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 June 30, 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
            (Primary
                Standard Industrial
            (I.R.S.
                Employerincorporation
                or organization)
            Classification
                Code Number)
            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
o
      NO x





As
      of
      August 14, 2007, there were 150,202,683 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.







ONSCREEN
      TECHNOLOGIES, INC.





INDEX





PagePart
                IItem
                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
            14Liquidity
                and Capital Resources
            15Results
                of Operations
            16Item
                3
            Controls
                and Procedures
            18Part
                IIItem
                1
            Legal
                Proceedings.
            19Item
                2
            Changes
                in Securities
            19Item
                3
            Defaults
                Upon Senior Securities
            20Item
                4
            Submission
                of Matters to a Vote of Security Holders
            20Item
                5
            Other
                Information
            20Item
                6
            Exhibits
                and Reports on Form 8-K
            20Signatures
            21Exhibits
            22




2






**PART
      I. FINANCIAL INFORMATION**





**Item
      1. Financial Statements**





**ONSCREEN
      TECHNOLOGIES, INC.**


**CONDENSED
      BALANCE SHEETS**


**June
                30, 2007**
              **(Unaudited)**
            
            **December
                31,**
              **2006****Assets****Current
                Assets**Cash
                and cash equivalents
            
            $
            15,632
            
            $
            570,501Accounts
                receivable, net of allowance of $5,328 at June 30, 2007 and December
                31,
                2006
            
            
            71,775
            
            
            11,295Inventory
            
            
            1,094,889
            
            
            2,125,735Prepaid
                expenses and other current assets
            
            
            187,536
            
            
            141,474**Total
                Current Assets**
            
            
            **1,369,832**
            
            
            **2,849,005****Property
                and Equipment, net of accumulated depreciation of $130,194 at June
                30,
                2007 and $119,057 at December 31, 2006**
            
            
            **52,929**
            
            
            **102,239****Other
                Assets**Note
                receivable
            
            
            100,000
            
            
            115,000Technology
                rights, net of accumulated amortization of $451,994 at June 30, 2007
                and
                $332,843 at December 31, 2006
            
            
            4,440,749
            
            
            4,509,900Patent
                costs, net of accumulated amortization
            
            
            630,086
            
            
            582,965Other
                assets
            
            
            21,813
            
            
            22,173**Total
                Other Assets**
            
            
            **5,192,648**
            
            
            **5,230,038****Total
                Assets**
            
            $
            **6,615,409**
            ****
            **$**
            **8,181,282****Liabilities
                and Stockholders’ Equity****Current
                Liabilities**Accounts
                payable and other payables
            
            $
            413,378
            
            $
            480,960Preferred
                stock dividends payable
            
            
            7,554
            
            
            27,353Accrued
                expenses
            
            
            166,156
            
            
            132,914Accrued
                compensation
            
            
            75,679
            
            
            85,000Deferred
                revenue
            
            
            5,253
            
            
            8,260Convertible
                notes payable, net of discounts of $176,822 at June 30, 2007 and
                $52,439
                at December 31, 2006
            
            
            1,553,178
            
            
            947,561**Total
                Current Liabilities**
            
            
            **2,221,198**
            
            
            **1,682,048**Long
                term notes payable
            
            
            800,000
            
            
            -Convertible
                notes payable, net of discounts of $0.00 at June 30, 2007 and $253,303
                at
                December 31, 2006
            
            
            -
            
            
            396.697**Total
                Liabilities**
            
            
            **3,021,198**
            
            
            **2,078,745****Commitments
                (Note 7)**
            
            
            -
            
            
            -**Stockholders'
                Equity**Preferred
                stock, par value $0.001; 10,000,000 shares authorizedConvertible
                Series A, Preferred stock, 5,000,000 shares authorized, 75,543 sharesand 90,543 shares outstanding at June 30, 2007 and December
                31,
                2006, respectively; liquidation preference of $75,543 at June 30,
                2007
            
            
            76
            
            
            91Convertible
                  Series B preferred stock, 30,000 shares authorized, no shares issued
                  at
                  June 30, 2007 and December 31, 2006, respectively.
            
            
            -
            
            
            -Common
                    stock, par value $0.001; 200,000,000 shares authorized, 149,966,312
                    and
                    147,127,238 shares issued and outstanding at June 30, 2007 and
                    December
                    31, 2006, respectively
            
            
            149,966
            
            
            147,127Common
                stock issuable, at par value
            
            
            -
            
            
            -Additional
                paid-in capital
            
            
            49,232,202
            
            
            48,926,371Accumulated
                deficit
            
            
            (45,788,033
            )
            
            (42,971,052
            )**Total
                Stockholders' Equity**
            
            
            **3,594,211**
            
            
            **6,102,537****Total
                Liabilities and Stockholders' Equity**
            
            $
            **6,615,409**
            ****
            **$**
            **8,181,282**




See
      accompanying notes to financial statements


3


**ONSCREEN
      TECHNOLOGIES, INC.**


**CONDENSED
      STATEMENTS OF OPERATIONS**


**(UNAUDITED)**





**For
                the three months ended**
              **June
                30,**
            
            **For
                the six months ended**
              **June
                30****2007**
            
            **2006**
            
            **2007**
            
            **2006****Revenues**
            
            **$**
            **75,271**
            
            **$**
            **32,175**
            
            **$**
            **124,664**
            
            **$**
            **64,805****Cost
                of Revenues**
            
            
            **1,126,638**
            
            
            **393,623**
            
            
            **1,177,863**
            
            
            **445,705****Gross
                Profit**
            
            
            **(1,051,367**
            **)**
            
            **(361,448**
            **)**
            
            **(1,053,199**
            **)**
            
            **(380,900**
            **)****Operating
                Expenses**Selling,
                general and administrative
            
            
            **342,261**
            
            
            **2,420,849**
            
            
            **784,619**
            
            
            **4,819,612**Research
                and development
            
            
            **289,807**
            
            
            **938,522**
            
            
            **648,904**
            
            
            **1,535,450**Restructuring
                costs
            
            
            **-**
            
            
            **-**
            
            
            **-**
            
            
            **13,967**Bad
                debt
            
            
            **3,995**
            
            
            **-**
            
            
            **3,995**
            
            
            **-****Total
                Operating Expenses**
            
            
            **636,063**
            
            
            **3,359,371**
            
            
            **1,437,518**
            
            
            **6,369,029****Loss
                from Operations**
            
            
            **(1,687,430**
            **)**
            
            **(3,720,819**
            **)**
            
            **(2,490,717**
            **)**
            
            **(6,749,929**
            **)****Other
                Income (Expense)**Other
                income
            
            
            **10,756**
            
            
            **16,200**
            
            
            **23,658**
            
            
            **27,174**Other
                expense
            
            
            **(12,923**
            **)**
            
            **-**
            
            
            **(12,923**
            **)**Settlement
                gain (loss), net
            
            
            **-**
            
            
            **(2,771,667**
            **)**
            
            **-**
            
            
            **(2,664,507**
            **)**Change
                in fair value of warrant liability
            
            
            **-**
            
            
            **1,679,362**
            
            
            **-**
            
            
            **1,679,362**Intrinsic
                value of convertible debt and amortization of debt
                discount
            
            
            **(84,099**
            **)**
            
            **(284,802**
            **)**
            
            **(216,706**
            **)**
            
            **(2,199,728**
            **)**Interest
                expense
            
            
            **(68,534**
            **)**
            
            **(397,737**
            **)**
            
            **(120,293**
            **)**
            
            **(684,704**
            **)****Total
                Other Income (Expense), Net**
            
            
            **(154,800**
            **)**
            
            **(1,758,644**
            **)**
            
            **(326,264**
            **)**
            
            **(3,842,403**
            **)****Net
                Loss**
            
            
            **(1,842,230**
            **)**
            
            **(5,479,463**
            **)**
            
            **(2,816,981**
            **)**
            
            **(10,592,332**
            **)**Preferred
                stock dividends
            
            
            **-**
            
            
            **(49,793**
            **)**
            
            **-**
            
            
            **(99,720**
            **)****Net
                Loss Available to Common Stockholders**
            
            **$**
            **(1,842,230**
            **)**
            **$**
            **(5,529,256**
            **)**
            **$**
            **(2,816,981**
            **)**
            **$**
            **(10,692,052**
            **)**Basic
                and Diluted Loss Per Common Share
            
            **$**
            **(0.01**
            **)**
            **$**
            **(0.05**
            **)**
            **$**
            **(0.02**
            **)**
            **$**
            **(0.11**
            **)**Basic
                and Diluted Loss Per Common Share Available to Common
                Stockholders
            
            **$**
            **(0.01**
            **)**
            **$**
            **(0.05**
            **)**
            **$**
            **(0.02**
            **)**
            **$**
            **(0.11**
            **)**Weighted
                average common shares outstanding
            
            
            **149,658,792**
            
            
            **118,044,602**
            
            
            **148,699,063**
            
            
            **96,564,824**




See
      accompanying notes to financial statements




4


**ONSCREEN
      TECHNOLOGIES, INC.**


**CONDENSED
      STATEMENTS OF CASH FLOWS**


**(UNAUDITED)**


**For
                the six months ended**
              **June
                30,****2007**
            
            **2006****CASH
                FLOWS FROM OPERATING ACTIVITIES:**Net
                Loss
            
            $
            (2,816,981
            )
            $
            (10,592,332
            )Adjustments
                to reconcile net loss to net cash used in operating
                activities:Stock,
                warrants and notes issued for compensation and services
            
            
            6,161
            
            
            1,652,242Change
                in fair value of warrant liability
            
            
            -
            
            
            (1,679,362
            )Non-cash
                interest expense, including intrinsic value of convertible debt and
                amortization of debt discount
            
            
            216,706
            
            
            2,199,728Non-cash
                gain on settlement, net
            
            
            -
            
            
            2,629,984Bad
                debt expense
            
            
            3,995
            
            
            2,333Amortization
                of technology rights
            
            
            119,151
            
            
            64,003Amortization
                of patent costs
            
            
            1,906
            
            
            -Amortization
                of deferred consulting and compensation
            
            
            -
            
            
            258,223Amortization
                of deferred financing fees
            
            
            -
            
            
            381,050Loss
                on disposal of assets
            
            
            12,353
            
            
            -Impairment
                of inventory
            
            
            1,046,233
            
            
            -Compensation
                expense payable in common stock
            
            
            12,500
            
            
            245,147Depreciation
            
            
            28,259
            
            
            62,544**(Increase)
                decrease in assets:**Accounts
                receivable and other receivables
            
            
            (64,475
            )
            
            2,993Notes
                receivable
            
            
            15,000
            
            
            -Inventory
            
            
            (15,387
            )
            
            (380,049
            )Prepaid
                expenses and other current assets
            
            
            (46,062
            )
            
            (29,553
            )Deposits
                and other assets
            
            
            360
            
            
            65,993**Increase
                (decrease) in liabilities:**Accounts
                payable and accrued expenses
            
            
            (43,661
            )
            
            746,776Deferred
                revenues
            
            
            (3,007
            )
            
            (540
            )**NET
                CASH USED IN OPERATING ACTIVITIES**
            
            
            (1,526,951
            )
            
            (4,370,820
            )**CASH
                FLOWS FROM INVESTING ACTIVITIES:**Investment
                in technology rights
            
            
            (50,000
            )
            
            (800,000
            )Investment
                in patents
            
            
            (49,027
            )
            
            (51,633
            )Proceeds
                from sales of fixed assets
            
            
            8,700
            
            
            -Purchase
                of property and equipment
            
            
            -
            
            
            (10,443
            )**NET
                CASH USED IN INVESTING ACTIVITIES**
            
            
            (90,327
            )
            
            (862,076
            )**CASH
                FLOWS FROM FINANCING ACTIVITIES:**Proceeds
                from notes and loans payable
            
            
            1,057,500
            
            
            6,418,950Payments
                on notes and loans payable
            
            
            -
            
            
            (375,475
            )Proceeds
                from exercise of warrants and options
            
            
            4,909
            
            
            158,583**NET
                CASH PROVIDED BY FINANCING ACTIVITIES**
            
            
            1,062,409
            
            
            6,202,058NET
                INCREASE IN CASH AND CASH EQUIVALENTS
            
            
            (554,869
            )
            
            969,162Cash
                and Cash Equivalents at Beginning of Year
            
            
            570,501
            
            
            727,141**CASH
                AND CASH EQUIVALENTS AT END OF PERIODS**
            
            **$**
            **15,632**
            
            **$**
            **1,696,303****(continued)**




5




**ONSCREEN
      TECHNOLOGIES, INC.**


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


**(UNAUDITED)**





For
                the six months endedJune
                30,2007
            
            2006SUPPLEMENTAL
                DISCLOSURE OF CASH FLOW INFORMATION:Income
                taxes paid
            
            $
            -
            
            $
            -Interest
                paid
            
            $
            81,842
            
            $
            283,655SUPPLEMENTAL
                DISCLOSURE OF NON-CASHINVESTING AND FINANCING ACTIVITIES:Conversion
                of Series A convertible preferred stock to common stock
            
            $
            15
            
            $
            24Discount
                on debt of convertible notes payable
            
            $
            87,786
            
            $
            3,288,904Accounts
                payable converted to notes payable
            
            $
            -
            
            $
            375,475Conversion
                of debt to common stock
            
            $
            177,500
            
            $
            9,287,898Technology
                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
            
            $
            715,245Other
                comprehensive loss from unrealized loss (gain)
            
            $
            -
            
            $
            (2,210
            )Reclassification
                of warrants from equity to liabilities
            
            $
            -
            
            $
            9,387,121




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 patented and patent-pending
      thermal technologies and architecture the Company has developed advanced,
      proprietary 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.





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 had a net loss of $2,816,981, and cash used
      in
      operations of $1,526,951 for the six months ended June 30, 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 2007 funding requirements. 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 and terms of additional financing and capital 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, 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 and six months ended June 30, 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
      June
      30, 2007, 33,136,601 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 six month periods ended June 30, 2007 and 2006 based on
      uncertainties concerning its ability to generate taxable income in future
      periods. The tax benefit for the six months ended June 30, 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 to use fair
      value 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 the portion of the
      award where 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 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 the option is granted, but the exercise price shall not be less than
      the fair market value on the date the option 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, and
      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 a 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 and six months ended June 30, 2007:





Three
                Months Ended
            
            Six
                Months EndedNumberof
              Shares
            
            Weighted
              Avg.
              Grant-date
              Fair
                Value
            
            Number
                of
              Shares
            
            Weighted
              Avg.
                Grant-
              date
                Fair
              ValueNon-vested
                stock options at beginning of period
            
            
            50,000
            
            $
            0.36
            
            
            485,000
            
            $
            0.45Granted
                during the period
            
            
            -
            
            
            -
            
            
            -
            
            
            -Vested
                during the period
            
            
            (17,500
            )
            $
            0.36
            
            
            (27,500
            )
            $
            0.33Forfeited
                during the period
            
            
            (32,500
            )
            
            
            
            
            (457,500
            )
            
            -Non-vested
                stock options at June 30, 2007
            
            
            -
            
            
            -
            
            
            -
            
            
            -




9


The
      following information is presented for the stock option activity for the three
      and six months ended June 30, 2007:





Three
                Months Ended
            
            Six
                Months Ended#
                of shares
            
            Weighted
                Average
              Exercise
              Price
            
            #
                of shares
            
            Weighted
                Average
              Exercise
              Price
            
            Weighted
              Average
              Remaining
              Contract
              Life
            
            Aggregate
                Intrinsic
              ValueOutstanding
                atbeginning
                of period:
            
            
            4,891,000
            
            $
            0.13
            
            
            5,463,500
            
            $
            0.14Forfeited
            
            
            (32,500
            )
            $
            0.39
            
            
            (605,000
            )
            $
            0.18Granted
            
            
            -
            
            
            -
            
            
            -
            
            
            -Exercised
            
            
            (250,000
            )
            $
            0.01
            
            
            (250,000
            )
            $
            0.01Outstanding
                atJune
                30, 2007
            
            
            4,608,500
            
            $
            0.14
            
            
            4,608,500
            
            $
            0.14
            
            
            3.2
                years
            
            $
            16,165Outstanding
                exercisableat
                June 30, 2007
            
            
            4,608,500
            
            $
            0.14
            
            
            4,608,500
            
            $
            0.14
            
            
            3.2
                years
            
            $
            16,165




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% - 5.2%,
      and expected lives of 1 - 5 years. There have been no options granted during
      2007.





In
      accordance with SFAS 123(R), during the three months ended June 30, 2007, the
      Company recognized compensation expense of $6,161 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
      June
      30, 2007, the Company has $6,869 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 six months ended June 30, 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 six months ended
      June
      30, 2007, note holders converted $177,500 of the notes into the Company’s common
      stock. Unamortized debt discount as of June 30, 2007 is $176,822.





During
      the six months ended June 30, 2007, the Company entered into twenty-four month
      secured promissory notes and received proceeds totaling $800,000. Interest
      accrues at 12% per annum, payable monthly, until the maturity of these notes
      at
      which time the principal is due. In April of 2007 the Company entered into
      a
      three-month promissory note and received proceeds totaling $80,000. Interest
      accrues at 12% per annum until the maturity of this note, at which time the
      principal is due. In July 2007, $40,800 of principal and interest was repaid
      (see note 11).




10




**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 six months ended June 30, 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.





The
      Company authorized for issuance 10,000 shares of Preferred stock, designated
      as
      Series C Preferred Stock, as the result of a negotiated investment plan with
      a
      specific investment group. Ownership of the stock is limited to this investment
      group. The owners and holders of the Series C Preferred Stock have the rights
      to
      appoint three board seats, and have the right to exchange any Common Shares
      they
      own into shares of Series C Preferred stock at any time, up to the number of
      Series C Preferred shares authorized, at a one for one ratio.




**NOTE
      10 OTHER EQUITY TRANSACTIONS**





During
      the six months ended June 30, 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 agreement.





During
      the six months ended June 30, 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 an employee in accordance with his 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.




11




During the
      six
      months ended June 30, 2007, the Company issued 841,204 shares of its common
      stock, and warrants for 72,296 shares of its common stock, in relation to the
      conversion of promissory notes.





During
      the six months ended June 30, 2007, the Company issued 490,938 shares of its
      common stock in relation to the exercise of warrants.





During
      the six months ended June 30, 2007, the Company converted accrued dividends
      of
      approximately $19,800 into 98,994 shares of the Company’s common stock at a per
      share price of $0.20, for a shareholder who elected to convert accrued dividends
      to common shares.





During
      the six months ended June 30, 2007, the Company recorded compensation expense
      of
      $6,161 for stock options for which the requisite service was performed during
      the first half 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 $12,500 of compensation expense for stock that is to
      be
      issued based upon employment agreements for which the requisite service had
      been
      performed.




**NOTE
      11 SUBSEQUENT EVENTS**





During
      July 2007, the Company entered into twenty-four month secured promissory note
      and received proceeds of $300,000. Interest accrues at 12% per annum, payable
      monthly, until the maturity of this note at which time the principal is
      due.





During
      July 2007 the company signed an agreement with Satow Strategies, LLC to provide
      strategic marketing services for the WayCool technology. The fee structure
      includes $25,000 in cash compensation and 100,000 unrestricted shares of
      OnScreen common stock upon delivery of a licensing and branding
      strategy.





During
      July 2007, $40,800 of principal and interest of a note payable issued in April
      of 2007 was repaid. (see note 6).





During
      July 2007, $38,000 was received for the sale of an LED truck which was fully
      depreciated in 2006.





In
      July
      and August 2007, 236,371 shares of common stock were issued upon exercise of
      warrants with proceeds of $1362, and services performed by Satow Strategies,
      LLC
      in connection with the strategic marketing for WayCool technology.




**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.





12


The
      Company cautions that these forward-looking
      statements are further qualified by important factors that could cause actual
      results to differ materially, 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”) is primarily focused on commercialization of its innovative thermal
      cooling technology, WayCool. The Company has developed innovative thermal
      management solutions capable of revolutionizing the semiconductor and electronic
      packaging industries. Utilizing its patented and patent-pending thermal
      technologies and architecture, the Company has developed highly advanced
      proprietary cooling applications that provide increased performance and are
      less
      expensive to install and support than competing products and technologies.
      The
      Company’s plan is to focus all of its resources on the commercialization of its
      technology utilizing licensing agreements allowing its partners to incorporate
      the WayCool technology into their products. In the first six months of 2007
      OnScreen signed licensing and royalty agreements with three companies allowing
      WayCool technology to be integrated into a variety of electronic devices. The
      Company does not expect to record any significant growth in revenues until
      the
      WayCool technology begins producing revenues from these and future licensing
      agreements.




The
      OnScreenTM architecture provides a platform for the production of LED display
      products in the commercial and government markets that is lighter than
      competitive products and provides a corresponding reduction in wind loading.
      These architectural advantages yield products that are battery powered,
      transported by any vehicle, easy to install and require less support
      infrastructure. This RediAlertTM Rapid Dispatch Emergency Signs product line
      provides a truly portable LED product for Emergency Response and commercial
      advertising. The Company is currently searching for a licensing partner to
      fully
      bring the RediAlertTM technology to market.





During
      the six
      months ended June 30, 2007, the Company continued to incur significant losses
      from operations. The Company incurred a net loss of $2,816,981 for the six
      months ended June 30, 2007. This net loss is significantly lower than for the
      same period last year when the Company recorded a net loss of $10,592,332,
      primarily due to reduced headcount, decrease in operating expenses, lower
      non-cash charges of approximately $2,137,000 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
      $1,983,022 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 six months ended
      June 30, 2007 the Company received proceeds of $177,500 from secured convertible
      notes and $800,000 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.




13




**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.





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
      are 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.




14




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 June 30, 2007 is $15,632. The
      Company has a net working capital deficit at June 30, 2007 of $851,366. 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 $1,526,951 for the six months ended June 30, 2007, versus $4,370,820 for
      the
      same period last year. The significant decrease in cash used in operations
      is a
      result of reduced headcount and lower operating expenses.





During
      the first six
      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 six months of
      2006,
      the Company recorded a total of approximately $2,155,000 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 commercialization of its innovative thermal cooling
      technology during 2007, it will continue to fund research and development
      related to the OnScreenTM products as well as sales and marketing efforts. The
      Company does not expect to record any significant growth in revenues in 2007
      until its WayCool technology is commercialized.





Capital
      Expenditures and Investments


During
      the first six months of 2007, the Company had no investment in fixed assets
      versus approximately $10,000 of expenditures incurred during the same period
      in
      2006. During the remainder of 2007, the Company does not anticipate any
      significant capital expenditures.





The
      Company invested $49,027 in patent costs and $50,000 in technology rights during
      the first six 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 six months of 2006, the Company invested $800,000
      in technology rights and $51,633 in patent costs.




15




Financing
      activities


During
      the first six months of 2007, the Company received $177,500 of proceeds from
      secured convertible notes, $800,000 of proceeds from secured promissory notes
      and $80,000 of proceeds from unsecured promissory notes. During the first half
      of 2007, the Company converted $177,500 of convertible secured notes into
      841,204 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 is not currently generating significant revenues to fund operations
      and
      had an accumulated deficit of $45,788,033 at June 30, 2007. The Company
      currently does not have sufficient 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.





Management
      expects the OnScreen WayCool technology 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 six months ended June 30, 2007 revenue was $124,664, and $64,805 for the
      same period during 2006. The revenue for the six months ended June 30, 2007
      is
      comprised of $73,485 from RediAlert TM products, $43,323 from Living Window TM products
      and related add-ons, and $7,856 from other income. The revenue for the six
      months ended June 30, 2006 is comprised of $53,105 from Living
      Window TM products
      and related add-ons and $11,700 from other income.




During
      the three months ended June 30, 2007 and 2006, revenue was $75,271 and $32,175,
      respectively. The revenue for the three months ended June 30, 2007 is comprised
      of $43,484 from RediAlertTM products, $28,500 from Living Window TM products
      and related add-ons, and $3,287 from other income. For the three months ended
      June 30, 2006, the Company recorded $25,875 from Living Window TM products
      and related add-ons and $6,300 from other income.




16




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





Cost
      of revenue


The
      cost
      of revenue for the six months ended June 30, 2007 and 2006 was $1,177,863 and
      $445,705, respectively. For the three months ended June 30, 2007 and 2006,
      the
      cost of revenue was $1,126,638 and $393,623, respectively. Impairment charges
      taken in June 2007 on inventory related to the Company’s sign business is
      included in cost of revenue for the three and six months ended June 30,
      2007.





Selling,
      General and Administrative Expenses


Selling,
      General and Administrative (SG&A) expenses include 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 $4,819,612 for the six months ended June 30, 2006 to
      $784,619 for the same period during 2007. This decrease of $4,034,993 is
      primarily the result of lower non-cash expenses and the reduction in staff
      and
      overhead expenditures versus the prior year.




For
      the
      three months ended June 30, 2007 compared to the same period in 2006, SG&A
      expenses decreased $2,078,588, primarily the result of lower non-cash expenses
      and reductions in staff and overhead.





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 $648,715 and $886,546
      in research and development during the three and six months ended June 30,
      2007,
      respectively, compared to the same periods in 2006 is a result of a decrease
      in
      non-cash compensation for research and development consulting services and
      reductions in headcount. During the six months ended June 30, 2006, the Company
      recorded approximately $200,000 of non-cash compensation for research and
      development consulting services provided to the Company ,while no non-cash
      compensation was recorded during the first half 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 and six months
      ended June 30, 2007 while it incurred $13,967 of restructuring costs during
      the
      same periods in 2006 related to the move from Florida to Oregon.





Other
      Income


Investment
      Income remained relatively unchanged during the three and six months ended
      June
      30, 2007 compared to the same periods in 2006. The Company does not expect
      this
      item to be significant during the remainder of 2007.





Settlement
      Gain (Loss), Net


The
      Company did not have any significant gain (loss) during the three and six months
      ended June 30, 2007, compared to a net settlement loss for the three and six
      months ended June 30, 2006 of $2,771,667 and $2,664,507,
      respectively.




17




The
      Company recorded a settlement gain for the three and six months ended June
      30,
      2006 of $8,333 and $115,493, respectively. During 2005, the Company reached
      a
      settlement with Capitol City Trailers regarding the use of one of its trucks.
      For the six months ended June 30, 2006, the Company had received $20,833, which
      it 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 did not record a receivable until a partial payment
      was made in the third quarter of 2006. The Company had also 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, offset by legal fees of approximately $55,000.




During
      April 2006 the Company negotiated the terms of a full and final settlement
      with
      Fusion Three, LLC whereby Fusion Three, LLC relinquishes all rights and claims
      to any revenues and fees in consideration for the Company issuing to Fusion
      Three, LLC a three year warrant authorizing Fusion Three, LLC to purchase up
      to
      5,600,000 shares of common stock at a per share price of $0.20. The Company
      also
      agreed to issue Fusion Three, LLC a warrant to purchase up to 1,200,000 shares
      of common stock at per share price of $0.35 for 300,000 shares; $0.50 for
      300,000 shares; $0.75 for 300,000 shares and $1.00 for 300,000 shares before
      November 15, 2007. During the second quarter of 2006, the Company recorded
      a net
      settlement loss of $2,780,000 associated with this transaction.





Intrinsic
      value of convertible debt and amortization of debt discount


The
      Company recorded an expense of $84,099 and $216,706 for the three and six months
      ended June 30, 2007, respectively, and $284,802 and $2,199,728, respectively,
      for the same periods in 2006, for the intrinsic value of convertible debt and
      the amortization of debt discount. The lower expense in 2007 of $152,195 and
      $1,983,022 for the three and six month periods, respectively, was due to a
      significant reduction in convertible debt.





Interest
      Expense


The
      interest expense of $68,534 and $120,293 for the three and six months ended
      June
      30, 2007, respectively, is for interest on the secured convertible notes
      payable, and secured and unsecured promissory notes. Interest expense of
      $397,737 and $684,704 for the three and six months ended June 30, 2006,
      respectively, was for interest on the unsecured convertible notes payable and
      deferred financing fees. Deferred financing fees were $317,541 and $401,050
      for
      the three and six months ended June 30, 2006, respectively.




Preferred
      Stock Dividends


No
      preferred dividend expense was recorded by the Company during the three and
      six
      months ended June 30, 2007, as during 2006 all Series A and Series B Convertible
      Preferred shareholders accepted 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 and six months ended June 30, 2006, the Company
      recorded Series A Convertible Preferred Stock dividends of $49,668 and $99,470,
      respectively, and Series B Convertible Preferred Stock dividends of $125 and
      $250, respectively.





18




**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.





(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 the
      six months ended June 30, 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 six months ended
      June
      30, 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.





19




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 six months ended
      June
      30, 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 an employee in accordance with his 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.





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 six months ended June 30, 2007, the Company issued 841,204 shares of its
      common stock and warrants for 72,296 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 six months ended
      June
      30, 2007, the Company issued 490,938 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 six months ended
      June
      30, 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





Exhibit
                Number
            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.





20





(b)
      Reports on Form 8-K





The
      Company filed a Current Report on Form 8-K on May 2, 2007, in connection with
      its change of Independent Registered Public Accounting Firm from Salberg &
Company, P.A. to Webb & Company, P.A.





The
      Company filed a Current Report on Form 8-K on May 9, 2007 in connection with
      its
      loan agreement and stock agreements with Central Finance, LLC.





The
      Company filed a Current Report on Form 8-K on June 4, 2007 in connection with
      the departure of its Chief Financial Officer and Chief Operating Officer, Mark
      Chandler.





The
      Company filed a Current Report on Form 8-K on July 11, 2007 announcing the
      appointment of Corey Lambrecht to the Company Board of Directors in a newly
      created board seat.





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 t his
      14th
      day of August 2007.





OnScreen
                Technologies, Inc.(Registrant)by:
            /s/  Russell
                L.
                Wall
              Russell
                L. WallChief
                Executive Officer/Directorby:
            /s/  Cynthia
                M.
                Wilson
              Cynthia
                M. WilsonInterim
                Chief Financial Officer




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