----

| DELAWARE                                                                            | 72-0925679                                |
|-------------------------------------------------------------------------------------|-------------------------------------------|
| (State      or other jurisdiction of incorporation      or  organization) | (I.R.S.      employer identification no.) |

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|  PART I - FINANCIAL      INFORMATION                                                                                                                      |     1      |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------|
|                                                                                                                                                                     |                      |
|             Item      1.  Consolidated Financial      Statements                                                       |          1 |
|                 Consolidated Balance Sheet                                                                             |          1      |
|                 Consolidated      Statements of Income                                                       |          2      |
|                 Consolidated      Statements of Cash Flows                                                   |          3      |
|                 Notes to the      Consolidated Financial Statements                                     |          4 |
|             Item      2.  Management's Discussion and Analysis of Financial Condition      and Results of Operations   |     7      |
|             Item 3. Quantitative      and Qualitative Disclosure About Market Risks           |    11                |
|             Item 4. Controls and      Procedures                                                                            |    11                |
|                                                                                                                                                                     |                      |
|  PART II - OTHER      INFORMATION                                                                                                                              |    12                |
|                                                                                                                                            |                      |
|             Item      7.  Exhibits                                                                                          |    12                |
|                                                                                                                                                                     |                      |
|  SIGNATURES                                                                                                                                               |    12                |
|                                                                                                                                                                     |                      |
|                                                                                                                                                                     |                      |
|                                                                                                                                                                     |                      |

|    |   |                                                                                                       |   |
|---------|--------|------------------------------------------------------------------------------------------------------------|--------|
| Exhibit | 31.1   | Certification of Chief Executive Officer      pursuant to section 302 of the Sarbanes-Oxley Act of    2002 | X-1    |
| Exhibit | 31.2   | Certification of Chief Financial Officer      pursuant to section 302 of the Sarbanes-Oxley Act of    2002 | X-2    |
| Exhibit | 32.1   | Certification of Chief Executive Officer      pursuant to section 906 of the Sarbanes-Oxley Act of    2002 | X-3    |
| Exhibit | 32.2   | Certification of Chief Financial Officer      pursuant to section 906 of the Sarbanes-Oxley Act of    2002 | X-4    |
|    |   |                                                                                                       |   |

----

PART I - FINANCIAL INFORMATION

Item 1.  Consolidated Financial Statements

ConsolidatedBalance Sheets

| ASSETS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | June      30, 2010 |       |   | December      31,2009 |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|------------|--------|-----------------------|--------|
| Current      assets:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | (Unaudited)        |       |   | (Audited)             |   |
| Cash and cash      equivalents                                                                                                                                                        |   | $                  | 2,838,872  |   |                  | $      | 3,674,179 |   |
| Trade and other accounts      receivable, net of allowance fordoubtful accounts of $79,976      and      $49,976                                                                                                    |   |               | 4,287,947  |   |                  |   | 3,818,538 |   |
| Inventories,      net                                                                                                                                                                 |   |               | 3,006,824  |   |                  |   | 2,956,682 |   |
| Deferred income taxes,      net                                                                                                                                                       |   |               | 56,500     |   |                  |   | 22,500 |   |
| Prepaid      tax                                                                                                                                                                      |   |               | 65,789     |   |                  |   | 123,789 |   |
| Deposits, prepaid expenses and      other current      assets                                                                                                                         |   |               | 381,240    |   |                  |   | 147,243 |   |
| Total current      assets                                                                                                                                                                            |   |               | 10,637,172 |   |                  |   | 10,742,931 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |               |       |   |                  |   |   |   |
| Property      and equipment, net of accumulated depreciation of$10,927,735 and      $10,361,928                                                                                       |   |               | 6,595,909  |   |                  |   | 6,343,575 |   |
| Goodwill                                                                                                                                                               |   |               | 1,564,966  |   |                  |   | 1,564,966 |   |
| Restricted      cash                                                                                                                                                   |   |               | 511,208    |   |                  |   | - |   |
| Other      intangible assets,      net                                                                                                                                 |   |               | 83,870     |   |                  |   | 95,887 |   |
| Total      assets                                                                                                                                                                     |   | $                  | 19,393,125 |   |                  | $      | 18,747,359 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |               |       |   |                  |   |   |   |
| LIABILITIES      AND SHAREHOLDERS’ EQUITY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |               |       |   |                  |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |               |       |   |                  |   |   |   |
| Current      liabilities:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |               |       |   |                  |   |   |   |
| Accounts      payable                                                                                                                                                                 |   | $                  | 1,503,129  |   |                  | $      | 1,543,700 |   |
| Accrued expenses and customer      deposits                                                                                                                                           |   |               | 374,687    |   |                  |   | 276,903 |   |
| Total current      liabilities                                                                                                                                                                       |   |               | 1,877,816  |   |                  |   | 1,820,603 |   |
| Long      term liabilities:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |               |       |   |                  |   |   |   |
| Long      term deferred tax liability,      net                                                                                                                                       |   |               | 173,266    |   |                  |   | 350,000 |   |
| Long      term portion of deferred gain on      lease                                                                                                                                 |   |               | 20,101     |   |                  |   | 22,347 |   |
| Total long term      liabilities                                                                                                                                                                     |   |               | 193,367    |   |                  |   | 372,347 |   |
| Total    liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |               | 2,071,183  |   |                  |   | 2,192,950 |    |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |               |       |   |                  |   |   |   |
| Shareholders’      equity:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |               |       |   |                  |   |   |   |
| Preferred stock, $1 par value;      2,000,000 shares authorized, none issued                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |               | -          |   |                  |   | - |   |
| Common stock, $0.01 par value;      10,000,000 shares authorized,3,926,491      shares issued, 2,790,514 and 2,675,481 outstanding                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |               | 39,265     |   |                  |   | 39,265 |   |
| Additional      paid-in-capital                                                                                                                                                       |   |               | 10,611,065 |   |                  |   | 10,317,403 |   |
| Common stock held in treasury,      1,135,977 and 1,251,010 shares at cost                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |               | (3,099,842 | )      |                  |   | (3,413,742 | ) |
| Retained      earnings                                                                                                                                                                |   |               | 9,771,454  |   |                  |   | 9,611,483 |   |
| Total shareholders’      equity                                                                                                                                                                |   |               | 17,321,942 |   |                  |   | 16,554,409 |   |
| Total liabilities and      shareholders’      equity                                                                                                                                           |   | $                  | 19,393,125 |   |                  | $      | 18,747,359 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |               |       |   |                  |   |   |   |

----

ConsolidatedStatements of Income

|                                                           |   | Three months endedJune 30, |      |   | Six months endedJune 30, |   |
|----------------------------------------------------------------|--------|----------------------------|-----------|--------|--------------------------|--------|
|                                                           |   | 2010                       |      |   | 2009                     |   |   | 2010 |   |   | 2009 |   |
| Revenue                                                        |   | $                          | 5,782,279 |   |                     | $      | 5,371,439 |   |   | $ | 11,367,639 |   |   | $ | 10,054,893 |   |
| Cost      of sales                                             |   |                       | 4,687,802 |   |                     |   | 4,496,306 |   |   |   | 9,289,014 |   |   |   | 8,235,447 |   |
| Gross profit                                                   |   |                       | 1,094,477 |   |                     |   | 875,133 |   |   |   | 2,078,625 |   |   |   | 1,819,446 |   |
| Selling      and marketing                                     |   |                       | 255,637   |   |                     |   | 183,729 |   |   |   | 413,626 |   |   |   | 334,180 |   |
| General      and administrative                                |   |                       | 671,862   |   |                     |   | 512,391 |   |   |   | 1,275,859 |   |   |   | 1,087,895 |   |
| Research      and development                                  |   |                       | 47,138    |   |                     |   | 57,716 |   |   |   | 102,811 |   |   |   | 126,463 |   |
| Total expense                                                  |   |                       | 974,637   |   |                     |   | 753,836 |   |   |   | 1,792,296 |   |   |   | 1,548,538 |   |
| Income from operations                                         |   |                       | 119,840   |   |                     |   | 121,297 |   |   |   | 286,329 |   |   |   | 270,908 |   |
| Other      income (expense), net                               |   |                       | 144,647   |   |                     |   | (5,377 | ) |   |   | 144,769 |   |   |   | (19,210 | ) |
| Income      before income taxes                                |   |                       | 264,487   |   |                     |   | 115,920 |   |   |   | 431,098 |   |   |   | 251,698 |   |
| Income      tax provision                                      |   |                       | 45,800    |   |                     |   | 39,000 |   |   |   | 109,800 |   |   |   | 93,000 |   |
| Net income                                                     |   | $                          | 218,687   |   |                     | $      | 76,920 |   |   | $ | 321,298 |   |   | $ | 158,698 |   |
| Net      income per share – basic                        |   | $                          | 0.08      |   |                     | $      | 0.03 |   |   | $ | 0.12 |   |   | $ | 0.06 |   |
| Net      income per share – diluted                      |   | $                          | 0.08      |   |                     | $      | 0.03 |   |   | $ | 0.12 |   |   | $ | 0.06 |   |
| Weighted      average common sharesOutstanding – basic   |   |                       | 2,691,914 |   |                     |   | 2,677,777 |   |   |   | 2,683,743 |   |   |   | 2,680,341 |   |
| Weighted      average common sharesOutstanding – diluted |   |                       | 2,739,858 |   |                     |   | 2,677,777 |   |   |   | 2,731,687 |   |   |   | 2,680,341 |   |

----

Consolidated Statements of Cash Flows

|                                                                                                                     |   | Six Months EndedJune 30, |      |
|--------------------------------------------------------------------------------------------------------------------------|--------|--------------------------|-----------|
|                                                                                                                     |   | 2010                     |      |   | 2009 |   |
| Cash      flows from operating activities:                                                                               |   |                     |      |   |   |   |
| Net income                                                                                                               |   | $                        | 321,298   |   |   | $ | 158,698 |   |
|  Adjustments      to reconcile net income to net cash provided by    operating      activities: |   |                     |      |   |   |   |   |   |
| Noncash gain from bargain      purchase                                                                                  |   |                     | (146,288  | ) |   |   | - |   |
| Depreciation and      amortization                                                                                       |   |                     | 698,440   |   |   |   | 691,694 |   |
| Share based compensation                                                                                                 |   |                     | 57,011    |   |   |   | 36,770 |   |
| Provision for doubtful      accounts                                                                                     |   |                     | 30,000    |   |   |   | 11,091 |   |
| Deferred tax expense                                                                                                     |   |                     | (48,200   | ) |   |   | 44,916 |   |
| Changes in operating assets and      liabilities:                                                                        |   |                     |      |   |   |   |   |   |
| Trade and other accounts      receivable                                                                                 |   |                     | (499,409  | ) |   |   | (1,116,460 | ) |
| Inventories                                                                                                              |   |                     | (50,142   | ) |   |   | 136,026 |   |
| Deposits, prepaid expenses and      other assets                                                                         |   |                     | (184,891  | ) |   |   | 132,418 |   |
| Accounts payable and accrued      expenses                                                                               |   |                     | (27,286   | ) |   |   | 315,979 |   |
| Net cash provided by operating      activities                                                                           |   |                     | 150,533   |   |   |   | 411,132 |   |
|  Cash      flows from investing activities:                                                                         |   |                     |      |   |   |   |   |   |
| Capital expenditures, net of      disposals                                                                              |   |                     | (840,869  | ) |   |   | (634,572 | ) |
| Acquisition activities                                                                                                   |   |                     | 16,357    |   |   |   | - |   |
| Net cash used in investing      activities                                                                               |   |                     | (824,512  | ) |   |   | (634,572 | ) |
|  Cash      flows from financing activities:                                                                         |   |                     |      |   |   |   |   |   |
| Payments on note payable                                                                                                 |   |                     | -         |   |   |   | (47,269 | ) |
| Cash dividend paid                                                                                                       |   |                     | (161,328  | ) |   |   | - |   |
| Purchase of treasury      shares                                                                                         |   |                     | -         |   |   |   | (33,188 | ) |
| Net cash used in financing      activities                                                                               |   |                     | (161,328  | ) |   |   | (80,457 | ) |
| Net      decrease in cash and cash equivalents                                                                           |   |                     | (835,307  | ) |   |   | (303,897 | ) |
| Cash      and cash equivalents at beginning of period                                                                    |   |                     | 3,674,179 |   |   |   | 2,320,467 |   |
| Cash      and cash equivalents at end of period                                                                          |   | $                        | 2,838,872 |   |   | $ | 2,016,570 |   |
|                                                                                                                     |   |                     |      |   |   |   |   |   |
|                                                                                                                     |   |                     |      |   |   |   |   |   |
|                                                                                                                     |   |
|                                                                                                                     |   |

----

Notes to theConsolidated Financial Statements

| Inventories      consist of the following as of: |   | June      30,2010 |      |   | December      31, 2009 |   |
|--------------------------------------------------|--------|-------------------|-----------|--------|------------------------|--------|
| Raw materials                                    |   | $                 | 822,620   |   |                   | $      | 1,043,228 |   |
| Work-in-process                             |   |              | 302,129   |   |                   |   | 243,360 |   |
| Finished goods                                   |   |              | 1,882,075 |   |                   |   | 1,679,094 |   |
|      Total              |   | $                 | 3,006,824 |   |                   | $      | 2,956,682 |   |

|                                  | Six      Months Ended June 30, |
|---------------------------------------|--------------------------------|
|                                  | 2010                           |
| Dividend      Yield                   |           1.26% |
| Expected      Volatility              |         46.48%       |
| Risk      Free Interest Rate          |          1.2%   |
| Expected      Option Terms (in years) | 5.0                            |

----

| Exercise      Price     | Number      of Outstanding Shares | Weighted      Average Remaining Contractual Life (years) | Options      Currently Exercisable | Average      Fair Value at Grant Date                                                     |
|-------------------------|-----------------------------------|----------------------------------------------------------|------------------------------------|-------------------------------------------------------------------------------------------|
| $   3.41 | 75,500                            | 5.51                                                     | --                                 |             $  0.96 |
| 4.76                    | 60,000                            | 4.96                                                     | --                                 |        1.77                                                                          |
| 7.15                    | 96,000                            | 3.51                                                     | 38,400                             |        2.74                                                                          |
| 9.86                    | 63,000                            | 1.47                                                     | 63,000                             |  4.22                                                                                |
|  12.42             | 10,000                            | 2.10                                                     |  6,000                        |  5.38                                                                                |
|  23.10             | 10,000                            | 2.68                                                     |  6,000                        | 10.77                                                                                     |

|                                 | Non-Vested Options    |
|--------------------------------------|-----------------------|
|                                 | Number      of Shares | Weighted      Average Fair Value |
| Non-vested      at December 31, 2009 |        86,800    | $  3.42 |
| Granted                              | 135,500               |         1.32 |
| Vested                               |  (21,200)        |         3.50 |
| Forfeited                            | -                     | - |
| Non-vested      at June 30, 2010     | 201,100               |               $  2.00 |

----

| Assets                 |   |   |    |
|------------------------|--------|--------|---------|
| Current Assets         |   | $      | 17,357  |   |
| Fixed Assets           |   |   | 83,381  |   |
| Deferred Tax    Assets |   |   | 165,872 |   |
| Other Assets           |   |   | 512,483 |   |
| Total      Assets      |   | $      | 779,093 |   |
|                   |   |   |    |   |
| Liabilities            |   |   |    |   |
| Current    Liabilities |   | $      | 82,254  |   |
| Total      Liabilities |   | $      | 82,254  |   |
|                   |   |   |    |   |

----

Item 2.  Management's Discussion and Analysis of FinancialCondition and Results of Operations

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|               |   | Three      Months Ending June 30, |      |   | Six      Months Ending June 30, |   |
|--------------------|--------|-----------------------------------|-----------|--------|---------------------------------|--------|
|               |   | 2010                              |      |   | %                               |   |   | 2009 |   |   | % |   |   | 2010 |   |   | % |   |   | 2009 |   |   | % |   |
| United      States |   | $                                 | 2,930,635 |   |                            |   | 51 |   |   | $ | 3,505,679 |   |   |   | 65 |   |   | $ | 6,038,855 |   |   |   | 53 |   |   | $ | 6,121,668 |   |   |   | 61 |   |
| Canada             |   |                              | 1,414,690 |   |                            |   | 25 |   |   |   | 873,421 |   |   |   | 16 |   |   |   | 2,754,700 |   |   |   | 24 |   |   |   | 1,820,099 |   |   |   | 18 |   |
| Europe             |   |                              | 655,997   |   |                            |   | 11 |   |   |   | 571,091 |   |   |   | 11 |   |   |   | 1,145,159 |   |   |   | 10 |   |   |   | 1,372,637 |   |   |   | 14 |   |
| Pacific      Rim   |   |                              | 419,066   |   |                            |   | 7 |   |   |   | 176,045 |   |   |   | 3 |   |   |   | 810,362 |   |   |   | 7 |   |   |   | 327,475 |   |   |   | 3 |   |
| Other              |   |                              | 361,891   |   |                            |   | 6 |   |   |   | 245,203 |   |   |   | 5 |   |   |   | 618,563 |   |   |   | 6 |   |   |   | 413,014 |   |   |   | 4 |   |
| Total              |   | $                                 | 5,782,279 |   |                            |   | 100 |   |   | $ | 5,371,439 |   |   |   | 100 |   |   | $ | 11,367,639 |   |   |   | 100 |   |   | $ | 10,054,893 |   |   |   | 100 |   |

----

----

----

Item 3. Quantitative and Qualitative Disclosure About MarketRisks

Item 4. Controls and Procedures

----

PART II - OTHER INFORMATION

Item 7.  Exhibits

| (a)   | Exhibits |
|-----------------|----------|

|   | 3.1 | Amended      and Restated By-laws(b) |
|--------|-----|--------------------------------------|

|   |                  10.43* | Employment      agreement between James E. Rouse and the Company dated December 26th,      2006.(c) |
|--------|--------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------|

|   |                     10.44* | Employment      agreement between David A. Garrison and the Company dated January 1st,      2007.(d) |
|--------|--------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------|

|   |  31.1 | Certification      of the CEO pursuant to Rule 13a-14(a) or Rule 15(d)-14(a) on page      X-1. |
|--------|------------|------------------------------------------------------------------------------------------------|

|   |  31.2 | Certification      of the CFO pursuant to Rule 13a-14(a) or Rule 15(d)-14(a) on page      X-2. |
|--------|------------|------------------------------------------------------------------------------------------------|

|   |  32.1 | Certification      pursuant to 18 U.S.C. §1350 as adopted pursuant to Section 906 of the      Sarbanes-Oxley Act of 2002 on pageX-3. |
|--------|------------|-------------------------------------------------------------------------------------------------------------------------------------------|

|   |  32.2 | Certification      pursuant to 18 U.S.C. §1350 as adopted pursuant to Section 906 of the      Sarbanes-Oxley Act of 2002 on pageX-4. |
|--------|------------|-------------------------------------------------------------------------------------------------------------------------------------------|

|   | __________________________ |
|--------|----------------------------|

|   | *      Indicates a management contract or compensatory plan required to be filed      as an exhibit. |
|--------|------------------------------------------------------------------------------------------------------|

|  (a)  |                  Incorporated by reference from the      Company’s Registration Statement on Form S-18 as filed with the Commission      in April 1988, Registration Statement No.  33-20945-FW. |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|            (b)   |                 Incorporated by reference from the Company’s Form 8-K as filed with the      Commission May 8, 2009. |
|-----------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  (c)   |                 Incorporated by reference from the Company’s Form 8-K as filed with the      Commission onDecember 8, 2006. |
|-----------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d)   |                 Incorporated by reference from the Company’s Form 10-KSB for period ended      December 31, 2006 as filed with the Commission in March of      2007. |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

SIGNATURES

|                 | ARRHYTHMIA      RESEARCH TECHNOLOGY, INC.                                                          |
|----------------------|---------------------------------------------------------------------------------------------------------|
| August      16, 2010 | By:           /s/  James      E. Rouse |
|                 | James E. Rouse                                                                                          |
|                 | President and Chief Executive      Officer                                                              |
|                 | (Principal Executive      Officer)                                                                 |
|                 | By:           /s/ David A.      Garrison         |
|                 | David A.  Garrison                                                                                      |
|                 | Executive Vice President and      Chief Financial Officer                                               |
|                 | (Principal Financial and      Accounting Officer)                                                       |

----

| Number | Exhibit | Page |
|--------|---------|------|

31.1                 Certificationof the CEO pursuant to Rule 13a-14(a) or Rule15(d)-14(a)                                                                                                                                    X-1

31.2                 Certificationof the CFO pursuant to Rule 13a-14(a) or Rule15(d)-14(a)                                                                                                                                    X-2

32.1                 Certificationpursuant to 18 U.S.C. §1350 as adopted pursuant to Section 906

of theSarbanes-Oxley Act of2002                                                                                                                                                                                                        X-3

32.2                 Certificationpursuant to 18 U.S.C. §1350 as adopted pursuant to Section 906

 ofthe Sarbanes-Oxley Act of2002                                                                                                                                                                                                       X-4