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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                               -------------------

                                    FORM 10-Q

                               -------------------

(MARK ONE)

   [X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
        EXCHANGE ACT OF 1934

        FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2007

                                       OR

   [ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
        EXCHANGE ACT OF 1934

                      Commission File Number: 333-91014-01

                         TREASURE ISLAND ROYALTY TRUST
             (Exact Name of Registrant as Specified in Its Charter)


              TEXAS                                              02-6148888
 (State or Other Jurisdiction of                              (I.R.S. Employer
 Incorporation or Organization)                              Identification No.)


        U.S. BANK NATIONAL ASSOCIATION                             77056
AS TRUSTEE OF THE TREASURE ISLAND ROYALTY TRUST                  (Zip Code)
          CORPORATE TRUST SERVICES
        5555 SAN FELIPE, 11TH FLOOR
          MAIL CODE: EX-TX-WSFH
             HOUSTON, TEXAS
   (Address of Principal Executive Offices)


                                 (713) 235-9208
              (Registrant's Telephone Number, Including Area Code)

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 [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer or a non-accelerated filer. See definition of "accelerated
filer and large accelerated filer" in Rule 12b-2 of the Exchange Act. (Check
one):

Large accelerated filer [ ]   Accelerated filer [ ]   Non-accelerated filer [X]

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

                                  Yes [ ] No [X]

As of August 13, 2007, there were 42,574,298 trust units outstanding.

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                                TABLE OF CONTENTS

<TABLE>
<S>      <C>                                                                                              <C>
                                                       PART I

                                                                                                          Page

Item 1.  Unaudited Financial Statements:

         Balance Sheet at June 30, 2007 and December 31, 2006...........................................   1

         Statement of Loss for the three and six months ended June 30, 2007 and 2006....................   2

         Notes to Financial Statements..................................................................   3

Item 2.  Trustee's Discussion and Analysis of Financial Condition and Results of Operations.............   4

Item 3.  Quantitative and Qualitative Disclosures about Market Risk.....................................   5

Item 4.  Controls and Procedures........................................................................   5



                                                       PART II

Item 6.  Exhibits.......................................................................................   6
</TABLE>


                                       i
<PAGE>





                          TREASURE ISLAND ROYALTY TRUST

                                 BALANCE SHEET
                                  (UNAUDITED)


<TABLE>
<CAPTION>
                                                                            JUNE 30, 2007      DECEMBER 31, 2006
                                                                           ---------------     -----------------
<S>                                                                      <C>                    <C>
Assets:
  Cash...............................................................      $           100     $             100
  Overriding royalty interests in oil and gas properties.............              788,645               835,645
                                                                           ---------------     -----------------
       Total assets..................................................      $       788,745     $         835,745
                                                                           ===============     =================

Liabilities and trust corpus:
  Current trust expenses payable.....................................      $        36,478     $          37,068
  Loan payable to Newfield...........................................              396,066               353,173
  Interest payable...................................................               70,713                55,863
  Commitments and contingencies......................................                   --                    --
  Trust corpus (42,574,298 units of beneficial interest authorized
    and outstanding).................................................              835,745               835,745
  Accumulated deficit................................................             (550,257)             (446,104)
                                                                           ---------------     -----------------
       Total liabilities and trust corpus............................      $       788,745     $         835,745
                                                                           ===============     =================
</Table>


    The accompanying notes are an integral part of this financial statement.



                                       1
<PAGE>


                          TREASURE ISLAND ROYALTY TRUST

                                STATEMENT OF LOSS
                                   (UNAUDITED)


<TABLE>
<CAPTION>

                                                   THREE MONTHS ENDED                   SIX MONTHS ENDED
                                                        JUNE 30,                            JUNE 30,
                                            -------------------------------       -----------------------------
                                                 2007              2006              2007              2006
                                            -------------     -------------       -----------      ------------
<S>                                         <C>               <C>                 <C>              <C>
Royalty income...........................   $          --     $          --       $        --      $         --
Impairment of overriding royalty
  interest in oil and gas properties ....              --                --            47,000                --
General and administrative expense.......          20,257            22,590            42,303            47,437
Interest expense.........................           7,754             5,745            14,850            10,767
                                            -------------     -------------       -----------      ------------
   Net loss..............................   $      28,011     $      28,335       $   104,153      $     58,204
                                            =============     =============       ===========      ============

Distributable income.....................              --                --                --                --
Distributable income per trust unit......              --                --                --                --

Outstanding trust units..................      42,574,298        42,574,298        42,574,298        42,574,298
</Table>


    The accompanying notes are an integral part of this financial statement.


                                       2
<PAGE>

                          TREASURE ISLAND ROYALTY TRUST

                          NOTES TO FINANCIAL STATEMENTS
                                   (UNAUDITED)

1.   FORMATION AND PURPOSE OF THE TRUST

     Treasure Island Royalty Trust was established in connection with Newfield
Exploration Company's November 2002 acquisition of EEX Corporation to provide
the shareholders of EEX with the option to receive an interest in an exploration
concept being pursued by EEX prior to the acquisition. The concept, referred to
as "Treasure Island," targets "ultra deep" prospects in the shallow waters of
the Gulf of Mexico. The trust owns, or has the right to receive, overriding
royalty interests to be paid from Newfield's (or its transferees') interest in
any future production that may be achieved from horizons below specified depths
in the Treasure Island area. Treasure Island remains an exploration concept and
there are no proved reserves or production currently associated with the royalty
interests.

     The trust was created under the laws of the State of Texas. The beneficial
interest in the trust is divided into 42,574,298 trust units, each of which
represents an equal undivided portion of the trust. At the time of Newfield's
acquisition of EEX, Newfield and Wachovia Bank, National Association entered
into an amended and restated trust agreement with respect to the trust and the
trust issued all 42,574,298 trust units to Newfield. Newfield subsequently
transferred all of the trust units to the holders of EEX stock who elected to
receive trust units as a portion of their consideration in the acquisition. U.S.
Bank National Association succeeded Wachovia as trustee in September 2006 upon
Wachovia's sale of its corporate trust business to U.S. Bank.

     The sole purpose of the trust is to hold non-expense bearing overriding
royalty interests in any future production from a specified area. The royalty
interests are passive in nature. The trustee of the trust and the trust's
unitholders have no control over, or responsibility for any costs related to,
drilling, development or operations. Neither Newfield nor any other operator of
Treasure Island properties has any contractual commitment to the trust to
conduct drilling on the properties or to maintain its ownership interest in any
of the properties.

     These unaudited financial statements reflect, in the opinion of the
trustee, all adjustments, consisting only of normal and recurring adjustments,
necessary to fairly state the trust's financial position as of, and results of
operations for, the periods presented. These financial statements have been
prepared in accordance with the instructions to Form 10-Q and, therefore, do not
include all disclosures required for financial statements prepared in conformity
with generally accepted accounting principles.

     For financial accounting purposes, the value of the overriding royalty
interests are assessed quarterly for possible impairment. An impairment
requiring a charge to earnings may result from the evaluation of drilling
results or the expiration or relinquishment of leaseholds associated with
prospects. As a result of the relinquishment of a leasehold, the trust recorded
an impairment charge of $47,000 in the first quarter of 2007.

     Interim period results are not necessarily indicative of results for a full
year.

     These financial statements and notes should be read in conjunction with the
trust's audited financial statements and the notes thereto for the year ended
December 31, 2006 included in the trust's annual report on Form 10-K.

2.   FEDERAL INCOME TAX

     Under current law, the trust is taxable as a grantor trust and not as a
business entity, although there is a remote possibility that the Internal
Revenue Service would attempt to treat the trust as a business entity. A grantor
trust is not subject to tax at the trust level. For tax purposes, trust
unitholders are considered to own the trust's income and principal as though no
trust were in existence.


                                       3
<PAGE>


ITEM 2.  TRUSTEE'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

OVERVIEW

     CREATION AND PURPOSE OF THE TRUST. Treasure Island Royalty Trust was
established in connection with Newfield Exploration Company's November 2002
acquisition of EEX Corporation to provide the shareholders of EEX with the
option to receive an interest in an exploration concept being pursued by EEX
prior to the acquisition. The concept, referred to as "Treasure Island," targets
"ultra deep" prospects in the shallow waters of the Gulf of Mexico. The trust
owns, or has the right to receive, overriding royalty interests to be paid from
Newfield's (or its transferees') interest in any future production that may be
achieved from horizons below specified depths in the Treasure Island area. The
sole purpose of the trust is to hold these overriding royalty interests. The
royalty interests are passive in nature. The trustee of the trust and the
trust's unitholders have no control over, or responsibility for any costs
related to, drilling, development or operations. Neither Newfield nor any other
operator of Treasure Island properties has any contractual commitment to the
trust to conduct drilling on the properties or to maintain its ownership
interest in any of the properties.

     TREASURE ISLAND. "Treasure Island" refers to a concept developed to explore
for oil and gas in "ultra deep" horizons below a salt weld located at a true
vertical depth of 18,000 to 22,000 feet in the shallow waters of the Gulf of
Mexico. The Treasure Island area covers horizons below specified depths in 116
lease blocks located offshore Louisiana in the South Timbalier, Ship Shoal,
South Marsh Island and Eugene Island areas. The specified depth or depths for
each of the blocks vary and were agreed upon by EEX and Newfield prior to
Newfield's acquisition of EEX. The depths do not correspond exactly to the
location of the base of the salt weld in all cases. Treasure Island remains an
exploration concept and there are no proved reserves or production currently
associated with the royalty interests. Treasure Island exploratory wells require
significant lead time to plan and drill and are very expensive and technically
challenging because of the depth of the targeted horizons and expected harsh
conditions such as high temperature and pressure.

     The trust currently holds an interest in 11 lease blocks within the
Treasure Island area. One of the leases is scheduled to expire at the end of
April 2009 and another of the leases is held by production from a shallower zone
(the trust does not own an interest in this zone). The remaining nine leases
have been extended beyond their initial terms -- five are associated with the
Blackbeard West Prospect, which is discussed further below, and four relate to
other prospects. All of the latter four leases are scheduled to expire in the
third quarter of 2008. An overriding royalty interest with respect to a
particular lease block will terminate if the lease expires.

     In August 2006, Newfield announced results from the first well to test the
Treasure Island concept, the "Blackbeard West #1" well. Exxon Mobil Corporation
was the operator of the well and BP Exploration and Production Inc. and
Petrobras America Inc. also participated in the well. The Blackbeard West
Prospect is subject to a 1.25% overriding royalty interest held by the trust.
The well was spud in early February 2005 and drilled to a total depth of 30,067
feet. The well encountered a thin gas bearing sand below 30,000 feet but failed
to reach its primary targets because of higher than expected pressure. After the
well was temporarily abandoned, Newfield became the operator and Exxon Mobil
Corporation withdrew from the prospect.

     In the first quarter of 2007, the Minerals Management Service, or MMS,
granted Newfield an extension for the five Blackbeard West leases through August
2008. On August 6, 2007, Newfield sold at least a majority of its interest in
each of the lease blocks in which the trust holds an interest to McMoRan Oil &
Gas LLC. In connection with the sale, Newfield designated McMoRan as the
operator of Blackbeard West. Newfield believes McMoRan will work to complete a
schedule of activities provided to the MMS that may further extend these leases,
but its success is uncertain. During the extension period, McMoRan may use the
information gathered from the well to investigate whether an economically
feasible well can be designed to safely test the prospect.

     Newfield anticipates that it will be at least two years before drilling of
a redesigned well or reentry into the existing well bore could commence. Because
of the high drilling costs and risks and Exxon Mobil's withdrawal, it is
unlikely that drilling activities will be commenced without one or more new
partners to pay a portion of the costs of further operations. Newfield does not
anticipate that drilling activities will commence on any other Treasure Island
prospect until the Blackbeard West Prospect has been successfully tested.


                                       4
<PAGE>

RESULTS OF OPERATIONS

     The trust has had no revenue. The trust incurred $28,011 and $28,335 of
administrative and interest expenses for the second quarter of 2007 and 2006,
respectively, and $57,153 and $58,204 of administrative and interest expenses
for the six months ended June 30 of 2007 and 2006, respectively. Administrative
expense consists primarily of legal, accounting and trustee fees and printing
and mailing costs.

     For financial accounting purposes, the value of the overriding royalty
interests are assessed quarterly for possible impairment. An impairment
requiring a charge to earnings may result from the evaluation of drilling
results or the expiration or relinquishment of leaseholds associated with
prospects. As a result of the relinquishment of a leasehold, the trust recorded
an impairment charge of $47,000 in the first quarter of 2007.

LIQUIDITY AND CAPITAL RESOURCES

     The trust's only sources of income are revenue, if any, attributable to the
overriding royalty interests, income from the investment of cash on hand and net
proceeds from the disposition of royalty interests. Because none of the
properties underlying the royalty interests are at present producing any oil or
gas and the trust has only a very small amount of cash on hand, the trust has no
source of revenue. Therefore, it must rely on Newfield for the funding of its
administrative expenses. Any material adverse change in Newfield's financial
condition or results of operations could materially and adversely affect the
trust and the trust unitholders.

     Until the royalty interests begin generating cash proceeds, Newfield has
agreed to make loans from time to time to fund the routine administration of the
trust. In addition, if after such time as the royalty interests commence
generating cash proceeds, 8% of the cash held by the trust at the end of a
calendar quarter is insufficient to cover the administrative expenses of the
trust, Newfield will lend the difference to the trust. Loans from Newfield bear
interest at an annual rate of 8% and are senior unsecured obligations of the
trust. The loans (including accrued interest) will be repaid in quarterly
installments to the extent that 8% of the cash received by the trust in a given
quarter exceeds the administrative expenses of the trust for that quarter. As of
June 30, 2007, the trust had borrowed $396,066 since inception to pay
administrative expenses and had incurred interest of $70,713, none of which had
been repaid.

FORWARD LOOKING INFORMATION

     This report contains information that is forward-looking or relates to
anticipated future events or results such as drilling and operating plans.
Although Newfield and the trustee believe that the expectations reflected in
this information are reasonable, this information is based upon assumptions and
anticipated results that are subject to numerous uncertainties. Please read the
discussions under the captions "Treasure Island" in Item 1 of Part I and "Risk
Factors" in Item 1A of Part I of the trust's annual report on Form 10-K for the
year ended December 31, 2006.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     None.

ITEM 4.  CONTROLS AND PROCEDURES

     As of the end of the period covered by this report, the trustee carried out
an evaluation of the effectiveness of the design and operation of the trust's
disclosure controls and procedures pursuant to Exchange Act Rule 15d-15(b).
Based upon that evaluation, the trustee concluded that the trust's disclosure
controls and procedures are effective in timely alerting the trustee to material
information relating to the trust required to be included in the trust's
periodic filings with the Securities and Exchange Commission. In its evaluation
of disclosure controls and procedures, the trustee has relied, to the extent
considered reasonable, on information provided by Newfield Exploration Company.
There has not been any change in the trust's internal control over financial
reporting during the period covered by this report that has materially affected,
or is reasonably likely to materially affect, the trust's internal control over
financial reporting.


                                       5
<PAGE>

                                     PART II

ITEM 6.  EXHIBITS

Exhibit Number                            Description
--------------                            -----------

     31.1         Certification of Vice President of Trustee of Treasure Island
                  Royalty Trust pursuant to 15 U.S.C. Section 7241, as adopted
                  pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

     32.1         Certification of Trustee of Treasure Island Royalty Trust
                  pursuant to 18 U.S.C.  Section 1350, as adopted pursuant to
                  Section 906 of the Sarbanes-Oxley Act of 2002


                                       6
<PAGE>


                                    SIGNATURE

     Pursuant to the requirements of Section 13 or 15(d) 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.

                                             TREASURE ISLAND ROYALTY TRUST

Date:  August 14, 2007                       By: U.S. Bank National Association,
                                                 as trustee



                                             By:   /s/ STEVEN A. FINKLEA
                                                 -------------------------------
                                                 Steven A. Finklea
                                                 Vice President


Note:    Because the registrant is a trust without officers or employees, only
         the signature of an officer of the trustee of the registrant is
         available and has been provided.


                                       7
<PAGE>





                                  EXHIBIT INDEX


Exhibit Number                            Description
--------------                            -----------

     31.1         Certification of Vice President of Trustee of Treasure Island
                  Royalty Trust pursuant to 15 U.S.C. Section 7241, as adopted
                  pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

     32.1         Certification of Trustee of Treasure Island Royalty Trust
                  pursuant to 18 U.S.C.  Section 1350, as adopted pursuant to
                  Section 906 of the Sarbanes-Oxley Act of 2002