U.S.
      SECURITIES AND EXCHANGE COMMISSION


Washington,
      D.C. 20549





FORM
      10-QSB


(Mark
      One)




x
            QUARTERLY
              REPORT UNDER SECTION 13 OR 15(d) OF THE  SECURITIES EXCHANGE ACT OF
              1934 For the quarter ended June 30, 2006o
            TRANSITION
              REPORT UNDER SECTION 13 OR 15(d) OF THE  SECURITIES EXCHANGE ACT OF
              1934 For the transition period from _____ to
              _____





Commission
      File Number: 000-29553





BLOODHOUND SEARCH TECHNOLOGIES,
      INC.





(Exact
      name of registrant as specified in its charter)





Nevada
              
              (State
                or other jurisdictionof
              incorporation)
            88-0492640
              (IRS
                Employer Identification No.)





19901
      Southwest Freeway, Suite 114


Sugar
      Land, TX 77479





(Address
      of principal executive offices)





(281)
      207-5436





(Issuer’s
      Telephone Number, Including Area Code)








(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
x No o





Number
      of
      shares of common stock outstanding as of August 14, 2006: 11,608,136 shares
      of
      common stock.


Transitional
      Small Business Format (check one): Yes o 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 o







**TABLE
      OF CONTENTS**


PagePART
                  IItem
                  1. Financial Statements
              3Item
                  2. Management’s Discussion and Analysis or Plan of
                  Operation
              7Item
                  3 Controls and Procedures
              9PART
                  IIItem
                  1. Legal Proceedings
              9Item
                  2. Unregistered Sales of Equity Securities and Use of
                  Proceeds
              9Item
                  3. Defaults Upon Senior Securities
              10Item
                  4. Submission of Matters to a Vote of Security Holders
              10Item
                  5. Other Information
              10Item
                  6. Exhibits
              10




2




PART
      I -
      FINANCIAL INFORMATION





**Item
      1.**  **Financial
      Statements.**





**Bloodhound
      Search Technologies, Inc.**


(Development
      Stage Company)


**BALANCE
      SHEETS**


**(unaudited)**


June
                  30,
                2006
              
              December
                  31,
                2005ASSETSCURRENT
                  ASSETSCash
              
              $
              50,478
              
              $
              27,751Accounts
                  receivable
              
              
              4,000
              
              
              -Note
                  and accrued interest receivable
              
              
              -
              
              
              202,150Total
                  current assets
              
              
              54,478
              
              
              229,901Licenses,
                  net of amortization of $32,750 and $3,750
              
              
              312,250
              
              
              11,250Total
                  assets
              
              $
              366,728
              
              $
              241,151LIABILITIES
                  AND STOCKHOLDERS' EQUITYCURRENT
                  LIABILITIESAccounts
                  payable - related party
              
              $
              11,576
              
              $
              11,576Accounts
                  payable
              
              
              5,982
              
              
              945Note
                  payable - related party
              
              
              3,200
              
              
              5,938Total
                  Current Liabilities
              
              
              20,758
              
              
              18,459STOCKHOLDERS'
                  EQUITYCommon
                  stock, par value $0.001, 25,000,000 sharesauthorized,
                  11,608,136 and 5,775,008 issued and outstanding
              
              
              11,068
              
              
              5,775Paid
                  in capital
              
              
              2,658,373
              
              
              470,802Deficit
                  accumulated during the development stage
              
              
              (2,323,471
              )
              
              (253,885
              )Total
                  stockholders' equity
              
              
              345,970
              
              
              222,692TOTAL
                  LIABILITIES AND STOCKHOLDERS’ EQUITY
              
              $
              366,728
              
              $
              241,151





3


**Bloodhound
      Search Technologies, Inc.**


(Development
      Stage Company)


**STATEMENTS
      OF OPERATIONS**


Three
      and
      Six Months Ended June 30, 2006 and 2005 and the period from March 20, 1996
      (Inception) to June 30, 2006


(unaudited)





Three
                Months
            
            Six
                Months
            
            March
                20, 1996 to June 30,
              20062006
            
            2005
            
            2006
            
            2005Revenue
            
            $
            8,000
            
            $
            -
            
            $
            8,000
            
            $
            -
            
            $
            8,000General
                and administrative expenses
            
            
            1,596,878
            
            
            2,868
            
            
            2,080,298
            
            
            6,472
            
            
            2,152,697Impairment
                of goodwill
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            205,922Net
                loss from operations
            
            
            (1,588,878
            )
            
            (2,868
            )
            
            (2,072,298
            )
            
            (6,472
            )
            
            (2,350,619
            )Interest
                income
            
            
            -
            
            
            -
            
            
            2,838
            
            
            -
            
            
            5,083Interest
                expense
            
            
            (63
            )
            
            -
            
            
            (126
            )
            
            -
            
            
            (1,064
            )Settlement
                of debt
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            23,129Net
                loss
            
            $
            (1,588,941
            )
            $
            (2,868
            )
            $
            (2,069,586
            )
            $
            (6,472
            )
            $
            (2,323,471
            )Net
                loss per share
            
            $
            (0.14
            )
            $
            (0.00
            )
            $
            (0.20
            )
            $
            (0.00
            )Weighted
                average number of shares
            
            
            10,328,466
            
            
            8,275,000
            
            
            9,046,468
            
            
            8,275,000




4





**Bloodhound
      Search Technologies, Inc.**


(Development
      Stage Company)


**STATEMENTS
      OF CASH FLOWS**


Six
      Months Ended June 30, 2006 and 2005 and the period from March 20, 1996
      (Inception) to June 30, 2006


(unaudited)


June
                  30,
                2006
              
              June
                  30,
                2005
              
              March
                  20, 1996 to
                June
                  30, 2006CASH
                FLOWS FROM
                OPERATING ACTIVITIESNet
                  loss
              
              $
              (2,069,586
              )
              $
              (6,472
              )
              $
              (2,323,471
              )Adjustments
                  to reconcile net loss to netcash
                  used in operating activities:Amortization
              
              
              29,000
              
              
              1,500
              
              
              34,417Domain
                  name write off
              
              
              -
              
              
              -
              
              
              3,333Impairment
                  of goodwill
              
              
              -
              
              
              -
              
              
              205,922Stock
                  issued for services
              
              
              1,427,500
              
              
              -
              
              
              1,428,750Change
                  in accounts receivable
              
              
              (4,000
              )
              
              -
              
              
              (4,000
              )Change
                  in accounts payable
              
              
              6,249
              
              
              2,318
              
              
              22,558Net
                  cash used in operations
              
              
              (610,837
              )
              
              (2,654
              )
              
              (632,491
              )CASH
                  FLOWS FROM INVESTING ACTIVITIESRepayment
                  of advances
              
              
              200,000
              
              
              -
              
              
              200,000Advances
                  - First Light Communications
              
              
              -
              
              
              -
              
              
              (200,000
              )Purchase
                  domain name
              
              
              -
              
              
              -
              
              
              (5,000
              )Net
                  cash provided by (used in) investing activities
              
              
              200,000
              
              
              -
              
              
              (5,000
              )CASH
                  FLOWS FROM FINANCING ACTIVITIESContributions
                  to capital
              
              
              -
              
              
              -
              
              
              6,905Proceeds
                  from sale of common stock
              
              
              433,564
              
              
              -
              
              
              681,064Net
                  cash provided by financing activities
              
              
              433,564
              
              
              -
              
              
              687,969Net
                  change in cash
              
              
              22,727
              
              
              (2,654
              )
              
              50,478Cash
                  at beginning of period
              
              
              27,751
              
              
              234,823
              
              
              -Cash
                  at end of period
              
              $
              50,478
              
              $
              232,169
              
              $
              50,478SCHEDULE
                  OF NONCASH OPERATING ACTIVITIESIssuance
                  of common stock for license
              
              $
              330,000
              
              $
              -
              
              $
              330,000Issuance
                  of stock for convertible debt
              
              
              1,800
              
              
              -
              
              
              1,800
  5


**Bloodhound
      Search Technologies, Inc.**


(Development
      Stage Company) \


**NOTES
      TO FINANCIAL STATEMENTS**  June
      30,
      2006





NOTE
      1 -
      BASIS OF PRESENTATION





The
      accompanying unaudited interim financial statements of Bloodhound Search
      Technologies, Inc. (“BSTI”), have been prepared in accordance with accounting
      principles generally accepted in the United States of America and the rules
      of
      the Securities and Exchange Commission ("SEC"), and should be read in
      conjunction with the audited financial statements and notes thereto contained
      in
      BSTI's Form 10-KSB. In the opinion of management, all adjustments, consisting
      of
      normal recurring adjustments, necessary for a fair presentation of financial
      position and the results of operations for the interim periods presented have
      been reflected herein. The results of operations for interim periods are not
      necessarily indicative of the results to be expected for the full year. Notes
      to
      the financial statements that would substantially duplicate the disclosure
      contained in the audited financial statements for fiscal year 2005, as reported
      in the Form 10-KSB, have been omitted.




Revenue
      Recognition, BSTI recognizes revenue when
      persuasive evidence of an arrangement exists, services have been rendered,
      the
      sales price is fixed or determinable, and collectibility is reasonably assured.
      This typically occurs when the services are performed.





NOTE
      2  -
      ACQUISTION OF LICENSE AGREEMENT





On
      January 20, 2006, BSTI acquired the license agreement for the right, title,
      interest and benefit of certain licensed materials and services related to
      strategic information monitoring systems for the issuance of 1,500,000 shares
      of
      restricted common stock fairly valued at $330,000. For the six months ended
      June
      30, 2006, BSTI recorded $27,500 of amortization expense related to this license.
      The license is being amortized over a 5 year life.





NOTE
      3 -
      NOTE PAYABLE WITH RELATED PARTIES


Officers-directors
      and a control shareholder have a demand note payable due them of $5,000. The
      note can be converted to 5,000,000 common shares at any time at the option
      of
      the holder. During the quarter ended June 30, 2006, $1,800 of the note was
      converted to 900,000 shares of common stock, leaving a remaining balance of
      $3,200. BSTI has accrued $1,064 of interest related to this note.





NOTE
      4
      -CAPITAL STOCK


During
      the three months ended March 31, 2006 BSTI issued:


633,128
      shares of common stock for cash of $316,564;


1,500,000
      shares of common stock valued at $330,000 to acquire the strategic information
      monitoring system license; and


500,000
      shares of common stock valued at $110,000 to its CEO for services.





During
      the three months ended June 30, 2006 BSTI issued:


260,000
      shares of common stock for cash of $117,000;


50,000
      shares of common stock valued at $11,000 for shareholder communication
      services;


1,450,000
      shares of common stock valued at $1,306,500 to directors for services;
      and


900,000
      shares of common stock to convert $1,800 of related party notes
      payable.




6




**Item
      2.**  **Management’s
      Discussion and Analysis or Plan of Operations.**





As
      used
      in this Form 10-QSB, references to “BSTI”, the "Company," the "Registrant,"
      "we," “our” or "us" refer to Bloodhound Search Technologies, Inc. unless the
      context otherwise indicates.





*Forward-Looking
      Statements*





This
      Form
      10-QSB contains forward-looking statements. For this purpose, any statements
      contained in this Form 10-QSB that are not statements of historical fact may
      be
      deemed to be forward-looking statements. You can identify forward-looking
      statements by those that are not historical in nature, particularly those that
      use terminology such as "may," "will," "should," "expects," "anticipates,"
      "contemplates," "estimates," "believes," "plans," "projected," "predicts,"
      "potential," or "continue" or the negative of these similar terms. In evaluating
      these forward-looking statements, you should consider various factors, including
      the following: (a) those risks and uncertainties related to general economic
      conditions, (b) whether we are able to manage our planned growth efficiently
      and
      operate profitable operations, (c) whether we are able to generate sufficient
      revenues or obtain financing to sustain and grow our operations, (d) whether
      we
      are able to successfully fulfill our primary requirements for cash. BSTI's
      actual results may differ significantly from the results projected in the
      forward-looking statements. BSTI assumes no obligation to update forward-looking
      statements, except as otherwise required under the applicable federal securities
      laws.





*Overview*





BSTI
      was
      incorporated in Nevada on March 20, 1996. It changed its name to "Safe Idea,
      Inc." on October 27, 2000 and to "Bloodhound Search Technologies, Inc." on
      December 20, 2005 to better reflect changes in the business operations in which
      it intends to engage.





After
      its
      inception in 1996, BSTI engaged in providing a repository of information, an
      interactive forum, and a comprehensive directory of services catering to
      entrepreneurs, enabling such entrepreneurs to publish their business plans
      and
      share their ideas in a collaborative environment. In 2006 BSTI acquired the
      license for the use, distribution and sub license of certain software, materials
      and services for the development of an internet search engine known as
      "Strategic Information Monitoring System" (SIMS). In 2004 BSTI acquired a
      license for the distribution of certain products made with a fire retarding
      fabric known under the trademarked name "Wetwool".





Strategic
      Information Monitoring System License





On
      January 20, 2006, BSTI entered into a License Agreement with Pekka Tolonen,
      pursuant to which Mr. Tolonen granted to BSTI a license to use and sublicense
      certain software and other materials related to a search engine known as
      Strategic Information Monitoring System ("SIMS"). SIMS is currently available
      for sale to the public, and in March 2006, BSTI closed on two sales of SIMS.
      A
      second generation version of SIMS is currently under development and is not
      yet
      available for sale or use by the public.





SIMS
      is a
      type of software program that is commonly known as a search engine. A search
      engine helps internet users find internet web sites on a given subject. SIMS
      differs from other internet search engines because it continuously retrieves
      information from the internet on the subjects in which the user is interested
      based on keywords supplied by the user. SIMS will have the capability to
      continuously monitor more than 10,000 news websites or the web sites of the
      user's preference. SIMS will be able to scan the relevant information sources
      24
      hours a day. After retrieving the relevant information, SIMS will be able to
      organize it automatically on a personal portal page that looks like an online
      news website.





The
      license permits Bloodhound to use, including sub-license, the licensed materials
      for the following purposes: (a) the provision of services for the maintenance,
      support, installation, marketing, distribution, licensing, sublicensing, and
      customer and technical support of the licensed materials; (b) Bloodhound's
      internal use; and (c) customization, modification, and additions to the licensed
      materials. The license is limited to the United States of America, Canada,
      Australia, China, and Hong Kong.





The
      license is for a perpetual term and is irrevocable, unless terminated earlier
      in
      accordance with the license agreement. The license agreement may be terminated
      by either party at any time after January 20, 2007 upon 60 days' prior written
      notice if either (a) certain services of Mr. Tolonen are not utilized by at
      least ten customers of BSTI or (b) BSTI is not active in marketing, providing,
      or selling the services of Mr. Tolonen for a continuous period of more than
      six
      months.




7




In
      consideration for the license, BSTI issued to Mr. Tolonen 1,500,000 shares
      of
      BSTI's common stock (post split). The shares were offered and issued in reliance
      on an exemption from the registration requirements of United States federal
      and
      state securities laws under Regulation S promulgated under the Securities Act
      of
      1933, as amended. Mr. Tolonen represented to BSTI that he is not a United States
      person (as defined in Regulation S) or an affiliate (as defined in Rule 501(b)
      under the Securities Act) of BSTI and is not acquiring the shares for the
      account or benefit of a United States person. Mr. Tolonen further represented
      that at the time of the origination of contact concerning the License Agreement
      and the date of the execution and delivery of the License Agreement, Mr. Tolonen
      was outside of the United States.





Wetwool
      License





On
      September 29, 2004, BSTI acquired from Cease-Fire Technologies, Pty. Ltd.,
      a
      private Australian corporation, a license to distribute technologies harnessing
      a passive fire control coating material with the trademark name "Wetwool" to
      include the territories of the United States and Canada. In consideration
      therefore, BSTI issued 1,500,000 shares of common stock to Cease-Fire
      Technologies, Pty. Ltd. Examples of products and technologies developed by
      Cease-Fire Technologies include intumescent paint for safety applications,
      fire
      retardant clear coating for timber, wildfire emergency erect curtain, fabric
      fire retardants, and passive fire retardant coating for any porous surface.
      Wetwool is a proprietary, trademarked, non-woven wool fabric impregnated with
      super-absorbent polymer crystals.





On
      March
      8, 2005, this exclusive license came into full force and effect upon delivery
      of
      the "Wetwool" coating material with its proprietary specifications and
      manufacturing know-how by Cease-Fire Technologies, Pty. Ltd., and the 1,500,000
      shares of common stock under the provisions of the Act to Cease-Fire
      Technologies, Pty. Ltd. were thereby ratified to be validly issued. Since the
      acquisition of the license, BSTI has been researching various manufacturing
      and
      marketing groups to gather information to implement BSTI's business plan. To
      date, BSTI has not consummated any agreements with manufacturers and marketing
      groups and has had no sales to date.





*Plan
      of Operation*





BSTI
      had
      limited operations and $8,000 of revenues during the fiscal quarter ended June
      30, 2006. In March 2006, BSTI closed on two sales of SIMS, and over the next
      twelve months it intends to continue its efforts to sell SIMS. BSTI also intends
      to continue its efforts to develop a second generation version of
      SIMS.





*Results
      of Operation*





During
      the three months ended June 30, 2006, BSTI had $8,000 of revenues, compared
      to
      none during the corresponding period of the previous fiscal year. BSTI’s
      operating expenses increased by $1,594,010 from $2,868 for the three months
      ended June 30, 2005, to $1,596,878 for the three months ended June 30, 2006.
      Such increase in expenses consists primarily of stock for services and
      advertising and marketing expenses that have been incurred following BSTI’s
      commencement of the marketing of its SIMS program in March 2006.





During
      the six months ended June 30, 2006, BSTI had $8,000 of revenues, compared to
      no
      revenue during the corresponding period of the previous fiscal year. BSTI’s
      operating expenses increased by $2,073,826 from $6,472 for the six months ended
      June 30, 2005, to $2,080,298 for the six months ended June 30, 2006. Such
      increase in expenses consists primarily of stock for services and advertising
      and marketing expenses that have been incurred following BSTI’s commencement of
      the marketing of its SIMS program in March 2006.





*Liquidity
      and Capital*





As
      of
      June 30, 2006, BSTI had $50,478 in cash and believes that such funds will not
      be
      sufficient to satisfy BSTI's cash requirements for the next twelve (12)
      months.




There
      is
      no assurance that the funds needed will be raised. There
      can
      be no assurance that we will be able to obtain additional financing if and
      when
      needed or that, if available, financing will be on acceptable terms. Our plans
      to deal with this uncertainty include raising additional capital or entering
      into a strategic arrangement with a third party. There can be no assurance
      that
      our plans can be realized. Additional equity financings may be dilutive to
      holders of our common stock and debt financing, if available, and may involve
      significant payment obligations and covenants that restrict how we operate
      our
      business.




8




*Off-Balance
      Sheet Arrangements*





None.





**Item
      3.**  **Controls
      and Procedures.**





*Evaluation
      of Disclosure Controls and Procedures*





Our
      disclosure controls and procedures are designed to ensure that information
      required to be disclosed in reports that we file or submit under the Securities
      Exchange Act of 1934 is recorded, processed, summarized and reported within
      the
      time periods specified in the rules and forms of the United States Securities
      and Exchange Commission. Our Chief Executive Officer and Chief Financial Officer
      have reviewed the effectiveness of our "disclosure controls and procedures"
      (as
      defined in the Securities Exchange Act of 1934 Rules 13a-14(c) and 15d-14(c))
      within the end of the period covered by this Quarterly Report on Form 10-QSB
      and
      have concluded that the disclosure controls and procedures were not effective
      to
      ensure that material information relating to BSTI is recorded, processed,
      summarized, and reported in a timely manner because of adjustments required
      by
      our auditors in the area of equity . Specifically, our independent auditors
      identified deficiencies in our internal controls and disclosure controls related
      to expense recognition on issuances of stock for services and asset valuation
      related to issuance of stock for a license. We are continuing our efforts to
      improve and strengthen our control processes and procedures to fully remedy
      these deficiencies. Our management and directors will continue to work with
      our
      auditors and other outside advisors to ensure that our controls and procedures
      are adequate and effective . There
      were no significant changes in our internal controls or in other factors that
      could significantly affect these controls subsequent to the last day they were
      evaluated by our Chief Executive Officer and Chief Financial Officer.





** **PART
      II. OTHER INFORMATION**





**Item
      1.**  **Legal
      Proceedings.**





There
      are
      no pending legal proceedings to which BSTI is a party or in which any director,
      officer or affiliate of BSTI, any owner of record or beneficially of more than
      5% of any class of voting securities of BSTI, or security holder is a party
      adverse to BSTI or has a material interest adverse to BSTI. BSTI’s property is
      not the subject of any pending legal proceedings.





**Item
      2. Unregistered Sales of Equity Securities and Use of
      Proceeds.**





On
      April
      18, 2006, BSTI issued 260,000 shares of common stock to an accredited investor
      and non affiliate of BSTI in consideration for an investment of $117,000. The
      issuance was pursuant to Section 4(2) of the Securities Act of 1933, as
      amended.





On
      May 5,
      2006, BSTI received an agreement from an assignee desiring to convert $840,
      which represented a portion of a Promissory Note in the aggregate principal
      amount of $5,000 which had been issued by BSTI in March 20, 2002. Said note
      had
      subsequently been assigned to five assignees. BSTI issued 420,000 shares
      pursuant to the terms of the Promissory Note to the assignee.





On
      May 8,
      2006, BSTI issued 50,000 shares of common stock to Phoenix IR Associates, Inc.
      pursuant to Section 4(2) of the Securities Act of 1933, as amended. The shares
      were issued in consideration for services rendered to BSTI.





On
      May
      17, 2006, BSTI issued 420,000 shares of common stock to Helena Wahala. The
      shares were issued pursuant to the conversion of the outstanding balance of
      a
      promissory note, in the amount of $840, at a conversion rate of $0.02 per share.
      Such issuance was made pursuant to Section 4(2) of the Securities Act of 1933,
      as amended.




9





On
      July
      12, 2006, BSTI issued 480,000 shares of common stock to Mindnet Investment,
      Inc.
      The shares were issued pursuant to the conversion of the outstanding balance
      of
      a promissory note, in the amount of $960, at a conversion rate of $0.002 per
      share. Such issuance was made pursuant to Section 4(2) of the Securities Act
      of
      1933, as amended.




Purchases
      of equity securities by the issuer and affiliated purchasers .





None.




**Item
      3.**  **Defaults
      Upon Senior Securities.**





None.





**Item
      4.**  **Submission
      of Matters to a Vote of Security Holders.**





There
      was
      no matter submitted to a vote of security holders during the fiscal quarter
      ended June 30, 2006.





**Item
      5.**  **Other
      Information.**





None.











**Item
      6.**  **Exhibits**





Exhibit
                No.
            
            Description31.1
            
            Rule
                13a-14(a)/15d14(a)
              Certifications
                of Principal Executive Officer31.2
            
            Rule
                13a-14(a)/15d14(a)
              Certifications
                of Principal Executive Officer32.1
            
            Section
                1350 Certifications




10




SIGNATURES





In
      accordance with to requirements of the Exchange Act, the registrant caused
      this
      report to be signed on its behalf by the undersigned, thereunto duly
      authorized.





Dated:
      August __, 2006


BLOODHOUND
                SEARCH
              TECHNOLOGIES, INC.By:
            /s/
              David CampbellName:
            David CampbellTitle:
            Chief Executive Officer,
              President and Director
              (Principal Executive Offier)By:
            /s/
              Robert HornName:
            Robert HornTitle:
            Chief Financial
              Secretary, and Director(Principal Financial and Accounting
              Officer)





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