================================================================================

                                  UNITED STATES
                       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 March 31, 2007

                                       OR

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

                For the transition period from ______ to ______.

                        Commission File Number 001-32865

                                    KSW, INC.
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)

                 Delaware                                11-3191686
      -------------------------------               ----------------------
      (State or other jurisdiction of                 (I.R.S. Employer
      incorporation or organization)                Identification Number)

 37-16 23rd Street, Long Island City, New York             11101
 ---------------------------------------------           ----------
   (Address of principal executive offices)              (Zip Code)

                                  718-361-6500
              ----------------------------------------------------
              (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 Exchange Act).

                                 Yes [ ] No [X]

         Indicate  the  number of  shares  outstanding  of each of the  issuer's
classes of common stock, as of the latest practicable date:

                                                    OUTSTANDING AT
                   CLASS                             MAY 7, 2007
         ----------------------------               --------------
         Common stock, $.01 par value                   5,838,643

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<PAGE>

                                    KSW, INC.
                          QUARTERLY REPORT ON FORM 10-Q
                          QUARTER ENDED MARCH 31, 2007

                                TABLE OF CONTENTS

                                                                       PAGE NO.
PART I   FINANCIAL INFORMATION                                         --------

Item 1.  Financial Statements

             Consolidated Balance Sheets -
             March 31, 2007 and December 31, 2006                         3

             Consolidated Statements of Income -
             Three months ended March 31, 2007 and 2006                   4

             Consolidated Statements of Comprehensive Income -
             Three months ended March 31, 2007 and 2006                   5

             Consolidated Statement of Stockholders' Equity -
             Three months ended March 31, 2007                            6

             Consolidated Statements of Cash Flows-
             Three months ended March 31, 2007 and 2006                   7

             Notes to Consolidated Financial Statements-                  8

Item 2.  Management's Discussion and Analysis of
         Financial Condition and Results of Operations                    12

Item 3.  Quantitative and Qualitative Disclosures about Market Risk       16

Item 4.  Controls and Procedures                                          17

PART II  OTHER INFORMATION

Item 1   Legal Proceedings                                                17
Item 1A  Risk Factors                                                     17
Item 2   Unregistered Sales of Equity Securities and Use of Proceeds      17
Item 3   Defaults Upon Senior Securities                                  17
Item 4   Submission of Matters to a Vote of Security Holders              17
Item 5   Other Information                                                17
Item 6   Exhibits                                                         18

SIGNATURE                                                                 19

INDEX TO EXHIBITS                                                         20

                                        2
<PAGE>

                         PART I - FINANCIAL INFORMATION

ITEM 1 - FINANCIAL STATEMENTS

                            KSW, INC. AND SUBSIDIARY
                           CONSOLIDATED BALANCE SHEETS
                                 (in thousands)

<TABLE>
<CAPTION>
                                                                 March 31,    December 31,
                                                                   2007           2006
                                                               ------------   ------------
                                                                (unaudited)
<S>                                                            <C>            <C>
ASSETS
Current assets:
   Cash and cash equivalents                                   $     12,538   $     14,085
   Marketable securities                                                675            663
   Accounts receivable                                               16,492         13,205
   Retainage receivable                                               5,512          5,566
   Costs and estimated earnings in excess of
     billings on uncompleted contracts                                  618          1,017
   Prepaid expenses and other receivables                               103            247
                                                               ------------   ------------
      Total current assets                                           35,938         34,783

Property and equipment, net of accumulated
   depreciation and amortization of $2,052 and $2,035
   at 3/31/07 and 12/31/06, respectively                                239            256
Deferred income taxes and other                                         315            506
                                                               ------------   ------------
   Total assets                                                $     36,492   $     35,545
                                                               ============   ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
   Accounts payable                                            $     11,940   $     11,960
   Retainage payable                                                  2,890          2,798
   Accrued payroll and benefits                                         856            932
   Accrued expenses                                                      70            296
   Billings in excess of costs and estimated
     earnings on uncompleted contracts                                6,367          4,987
   Income taxes payable                                                  69          1,449
                                                               ------------   ------------
     Total current liabilities                                       22,192         22,422
                                                               ------------   ------------
Commitments and contingencies (Note 6)

Stockholders' equity (Note 3):
   Preferred stock, $.01 par value, 1,000,000 shares
     authorized, no shares issued and outstanding                         -              -
   Common stock, $.01 par value, 25,000,000 shares
     authorized, 5,828,643 and 5,758,143 shares issued
     and outstanding at 3/31/07 and 12/31/06, respectively               58             58
   Additional paid-in capital                                        11,336         10,890
   Retained earnings                                                  2,800          2,077
   Accumulated other comprehensive income:
      Net unrealized holding gains on available -
       for-sale securities                                              106             98
                                                               ------------   ------------
       Total stockholders' equity                                    14,300         13,123
                                                               ------------   ------------
   Total liabilities and stockholders' equity                  $     36,492   $     35,545
                                                               ============   ============
</TABLE>

          See accompanying notes to consolidated financial statements.

                                        3
<PAGE>

                            KSW, INC. AND SUBSIDIARY

                        CONSOLIDATED STATEMENTS OF INCOME
                 (in thousands, except share and per share data)
                                   (unaudited)

<TABLE>
<CAPTION>
                                           Three Months          Three Months
                                          Ended March 31,       Ended March 31,
                                               2007                  2006
                                         ----------------      ----------------
<S>                                      <C>                   <C>
Revenues                                 $         17,991      $         15,761
Cost of revenues                                   15,501                13,656
                                         ----------------      ----------------
 Gross profit                                       2,490                 2,105

Selling, general and
   administrative expenses                          1,337(1)              1,480(1)
                                         ----------------      ----------------
  Operating income                                  1,153                   625

Other income:
Interest income, net                                  113                    41
                                         ----------------      ----------------
Income before provision
   for income taxes                                 1,266                   666

Provision for income taxes                            543                   320
                                         ----------------      ----------------
Net income                               $            723      $            346
                                         ================      ================
Income per common share:
Basic                                    $            .12      $            .06

Diluted                                  $            .12      $            .06

Weighted average common
  shares outstanding (Note 5):
  Basic                                         5,798,518             5,556,561
  Diluted                                       5,920,159             5,691,855
</TABLE>

(1) During the three months ended March 31, 2007 and 2006, selling,  general and
administrative  expenses  include stock  compensation  expense of $338 and $368,
respectively,  related  to the  exercise  of stock  options  and the  effect  of
accounting standard SFAS 123-R.

          See accompanying notes to consolidated financial statements.

                                        4
<PAGE>

                            KSW, INC. AND SUBSIDIARY

                 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
                                 (in thousands)
                                   (unaudited)

                                           Three Months       Three Months
                                          Ended March 31,    Ended March 31,
                                               2007               2006
                                         ----------------   ----------------
Net income                               $            723   $            346
                                         ----------------   ----------------
Other comprehensive income before tax:

Unrealized holding gains arising
   during the period                                   15                 35

Less: reclassification adjustment
   for gains included in net income                     -                  -
                                         ----------------   ----------------
Other comprehensive income
   before income tax expense                           15                 35

Income tax expense related to items
  of other comprehensive income                         7                 16
                                         ----------------   ----------------
Other comprehensive income net of
  income tax expense                                    8                 19
                                         ----------------   ----------------
Total comprehensive income               $            731   $            365
                                         ================   ================

          See accompanying notes to consolidated financial statements.

                                        5
<PAGE>

                            KSW, INC. AND SUBSIDIARY

                 CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY

                        THREE MONTHS ENDED MARCH 31, 2007
                        (in thousands, except share data)

<TABLE>
<CAPTION>
                                                                                               Accumulated
                                         Common Stock            Additional                      Other
                                  ---------------------------      Paid-In       Retained     Comprehensive
                                     Shares         Amount         Capital       Earnings         Income           Total
                                  ------------   ------------   ------------   ------------   --------------   ------------
<S>                                  <C>         <C>            <C>            <C>            <C>              <C>
Balances, December 31, 2006          5,758,143   $         58   $     10,890   $      2,077   $           98   $     13,123
Net income                                   -              -              -            723                -            723
Exercise of stock options               70,500              -            441              -                -            441
Stock based compensation                     -              -              5              -                -              5
Net unrealized gains on
 available-for-sale securities               -              -              -              -                8              8
                                  ------------   ------------   ------------   ------------   --------------   ------------
Balances, March 31, 2007             5,828,643   $         58   $     11,336   $      2,800   $          106   $     14,300
                                  ============   ============   ============   ============   ==============   ============
</TABLE>

          See accompanying notes to consolidated financial statements.

                                        6
<PAGE>

                            KSW, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (in thousands)
                                   (unaudited)

<TABLE>
<CAPTION>
                                                          Three Months      Three Months
                                                         Ended March 31,   Ended March 31,
                                                              2007              2006
                                                         ---------------   --------------
<S>                                                      <C>               <C>
Cash flows from operating activities:
   Net income                                            $           723   $          346
Adjustments to reconcile net income to cash
   provided by (used in) operating activities:
   Depreciation and amortization                                      17               12
   Deferred income taxes                                             187              261
   Tax benefits from exercise of stock options                      (152)            (167)
   Stock-based compensation expense related
      to stock option plan                                           329              368
Changes in operating assets and liabilities:
   Accounts receivable                                            (3,287)            (681)
   Retainage receivable                                               54             (736)
   Costs and estimated earnings in excess
      of billings on uncompleted contracts                           399             (187)
   Prepaid expenses and other receivables                            144              122
   Accounts payable                                                  (20)            (170)
   Retainage payable                                                  92              229
   Accrued payroll and benefits                                      (76)             189
   Accrued expenses                                                 (226)             (78)
   Billings in excess of costs and estimated
      earnings on uncompleted contracts                            1,380            1,553
   Income taxes payable                                           (1,380)               -
                                                         ---------------   --------------
Net cash provided by (used in) operating
   activities (Note 4)                                            (1,816)           1,061
                                                         ---------------   --------------
Cash flows from investing activities:
   Purchases of property and equipment                                                (22)
   Purchases of marketable securities                                  -               (5)
                                                         ---------------   --------------
Net cash used in investing activities                                  -              (27)
                                                         ---------------   --------------
Cash flows from financing activities:
   Proceeds from exercise of stock options                           117              324
   Tax benefits from exercise of stock options                       152              167
                                                         ---------------   --------------
Net cash provided by financing activities (Note 4)                   269              491
                                                         ---------------   --------------
   Net increase (decrease) in cash                                (1,547)           1,525
Cash and cash equivalents, beginning of period                    14,085            5,199
                                                         ---------------   --------------
Cash and cash equivalents, end of period                 $        12,538   $        6,724
                                                         ===============   ==============
Supplemental  disclosure  of cash flow  information
Cash paid during the period for:
     Interest                                            $             1   $            1
     Income taxes                                        $         1,739   $           60
</TABLE>

          See accompanying notes to consolidated financial statements.

                                        7
<PAGE>

                            KSW, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

1.      Nature of Operations and Basis of Presentation

The Company  furnishes and installs  heating,  ventilating and air  conditioning
systems and process piping systems for  institutional,  industrial,  commercial,
high-rise  residential and public works projects,  primarily in the State of New
York. The Company also serves as a mechanical trade manager,  performing project
management  services  relating to the mechanical  trades.  The Company considers
itself to be one operating segment.

The  unaudited  consolidated  financial  statements  presented  herein have been
prepared in accordance with the instructions to Form 10-Q and do not include all
of the  information  and note  disclosures  required  by  accounting  principles
generally  accepted  in  the  United  States  of  America.   These  consolidated
statements should be read in conjunction with the financial statements and notes
thereto  included in the  Company's  Form 10-K for the year ended  December  31,
2006.

In the opinion of management,  the accompanying unaudited consolidated financial
statements  include all  adjustments  necessary for a fair  presentation  of the
financial  position of the Company as of March 31, 2007 and  December  31, 2006,
and the  results  of its  income,  comprehensive  income  and cash flows for the
three-month  periods  ended  March 31,  2007 and 2006.  Because of the  possible
fluctuations in the marketplace in the construction industry,  operating results
of the Company on a quarterly  basis may not be indicative of operating  results
for the full year.

2.      Significant Accounting Policies

The significant  accounting  policies followed by the Company and its subsidiary
in preparing its consolidated  financial statements are set forth in Note (2) to
such consolidated  financial statements included in Form 10-K for the year ended
December 31, 2006. The Company has made no significant changes to these policies
during 2007.

The Company  adopted the  provisions  of Financial  Standards  Accounting  Board
Interpretation  No. 48 "Accounting  for Uncertainty in Income Taxes" ("FIN 48"),
an interpretation of FASB Statement No. 109 ("SFAS 109") on January 1, 2007. The
Company had no adjustment as a result of FIN 48.

3.      Stockholders' Equity

SFAS 123-R,  which requires the Company to expense the vesting of stock options,
lowered net income by approximately $3,000 for the quarter ended March 31, 2007.
In addition,  during the quarter,  an executive and a former director  exercised
70,500  options  which  lowered  net income  by  $179,000  for the quarter ended
March 31, 2007.

                                        8
<PAGE>

The adoption of SFAS 123-R  lowered net income by  approximately  $3,000 for the
quarter ended March 31, 2006. In addition,  during the quarter,  two  executives
and a former director  exercised  195,000  options,  which lowered net income by
$196,000 for the quarter ended March 31, 2006.

As of March 31, 2007, there is approximately $9,000 of unrecognized compensation
expense related to unvested share-based  compensation awards granted.  That cost
is expected to be recognized over the next 1.4 years.

The stock option plan expired  December 2005.  Therefore,  no new options can be
granted under this plan.

Options were granted to certain  employees  and directors at prices equal to the
market  value of the stock on the dates the options  were  granted.  The options
granted  generally  have a term of 10 years  from  the  grant  date and  granted
options vest ratably over a three year period.  The fair value of each option is
amortized into compensation  expense on a straight-line  basis between the grant
date for the option and each vesting date. The Company  estimates the fair value
of all  stock  option  awards  as of the  date  of the  grant  by  applying  the
Black-Scholes  pricing  valuation model. The application of this valuation model
involves  assumptions that are judgmental and sensitive in the  determination of
compensation  expense which would include the expected  stock price  volatility,
risk-free interest rate,  weighted-average  expected life of the options and the
dividend yield.

Historical  information  is the primary  basis for the selection of the expected
volatility,  expected dividend yield and the expected lives of options. The risk
free interest rate was selected based upon yields of U.S. Treasury issues with a
term  equal to the  expected  life of the  option  being  valued.  Stock  option
activity for the quarter ended March 31, 2007 was as follows:

<TABLE>
<CAPTION>
                                                                     Weighted
                                                     Weighted         Average
                                                      Average        Remaining       Aggregate
                                      Number         Exercise       Contractual      Intrinsic
                                    of Shares          Price       Term in Years       Value
                                  -------------    -------------   -------------   -------------
<S>                                     <C>        <C>                       <C>   <C>
Outstanding at January 1, 2007          368,835    $        1.65

Expired/canceled                              -                -

Granted                                       -                -

Exercised                               (70,500)   $        1.66
                                  -------------
Outstanding at March 31, 2007           298,335    $        1.64             4.3   $   1,422,000
                                  =============
Exercisable at March 31, 2007           285,002    $        1.64             3.9   $   1,359,000
</TABLE>

                                        9
<PAGE>

There were no options granted during the quarters ended March 31, 2007 and 2006.

Cash proceeds,  tax benefits and intrinsic  value related to total stock options
exercised during the quarters ended March 31, 2007 and 2006, are as follows:

<TABLE>
<CAPTION>
                                                     Three Months Ended   Three Months Ended
                                                       March 31, 2007       March 31, 2006
                                                     ------------------   ------------------
<S>                                                  <C>                  <C>
Proceeds from stock options exercised                $          117,000   $          324,000

Tax benefits related to stock options exercised      $           52,000   $          167,000

Intrinsic value of stock options exercised           $          341,000   $          362,000
</TABLE>

4.      Restatement of Statements of Cash Flows

A correction has been made to the  consolidated  statement of cash flows for the
first quarter of 2006,  which had presented the tax benefit of $167,000  related
to the exercise of stock  options as a financing  outflow (a  bracketed  number)
rather than a financing  inflow of $167,000 (a  non-bracketed  number).  The tax
benefit was properly  discussed in the M, D & A section for the first quarter of
2006,  and the cash balance at the end of the period was properly  stated in the
statement of cash flows. There was no effect on the consolidated  balance sheet,
income  statement,   stockholders'  equity,  or  comprehensive  income  for  the
aforementioned quarter.

5.      Earnings per Share

<TABLE>
<CAPTION>
                                                     Three Months Ended   Three Months Ended
                                                       March 31, 2007       March 31, 2006
                                                     ------------------   ------------------
<S>                                                  <C>                  <C>
Net income                                           $          723,000   $          346,000
                                                     ==================   ==================

Income Per Share - Basic
Weighted average shares outstanding
    during the period                                         5,798,518            5,556,561
                                                     ==================   ==================
Income per common share -
 Basic                                               $              .12   $              .06
                                                     ==================   ==================
Income  Per Share - Diluted
Weighted average shares outstanding
    during the period                                         5,798,518            5,556,561

Effect of stock options
    dilution                                                    121,641              135,294
                                                     ------------------   ------------------
Total shares outstanding for purposes of
  calculating diluted earnings                                5,920,159            5,691,855
                                                     ==================   ==================
Income per common and common equivalent
 share - Diluted                                     $              .12   $              .06
                                                     ==================   ==================
</TABLE>

                                       10
<PAGE>

6.      Commitment and Contingencies

Proposals  and Claims.  During the  ordinary  and routine  course of its work on
construction projects, the Company may incur expenses for work outside the scope
of its contractual obligations, for which the owner or general contractor agrees
that the Company will be entitled to additional compensation, but where there is
not yet an agreement on price. The Company's  financial  statements  include the
amounts the  Company  believes it will  ultimately  receive on these  authorized
proposals.  Also  during the course of its work on  construction  projects,  the
Company  may  incur  expenses  for work  outside  the  scope of its  contractual
obligations,  for which no  acknowledgment of liability exists from the owner or
general  contractor for such  additional  work.  These claims may include change
proposals  for  extra  work  or  requests  for an  equitable  adjustment  to the
Company's  contract  price  due  to  unforeseen  disruptions  to  its  work.  In
accordance with accounting principles generally accepted in the United States of
America for the  construction  industry,  until written  acknowledgments  of the
validity  of the claims are  received,  the  claims  are not  recognized  in the
accompanying   financial   statements.   No  accruals  have  been  made  in  the
accompanying  consolidated  financial  statements related to these proposals for
which  no  acknowledgment  of  liability  exists.  While  the  Company  has been
generally  successful in obtaining a favorable  resolution of such claims, there
is no assurance that the Company will be successful in the future.

7.      Recently Issued Accounting Pronouncements

In September 2006, the FASB issued SFAS No. 157, "Fair Value Measurements" (SFAS
157).  SFAS 157  provides  guidance  for using fair value to measure  assets and
liabilities.  It also responds to investors'  requests for expanded  information
about the  extent to which  companies  measure  assets and  liabilities  at fair
value,  the information used to measure fair value, and the effect of fair value
measurements on earnings.  SFAS 157 applies whenever other standards require (or
permit) assets or liabilities to be measured at fair value,  and does not expand
the use of fair  value  in any new  circumstances.  SFAS  157 is  effective  for
financial  statements issued for fiscal years beginning after November 15, 2007.
The  adoption  of SFAS 157 is not  expected  to have a  material  impact  on the
Company's consolidated results of operations and financial condition.

In February  2007,  FASB issued  Statement  No. 159,  "The Fair Value Option for
Financial  Assets and  Financial  Liabilities  - including  an amendment of FASB
Statement No. 115" ("SFAS No. 159").  SFAS No. 159 permits entities to choose to
measure many financial  instruments and certain other items at fair value.  SFAS
No. 159 is effective for financial  statements  beginning with the first quarter
of 2008. The adoption of SFAS No. 159 is not expected to have a material  impact
on the Company's consolidated results of operations and financial condition.

                                       11
<PAGE>

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

RESULTS OF OPERATIONS

REVENUES

Total  revenues for the quarter ended March 31, 2007  increased by $2,230,000 or
14.1% to $17,991,000, as compared to $15,761,000 for the quarter ended March 31,
2006. This increase in revenues was a result of the Company's performance on its
higher backlog of work. Revenue would have been higher, but several new projects
which were  expected to start in the first  quarter of 2007 were  delayed due to
unexpected  construction  issues encountered during the foundation stages. As of
March 31,  2007,  the  Company  has backlog of  approximately  $108,000,000,  as
compared to approximately $84,000,000 as of March 31, 2006. The Company believes
that  approximately  $ 49,000,000 of the Company's  backlog at March 31, 2007 is
not reasonably expected to be completed within the year ended December 31, 2007.

COST OF REVENUES

Cost of revenues for the quarter ended March 31, 2007 increased by $1,845,000 or
13.5% to $15,501,000, as compared to $13,656,000 for the quarter ended March 31,
2007,  which  corresponds to the change in revenues  noted above.  The increased
revenues  have allowed the Company to allocate  the cost of project  supervision
and drafting  salaries over multiple  projects and more effectively  utilize its
experienced field labor personnel.  In addition,  the Company has taken steps to
reduce  pricing  volatility of piping  materials by entering into  agreements to
purchase these products at fixed prices.

GROSS PROFIT

Gross profit for the quarter  ended March 31, 2007 was  $2,490,000,  or 13.8% of
revenues, as compared to a gross profit of $2,105,000, or 13.4% of revenues, for
the quarter  ended March 31, 2006.  The increase in gross profit for the quarter
ended March 31,  2007,  as compared to the  quarter  ended March 31,  2006,  was
primarily a result of the above mentioned items.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

Selling,  general and  administrative  expenses  ("SG&A") for the quarter  ended
March 31, 2007  decreased  by $143,000 or (9.7)% to  $1,337,000,  as compared to
$1,480,000  for the quarter ended March 31, 2006. A substantial  portion of this
change was a result of the  Company's  ability  to reduce  SG&A by  utilizing  a
portion of its office  staff on its trade  management  contracts,  on which SG&A
costs are reimbursed as part of the Company's general condition costs.

In  addition,  during the periods  ended  March 31,  2007 and 2006,  the Company
incurred SG&A related to the vesting and exercising of stock options of $338,000
and $368,000, respectively.

                                       12
<PAGE>

OTHER INCOME

Other income for the quarter ended March 31, 2007 was  $113,000,  as compared to
$41,000 for the quarter  ended March 31,  2006.  This  increase  was a result of
interest earned.

PROVISION FOR TAXES

The tax provision for the quarter ended March 31, 2007 was $543,000, as compared
to a tax  provision  of $320,000 for the quarter  ended March 31, 2006.  The tax
expense was lower than the Company's effective tax rate during the quarter ended
March 31, 2007 as a result of a reversal of an  over-accrual  of previous year's
tax expense.

NET INCOME

As a result of all the items mentioned above, the Company reported net income of
$723,000,  or $.12 per share-basic and diluted,  for the quarter ended March 31,
2007,  as compared to reported net income of $346,000,  or $.06 per  share-basic
and diluted,  for the quarter  ended March 31, 2006.  Included in the net income
for the  quarter  ended  March  31,  2007  were net  expenses  of  approximately
$182,000,  related to the  exercising  and vesting of stock  options  during the
period.  Excluding  the  effect of stock  options,  net  income  would have been
$905,000,  or $.16 per share-basic and $.15 per  share-diluted,  for the quarter
ended March 31, 2007. Included in the net income for the quarter ended March 31,
2006 were net expenses of approximately $199,000,  related to the exercising and
vesting of stock options during the period, which resulted in a reduction in the
calculation of both basic and diluted earnings per share of  approximately  $.04
per share.  Excluding  the effect of stock  options,  net income would have been
$545,000,  or $.10 per  share-basic  and diluted for the quarter ended March 31,
2006.

LIQUIDITY AND CAPITAL RESOURCES

GENERAL

The Company's  principal capital requirement is to fund its work on construction
projects. Projects are billed monthly based on the work performed to date. These
project  billings,  less a withholding  of  retention,  which is received as the
project nears  completion,  are collectible  based on their respective  contract
terms.  The Company has historically  relied  primarily on internally  generated
funds and bank borrowings to finance its  operations.  The Company has a line of
credit  which is subject to certain  conditions.  The  Company has not relied on
bank borrowings to finance its operation since July 2003.

As of March  31,  2007,  total  cash and cash  equivalents  was  $12,538,000,  a
$5,814,000 increase over the $6,724,000 reported as of March 31, 2006.

                                       13
<PAGE>

CASH PROVIDED BY (USED IN) OPERATIONS

Net cash used in operations was $1,816,000 for the quarter ended March 31, 2007.
The net cash used in  operations  for the  quarter  ended  March 31,  2007 was a
result of the  funding of newer  projects  as well as the  payment of  corporate
income taxes and executive bonuses.

Net cash provided by operations  was  $1,061,000 for the quarter ended March 31,
2006 (see Note 4). The net cash  provided by  operations  for the quarter  ended
March 31, 2006 was a result of the Company's  earnings as well as the collection
of the second installment on the Co-Op City litigation  settlement (see "Item 7.
Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations-Overview"  in the  Company's  Annual Report on Form 10-K for the year
ended December 31, 2006 for further discussion).

CASH USED IN INVESTING ACTIVITIES

There was no cash provided by or used in investing activities during the quarter
ended March 31, 2007.

Net cash used in investing activities was $27,000 during the quarter ended March
31, 2006.  The Company  purchased  marketable  securities  of $5,000  during the
quarter ended March 31, 2006. In addition,  the Company  purchased  property and
equipment totaling $22,000 during the quarter ended March 31, 2006.

CASH PROVIDED BY FINANCING ACTIVITIES

Net cash provided by financing  activities  during the quarters  ended March 31,
2007 and 2006 was $269,000 and $491,000, respectively.

During the quarter  ended March 31,  2007,  an executive  and a former  director
exercised  options to purchase  70,500  shares,  contributing  cash  proceeds of
$117,000 to the Company.

During the quarter  ended March 31, 2006,  two company  executives  and a former
director  exercised  options  to  purchase  195,000  shares,  contributing  cash
proceeds of $324,000 to the Company.

SFAS 123-R  requires  cash  flows  resulting  from  excess  tax  benefits  to be
classified  as a part  of cash  flows  from  financing  activities.  Excess  tax
benefits  represent tax benefits  related to exercised  options in excess of the
associated  deferred  tax asset  for such  options.  As a result of SFAS  123-R,
$152,000 and  $167,000 of excess tax  benefits for the quarters  ended March 31,
2007 and 2006,  respectively,  have been classified as an operating cash outflow
and a financing cash inflow (see Note 4).

                                       14
<PAGE>

CREDIT FACILITY

The Company has a line of credit  facility  from Bank of  America,  N.A.,  which
provides borrowings for working capital purposes up to $2,000,000. This facility
expires on March 31, 2008, is secured by the Company's assets, and is guaranteed
by the  Company's  subsidiary,  KSW  Mechanical  Services,  Inc.  There  were no
borrowings against this line of credit.

Advances  bear  interest,  based on the Company's  option,  at either the bank's
prime  lending  rate plus one percent per annum (9.25% at March 31, 2007) or the
London Inter-Bank Offered Rate ("LIBOR") plus two and one-half percent per annum
(7.82% at March 31, 2007).

Payment may be  accelerated  by certain  events of default  such as  unfavorable
credit  factors,  the  occurrence of a material  adverse change in the Company's
business,  properties or financial condition,  a default in payment on the line,
impairment of security,  bankruptcy,  or the Company ceasing operations or being
unable to pay its debts.  The line of credit  must be paid in full at the end of
the term.

The Company currently has no significant capital expenditure commitments.

SURETY

On some of its projects,  the Company is required to provide a surety bond.  The
Company  obtains its surety bonds from Federal  Insurance  Company,  a member of
Chubb Group of Insurance Companies. The Company's ability to obtain bonding, and
the amount of bonding required, is solely at the discretion of the surety and is
primarily based upon the Company's net worth,  working  capital,  the number and
size  of  projects  under  construction  and  the  surety's   relationship  with
management.  The Company is  contingently  liable to the surety  under a general
indemnity agreement. The Company agrees to indemnify the surety for any payments
made on contracts of  suretyship,  guaranty or indemnity  that might result from
the Company not having the financial capacity to complete  projects.  Management
believes the likelihood of the surety having to complete projects is remote. The
contingent liability is the cost of completing all bonded projects,  which is an
undeterminable  amount  because  it is  subject  to  bidding  by third  parties.
Management  believes that all  contingent  liabilities  will be satisfied by the
Company's  performance on the specific  bonded  contracts  involved.  The surety
provides  bonding solely at its discretion,  and the arrangement with the surety
is an at-will arrangement subject to termination.

The Company's  bonding limits have been sufficient  given the volume and size of
the  Company's  contracts.  The  Company's  surety may require  that the Company
maintain  certain  tangible  net  worth  levels,   and  may  require  additional
guarantees if the Company should desire increased  bonding limits.  At March 31,
2007,  approximately  $50,000,000 of the Company's  backlog of  $108,000,000  is
anticipated to be bonded.

                                       15
<PAGE>

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

There have been no material  changes in the  accounting  policies and  estimates
that  the  Company  considers  to be  "critical"  from  those  disclosed  in the
Company's Annual Report on Form 10-K for the year-ended December 31, 2006.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

See Note (7) to the consolidated  financial statements for a summary of recently
issued accounting pronouncements impacting the Company.

FORWARD-LOOKING STATEMENTS

Certain  statements  contained  in this  report  are not  historical  facts  and
constitute "forward-looking  statements" (as such term is defined in the Private
Securities  Litigation  Reform Act of 1995).  These forward  looking  statements
generally can be identified as statements  that include words such as "believe",
"expect",  "anticipate",  "intend", "plan", "foresee", "likely", "will" or other
similar   words  or  phrases.   Such   forward-looking   statements   concerning
management's expectations, strategic objectives, business prospects, anticipated
economic performance and financial condition,  and other similar matters involve
known and unknown risks,  uncertainties  and other important  factors that could
cause the  actual  results,  performance  or  achievements  of results to differ
materially  from any future results,  performance or  achievements  discussed or
implied by such forward-looking statements. This document describes factors that
could  cause  actual  results  to differ  materially  from  expectations  of the
Company.  All written and oral  forward-looking  statements  attributable to the
Company  or  persons  acting on behalf of the  Company  are  qualified  in their
entirety by such factors. Such risks, uncertainties, and other important factors
include, among others:  inability to obtain bonding,  inability to retain senior
management, low labor productivity and shortages of skilled labor, a rise in the
price of steel  products,  economic  downturn,  reliance  on certain  customers,
competition,  inflation, the adverse effect of terrorist concerns and activities
on public budgets and insurance costs, the  unavailability  of private funds for
construction,  and other various matters, many of which are beyond the Company's
control and other  factors as are  described  in "Item 1A. Risk  Factors" in the
Company's Form 10-K for the fiscal year ended December 31, 2006. Forward-looking
statements  speak  only as of the date of the  document  in which they are made.
Other than required by applicable  law, the Company  disclaims any obligation or
undertaking  to  provide  any  updates  or  revisions  to  any   forward-looking
statements to reflect any changes in the Company's  expectations  or any changes
in events,  conditions or circumstances on which the forward-looking  statements
are based.

ITEM 3. QUANTITITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company does not utilize futures,  options or other derivative  instruments.
As  of  March  31,  2007,  the  Company  has  invested  $675,000  in  marketable
securities.

                                       16
<PAGE>

ITEM 4. CONTROLS AND PROCEDURES

The  Company  carried  out an  evaluation,  under the  supervision  and with the
participation  of management,  including our Chief  Executive  Officer and Chief
Financial  Officer,   of  the  effectiveness  of  our  disclosure  controls  and
procedures (as defined in Rules  13a-15(e) and 15d-15(e) under the Exchange Act)
as of March 31, 2007. Based on that evaluation,  our Chief Executive Officer and
Chief Financial  Officer  concluded that our disclosure  controls and procedures
were effective as of March 31, 2007.

There  has been no change  in the  Company's  internal  control  over  financial
reporting (as defined in Rules  13a-15(f) and 15d-15(f)  under the Exchange Act)
during the Company's quarter ended March 31, 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 1A. RISK FACTORS

There have been no material  changes  related to risk  factors  from those items
previously disclosed in the December 31, 2006 Form 10-K.

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.

                                       17
<PAGE>

ITEM 6. EXHIBITS

        Exhibit 11 - Statement regarding  Computation of Earnings per Share (see
        Note 5 to the Consolidated  Financial  Statements  included elsewhere in
        this Report)

        Exhibit 31.1 - Certification of Chief Executive Officer required by Rule
        13a-14(a)

        Exhibit 31.2 - Certification of Chief Financial Officer required by Rule
        13a-14(a)

        Exhibit 32.1 - Certification of Chief Executive Officer required by Rule
        13a-14(b) and 18 U.S.C. Section 1350

        Exhibit 32.2 - Certification of Chief Financial Officer required by Rule
        13a-14(b) and 18 U.S.C. Section 1350

                                       18
<PAGE>

                                    SIGNATURE

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned, thereunto duly authorized.

                                                     KSW, INC.

Date: May 7, 2007
                                                     /s/ Richard W. Lucas
                                                     ---------------------------
                                                     Richard W. Lucas
                                                     Chief Financial Officer

                                                     (Principal Financial and
                                                     Accounting Officer and
                                                     Duly Authorized Officer)

                                       19
<PAGE>

                                    KSW, INC.

                                INDEX TO EXHIBITS
EXHIBIT
NUMBER                             DESCRIPTION
-------    ---------------------------------------------------------------------
11         Statement Regarding  Computation of Earnings per Share (see Note 5 to
           the  Consolidated  Financial  Statements  included  elsewhere in this
           Report)

31.1       Certification of Chief Executive Officer required by Rule 13a-14(a)

31.2       Certification of Chief Financial Officer required by Rule 13a-14(a)

32.1       Certification  of Chief Executive  Officer required by Rule 13a-14(b)
           and 18 U.S.C. Section 1350

32.2       Certification of Chief Financial  Officer required by Rule 13a-14 (b)
           and 18 U.S.C. Section 1350

                                       20