UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549  FORM 10-QSB   XQUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2007  ___ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____ to ____  TRANQUILITY, INC. (Name of small business issuer in its charter)  Delaware0-514352-2175900(State or other jurisdiction of incorporation)(Commission File Number)(IRS Employer Identification No.)PO Box 110310
Naples, FL 34108-0106(Address of Principal Executive Office)Registrants telephone number, including area code:  (239) 598-2300  Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act during the past 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 [  ] No [X].  Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).   Yes [X] No  [ ]  Applicable only to corporate issuers  State the number of shares outstanding of each of the issuers classes of common equity, as of the latest practicable date. At November 12, 2007, the following shares were outstanding: 5,105,740.  Transitional Small Business Disclosure Format (Check one):  Yes [ ]  No [X]    - 1 -    PART 1 - FINANCIAL INFORMATION   ITEM 1.  FINANCIAL STATEMENTS AND EXHIBITS  (a) The consolidated financial statements of Tranquility, Inc. (the "Company"), included herein were prepared, without audit, pursuant to rules and regulations of the Securities and Exchange Commission.  Because certain information and notes normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America were condensed or omitted pursuant to such rules and regulations, these financial statements should be read in conjunction with the financial statements and notes thereto included in the audited financial statements of the Company as included in the Company's Form 10-KSB for the year ended December 31, 2006.            - 2 -    TRANQUILITY, INC. (A Development Stage Company) Balance Sheet September 30, 2007 (unaudited) September 30,September 30,20072006ASSETSCURRENT ASSETSCash and cash equivalents$--$--Total current assets----PROPERTY AND EQUIPMENT, net of accumulated depreciation ofTOTAL ASSETS----LIABILITIES AND STOCKHOLDERS' DEFICITCURRENT LIABILITIESAccrued liabilities----Payable to stockholder24,78014,691TOTAL CURRENT LIABILITIES24,78014,691COMMITMENTS AND CONTINGENCIES----STOCKHOLDERS' DEFICITPreferred stock:  par value $.01; 5,000,000 shares authorized;no shares issued and outstanding----Common stock: par value $.001; 25,000,000 shares authorized;----5,105,740 shares issued and outstanding5,1065,106Additional paid-in capital11,87811,878Deficit accumulated during the development stage(41,764)(31,675)TOTAL STOCKHOLDERS' DEFICIT(24,780)(14,691)TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT$--$--    See Accompanying Notes to Financial Statements  - 3 -    TRANQUILITY, INC. (A Development Stage Company) Statement of Operations September 30, 2007 (unaudited) Cumulative fromThree Months EndedNine Months EndedAugust 20, 1997September 30,September 30,September 30,September 30,(inception) to2007200620072006September 30, 2007REVENUESSales Revenues$--$--$--$--$--Cost of sales----------Gross profit----------OPERATING EXPENSESGeneral and administrative expenses3,0004110,0003,79141,764Total operating expenses3,0004110,0003,79141,764LOSS FROM OPERATIONS(3,000)(41)(10,000)(3,791)(41,764)OTHER INCOMEInterest income----------Total other income----------NET LOSS BEFORE INCOME TAX(3,000)(41)(10,000)(3,791)(41,764)PROVISION FOR INCOME TAXES----------NET LOSS$(3,000)$(41)$(10,000)$(3,791)$(41,764)BASIC AND DILUTED NET LOSSPER SHARE$--$--$--$--WEIGHTED AVERAGE SHARES OUTSTANDING:BASIC AND DILUTED$5,105,740$5,105,740$5,105,740$5,105,740   See Accompanying Notes to Financial Statements  - 4 -    TRANQUILITY, INC. (A Development Stage Company) Statement of Cash Flow September 30, 2007 (unaudited) Cumulative fromNine Months EndedAugust 20, 1997September 30,September 30,(inception) to20072006September 30, 2007CASH FLOWS FROM OPERATING ACTIVITIES:Net loss$(10,000)$(3,791)$(41,764)Adjustment to reconcile net loss to net cash used in operations:Common stock issued for services------Change in operating liabilities and assets:Accrued liabilities------Net cash used in operating activities(10,000)(3,791)(41,764)CASH FLOWS FROM FINANCING ACTIVITIESIncrease to payable to stockholder10,0003,79124,780Issuance of common stock----16,984CASH FLOWS FROM INVESTING ACTIVITIES:Net cash provided by financing activities10,0003,79141,764Cash and cash equivalents, beginning of period------Cash and cash equivalents, end of period------Supplemental disclosures of cash flow information:Cash paid for interest----Cash paid for income taxes$--$--   See Accompanying Notes to Financial Statements  - 5 -    Tranquility, Inc. (A Development Stage Company) Notes to Financial Statements  NOTE 1 - ORGANIZATION  Tranquility, Inc. (the "Company") is currently a development stage company under the provisions of Statement of Financial Accounting Standards ("SFAS") No. 7 and was incorporated under the laws of the State of Delaware on August 20, 1997.  The Company has a December 31 year-end.  NOTE 2  SIGNIFICANT ACCOUNTING POLICIES  The Company follows the accrual basis  of  accounting  in  accordance  with accounting principles generally accepted in the United States of America and has adopted a year-end of December 31.  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.  Management further acknowledges that it is solely responsible for adopting sound accounting practices, establishing  and  maintaining  a  system  of  internal accounting  control and preventing and detecting  fraud. The Company's system of internal accounting control is designed to assure, among other items, that 1) recorded  transactions  are valid; 2) valid  transactions  are recorded;  and 3) transactions  are  recorded in the proper  period in a timely  manner to produce financial  statements which present fairly the financial  condition,  results of operations  and cash  flows of the  Company  for the  respective  periods  being presented.  Use of Estimates  The preparation of financial statements in conformity with generally accepted accounting principles require management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods.  Actual results could differ from these estimates.  Cash Equivalents  Cash equivalents include all highly liquid debt instruments with original maturities of three months or less which are not securing any corporate obligations.  Fair Value of Financial Instruments  The estimated fair values of due to stockholder, approximate their carrying value because of the short term maturity of these instruments or the stated interest rates are indicative of market interest rates.   - 6 -    Concentration of Credit Risk  The Company places its cash with high quality financial institutions and at times may exceed the FDIC $100,000 insurance limit.  The Company will extend credit based on an evaluation of the customers financial condition, generally without collateral.  Exposure to losses on receivables is principally dependent on each customers financial condition.  The Company will monitor its exposure for credit losses and maintains allowances for anticipated losses, if required.  Advertising Costs  Advertising costs are expensed as incurred. There were no advertising expenses for the nine months ended September 30, 2007.  Income Taxes  The Company accounts for income taxes under SFAS 109, "Accounting for Income Taxes." Under the asset and liability method of SFAS 109, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under SFAS 109, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.  The Internal Revenue Code contains provisions that may limit the net operating loss carryforwards available if significant changes in stockholder ownership of the Company occur.  Basic and Diluted Income/(Loss) Per Share:  In accordance with SFAS No. 128, "Earnings Per Share," the basic income/(loss) per common share is computed by dividing net income/(loss) available to common stockholders by the  weighted average number of common shares outstanding. Diluted income per common share is computed similar to basic income per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. As of December 31, 2006, the Company does not have any equity or debt instruments outstanding that can be converted into common stock.  Stock-Based Compensation  In March 2004, the FASB issued a proposed statement, Share-Based Payment, which addresses the accounting for share-based payment transactions in which an enterprise receives employee services in exchange for equity instruments of the enterprise or liabilities that are based on the grant-date fair value of the enterprise's equity instruments or that may be settled by the issuance of such equity instruments. The proposed statement would eliminate the ability to account for share-based compensation transactions using Accounting Principles Board ("APB") Opinion No. 25, Accounting for Stock Issued to Employees, and generally would require instead that such transactions be accounted for using a fair-value-based method. In December 2004, the FASB  - 7 -    issued SFAS No. 123(R), Share-Based Payment, which is a revision of SFAS No. 123. Generally, the approach in SFAS No. 123(R) is similar to the approach described in SFAS No. 123. However, SFAS No. 123(R) requires all share-based payments to employees, including grants of employee stock options, to be recognized in the income statement based on their grant-date fair values. Pro forma disclosure is no longer an alternative.  As permitted by SFAS No. 123, for 2005, the Company accounted for share-based payments to employees using APB Opinion No. 25's intrinsic value method and, as such, generally recognized no compensation cost for employee stock options.  Effective January 1, 2006, we have adopted SFAS No. 123(R)'s fair value method of accounting for share based payments. Accordingly, the adoption of SFAS No. 123(R)'s fair value method may have a significant impact on the Company's results of operations as we are required to recognize the cost of employee services received in exchange for awards of equity instruments based on the grant-date fair value of those awards. SFAS No. 123(R) permits public companies to adopt its requirements using either the "modified prospective" method or the "modified retrospective" method.  The Company adopted SFAS No. 123(R) using the modified prospective method. In April 2005, the SEC delayed the effective date of SFAS No. 123(R), which is now effective for public companies for annual, rather than interim periods that begin after June 15, 2005. The impact of the adoption of SFAS No. 123(R) cannot be predicted at this time because it will depend on levels of share-based payments granted in the future.  Segment Reporting  Based on the Company's integration and management strategies, the Company operated in a single business segment. For the nine months ended September 30, 2007 and 2006, the Company had no revenue.  Revenue Recognition  Revenue is recognized in accordance with SEC Staff Accounting Bulletin No. 101, Revenue Recognition in Financial Statements.  The Company recognizes revenue when the significant risks and rewards of ownership have been transferred to the customer pursuant to applicable laws and regulations, including factors such as when there has  been evidence of a sales arrangement, the performance has occurred, or service have been rendered, the price to the buyer is fixed or determinable, and collectability is reasonably assured.  Reporting on the Costs of Start-Up Activities  Statement of Position 98-5 (SOP 98-5), Reporting on the Costs of Start-Up Activities, which provides guidance on the financial reporting of start-up costs and organizational costs, requires most costs of start-up activities and organizational costs to be expensed as incurred.  SOP 98-5 is effective for fiscal years beginning after December 15, 1998.  With the adoption of SOP 98-5, there has been little or no effect on the Companys financial statements.   - 8 -    Dividends  The Company has not yet adopted any policy regarding payment of dividends.  No dividends have been paid or declared since inception.  New Accounting Pronouncements  In March 2004, the FASB approved the consensus reached on the Emerging Issues Task Force (EITF) Issue No. 03-1, "The Meaning of Other-Than-Temporary Impairment and Its Application to Certain Investments." The objective of this Issue is to provide guidance for identifying impaired investments. EITF 03-1 also provides new disclosure requirements for investments that are deemed to be temporarily impaired. In September 2004, the FASB issued a FASB Staff Position (FSP) EITF 03-1-1 that delays the effective date of the measurement and recognition guidance in EITF 03-1 until after further deliberations by the FASB. The disclosure requirements are effective only for annual periods ending after June 15, 2004. The Company has evaluated the impact of the adoption of the disclosure requirements of EITF 03-1 and does not believe it will have an impact to the Company's overall combined results of operations or combined financial position. Once the FASB reaches a final decision on the measurement and recognition provisions, the Company will evaluate the impact of the adoption of EITF 03-1.  In November 2004, the FASB issued SFAS No. 151 "Inventory Costs, an amendment of ARB No. 43, Chapter 4, (" SFAS No. 151"). The amendments made by SFAS 151 clarify that abnormal amounts of idle facility expense, freight, handling costs, and wasted materials (spoilage) should be recognized as current-period charges and require the allocation of fixed production overheads to inventory based on the normal capacity of the production facilities. The guidance is effective for inventory costs incurred during fiscal years beginning after June 15, 2005. Earlier application is permitted for inventory costs incurred during fiscal years beginning after November 23, 2004.  The Company has evaluated the impact of the adoption of SFAS 151, and does not believe the impact will be significant to the Company's overall results of operations or financial position.  In December 2004, the FASB issued SFAS No.152, "Accounting for Real Estate Time-Sharing Transactions-an amendment of FASB Statements No. 66 and 67" ("SFAS 152") SFAS 152 amends SFAS No. 66, "Accounting for Sales of Real Estate", to reference the financial accounting and reporting guidance for real estate time-sharing transactions that is provided in AICPA Statement of Position (SOP) 04-2, "Accounting for Real Estate Time-Sharing Transactions". SFAS 152 also amends SFAS No. 67, "Accounting for Costs and Initial Rental Operations of Real Estate Projects", to state that the guidance for (a) incidental operations and (b) costs incurred to sell real estate projects does not apply to real estate time-sharing transactions. The accounting for those operations and costs is subject to the guidance in SOP 04-2. SFAS 152 is effective for financial statements for fiscal years beginning after June 15, 2005, with earlier application encouraged. The Company has evaluated the impact of the adoption of SFAS 152, and does not believe the impact will be significant if any, to the Company's overall results of operations or financial position since the Company does not enter into such transactions.  In December 2004, the FASB issued SFAS No.153, "Exchanges of Nonmonetary Assets, an amendment of APB Opinion No. 29, Accounting for Nonmonetary Transactions." The amendments made by SFAS 153 are based on the principle that exchanges of nonmonetary assets  - 9 -    should be measured based on the fair value of the assets exchanged. Further, the amendments eliminate the narrow exception for nonmonetary exchanges of similar productive assets and replace it with a broader exception for exchanges of nonmonetary assets that do not have commercial substance. Previously, Opinion 29 required that the accounting for an exchange of a productive asset for a similar productive asset or an equivalent interest in the same or similar productive asset should be based on the recorded amount of the asset relinquished. Opinion 29 provided an exception to its basic measurement principle (fair value) for exchanges of similar productive assets. That exception required that some nonmonetary exchanges, although commercially substantive, to be recorded on a carryover basis. By focusing the exception on exchanges that lack commercial substance, the FASB believes SFAS No.153 produces financial reporting that more faithfully represents the economics of the transactions. SFAS No.153 is effective for nonmonetary asset exchanges occurring in fiscal periods beginning after June 15, 2005. Earlier application is permitted for nonmonetary asset exchanges occurring in fiscal periods beginning after the date of issuance. The provisions of SFAS No.153 shall be applied prospectively. The Company has evaluated the impact of the adoption of SFAS 153, and does not believe the impact will be significant to the Company's overall results of operations or financial position.  In December 2004, the FASB issued SFAS No.123 (revised 2004), "Share-Based Payment" ("SFAS 123(R)"). SFAS 123(R) will provide investors and other users of financial statements with more complete and neutral financial information by requiring that the compensation cost relating to share-based payment transactions be recognized in financial statements. That cost will be measured based on the fair value of the equity or liability instruments issued. SFAS 123(R) covers a wide range of share-based compensation arrangements including share options, restricted share plans, performance-based awards, share appreciation rights, and employee share purchase plans. SFAS 123(R) replaces SFAS No. 123, "Accounting for Stock-Based Compensation", and supersedes APB Opinion No. 25, "Accounting for Stock Issued to Employees". SFAS 123, as originally issued in 1995, established as preferable a fair-value-based method of accounting for share-based payment transactions with employees. However, that statement permitted entities the option of continuing to apply the guidance in Opinion 25, as long as the footnotes to financial statements disclosed what net income would have been had the preferable fair-value-based method been used. Public entities (other than those filing as small business issuers) will be required to apply SFAS 123(R) as of the first interim or annual reporting period that begins after June 15, 2005. This pronouncement is effective for the Company, a small business issuer, as of the first interior annual reporting period that begins after December 15, 2005. The Company has evaluated the impact of the adoption of SFAS 123(R), and does not believe the impact will be significant to the Company's overall results of operations or financial position.  In May, 2005, The FASB issued SFAS No. 154, entitled Accounting Changes and Error Corrections  a replacement of APB Opinion No. 20 and FASB  Statement No. 3.This Statement replaces APB Opinion No. 20, Accounting Changes and FASB Statement No. 3, Reporting Accounting Changes in Interim Financial Statements, and changes the requirements for the accounting for and reporting of a change in accounting principle.  This statement applies to all voluntary changes in accounting principle.  It also applies to changes required by an accounting pronouncement in the unusual instance that the pronouncement does not include specific transition provisions.  Opinion 20 previously required that most voluntary changes in accounting principle be recognized by including in net income of the period of the change the cumulative effect of changing to the new accounting principle.  This Statement requires retrospective applicationto prior periods financial statements of changes in accounting principle, unless it is  - 10 -    impracticable to determine either the period-specific effects or the cumulative effect of the change.  This Statement defines as the application of a different accounting principle to prior accounting periods as if that principle had always been used or as the adjustment of previously issued financial statements to reflect a change in the reporting entity.  This statement also redefines restatementas the revising of previously issued financial statements to reflect the correction of an error.  The adoption of SFAS 154 did not impact the financial statements.  In February, 2006, FASB issued SFAS No. 155, Accounting for Certain Hybrid Financial Statements.  SFAS No. 155 amends SFAS No. 133, Accounting for Derivative Instruments and Hedging Activitiesand SFAS No. 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities.  SFAS No. 155, permits fair value measurement for any hybrid financial instrument that contains an embedded derivative that otherwise would require bifurcation, clarifies which interest-only strips and principal-only strips are not subject to the requirements of SFAS No. 133, establishes a requirement to evaluate interest in securitized financial assets to identify interests that are freestanding derivatives or that are hybrid financial statements that contain an embedded derivative requiring bifurcation, clarifies that concentrations of credit risk in the form of subordination are not embedded derivatives, and amends SFAS No. 140 to eliminate the prohibition on the qualifying special-purpose entity from holding a derivative financial instrument that pertains to a beneficial interest other than another derivative financial instrument.  This statement is effective for all financial instruments acquired or issued after the beginning of the Companys first fiscal year that begins after September 15, 2006.  Management believes that this statement will not have a significant impact on the financial statements.  In March, 2006 FASB issued SFAS 156 Accounting For Servicing of Financial Assetsthis 
Statement amends FASB Statement No. 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities,with respect to the accounting for separately recognized servicing assets and servicing liabilities.  This Statement:  1. Requires an entity to recognize a servicing asset or servicing liability each time it undertakes an obligation to service a financial asset by entering into a servicing contract. 2. Requires all separately recognized servicing assets and servicing liabilities to be initially measured at fair value, if practicable. 3. Permits an entity to choose Amortization method or Fair value measurement method for each class of separately recognized servicing assets and servicing liabilities. 4. At its initial adoption, permits a one-time reclassification of available-for-sale securities to trading securities by entities with recognized servicing rights, without calling into question the treatment of other available-for-sale securities under Statement 115, provided that the available-for-sale securities are identified in some manner as offsetting the entitys exposure to changes in fair value of servicing assets or servicing liabilities that a servicer elects to subsequently measure at fair value. 5. Requires separate presentation of servicing assets and liabilities subsequently measured at fair value in the statement of financial position and additional disclosures for all separately recognized servicing assets and servicing liabilities.  Management believes that this statement will not have a significant impact on the financial statements.  In September 2006, FASB issued SFAS 157 Fair Value Measurements. This Statement defines fair value, establishes a framework for measuring fair value in generally accepted accounting  - 11 -    principles (GAAP), and expands disclosures about fair value measurements. This Statement applies under other accounting pronouncements that require or permit fair value measurements, the Board having previously concluded in those accounting pronouncements that fair value is the relevant measurement attribute. Accordingly, this Statement does not require any new fair value measurements. However, for some entities, the application of this Statement will change current practice. This Statement is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. Management is currently evaluating the effect of this pronouncement on financial statements.  In September 2006, FASB issued SFAS 158 Employers Accounting for Defined Benefit Pension and Other Postretirement Plansan amendment of FASB Statements No. 87, 88, 106, and 132(R).  This Statement improves financial reporting by requiring an employer to recognize the overfunded or underfunded status of a defined benefit postretirement plan (other than a multiemployer plan) as an asset or liability in its statement of financial position and to recognize changes in that funded status in the year in which the changes occur through comprehensive income of a business entity or changes in unrestricted net assets of a not-for-profit organization. This Statement also improves financial reporting by requiring an employer to measure the funded status of a plan as of the date of its year-end statement of financial position, with limited exceptions. An employer with publicly traded equity securities is required to initially recognize the funded status of a defined benefit postretirement plan and to provide the required disclosures as of the end of the fiscal year ending after December 15, 2006. An employer without publicly traded equity securities is required to recognize the funded status of a defined benefit postretirement plan and to provide the required disclosures as of the end of the fiscal year ending after June 15, 2007. However, an employer without publicly traded equity securities is required to disclose the following information in the notes to financial statements for a fiscal year ending after December 15, 2006, but before June 16, 2007, unless it has applied the recognition provisions of this Statement in preparing those financial statements. The requirement to measure plan assets and benefit obligations as of the date of the employers fiscal year-end statement of financial position is effective for fiscal years ending after December 15, 2008. The management is currently evaluating the effect of this pronouncement on financial statements.  NOTE 3  GOING CONCERN UNCERTAINITY  The Company has had no significant operations, assets or liabilities since inception and,  accordingly,  is fully dependent on either future sales of securities or upon its current management and/or advances or loans from significant stockholders or corporate officers  to  provide  sufficient  working  capital to  preserve  the integrity of the corporate entity.  Because of these factors, our auditors have issued an audit opinion for the Company which includes a statement describing our going concern status.  This means, in our auditors opinion, substantial doubt about our ability to continue as a going concern exists at the date of their opinion. The Companys continued existence is dependent upon its ability to generate sufficient cash flows from operations to support its daily operations as well as provide sufficient resources to retire existing liabilities and obligations on a timely basis.  The Company anticipates offering future sales of equity securities.  However, there is no assurance that the Company will be able to obtain additional funding through the sales of additional  equity  securities  or, that such  funding,  if available, will be obtained on terms favorable to or affordable by the Company.  - 12 -    If no additional operating capital is received during the next twelve months, the Company  will be  forced  to rely on  existing  cash in the  bank  and upon additional funds  loaned  by  management  and/or  significant  stockholders  to preserve the integrity of the corporate  entity at this time. In the event, theCompany is unable to acquire advances from management and/or significant stockholders, the Company's ongoing operations would be negatively impacted.  It  is  the  intent  of  management  and  significant  stockholders  to  provide sufficient working  capital  necessary to support and preserve the integrity of the corporate entity.  However, no formal commitments or arrangements to advance or loan funds to the Company or repay any such advances or loans exist. There is no legal obligation for either management or significant stockholders to provide additional future funding.  In such a restricted cash flow scenario, the Company would be unable to complete our  business  plan  steps,  and  would,  instead,   delay  all  cash  intensive activities.  Without necessary cash flow, the Company may become dormant during the next twelve months, or until such time as necessary funds could be raised in the equity securities market.  While the Company is of the opinion that good faith estimates of the Companys ability to secure additional  capital in the future to reach our goals have been made, there is no guarantee that the Company will receive  sufficient funding to sustain operations or implement any future business plan steps. These conditions raise substantial doubt about the Company's ability to continue as a going concern.  These financial statements do not include any adjustments that might arise from this uncertainty. NOTE 4  PAYABLE TO STOCKHOLDER For the nine months ending September 30, 2007, the company had an advance from an officer / stockholder in the amount of $24,780.  The advance was unsecured, bore no interest and was payable on demand.  During the nine months ended September 30, 2007, the stockholder paid expenses on behalf of the Company in the amount of $10,000 leaving a balance due to stockholder for professional fees incident to maintaining corporate existence. NOTE 5  STOCK BASED COMPENSATION 2001 COMPENSATORY STOCK OPTION PLAN On February 14, 2001, the Company adopted its 2001 Compensatory Stock Option Plan.  Pursuant to the 2001 plan, the Company may grant nonstatutory (nonqualified) stock options to employees of the Company.  A total of 2,000,000 shares of common stock have been reserved for issuance under the Plan. The maximum term of options granted under the 2001 Compensatory Stock Option Plan is five years.  Options granted are nontransferable and generally expire within six months after termination of the grantees employment. The exercise price of compensatory stock options must not be less than fair value of the common stock on the date of the grant.  The authority to grant new options under the Plan will terminate on February 13, 2011, unless the Plan is terminated prior to that time by the board of directors.  - 13 -    To date, no compensatory stock options have been granted pursuant to the Plan. 2001 EMPLOYEE STOCK COMPENSATION PLAN On February 14, 2001, the Company adopted its 2001 Employee Stock Compensation Plan.  Pursuant to the 2001 plan, the Company may issue shares of its common stock to employees or others who provide services to the Company.  A total of 1,500,000 shares of common stock have been reserved for issuance under the Plan. The authority to grant shares of common stock under the Plan will terminate on February 13, 2011, unless the Plan is terminated prior to that time by the board of directors. To date, no shares of common stock have been granted pursuant to the Plan. NOTE 6  INCOME TAXES The provision for income taxes differs from the amount computed by applying the statutory federal income tax rate to income before provision for income taxes.  The sources and tax effects of the differences are as follows: U.S. federal statutory rate (34.0%) Valuation reserve 34.0% Total -% As of December 31, 2006, the Company has a net operating loss carryforward of $ 31,764.  NOTE 7  RELATED PARTY TRANSACTIONS  The Company does not lease or rent any property.  Office space and services are provided without charge by an officer / shareholder.  Such costs are immaterial to the financial statements and, accordingly, have not been reflected therein.  The officers and directors of the Company are involved in other business activities and may, in the future, become involved in other business opportunities.  If a specific business opportunity becomes available, such persons may face a conflict in selecting between the Company and their other business interests.  The Company has not formulated a policy for the resolution of such conflicts.    - 14 -    ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN OF OPERATION  DISCLAIMER REGARDING FORWARD-LOOKING STATEMENTS  Certain statements in this report, including statements in the following discussion are what are known as forward-looking statements, which are basically statements about the future.  For that reason, these statements involve risk and uncertainty since no one can accurately predict the future.  Words such as plans, intends, will, hopes, seeks, anticipates, expects, and the like, often identify such forward-looking statements, but are not the only indication that a statement is a forward-looking statement.  Such forward-looking statements include statements concerning our plans and objectives with respect to the present and future operations of the Company, and statements which express or imply that such present and future operations will or may produce revenues, income or profits.  Numerous factors and future events could cause the Company to change such plans and objectives, or fail to successfully implement such plans or achieve such objectives, or cause such present and future operations to fail to produce revenues, income or profits.  Therefore, the reader is advised that the following discussion should be considered in light of the discussion of risks and other factors contained in this report on Form 10-QSB and in the Companys other filings with the Securities and Exchange Commission.  No statements contained in the following discussion should be construed as a guarantee or assurance of future performance or future results.  PLAN OF OPERATION Tranquility, Inc. (the Company) did not engage in any material operations during the period ended September 30, 2007.  For the fiscal year ending December 31, 2007, and for the twelve months following the date of this report, the Company expects to continue its efforts to locate a suitable business acquisition candidate and thereafter to complete a business acquisition transaction.  The Company anticipates incurring a loss for the fiscal year as a result of expenses associated with compliance with the reporting requirements of the Securities Exchange Act of 1934, and expenses associated with locating and evaluating acquisition candidates. The Company does not expect to generate revenues until it completes a business acquisition, and, depending upon the performance of the acquired business, it may also continue to operate at a loss after completion of a business combination.  During the next 12 months, the Company will require additional capital in order to pay the costs associated with carrying out its plan of operations and the costs of compliance with its continuing reporting obligations under the Securities Exchange Act of 1934 as amended, for the fiscal year ending December 31, 2007 and thereafter.  This additional capital will be required whether or not the Company is able to complete a business combination transaction during the current fiscal year.  Furthermore, once a business combination is completed, the Companys needs for additional financing are likely to increase substantially.  No specific commitments to provide additional funds have been made by management or other stockholders, and the Company has no current plans, proposals, arrangements or understandings to raise additional capital through the sale or issuance of additional securities prior to the location of a merger or acquisition candidate.  Accordingly, there can be no assurance that any additional  - 15 -    funds will be available to the Company to allow it to cover its expenses.  Notwithstanding the foregoing, however, to the extent that additional funds are required, the Company anticipates that it will either continue to rely on its majority shareholder to pay expenses on its behalf, or it will seek to raise capital through the private placement of restricted securities.  The majority shareholders are under no obligation to pay such expenses.  If the Company is unable to raise additional funds, it will not be able to pursue its business plan.  In addition, in order to minimize the amount of additional cash which is required in order to carry out its business plan, the Company might seek to compensate certain service providers by issuances of stock in lieu of cash.  LIQUIDITY AND CAPITAL RESOURCES  As of September 30, 2007, the Company remains in the development stage.  As of September 30, 2007, the Companys balance sheet reflects total assets of $nil, and total current liabilities of $24,780.   The Company has cash on hand of $nil and a deficit accumulated in the development stage of $41,764.  The Company does not have sufficient assets or capital resources to pay its on-going expenses while it is seeking out business opportunities, and it has no current plans to raise additional capital through sale of securities.  As a result, although the Company has no agreement in place with its shareholders or other persons to pay expenses on its behalf, it is anticipated that the Company will continue to rely on its majority shareholders to pay expenses on its behalf at least until it is able to consummate a business transaction.  The majority shareholders are under no obligation to pay such expenses.  OFF BALANCE SHEET ARRANGEMENTS  The Company does not have any off-balance sheet arrangements.  ITEM 3. CONTROLS AND PROCEDURES  The Securities and Exchange Commission defines the term disclosure controls and procedures to mean a company's controls and other procedures of an issuer that are designed to ensure that information required to be disclosed in the reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commissions rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Securities Exchange Act of 1934 is accumulated and communicated to the issuers management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.  The Company maintains such a system of controls and procedures in an effort to ensure that all information which it is required to disclose in the reports it files under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified under the SEC's rules and forms and that information required to be disclosed is accumulated and communicated to principal executive and principal financial officers to allow timely decisions regarding disclosure.  As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our chief executive officer and chief financial officer, of  - 16 -    the effectiveness of the design and operation of our disclosure controls and procedures.  Based on this evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures are designed to provide reasonable assurance of achieving the objectives of timely alerting them to material information required to be included in our periodic SEC reports and of ensuring that such information is recorded, processed, summarized and reported with the time periods specified.  Our chief executive officer and chief financial officer also concluded that our disclosure controls and procedures were effective as of September 30, 2007 to provide reasonable assurance of the achievement of these objectives.  There was no change in the Company's internal control over financial reporting during the quarter ended September 30, 2007, that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.  PART II - OTHER INFORMATION  ITEM 1. LEGAL PROCEEDINGS None.   ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS None.  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  (a) The following exhibits are filed herewith:  31.1 Certifications pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.  31.2 Certifications pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.  32.1 Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.  32.2 Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.    - 17 -    SIGNATURES  In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.   TRANQUILITY, INC.  By: /s/ Dominick Pope, CEO  Date: November 14, 2007   By: /s/ Dominick Pope, CFO  Date: November 14, 2007        - 18 -