U.S.
      SECURITIES AND EXCHANGE COMMISSION


Washington,
      D.C. 20549





FORM
      10-QSB





x QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE


SECURITIES
      EXCHANGE ACT OF 1934





For
      the
      quarterly period ended October 31, 2007





 ̈ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE


SECURITIES
      EXCHANGE ACT OF 1934





For
      the
      transition period from to





Commission
      file number 000-52924





Shelby
      Acquisition III, Inc.


(Exact
      name of small business issuer as specified in its charter)





Delaware


(State
      or
      other jurisdiction of incorporation or organization)





20-8379587


(I.R.S.
      Employer Identification Number)




c/o
      James R. Kerr, 8813 N. 85 th Ct.,
      Scottsdale, AZ 85258


(Address
      of Principal Offices)





(480)
      945-2232


(Issuer’s
      Telephone Number)





No
      change


(Former
      name, former address and former fiscal year, if changed since last
      report)





Check
      whether the issuer (1) filed all reports required to be filed by Section 13
      or
      15(d) of the 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: 5,000,000 shares of common stock, par value
      $.0001 per share, outstanding as of March 11, 2008.





Transitional
      Small Business Disclosure Format (Check one):  Yes  ̈  No x





**SHELBY
      ACQUISITION III, INC.**




**-
      INDEX -**




Page**PART
                I- FINANCIAL INFORMATION:**Item
                1.
            Financial
                StatementsBalance
                Sheet as of October 31, 2007 (unaudited)
            F-1Statements
                of Operations for the Three Months Ending October 31, 2007
                (unaudited)
            F-2and
                for the Period from February 1, 2007 (Date of Inception)
                throughOctober
                31, 2007 (unaudited)Statement
                of Stockholder’s Equity for the Period from February 1, 2007 (Date of
                Inception)
            F-3through
                October 31, 2007 (unaudited)Statements
                of Cash Flows for the Three Months Ending October 31, 2007
                (unaudited)
            F-4and
                for the Period from February 1, 2007 (Date of Inception)
                throughOctober
                31, 2007 (unaudited)Notes
                to Financial Statements (unaudited)
            F-5Item
                2.
            Management's
                Discussion and Analysis of Financial Condition and Results of
                Operations
            1Item
                3.
            Controls
                and Procedures
            2**PART
                II – OTHER INFORMATION:**Item
                1.
            Legal
                Proceedings
            3Item
                2.
            Unregistered
                Sales of Equity Securities and Use of Proceeds
            3Item
                3.
            Defaults
                Upon Senior Securities
            3Item
                4.
            Submission
                of Matters to a Vote of Security Holders
            3Item
                5.
            Other
                Information
            3Item
                6.
            Exhibits
            3Signatures
            4





**PART
      I – FINANCIAL INFORMATION**





**Item
      1. Financial Statements.**




**SHELBY
      ACQUISITION III, INC.**


**(A
      Development Stage Company)**


**BALANCE
      SHEET**


**(Unaudited)**





**ASSETS****CURRENT
                ASSETS****Cash
                and cash equivalents**
            
            $
            11,833**TOTAL
                ASSETS**
            
            **$**
            **11,833****LIABILITIES
                & STOCKHOLDER'S EQUITY****CURRENT
                LIABILITIES****Accrued
                Professional Fees**
            
            $
            3,675**TOTAL
                LIABILITIES**
            
            
            3,675**STOCKHOLDER'S
                EQUITY****Preferred
                Stock, .0001 par value; 10,000 shares authorized; none issued and
                outstanding**
            
            
            —**Common
                Stock, .0001 par value; 100,000,000 shares authorized; 5,000,000
                issued
                and outstanding**
            
            
            500**Additional
                Paid in Capital**
            
            
            24,500**Deficiency
                accumulated during development stage**
            
            
            (16,842
            )**TOTAL
                STOCKHOLDER'S EQUITY**
            
            
            8,158**TOTAL
                LIABILITIES & STOCKHOLDER'S EQUITY**
            
            **$**
            **11,833**





See
      accompanying notes to financial statements.


F-1


**SHELBY
      ACQUISITION III, INC.**


**(A
      Development Stage Company)**


**STATEMENTS
      OF OPERATIONS**


**(Unaudited)**





**For the****For the**
            
            **Cumulative****Three**
            
            **Period from****Months**
            
            **Inception****Ended**
            
            **(February 1, 2007)****October 31, 2007**
            
            **to October 31, 2007****Revenue**
            
            **$**
            **-**
            
            **$**
            **-****General
                and Administrative Expenses**
            
            
            **3,675**
            
            
            **16,842****Net
                Loss**
            
            **$**
            **(3,675**
            **)**
            **$**
            **(16,842**
            **)****Basic
                and Diluted Net Loss Per Share**
            
            
            **0.00**
            
            
            **0.00****Number
                of Shares Used in Computing Basic and****Diluted
                Net Loss Per Share**
            
            
            **5,000,000**
            
            
            **5,000,000**





See
      accompanying notes to financial statements.


F-2


**SHELBY
      ACQUISITION III, INC.**


**(A
      Development Stage Company)**


**STATEMENT
      OF STOCKHOLDER’S EQUITY**


**(Unaudited)**


**Deficit****Accumulated****Additional**
              
              **During****Preferred Stock**
              
              **Common Stock**
              
              **Paid In**
              
              **Development**
              
              **Stockholder's****Shares**
              
              **Amount**
              
              **Shares**
              
              **Amount**
              
              **Capital**
              
              **Stage**
              
              **Equity****BALANCE
                  AT FEBRUARY 1, 2007 INCEPTION**
              
              
              —
              
              $
              -
              
              
              —
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -Issuance
                  of Common Stock
              
              
              —
              
              
              -
              
              
              5,000,000
              
              
              500
              
              
              24,500
              
              
              —
              
              
              25,000Net
                  loss
              
              
              —
              
              
              -
              
              
              —
              
              
              —
              
              
              —
              
              
              (13,167
              )
              
              (13,167
              )**Balance
                  as of July 31, 2007**
              
              
              **—**
              
              
              **-**
              
              
              **5,000,000**
              
              
              **500**
              
              
              **24,500**
              
              
              **(13,167**
              **)**
              **$**
              **11,833**Net
                  loss for period 8/1/07 through 10/31/07
              
              
              —
              
              
              -
              
              
              —
              
              
              —
              
              
              —
              
              
              (3,675
              )
              
              (3,675
              )**Balance
                  as of October 31, 2007**
              
              
              **—**
              
              **$**
              **-**
              
              
              **5,000,000**
              
              **$**
              **500**
              
              **$**
              **24,500**
              
              **$**
              **(16,842**
              **)**
              **$**
              **8,158**


See
      accompanying notes to financial statements.


F-3


**SHELBY
      ACQUISITION III, INC.**


**(A
      Development Stage Company)**


**STATEMENTS
      OF CASH FLOWS**


**(Unaudited)**


**For the****Cumulative****For the**
              
              **Period from****Three Months**
              
              **Inception****Ended**
              
              **(February 1, 2007)****October 31, 2007**
              
              **to October 31, 2007****CASH
                  FLOWS FROM OPERATING ACTIVITIES****Net
                  Loss**
              
              $
              (3,675
              )
              $
              (16,842
              )**Adjustments
                  to reconcile Net Loss to net cash provided by
                  operations:****Due
                  to affiliate**
              
              
              (592
              )
              
              —**Accrued
                  professional fees**
              
              
              3,675
              
              
              3,675**Net
                  cash used in Operating Activities**
              
              
              (592
              )
              
              (13,167
              )**CASH
                  FLOWS FROM FINANCING ACTIVITIES****Proceeds
                  from Issuance of Common Stock**
              
              
              0
              
              
              25,000**Net
                  cash provided by Financing Activities**
              
              
              0
              
              
              25,000**Net
                  (decrease) increase in cash and cash equivalents for
                  period**
              
              
              (592
              )
              
              11,833**Cash
                  and cash equivalents at beginning of period**
              
              
              12,425
              
              
              —**Cash
                  and cash equivalents at end of period**
              
              **$**
              **11,833**
              
              **$**
              **11,833**




See
      accompanying notes to financial statements.


F-4


**SHELBY
      ACQUISITION III, INC.**


**(A
      DEVELOPMENT STAGE COMPANY)**


**NOTES
      TO FINANCIAL STATEMENTS**


**October
      31, 2007**





NOTE
      1-
      ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES





The
      accompanying Interim Financial Statements of Shelby Acquisition III, Inc. (the
      “Company”) as of October 31, 2007 and the three months then ended and the period
      from February 1, 2007 (inception) through October 31, 2007, have been prepared
      in accordance with accounting principles generally accepted for interim
      financial statement presentation and in accordance with the instructions to
      Regulation S-B. Accordingly, they do not include all of the information and
      footnotes required by accounting principles generally accepted in the United
      States of America for complete financial statement presentation, and should
      be
      read in conjunction with the Financial Statements and Notes thereto included
      in
      the Company’s Form 10-SB for the period February 1, 2007 (inception) through
      July 31, 2007. In the opinion of management, all adjustments for a fair
      statement of the results of operations and financial position for the interim
      and cumulative date periods presented have been included. All such adjustments
      are of a normal recurring nature and there have been no changes in significant
      accounting policies since July 31, 2007.





The
      result of operations and cash flows for the three months ended October 31,
      2007
      are not necessarily indicative of the results to be expected for the full
      year.








(a)
            Organization
                and Business:





Shelby
      Acquisition III, Inc. (“the Company”) was incorporated in the state of Delaware
      on February 1, 2007 for the purpose of raising capital that is intended to
      be
      used in connection with its business plans which may include a possible merger,
      acquisition or other business combination with an operating
      business.





The
      company is currently in the development stage. All activities of the company
      to
      date relate to its organization, initial funding and share
      issuances.





(b)
            Basis
                of Presentation/Going concern:





The
      accompanying financial statements have been prepared in conformity with United
      States generally accepted accounting principles, which assumes the company
      will
      realize its assets and discharge its liabilities in the normal course of
      business. As reflected in the accompanying financial statements, the company
      has
      a deficit accumulated during the development stage of $16,842, used cash from
      operations of $(13,167) since its inception, and has working capital of $8,158
      at October 31, 2007. The company’s ability to continue as a going concern is
      dependent on its ability to find a suitable target Company and enter into a
      possible reverse merger with such Company. Management’s plan includes obtaining
      additional funds by equity financing through a reverse merger transaction and/or
      related party advances, however there is no assurance of additional funding
      being available.


F-5


**SHELBY
      ACQUISITION III, INC.**


**(A
      DEVELOPMENT STAGE COMPANY)**


**NOTES
      TO FINANCIAL STATEMENTS**


**October
      31, 2007**





NOTE
      1 – ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
      (Continued):





These
      factors raise substantial doubt about the Company’s ability to continue as a
      going concern. The accompanying financial statements do not include any
      adjustments relating to the recoverability of the recorded assets or the
      classification of the liabilities that may be necessary should the Company
      be
      unable to continue as a going concern.




(c)
            Cash
                and Cash Equivalents




The
      Company considers highly liquid financial instruments purchased with a maturity
      of three months or less to be cash equivalents.




(d)
            Use
                of Estimates:





The
      preparation of the statement of financial condition in conformity with
      accounting principles generally accepted in the United States requires
      management to make estimates and assumptions that affect the amounts of assets
      and liabilities and disclosure of contingent assets and liabilities at the
      date
      of the statement of financial condition and reported amounts of revenues and
      expenses during the reporting period. Actual results could differ from those
      estimates.





(e)
            Income
                Taxes





The
      Company utilizes the liability method of accounting for income taxes. Under
      the
      liability method deferred tax assets and liabilities are determined based on
      the
      differences between financial reporting basis and the tax basis of the assets
      and liabilities and are measured using enacted tax rates and laws that will
      be
      in effect, when the differences are expected to reverse. An allowance against
      deferred tax assets is recognized, when it is more likely than not, that such
      tax benefits will not be realized.





(f)
            Loss
                per Common Share





Basic
      loss per share is calculated using the weighted-average number of common shares
      outstanding during each reporting period. Diluted loss per share includes
      potentially dilutive securities such as outstanding options and warrants, using
      various methods such as the treasury stock or modified treasury stock method
      in
      the determination of dilutive shares outstanding during each reporting period.
      The Company does not have any potentially dilutive instruments.





(g)
            Fair
                Value of Financial Instruments





The
      carrying value of cash equivalents and accrued expenses approximates fair value
      due to the short period of time to maturity.


F-6


**SHELBY
      ACQUISITION III, INC.**


**(A
      DEVELOPMENT STAGE COMPANY)**


**NOTES
      TO FINANCIAL STATEMENTS**


**October
      31, 2007**





NOTE
      2 – CAPITAL STOCK





The
      total
      number of shares of capital stock which the Company shall have authority to
      issue is one hundred ten million (110,000,000). These shares shall be divided
      into two classes with 100,000,000 shares designated as common stock at $.0001
      par value (the “Common Stock”) and 10,000,000 shares designated as preferred
      stock at $.0001 par value (the “Preferred Stock”). The Preferred stock of the
      Company shall be issued by the Board of Directors of the Company in one or
      more
      classes or one or more series within any class and such classes or series shall
      have such voting powers, full or limited, or no voting powers, and such
      designations, preferences, limitations or restrictions as the Board of Directors
      of the Company may determine, from time to time.





Holders
      of shares of Common stock shall be entitled to cast one vote for each share
      held
      at all stockholders’ meetings for all purposes, including the election of
      directors. The Common Stock does not have cumulative voting rights.





No
      holder
      or shares of stock of any class shall be entitled as a matter of right to
      subscribe for or purchase or receive any part of any new or additional issue
      of
      shares of stock of any class, or of securities convertible into shares of stock
      of any class, whether now hereafter authorized or whether issued for money,
      for
      consideration other than money, or by way of dividend.





On
      February 1, 2007, the Company issued 5,000,000 shares of Common stock at a
      purchase price of $.005 per share, for an aggregate purchase price of
      $25,000.





NOTE
      3 – RECENT ACCOUNTING PRONOUNCEMENTS





In
      September 2006, the Financial Accounting Standard Board issued SFAS No., 157,
      “Fair Value Measurements” that provides enhanced guidance for using fair value
      to measure assets and liabilities. The standard applies whenever other standards
      require (or permit) assets or liabilities to be measured at fair value. The
      standard does not expand the use of fair value in any new
      circumstances.





This
      statement is effective for financial statements issued for fiscal years
      beginning after November 15, 2007, and interim periods within those fiscal
      years. Earlier application is encouraged, provided that the reporting entity
      has
      not yet issued financial statements for that fiscal year, including financial
      statements for an interim period within that fiscal year.




In
      July
      2006, the Financial Accounting Standards Board (FASB) issued FASB Interpretation
      No. 48, Accounting for Uncertainty in Income Taxes-an interpretation of FASB
      Statement No. 109 (FIN 48), which provides clarification related to the process
      associated with accounting for uncertain tax positions recognized in
      consolidated financial statements. FIN 48 prescribes a more-likely-than-not
      threshold for financial statement recognition and measurement of a tax position
      taken, or expected to be taken, in a tax return. FIN 48 also provides guidance
      related to, among other things, classification, accounting for interest and
      penalties associated with tax positions, and disclosure requirements. We adopted
      FIN 48 on February 1, 2007. Currently, this pronouncement has no effect on
      our
      financial statements.


F-7


**SHELBY
      ACQUISITION III, INC.**


**(A
      DEVELOPMENT STAGE COMPANY)**


**NOTES
      TO FINANCIAL STATEMENTS**


**October
      31, 2007**





NOTE
      3 – RECENT ACCOUNTING PRONOUNCEMENTS
      (Continued):





In
      February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for
      Financial Assets and Financial Liabilities” (“SFAS No. 159”). SFAS No. 159
      permits entities to choose to measure, on an item-by-item basis, specified
      financial instruments and certain other items at fair value. Unrealized gains
      and losses on items for which the fair value option has been elected are
      required to be reported in earnings at each reporting date. SFAS No. 159 is
      effective for fiscal years beginning after November 15, 2007, the provisions
      of
      which are required to be applied prospectively. The Company expects to adopt
      SFAS No. 159 in the first quarter of Fiscal 2008 and is still evaluating the
      effect, if any on its financial position or results of operations.





In
      December 2007, the FASB issued SFAS No. 141(R), “Business Combinations”, which
      replaces SFAS 141, “Business Combinations”. SFAS 141(R) establishes principles
      and requirements for determining how an enterprise recognizes and measures
      the
      fair value of certain assets and liabilities acquired in a business combination,
      including noncontrolling interests, contigent consideration, and certain
      acquired contingencies. SFAS 141(R) also requires acquisition-related
      transaction expenses and restructuring costs be expensed as incurred rather
      than
      capitalized as a component of the business combination. SFAS
      141(R) is effective for financial statements issued for fiscal years beginning
      after December 15, 2008. T he
      application of this statement is not expected to have a material effect on
      the
      Company’s results of operations or financial position.





In
      December 2007, the FASB issued SFAS No. 160, “Noncontrolling Interests in
      Consolidated Financial Statements”, an amendment of Accounting Research Bulletin
      No. 51, “Consolidated Financial Statements. SFAS No. 160 establishes accounting
      and reporting standards for the noncontrolling interest in a subsidiary and
      for
      the deconsolidation of a subsidiary, and clarifies that a noncontrolling
      interest in a subsidiary is an ownership interest that should be reported as
      equity in the consolidated financial statements. SFAS No. 160 establishes a
      single method of accounting for changes in a parent’s ownership interest in a
      subsidiary that do not result in deconsolidation and requires a parent to
      recognize a gain or loss in net income when a subsidiary is deconsolidated.
      S FAS
      160
      is effective for financial statements issued for fiscal years beginning after
      December 15, 2008, and interim periods within those fiscal years, except for
      the
      presentation and disclosure requirements, which will apply retrospectively.
      This
      standard is not expected to have a material impact on the Company’s future
      financial statements.


F-8


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





Shelby
      Acquisition III, Inc. (“we”, “our”, “us” or the “Company”) was organized as a
      vehicle to investigate and, if such investigation warrants, acquire a target
      company or business seeking the perceived advantages of being a publicly held
      corporation. Our principal business objective for the next 12 months and beyond
      such time will be to achieve long-term growth potential through a combination
      with a business rather than immediate, short-term earnings. The Company will
      not
      restrict our potential candidate target companies to any specific business,
      industry or geographical location and, thus, may acquire any type of
      business.





***Results
      of Operations***





For
      the
      three months ending October 31, 2007, the Company had no activities that
      produced revenues from operations.





For
      the
      three months ending October 31, 2007 and for the cumulative period from
      inception (February 1, 2007) to October 31, 2007, the Company had a net loss
      of
      $3,675 and $16,842, respectively, due to legal, accounting, audit and other
      professional service fees incurred in relation to the preparation of the
      Company’s Registration Statement on Form 10-SB that was filed in November of
      2007.





***Liquidity
      and Capital Resources***





As
      of
      October 31, 2007, the Company had assets equal to $11,833 ,
      comprised exclusively of cash and cash equivalents. The Company’s current
      liabilities as of October 31, 2007 totaled $3,675, comprised exclusively of
      accrued professional fees.





The
      following is a summary of the Company's cash flows from operating, investing,
      and financing activities:





For
      the
      Period from February 1, 2007 (Date of Inception) through October 31,
      2007





Operating
                activities
            
            $
            (13,167
            )Investing
                activities
            
            
            -Financing
                activities
            
            $
            25,000Net
                effect on cash
            
            $
            11,833




The
      Company has nominal assets and has generated no revenues since inception. The
      Company is also dependent upon the receipt of capital investment or other
      financing to fund its ongoing operations and to execute its business plan of
      seeking a combination with a private operating company. If continued funding
      and
      capital resources are unavailable at reasonable terms, the Company may not
      be
      able to implement its plan of operations.





***Plan
      of Operations***





The
      Company currently does not engage in any business activities that provide cash
      flow. The costs of investigating and analyzing business combinations for the
      next 12 months and beyond such time will be paid with money in our treasury.





During
      the next twelve months we anticipate incurring costs related to:





(i)  filing
      of
      reports under the Securities Exchange Act of 1934, as amended (the “Exchange
      Act”), and


(ii)  consummating
      an acquisition.


1


We
      believe we will be able to meet these costs through use of funds in our
      treasury, through deferral of fees by certain service providers and additional
      amounts, as necessary, to be loaned to or invested in us by our sole
      stockholder, management or other investors.





The
      Company may consider a business which has recently commenced operations, is
      a
      developing company in need of additional funds for expansion into new products
      or markets, is seeking to develop a new product or service, or is an established
      business which may be experiencing financial or operating difficulties and
      is in
      need of additional capital. In the alternative, a business combination may
      involve the acquisition of, or merger with, a company which does not need
      substantial additional capital, but which desires to establish a public trading
      market for its shares, while avoiding, among other things, the time delays,
      significant expense, and loss of voting control which may occur in a public
      offering.





Since
      our
      Registration Statement on Form 10-SB became effective, our sole officer and
      director has had limited contact or discussions with representatives of other
      entities regarding a business combination with us. Any target business that
      is
      selected may be a financially unstable company or an entity in its early stages
      of development or growth, including entities without established records of
      sales or earnings. In that event, we will be subject to numerous risks inherent
      in the business and operations of financially unstable and early stage or
      potential emerging growth companies. In addition, we may effect a business
      combination with an entity in an industry characterized by a high level of
      risk,
      and, although our management will endeavor to evaluate the risks inherent in
      a
      particular target business, there can be no assurance that we will properly
      ascertain or assess all significant risks.





The
      Company anticipates that the selection of a business combination will be complex
      and extremely risky. Because of general economic conditions, rapid technological
      advances being made in some industries and shortages of available capital,
      our
      management believes that there are numerous firms seeking even the limited
      additional capital which we will have and/or the perceived benefits of becoming
      a publicly traded corporation. Such perceived benefits of becoming a publicly
      traded corporation include, among other things, facilitating or improving the
      terms on which additional equity financing may be obtained, providing liquidity
      for the principals of and investors in a business, creating a means for
      providing incentive stock options or similar benefits to key employees, and
      offering greater flexibility in structuring acquisitions, joint ventures and
      the
      like through the issuance of stock. Potentially available business combinations
      may occur in many different industries and at various stages of development,
      all
      of which will make the task of comparative investigation and analysis of such
      business opportunities extremely difficult and complex.





***Off-Balance
      Sheet Arrangements***





The
      Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a
      current or future effect on the Company’s financial condition, changes in
      financial condition, revenues or expenses, results of operations, liquidity,
      capital expenditures or capital resources that is material to investors. ****





**Item
      3. Controls and Procedures.**





Evaluation
      of disclosure controls and procedures.





We
      maintain disclosure controls and procedures that are designed to ensure that
      information required to be disclosed in our reports, filed pursuant to the
      Exchange Act, is recorded, processed, summarized and reported within the time
      periods specified in the Securities and Exchange Commission's rules, regulations
      and related forms, and that such information is accumulated and communicated
      to
      our principal executive officer and principal financial officer, as appropriate,
      to allow timely decisions regarding required disclosure.


2


As
      of
      October 31, 2007, we carried out an evaluation, under the supervision and with
      the participation of our management, including our principal executive officer
      and principal financial officer, of the effectiveness of the design and
      operation of our disclosure controls and procedures. Based on this evaluation,
      our principal executive officer and principal financial officer concluded that
      our disclosure controls and procedures were effective as of the end of the
      period covered by this report.





Changes
      in internal controls.





There
      have been no changes in our internal controls over financial reporting or in
      other factors during our most recent fiscal quarter that could significantly
      affect these controls and procedures during the quarterly period ended October
      31, 2007.





**PART
      II — OTHER INFORMATION**





**Item
      1. Legal Proceedings.**





To
      the
      best knowledge of the officers and sole director, the Company is not a party
      to
      any legal proceeding or litigation.





**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)
      Exhibits required by Item 601 of Regulation S-B.





Exhibit No.
            
            Description*3.1
            
            Certificate
                of Incorporation, as filed with the Delaware Secretary of State on
                February 1, 2007.*3.2
            
            By-Laws.31.1
            
            Certification
                of the Company’s Principal Executive Officer and Principal Financial
                Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002,
                with
                respect to the registrant’s Quarterly Report on Form 10-QSB for the
                quarter ended October 31, 2007.32.1
            
            Certification
                of the Company’s Principal Executive Officer and Principal Financial
                Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
                Section
                906 of the Sarbanes Oxley Act of
                2002.





*
            Filed
                as an exhibit to the Company's Registration Statement on Form 10-SB,
                as
                filed with the Securities and Exchange Commission on November 20,
                2007,
                and incorporated herein by this
                reference.




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**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.




Dated:
                    March 11, 2008
                **SHELBY
                    ACQUISITION III, INC.**By:
                /s/
                    James R. KerrName:
                    James R. KerrTitle:
                    President and
                    Secretary


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