Company’s offer to receive all outstanding
      dividends through March 2006 in either cash or common shares at a per share
      price of $0.20. During the three months ended March 31, 2006, the Company
      recorded Series A Convertible Preferred Stock dividends of $49,802 and Series
      B
      Convertible Preferred Stock dividends of $125.





**Item
      3. Controls and Procedures**





Within
      90
      days prior to the filing of this report, the Company carried out an evaluation,
      under the supervision and with the participation of its management, including
      the Chief Executive Officer and Chief Financial Officer, of the design and
      operation of its disclosure controls and procedures. Based on this evaluation,
      the Company’s Chief Executive Officer and Chief Financial Officer concluded that
      the Company’s disclosure controls and procedures are effective for the
      gathering, analyzing and disclosing the information the Company is required
      to
      disclose in the reports it files under the Securities Exchange Act of 1934,
      within the time periods specified in the SEC’s rules and forms. There have been
      no significant changes in the Company’s internal controls or in other factors
      that could significantly affect internal controls subsequent to the date of
      this
      evaluation.





17


(a)
      Our
      management, including the principal executive officer and principal financial
      officer, do not expect that our disclosure controls and procedures will prevent
      all error and fraud. A control system, no matter how well conceived and
      operated, can only provide reasonable, not absolute, assurance that the
      objectives of the control system are met. Further, the design of a control
      system must reflect the fact that there are resource constraints, and the
      benefits of controls must be considered relative to their costs. Because of
      the
      inherent limitations in all control systems, no evaluation of controls can
      provide absolute assurance that all control issues and instances of fraud,
      if
      any, within our Company have been detected. These inherent limitations include
      the realities that judgments in decision-making can be faulty, and that
      breakdowns can occur because of simple error or mistake. Additionally, controls
      can be circumvented by the individual acts of some persons, collusion of two
      or
      more people, or by management override of the control. The design of any system
      of controls also is based in part upon certain assumptions about the likelihood
      of future events, and there can be no assurance that any design will succeed
      in
      achieving its stated goals under all potential future conditions.





(b)   Changes
      in internal controls over financial reporting .





In
      addition, there were no significant changes in our internal control over
      financial reporting that could significantly affect these controls during
      quarter ended March 31, 2007. We have not identified any significant deficiency
      or material weaknesses in our internal controls, and therefore there were no
      corrective actions taken.





**PART
      II - OTHER INFORMATION**





**Item
      1. Legal Proceedings.**





None.





**Item
      2. Changes in Securities.**





**Common
      Stock Issued**





The
      Company relied on Section 4(2) of the Securities Act of 1933 as the basis for
      an
      exemption from registration for this issuance. During the three months ended
      March 31, 2007, the Company issued 82,938 shares of its common stock to an
      employee in accordance with his employment agreement. These shares were valued
      at $25,000 using a thirty-day average price at December 31, 2006, in accordance
      with the employee’s employment agreement.





The
      Company relied on Section 4(2) of the Securities Act of 1933 as the basis for
      an
      exemption from registration for this issuance. During the three months ended
      March 31, 2007, the Company was to issue 500 shares of its Series B Convertible
      Preferred stock and 125,000 shares of its Series A Convertible Preferred stock
      to the CFO in accordance with the employee’s employment agreement. The 125,000
      shares of Series A Convertible Preferred stock was valued at $1.00 per share
      based on contemporaneous cash sales. The 500 shares of Series B Convertible
      Preferred stock was valued at $270 per share based on contemporaneous cash
      sales. The total value of these shares of $260,000 was expensed over the term
      of
      the employee’s employment agreement. In lieu of the Convertible A and B
      Preferred stock, the Company issued 1,250,000 of its Common Stock.





18




The
      Company relied on Section 4(2) of the Securities Act of 1933 as the basis for
      an
      exemption from registration for this issuance. During
      the three months ended March 31, 2007, the Company issued 578,704 shares of
      its
      common stock and warrants for 47,296 shares of its common stock in relation
      to
      the conversion of promissory notes.





The
      Company relied on Section 4(2) of the Securities Act of 1933 as the basis for
      an
      exemption from registration for this issuance. During the three months ended
      March 31, 2007, the Company issued 239,938 shares of its common stock in
      relation to the exercise of warrants.





The
      Company relied on Section 4(2) of the Securities Act of 1933 as the basis for
      an
      exemption from registration for this issuance. During the three months ended
      March 31, 2007, the Company converted 15,000 shares of the Company’s Series A
      convertible preferred stock into 75,000 shares of the Company’s common stock at
      the request of certain Series A convertible preferred stock
      holders.





**Item
      3. Defaults Upon Senior Securities.**





None.





**Item
      4. Submission of Matters to a Vote of Security Holders.**





None





**Item
      5. Other Information.**





None





**Item
      6. Exhibits and Reports on Form 8-K**





(a)
      Exhibits


ExhibitNumber
              
              Description31.1
              
              Certification
                  of Chief Executive Officer pursuant to Exchange Act Rules 13a-15(e)
                  and
                  15d-15(e), as adopted pursuant to Section 203 of the Sarbanes-Oxley
                  Act of
                  2002.31.2
              
              Certification
                  of Chief Financial Officer pursuant to Exchange Act Rules 13a-15(e)
                  and
                  15d-15(e), as adopted pursuant to Section 203 of the Sarbanes-Oxley
                  Act of
                  2002.32.1
              
              Certification
                  of Chief Executive Officer pursuant to 18U.S.C. Section 1350, as
                  adopted
                  pursuant to Section 906 of the Sarbanes-Oxley Act of
                  2002.32.2
              
              Certification
                  of Chief Financial Officer pursuant to 18U.S.C. Section 1350, as
                  adopted
                  pursuant to Section 906 of the Sarbanes-Oxley Act of
                  2002.


(b)
      Reports on Form 8-K





The
      Company filed a Current Report on Form 8-K on January 18, 2007 in connection
      with the disclosure of the multi-year licensing agreement with CUI,
      Inc.





19




The
      Company filed a Current Report on Form 8-K on February 21, 2007 in connection
      with the disclosure of a twelve months licensing and royalty agreement with
      Thermaltake Technologies Co., Ltd.





The
      Company filed a Current Report on Form 8-K on February 28, 2007 announcing
      its
      exclusive one-year licensing and royalty agreement with OCZ Technology Group,
      Inc.





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.




Signed
      and submitted this 15th day of May 2007.




OnScreen
                  Technologies, Inc.
                (Registrant)by:
            /s/
                Russell L. WallRussell
                L. Wall
              Chief
                  Executive Officer/Director  by:
              /s/
                    Mark R. ChandlerMark
                    R. Chandler
                  Chief
                    Financial Officer / Principal Accounting
                    Officer
  20