UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                   Form 10-QSB

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

(Mark one)
    X    Quarterly  Report Under Section 13 or 15(d) of the Securities  Exchange
-------- Act of 1934


              For the quarterly period ended September 30, 2006

         Transition Report Under Section 13 or 15(d) of the Securities  Exchange
-------- Act of 1934


              For the transition period from ______________ to _____________

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

                         Commission File Number: 0-21071
                                                 -------

                               Nevstar Corporation
             (Exact name of registrant as specified in its charter)

          Nevada                                              88-0309578
------------------------                                ------------------------
(State of incorporation)                                (IRS Employer ID Number)

                      12890 Hilltop Road, Argyle, TX 76226
                      ------------------------------------
               (Address of principal executive offices) (Zip Code)

                                 (972) 233-0300
                                 --------------
              (Registrant's telephone number, including area code)

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

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
                                                             ---   ---

Indicate by check mark whether the  registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act): YES X  NO
                                    ---   ---

State the number of shares outstanding of each of the issuer's classes of common
equity as of the latest practicable date: October 24, 2006: 419,449
                                          -------------------------

Transitional Small Business Disclosure Format (check one): YES    NO X
                                                              ---   ---



<PAGE>

                               Nevstar Corporation

               Form 10-Q for the Quarter ended September 30, 2006

                                Table of Contents


                                                                            Page
                                                                            ----
Part I - Financial Information

  Item 1   Financial Statements                                                3

  Item 2   Management's Discussion and Analysis or Plan of Operation          13

  Item 3   Controls and Procedures                                            14


Part II - Other Information

  Item 1   Legal Proceedings                                                  15

  Item 2   Unregistered Sales of Equity Securities and Use of Proceeds        15

  Item 3   Defaults Upon Senior Securities                                    15

  Item 4   Submission of Matters to a Vote of Security Holders                15

  Item 5   Other Information                                                  15

  Item 6   Exhibits                                                           15


Signatures                                                                    15








                                                                               2

<PAGE>
<TABLE>
<CAPTION>

Part I
Item 1 - Financial Statements

                               Nevstar Corporation
                        (a development stage enterprise)
                                 Balance Sheets
                           September 30, 2006 and 2005

                                   (Unaudited)


                                                               September 30,    September 30,
                                                                    2006             2005
                                                               -------------    -------------
<S>                                                            <C>              <C>
                                     Assets
                                     ------
Assets
   Cash in bank                                                $          29    $        --
                                                               -------------    -------------

Total Assets                                                   $          29    $        --
                                                               =============    =============


                      Liabilities and Stockholders' Deficit
                      -------------------------------------

Current Liabilities
   Current portion of long-term pre-petition tax liabilities   $     113,638    $     170,857
   Accounts payable - trade                                           61,547           56,047
   Accrued interest payable                                          119,475           73,258
   Line of credit payable to stockholder                             390,625          390,625
                                                               -------------    -------------
                                                                     685,285          690,787
                                                               -------------    -------------

Long-Term Liabilities
   Line of credit payable to stockholder                               8,500             --
                                                               -------------    -------------

   Total Liabilities                                                 693,785          690,787
                                                               -------------    -------------


Commitments and contingencies


Stockholders' Deficit
   Preferred stock - $0.01 par value
     10,000,000 shares authorized
     None issued and outstanding                                        --               --
   Common stock - $0.01 par value
     150,000,000 shares authorized
     419,449 and 169,449 shares
      issued and outstanding, respectively                             4,194            1,694
   Additional paid-in capital                                        577,956          505,456
   Accumulated deficit - prior to development stage               (1,001,679)      (1,001,679)
   Deficit accumulated during development stage                     (274,227)        (196,258)
                                                               -------------    -------------

     Total Stockholders' Deficit                                    (693,756)        (690,787)
                                                               -------------    -------------

Total Liabilities and Stockholders' Deficit                    $          29    $        --
                                                               =============    =============
</TABLE>



   The financial information presented herein has been prepared by management
           without audit by independent certified public accountants.
   The accompanying notes are an integral part of these financial statements.

                                                                               3

<PAGE>
<TABLE>
<CAPTION>

                               Nevstar Corporation
                        (a development stage enterprise)
                 Statements of Operations and Comprehensive Loss
               Three months ended September 30, 2006 and 2005 and
          Period from November 22, 2002 (date of bankruptcy settlement)
                           through September 30, 2006

                                   (Unaudited)

                                                                           Period from
                                                                           November 22,
                                                                           2002 (date of
                                                                            bankruptcy
                                         Three months     Three months      settlement)
                                             ended            ended           through
                                         September 30,    September 30,    September 30,
                                              2006             2005             2006
                                         -------------    -------------    -------------
<S>                                      <C>              <C>              <C>

Revenues                                 $        --      $        --      $        --

Expenses
   General and administrative expenses          11,867           13,821          164,791
                                         -------------    -------------    -------------

Loss from Operations                           (11,867)         (13,821)         (164,791)

Other Expense
   Other income                                   --               --             20,000
   Gain on settlement of liabilities              --               --              9,985
   Interest expense                            (19,548)         (10,200)        (139,421)
                                         -------------    -------------    -------------

Loss before Provision for Income Taxes         (31,415)         (24,021)        (274,227)

Provision for Income Taxes                        --               --               --
                                         -------------    -------------    -------------

Net Loss                                       (31,415)         (24,021)        (274,227)

Other Comprehensive Income                        --               --               --
                                         -------------    -------------    -------------

Comprehensive Loss                       $     (31,415)   $     (24,021)   $    (274,227)
                                         =============    =============    =============

Loss per weighted-average share
   of common stock outstanding,
   computed on Net Loss -
   basic and fully diluted               $       (0.07)   $       (0.14)
                                         =============    =============

Weighted-average number
   of shares of common
   stock outstanding                           419,449          169,449
                                         =============    =============
</TABLE>








   The financial information presented herein has been prepared by management
           without audit by independent certified public accountants.
   The accompanying notes are an integral part of these financial statements.
                                                                               4

<PAGE>
<TABLE>
<CAPTION>

                               Nevstar Corporation
                        (a development stage enterprise)
                            Statements of Cash Flows
                 Three months ended September 30, 2006 and 2005
          Period from November 22, 2002 (date of bankruptcy settlement)
                           through September 30, 2006

                                   (Unaudited)

                                                                                                Period from
                                                                                                November 22,
                                                                                               2002 (date of
                                                                                                bankruptcy
                                                               Three months     Three months    settlement
                                                                 ended            ended           through
                                                             September 30,    September 30,    September 30,
                                                                  2006             2005             2006
                                                             -------------    -------------    -------------
<S>                                                          <C>              <C>              <C>
Cash Flows from Operating Activities
   Net Loss                                                  $     (31,415)   $     (24,021)   $    (274,227)
   Adjustments to reconcile net income to net cash
     provided by operating activities
       Depreciation                                                   --               --               --
       Gain on negotiated debt reduction in
         pre-petition tax liabilities                                 --               --             (9,985)
       Increase (Decrease) in
         Accounts payable - trade                                    8,750            3,500          (16,499)
         Pre-petition tax liabilities                                 --               --            (47,234)
       Accrued interest payable                                     19,548           10,200          118,054
                                                             -------------    -------------    -------------
Net cash used in operating activities                               (3,117)         (10,321)        (229,891)
                                                             -------------    -------------    -------------


Cash Flows from Investing Activities                                  --               --               --
                                                             -------------    -------------    -------------


Cash Flows from Financing Activities
   Proceeds from sale of common stock                                 --               --             75,000
   Proceeds from loans from stockholder                              1,000           10,321          176,500
   Cash paid on loans from stockholder                                --               --            (21,580)
                                                             -------------    -------------    -------------
Net cash provided by financing activities                            1,000           10,321          229,920
                                                             -------------    -------------    -------------


Increase (Decrease) in Cash and Cash Equivalents                    (2,117)            --                 29

Cash and cash equivalents at beginning of period                     2,146             --               --
                                                             -------------    -------------    -------------

Cash and cash equivalents at end of period                   $          29    $        --      $          29
                                                             =============    =============    =============

Supplemental Disclosures of Interest and Income Taxes Paid
   Interest paid during the period                           $        --      $        --      $      19,985
                                                             =============    =============    =============
   Income taxes paid (refunded)                              $        --      $        --      $        --
                                                             =============    =============    =============
</TABLE>







   The financial information presented herein has been prepared by management
           without audit by independent certified public accountants.
   The accompanying notes are an integral part of these financial statements.
                                                                               5

<PAGE>

                               Nevstar Corporation
                        (a development stage enterprise)
                          Notes to Financial Statements
                           September 30, 2006 and 2005



Note A - Organization and Description of Business

Nevstar  Corporation  (Company) was incorporated  under the laws of the State of
Nevada on December  2, 1993 as Mesquite  Gaming  Corp.  On October 3, 1995,  the
Company  changed its name to NevStar  Gaming  Corporation  and on September  18,
1997, changed its name to NevStar Gaming & Entertainment Corporation.

The  Company  was  formed  to  acquire,  develop,   construct,  own  and  manage
hotel/casino  projects. The Company's strategy was to concentrate its efforts on
"niche" markets, such as "local" or "neighborhood" casinos. The Company obtained
its license and related  approvals from the Nevada Gaming  Commission to conduct
gaming at its initial hotel/casino, Mesquite Star Hotel and Casino (The Mesquite
Star) in Mesquite,  Nevada,  pursuant to an Order of Registration dated June 23,
1998. On July 1, 1998,  the Mesquite  Star,  opened for business and the Company
began receiving  revenues from  operations.  The Mesquite Star was located on an
approximately 25-acre property in Mesquite, Nevada.

On December 1, 1999,  the Company  filed a voluntary  petition  for relief under
Chapter 11 (the First Chapter 11  Proceeding)  in the United  States  Bankruptcy
Court, District of Nevada (Bankruptcy Court), Case No. 99-19566RCJ.  The Company
acted as debtor in possession during the First Chapter 11 Proceeding. In part as
a result of the objections of certain of the Company's secured creditors and the
Bankruptcy Court's belief that the Company could not be successfully reorganized
in view of such objections,  the Bankruptcy Court dismissed the First Chapter 11
Proceeding on or about March 2, 2000.

On March 3, 2000,  Randy Black  (Black) was  appointed by the District  Court of
Clark  County,  Nevada as receiver for the  Company.  On or about March 8, 2000,
Black caused the casino to cease all  meaningful  operations  and the casino was
closed.  The Company has not  engaged in  business  operations  since that date.
Subsequently,  Black  acquired  the first trust deed on the casino from the bank
and he began foreclosure proceedings against the casino.

On July 10, 2000, the Company again filed a voluntary  petition for relief under
Chapter 11 (the Second Chapter 11 Proceeding) in the Bankruptcy  Court, Case No.
BK-S-00-15075-LBR. During the Second Chapter 11 Proceeding, the Company acted as
debtor in possession. During the course of the Second Chapter 11 Proceeding, the
Bankruptcy  Court permitted Black to foreclose on the casino,  which occurred on
November 13, 2000. In April,  2001, the Company and W/F Investment  Corp.  (W/F)
submitted to the Bankruptcy  Court a plan of  reorganization,  which was amended
from  time to time (the Plan of  Reorganization).  On  February  20,  2002,  the
Bankruptcy  Court  issued an order  confirming  the Plan of  Reorganization.  On
November 22, 2002,  the Plan of  Reorganization  became  effective.  The Company
issued 15,141,674 shares of common stock to holders of unsecured claims; 156,428
shares of common stock to certain  administrative  claimants and to a previously
secured  claim  holder,  and  27,807,219  shares  of  common  stock  to the Plan
Proponents.   The  7,583,687   shares  of  Common  Stock  that  were  previously
outstanding  were retained by the holders of those shares.  There are a total of
50,715,008 shares of common Stock outstanding after the issuance of shares under
the Plan of  Reorganization.  The Plan of  Reorganization  authorized  a reverse
split of the Common Stock, which occurred on January 12, 2006. The effect of the
reverse stock split is reflected in the accompanying  financial statements as of
the first day of the first period presented.

On September 6, 2005, the United States  Bankruptcy  Court,  District of Nevada,
issued a final  decree in the  Chapter  11  proceeding,  formally  removing  the
Company from the  oversight of the  Bankruptcy  Court and ending all  bankruptcy
proceedings.

On October 11, 2005, the Company  entered into a Stock  Purchase  Agreement with
Halter Financial  Investments,  L.P., a Texas limited partnership (HFI) pursuant
to which the Company sold 250,000 newly issued,  restricted  post-reverse  split
shares  (75,000,000  pre-reverse  split  shares)  of its  common  stock  to HFI,
constituting a change of control of the Company.

The Company's emergence from Chapter 11 of Title 11 of the United States Code on
November 22, 2002 created the combination of a change in majority  ownership and
voting control - that is, loss of control by the then-existing  stockholders,  a
court-approved reorganization, and a reliable measure of the entity's fair value
- resulting in a fresh start,  creating,  in substance,  a new reporting entity.
Accordingly,   the  Company,   post  bankruptcy,   has  no  significant  assets,
liabilities or operating activities.  Therefore, the Company, as a new reporting
entity, qualifies as a "development stage enterprise" as defined in Statement of
Financial Accounting Standard No. 7, as amended.


                                                                               6

<PAGE>

                               Nevstar Corporation
                        (a development stage enterprise)
                          Notes to Financial Statements
                           September 30, 2006 and 2005



Note A - Organization and Description of Business - Continued

The  Company's  post-bankruptcy  business  plan is to locate and combine with an
existing,  privately-held  company which is profitable or, in management's view,
has growth  potential,  irrespective  of the  industry  in which it is  engaged.
However, the Company does not intend to combine with a private company which may
be deemed to be an investment  company subject to the Investment  Company Act of
1940. A combination  may be structured as a merger,  consolidation,  exchange of
the  Company's  common  stock for stock or assets or any other  form  which will
result in the combined enterprise's becoming a publicly-held corporation.

As of the date of the accompanying  financial statements and subsequent thereto,
the Company does not have any operations.


Note B - Preparation of Financial Statements

The  Company  follows  the  accrual  basis  of  accounting  in  accordance  with
accounting principles generally accepted in the United States of America and has
a year-end of June 30.

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

Management further acknowledges that it is solely responsible for adopting sound
accounting  practices,   establishing  and  maintaining  a  system  of  internal
accounting  control and preventing and detecting  fraud. The Company's system of
internal  accounting  control is designed to assure,  among other items, that 1)
recorded  transactions  are valid; 2) valid  transactions  are recorded;  and 3)
transactions  are  recorded in the proper  period in a timely  manner to produce
financial  statements which present fairly the financial  condition,  results of
operations  and cash  flows of the  Company  for the  respective  periods  being
presented.

During interim periods, the Company follows the accounting policies set forth in
its annual  audited  financial  statements  filed with the U. S.  Securities and
Exchange  Commission on its Annual Report on Form 10-KSB for the year ended June
30, 2006. The information  presented within these interim  financial  statements
may not  include  all  disclosures  required by  generally  accepted  accounting
principles and the users of financial  information  provided for interim periods
should refer to the annual  financial  information  and footnotes when reviewing
the interim financial results presented herein.

In the opinion of management,  the accompanying  interim  financial  statements,
prepared in  accordance  with the U. S.  Securities  and  Exchange  Commission's
instructions   for  Form  10-QSB,   are   unaudited  and  contain  all  material
adjustments,  consisting  only of  normal  recurring  adjustments  necessary  to
present fairly the financial condition,  results of operations and cash flows of
the Company for the respective  interim  periods  presented.  The current period
results of operations are not necessarily indicative of results which ultimately
will be reported for the full fiscal year ending June 30, 2007.


Note C - Going Concern Uncertainty

The Company has no post-bankruptcy  operating history,  limited cash on hand, no
other  operating  assets and has a business plan with inherent risk.  Because of
these  factors,  the  Company's  auditors  have  issued an audit  opinion on the
Company's  June 30,  2006 and 2005  financial  statements,  respectively,  which
includes a statement  describing the Company's going concern status. This means,
in the Company's auditor's opinion, substantial doubt exists about the Company's
ability to continue as a going concern at the date of their opinion.





                                                                               7

<PAGE>

                               Nevstar Corporation
                        (a development stage enterprise)
                    Notes to Financial Statements - Continued
                           September 30, 2006 and 2005



Note C - Going Concern Uncertainty - Continued

The Company's majority stockholder maintains the corporate status of the Company
and has provided all nominal  working  capital  support on the Company's  behalf
since the bankruptcy  discharge date. Because of the Company's lack of operating
assets,  its  continuance  is fully  dependent  upon the majority  stockholder's
continuing support.  The majority stockholder intends to continue the funding of
nominal necessary expenses to sustain the corporate entity.

The  Company's  continued  existence is  dependent  upon its ability to generate
sufficient cash flows from operations to support its daily operations as well as
provide sufficient resources to retire existing liabilities and obligations on a
timely basis. Further, the Company faces considerable risk in it's business plan
and a potential  shortfall of funding due to our  inability to raise  capital in
the equity  securities  market.  If no additional  operating capital is received
during the next twelve  months,  the Company  will be forced to rely on existing
cash in the bank and additional  funds loaned by management  and/or  significant
stockholders.  In the event,  the  Company is unable to  acquire  advances  from
management and/or  significant  stockholders,  the Company's ongoing  operations
would be negatively impacted.

The Company's  business plan is to seek an  acquisition or merger with a private
operating   company  which  offers  an  opportunity   for  growth  and  possible
appreciation of our stockholders'  investment in the then issued and outstanding
common stock.  However,  there is no assurance  that the Company will be able to
successfully  consummate  an  acquisition  or merger  with a  private  operating
company or, if  successful,  that any  acquisition  or merger will result in the
appreciation  of our  stockholders'  investment in the then  outstanding  common
stock.

The Company  remains  dependent upon additional  external  sources of financing;
including being dependent upon its management and/or significant stockholders to
provide   sufficient   working  capital  in  excess  of  the  Company's  initial
capitalization to preserve the integrity of the corporate entity.

The Company  anticipates  offering future sales of equity  securities.  However,
there is no assurance that the Company will be able to obtain additional funding
through the sales of additional  equity  securities  or, that such  funding,  if
available, will be obtained on terms favorable to or affordable by the Company.

It  is  the  intent  of  management  and  significant  stockholders  to  provide
sufficient  working  capital  necessary to support and preserve the integrity of
the corporate entity.  However, no formal commitments or arrangements to advance
or loan funds to the Company or repay any such advances or loans exist. There is
no legal obligation for either management or significant stockholders to provide
additional future funding.


Note D - Summary of Significant Accounting Policies

1.   Cash and cash equivalents
     -------------------------

     For  Statement of Cash Flows  purposes,  the Company  considers all cash on
     hand  and  in  banks,  certificates  of  deposit  and  other  highly-liquid
     investments with maturities of three months or less, when purchased,  to be
     cash and cash equivalents.

2.   Income Taxes
     ------------

     The Company uses the asset and liability  method of  accounting  for income
     taxes. At June 30, 2006 and 2005, respectively,  the deferred tax asset and
     deferred tax liability accounts, as recorded when material to the financial
     statements,  are entirely the result of  temporary  differences.  Temporary
     differences   represent  differences  in  the  recognition  of  assets  and
     liabilities for tax and financial reporting purposes.

     As of September  30, 2006 and 2005,  the deferred tax asset  related to the
     Company's net operating loss  carryforward  is fully  reserved.  Due to the
     provisions  of Internal  Revenue  Code Section 338, the Company may have no
     net operating loss carryforwards available to offset financial statement or
     tax  return  taxable  income in future  periods  as a result of a change in
     control   involving  50  percentage  points  or  more  of  the  issued  and
     outstanding securities of the Company.


                                                                               8

<PAGE>

                               Nevstar Corporation
                        (a development stage enterprise)
                    Notes to Financial Statements - Continued
                           September 30, 2006 and 2005



Note D - Summary of Significant Accounting Policies - Continued

3.   Earnings (loss) per share
     -------------------------

     Basic  earnings  (loss) per share is computed  by  dividing  the net income
     (loss) available to common stockholders by the  weighted-average  number of
     common shares  outstanding  during the respective  period  presented in our
     accompanying financial statements.

     Fully diluted earnings (loss) per share is computed similar to basic income
     (loss) per share  except that the  denominator  is increased to include the
     number of common  stock  equivalents  (primarily  outstanding  options  and
     warrants).

     Common  stock  equivalents  represent  the  dilutive  effect of the assumed
     exercise of the outstanding stock options and warrants,  using the treasury
     stock method, at either the beginning of the respective period presented or
     the date of  issuance,  whichever  is later,  and only if the common  stock
     equivalents  are  considered  dilutive  based upon the Company's net income
     (loss) position at the calculation date.

     At September 30, 2006 and 2005, and subsequent thereto,  the Company had no
     outstanding common stock equivalents.

     The  weighted-average  number of shares issued and outstanding as reflected
     in the accompanying  financial statements have been adjusted to give effect
     to the aforementioned 1-for-300 reverse stock split.

4.   Recent Accounting Pronouncements
     --------------------------------

     The Company  does not expect the  adoption of  recently  issued  accounting
     pronouncements  to have a significant  impact on the  Company's  results of
     operations, financial position or cash flows.


Note E - Fair Value of Financial Instruments

The carrying amount of cash,  accounts payable and notes payable, as applicable,
approximates  fair value due to the short term nature of these items  and/or the
current interest rates payable in relation to current market conditions.

Interest  rate risk is the risk  that the  Company's  earnings  are  subject  to
fluctuations  in interest  rates on either  investments  or on debt and is fully
dependent  upon  the  volatility  of  these  rates.  The  Company  does  not use
derivative instruments to moderate its exposure to interest rate risk, if any.

Financial  risk  is  the  risk  that  the  Company's  earnings  are  subject  to
fluctuations in interest rates or foreign exchange rates and are fully dependent
upon the  volatility  of  these  rates.  The  Company  does  not use  derivative
instruments to moderate its exposure to financial risk, if any.


Note F - Pre-Petition Tax Liabilities

Pre-petition  tax  liabilities  consist  of  approximately  $126,599  (including
accrued interest of approximately $12,961) to the Nevada Department of Taxation.
Pursuant  to the  Bankruptcy  Code and  stipulations  entered  into  between the
parties and the Company,  the amounts will be paid in full,  plus interest at 5%
in quarterly  payments ending  September,  2009. Since the Company is in default
with  regard  to its  payments,  the  total  pre-petition  tax  liabilities  are
presented  as  current  liabilities  in the  accompanying  balance  sheet  as of
September 30, 2006.

During the quarter  ended  December 31, 2005,  the Company  reached a settlement
agreement with the Nevada Gaming Commission and paid approximately  $51,220 as a
"settlement in full" on the outstanding debt, resulting in an approximate $9,985
gain on debt extinguishment.




                                                                               9

<PAGE>

                               Nevstar Corporation
                        (a development stage enterprise)
                    Notes to Financial Statements - Continued
                           September 30, 2006 and 2005



Note G - Line of Credit Notes Payable to Stockholders

W/F Investment Corp.
--------------------

The Company has a $250,000  revolving line of credit with W/F Investment Corp, a
company  stockholder and key participant of the Company's Plan of Reorganization
in the Second  Chapter 11 Proceeding.  As of June 30, 2006,  this Line of Credit
has an outstanding balance of approximately $390,625.

Proceeds  from this Line of Credit were used to pay the  Company's  obligations,
including the bankruptcy related allowed  administrative  expenses,  accounting,
legal and related expenses.  The Line of Credit bears interest at prime plus 2%,
payable monthly. The Line of Credit is due October 31, 2007. Accrued interest on
the Line of Credit totaled approximately $106,044 at September 30, 2006.

Because  the  Company  has  exceeded  its credit  limit and is in default on the
payment terms of the accrued  interest and because the lender has the right, due
to the  existence  of these  defaults,  to call the Line of Credit,  the balance
outstanding  is presented as a current  liability  in the  accompanying  balance
sheet at September 30, 2006.

Halter Financial Investments, L. P.
-----------------------------------

The Company and Halter Financial Investments,  L. P. (HFI), an entity controlled
by the Company's  President and Chief Executive Officer,  have acknowledged that
outside funds are necessary to support the corporate  entity and comply with the
periodic  reporting  requirements  of the  Securities  Exchange Act of 1934,  as
amended.  To this end,  HFI has agreed to lend the Company up  to$50,000  with a
maturity  period not to exceed two (2) years from the initial funding date at an
interest rate of 6.0% per annum.  Through  September 30, 2006,  HFI has advanced
$8,500 under this  agreement,  with an initial  scheduled  maturity  date in May
2008.


Note H - Income Taxes

The  components  of income tax  (benefit)  expense  for each of the three  month
periods through September 30, 2006 and 2005 and for the period from November 22,
2002 (date of bankruptcy settlement) through September 30, 2006 is as follows:

                                                                    Period from
                                                                    November 22,
                                                                   2002 (date of
                                                                    bankruptcy
                                   Three months    Three months     settlement)
                                       ended           ended          through
                                   September 30,   September 30,   September 30,
                                        2006            2005            2006
                                   -------------   -------------   -------------
     Federal:
       Current                     $        --     $        --     $        --
       Deferred                             --              --              --
                                   -------------   -------------   -------------
                                            --              --              --
                                   -------------   -------------   -------------
     State:
       Current                              --              --              --
       Deferred                             --              --              --
                                   -------------   -------------   -------------
                                            --              --              --
                                   -------------   -------------   -------------
       Total                       $        --     $        --     $        --
                                   =============   =============   =============

As a result of a October 28,  2005 change in control,  the Company has a limited
net operating loss carryforward to offset future taxable income.  The amount and
availability  of  any  net  operating  loss  carryforwards  may  be  subject  to
limitations set forth by the Internal  Revenue Code.  Factors such as the number
of shares ultimately issued within a three year look- back period; whether there
is a deemed more than 50 percent change in control  involving holders of 5.0% or
more of the  issued  and  outstanding  shares of common  stock;  the  applicable
long-term  tax  exempt  bond  rate;  continuity  of  historical  business;   and
subsequent  income of the  Company  all enter  into the  annual  computation  of
allowable annual utilization of the carryforwards.


                                                                              10

<PAGE>
<TABLE>
<CAPTION>

                               Nevstar Corporation
                        (a development stage enterprise)
                    Notes to Financial Statements - Continued
                           September 30, 2006 and 2005



Note H - Income Taxes - Continued

The  Company's  income tax expense  (benefit) for each of the three months ended
September  30, 2006 and 2005 and for the period from  November 22, 2002 (date of
bankruptcy  settlement)  through September 30, 2006 respectively,  differed from
the statutory federal rate of 34 percent as follows:

                                                                                               Period from
                                                                                               November 22,
                                                                                              2002 (date of
                                                                                               bankruptcy
                                                            Three months      Three months     settlement)
                                                                ended            ended           through
                                                            September 30,    September 30,    September 30,
                                                                 2006             2005             2006
                                                            -------------    -------------    -------------
<S>                                                         <C>              <C>              <C>
Statutory rate applied to income before income taxes        $     (10,700)   $      (8,200)   $     (93,300)
Increase (decrease) in income taxes resulting from:
     State income taxes                                              --               --               --
     Other, including reserve for deferred tax asset
       and application of net operating loss carryforward          10,700            8,200           93,300
                                                            -------------    -------------    -------------

     Income tax expense                                     $        --      $        --      $        --
                                                            =============    =============    =============
</TABLE>


The  Company's  available  net operating  loss  carryforward,  subsequent to the
October 28, 2005 change in control,  is nominal and gives rise to a deferred tax
asset as of June 30, 2006 and 2005,  respectively.  This  deferred tax asset has
been fully reserved due to the uncertainty of it's ultimate utilization, if any,
in future periods.


Note I - Common Stock Transactions

Authorized Shares and Reincorporation

On January 3, 2006,  the  Company  filed an  Amendment  and  Restatement  of its
Articles of  Incorporation  with the  Secretary of State of the State of Nevada.
This Amendment allows for the issuance of up to 150,000,000  shares,  consisting
of any combination of Common Stock, par value $0.01 and up to 10,000,000  shares
of Preferred Stock, par value $0.01 per share. Prior to this change, the Company
was authorized to issue up to 126,396,000 shares of $0.01 par value Common Stock
and up to 10,000,000  shares of $0.01 par value Preferred  Stock.  The effect of
this change is  reflected in the  accompanying  financial  statements  as of the
first day of the first period presented.

On January 12, 2006, the Company  effected a 1-for-300 share reverse stock split
of the then issued and outstanding common stock. The reverse stock split did not
change the number of  authorized  shares of common stock or the par value of the
Company's  common stock.  Except for any changes as a result of the treatment of
fractional  shares,  each stockholder  holds the same percentage of common stock
outstanding  immediately  following the reverse stock split as such  stockholder
did immediately prior to the reverse stock split.

This  action  caused  the  issued  and  outstanding   shares  to  decrease  from
125,715,008 to approximately  419,449. The effect of this action is reflected in
the  accompanying  financial  statements as of the first day of the first period
presented.

Stock issuances

On October 11,  2005,  the Company  sold  250,000  post-reverse  split shares of
restricted   common  stock  for  gross  proceeds  of  $75,000,   pursuant  to  a
subscription agreement, to Halter Financial Investments, L. P., (a Texas Limited
Partnership),  an entity  controlled  by  Timothy  P.  Halter,  who  became  the
Company's current Chief Executive Officer.  The Company relied upon Section 4(2)
of The Securities Act of 1933, as amended, for an exemption from registration of
these shares and no  underwriter  was used in this  transaction.  As a result of
this  transaction,  Halter  Financial  Investments,  L. P. became the  Company's
controlling  stockholder,  owning  approximately  59.60% of the  419,449  shares
currently issued and outstanding.



                                                                              11

<PAGE>

                               Nevstar Corporation
                        (a development stage enterprise)
                    Notes to Financial Statements - Continued
                           September 30, 2006 and 2005



Note J - Commitments and Contingencies

In connection  with the previously  mentioned  Stock Purchase  Agreement and the
January 2006  reverse  stock split,  the Company  entered into a Settlement  and
Stock Issuance  Agreement  (Settlement  Agreement) with W/F Investment  Corp., a
California  corporation (W/F  Investment),  pursuant to which (I) W/F Investment
shall  forgive  the  approximately  $460,000,   including  accrued  interest  of
approximately  $70,000, that was loaned to the Company for purposes of providing
the Company  with  working  capital,  and in return,  the  Company  will pay W/F
Investment  $100,000 and issue 107,000 newly  issued,  restricted  shares of the
Company's common stock to W/F Investment.  The Settlement Agreement had not been
consummated as of September 30, 2006, or subsequent thereto.

W/F  Investment  is a secured  lender of the Company and a member of W/F Nevstar
LLC, a California corporation (W/F Nevstar) and a significant stockholder of the
Company.  William O. Fleischman, a member and the immediate past Chairman of our
Board of Directors, is the managing member of W/F Nevstar.

Immediately following the execution of the Settlement Agreement described above,
the Stock  Purchase  Agreement  calls for HFI and W/F Investment to enter into a
Put  Option  Agreement  pursuant  to which W/F  Investment  may  require  HFI to
purchase up to 199,869  shares of the common  stock of the  Company  held by W/F
Investment  at a price per share of $2.00 at any time  during the period of time
(I) commencing 180 days following the execution of the Stock Purchase  Agreement
and  (ii)  ending  upon  the  earlier  of six  months  following  the  Company's
completion of a transaction  whereby the Company acquires operating control,  or
substantially  all of the assets,  of a privately  held  corporation  generating
revenues  as  reported  in  financial  statements  audited  in  conformity  with
accounting  practices  generally  accepted  in the  United  States  or two years
following the execution of the Stock Purchase Agreement.





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                                                                              12

<PAGE>

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

(1)  Caution Regarding Forward-Looking Information

Certain  statements  contained  in this  quarterly  filing,  including,  without
limitation, statements containing the words "believes", "anticipates", "expects"
and  words  of  similar  import,  constitute  forward-looking  statements.  Such
forward-looking  statements  involve known and unknown risks,  uncertainties and
other factors that may cause the actual results,  performance or achievements of
the Company,  or industry  results,  to be materially  different from any future
results,   performance   or   achievements   expressed   or   implied   by  such
forward-looking statements.

Such factors include, among others, the following:  international,  national and
local general economic and market conditions:  demographic  changes; the ability
of the Company to sustain,  manage or  forecast  its growth;  the ability of the
Company to successfully make and integrate acquisitions;  raw material costs and
availability;  new product  development and  introduction;  existing  government
regulations  and  changes  in,  or  the  failure  to  comply  with,   government
regulations;  adverse publicity;  competition; the loss of significant customers
or suppliers;  fluctuations  and  difficulty in forecasting  operating  results;
changes in business strategy or development  plans;  business  disruptions;  the
ability  to attract  and  retain  qualified  personnel;  the  ability to protect
technology; and other factors referenced in this and previous filings.

Given  these  uncertainties,  readers  of this Form  10-QSB  and  investors  are
cautioned not to place undue reliance on such  forward-looking  statements.  The
Company  disclaims  any  obligation  to update any such  factors or to  publicly
announce the result of any  revisions to any of the  forward-looking  statements
contained herein to reflect future events or developments.

(2)  Results of Operations, Liquidity and Capital Resources

Quarter Ended September 30, 2006 compared to September 30, 2005
---------------------------------------------------------------

The  Company  had no  revenue  for the  respective  three  month  periods  ended
September 30, 2006 and 2005, respectively.

During each of the three month  periods ended  September 30, 2006 and 2005,  the
Company  recognized  general  operating  expenses of  approximately  $11,900 and
$13,800,  respectively,  which were directly related to the Company's compliance
with the periodic reporting requirements of the Securities Exchange Act of 1934,
as amended. During the quarter ended December 31, 2005, the Company recognized a
one-time gain on  forgiveness  of debt or  approximately  $9,985  related to the
settlement  and payment in full of the  pre-petition  tax liability  owed to the
Nevada Gaming Board.

The Company accrued  interest  expense on  pre-petition  tax liabilities and the
Line of Credit notes payable to two separate  stockholders totaled approximately
$19,500 and $10,200 for each of the three month periods ended September 30, 2006
and 2005, respectively.

The  Company  does not  expect  to  generate  any  meaningful  revenue  or incur
operating  expenses for purposes  other than  fulfilling  the  obligations  of a
reporting  company  under The  Securities  Exchange Act of 1934 unless and until
such time that the Company's operating subsidiary begins meaningful operations.

At June 30, 2006, the Company had working capital of approximately $(685,000).

It is the belief of management  and  significant  stockholders  that  sufficient
working capital necessary to support and preserve the integrity of the corporate
entity  will be  present.  However,  there is no  legal  obligation  for  either
management or significant  stockholders  to provide  additional  future funding.
Should this pledge fail to provide financing, the Company has not identified any
alternative  sources.  Consequently,   there  is  substantial  doubt  about  the
Company's ability to continue as a going concern.

The  Company's  need for  capital  may  change  dramatically  as a result of any
business acquisition or combination transaction.  There can be no assurance that
the Company will  identify any such  business,  product,  technology  or company
suitable for acquisition in the future.  Further, there can be no assurance that
the Company would be successful in  consummating  any  acquisition  on favorable
terms  or that it will be able  to  profitably  manage  the  business,  product,
technology or company it acquires.

Plan of Business
----------------

General
-------

The  Company  intends to locate and  combine  with an  existing,  privately-held
company which is profitable  or, in  management's  view,  has growth  potential,
irrespective of the industry in which it is engaged.  However,  the Company does
not  intend  to  combine  with a  private  company  which may be deemed to be an



                                                                              13

<PAGE>

investment  company subject to the Investment Company Act of 1940. A combination
may be structured as a merger,  consolidation,  exchange of the Company's common
stock for stock or assets or any other form which  will  result in the  combined
enterprise's becoming a publicly-held corporation.

Pending  negotiation and consummation of a combination,  the Company anticipates
that it will have, aside from carrying on its search for a combination  partner,
no business  activities,  and, thus, will have no source of revenue.  Should the
Company incur any significant  liabilities prior to a combination with a private
company, it may not be able to satisfy such liabilities as are incurred.

If the Company's management pursues one or more combination opportunities beyond
the  preliminary  negotiations  stage and those  negotiations  are  subsequently
terminated,  it is  foreseeable  that such efforts  will  exhaust the  Company's
ability to continue to seek such combination opportunities before any successful
combination can be consummated.  In that event,  the Company's common stock will
become  worthless  and  holders of the  Company's  common  stock will  receive a
nominal distribution, if any, upon the Company's liquidation and dissolution.

Combination Suitability Standards

In its pursuit for a combination  partner,  the Company's  management intends to
consider only  combination  candidates  which are profitable or, in management's
view, have growth potential.  The Company's management does not intend to pursue
any  combination  proposal  beyond the  preliminary  negotiation  stage with any
combination  candidate which does not furnish the Company with audited financial
statements  for at least its most  recent  fiscal year and  unaudited  financial
statements for interim periods  subsequent to the date of such audited financial
statements, or is in a position to provide such financial statements in a timely
manner.  The Company will, if necessary  funds are available,  engage  attorneys
and/or accountants in its efforts to investigate a combination  candidate and to
consummate a business  combination.  The Company may require  payment of fees by
such combination  candidate to fund the investigation of such candidate.  In the
event such a combination candidate is engaged in a high technology business, the
Company may also obtain  reports from  independent  organizations  of recognized
standing  covering the technology  being developed and/or used by the candidate.
The  Company's  limited  financial  resources may make the  acquisition  of such
reports  difficult  or even  impossible  to obtain  and,  thus,  there can be no
assurance  that the Company  will have  sufficient  funds to obtain such reports
when considering combination proposals or candidates.  To the extent the Company
is  unable to  obtain  the  advice or  reports  from  experts,  the risks of any
combined enterprise's being unsuccessful will be enhanced.  Furthermore,  to the
knowledge of the Company's officers and directors, neither the candidate nor any
of  its  directors,   executive  officers,  principal  stockholders  or  general
partners:

     (1)  will have been convicted of securities  fraud,  mail fraud, tax fraud,
          embezzlement,   bribery,  or  a  similar  criminal  offense  involving
          misappropriation  or theft of funds,  or be the  subject  of a pending
          investigation or indictment involving any of those offenses;

     (2)  will have been  subject to a  temporary  or  permanent  injunction  or
          restraining  order arising from unlawful  transactions  in securities,
          whether as issuer, underwriter, broker, dealer, or investment advisor,
          may be the subject of any pending  investigation  or a defendant  in a
          pending  lawsuit  arising from or based upon  allegations  of unlawful
          transactions in securities; or

     (3)  will have been a defendant in a civil action which resulted in a final
          judgement  against it or him awarding damages or rescission based upon
          unlawful practices or sales of securities.

The Company's  officers and directors will make these  determinations  by asking
pertinent  questions of the  management of prospective  combination  candidates.
Such persons will also ask pertinent  questions of others who may be involved in
the combination proceedings.  However, the officers and directors of the Company
will not generally take other steps to verify independently information obtained
in this manner which is favorable.  Unless  something  comes to their  attention
which  puts  them on  notice  of a  possible  disqualification  which  is  being
concealed  from them,  such persons will rely on  information  received from the
management of the prospective  combination  candidate and from others who may be
involved in the combination proceedings.

Item 3 - Controls and Procedures

(a)  Evaluation of Disclosure Controls and Procedures

     The Company maintains  disclosure controls and procedures that are designed
     to ensure that  information  required to be  disclosed  in its Exchange Act
     reports is recorded,  processed,  summarized  and reported  within the time
     periods  specified  in the Security  and  Exchange  Commission's  rules and
     forms,  and that such  information is accumulated  and  communicated to the
     Company's  management,  including the Company's Chief Executive Officer and
     Chief  Financial  Officer,  as  appropriate,   to  allow  timely  decisions



                                                                              14

<PAGE>

     regarding required disclosure.  Management necessarily applied its judgment
     in assessing the costs and benefits of such controls and procedures, which,
     by  their  nature,   can  provide  only  reasonable   assurance   regarding
     management's control objectives.

     The Company  carried out an evaluation,  under the supervision and with the
     participation of its management,  including its Chief Executive Officer and
     Chief Financial  Officer,  on the effectiveness of the design and operation
     of its disclosure  controls and  procedures  pursuant to Exchange Act Rules
     13a-15 and 15d-15 as of the end of the period covered by this report. Based
     upon that  evaluation,  the  Company's  Chief  Executive  Officer and Chief
     Financial  Officer  concluded  that the Company's  disclosure  controls and
     procedures are effective in timely alerting them to information relating to
     the Company required to be included in the Company's Exchange Act reports.

     While the  Company  believes  that its  existing  disclosure  controls  and
     procedures have been effective to accomplish their objectives,  the Company
     intends to continue to examine, refine and document its disclosure controls
     and procedures and to monitor ongoing developments in this area.

(b)  Changes in Internal Controls

     During  the  quarter  ended  September  30,  2006,  there  were no  changes
     (including  corrective  actions with regard to significant  deficiencies or
     material  weaknesses)  in the  Company's  internal  control over  financial
     reporting  that  have  materially  affected,  or are  reasonably  likely to
     materially affect, the Company's internal control over financial reporting.


Part II - Other Information

Item 1 - Legal Proceedings

     None

Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds

     None

Item 3 - Defaults on Senior Securities

     None

Item 4 - Submission of Matters to a Vote of Security Holders

     The Company has held no regularly scheduled,  called or special meetings of
     stockholders during the reporting period.

Item 5 - Other Information

   None

Item 6 - Exhibits

     Exhibits
     --------
     31.1 Certification pursuant to Section 302 of Sarbanes-Oxley Act of 2002
     32.1 Certification pursuant to Section 906 of Sarbanes-Oxley Act of 2002.

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

                                   SIGNATURES

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

                                                             Nevstar Corporation

Dated: October 31, 2006                             /s/ Timothy P. Halter
       ----------------                     ------------------------------------
                                                               Timothy P. Halter
                                              President, Chief Executive Officer
                                            Chief Financial Officer and Director


                                                                              15