----

----

|   | þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|--------|--------|-----------------------------------------------------------------------------------------|

|   | o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|--------|---|------------------------------------------------------------------------------------------|

| New Jersey(State of incorporation) | 22-1114430(IRS employer identification no.) |
|------------------------------------|---------------------------------------------|

----

----

----

INDEX

| PART I.    | FINANCIAL INFORMATION                                       | PAGE   |
|------------|-------------------------------------------------------------|--------|
|       |                                                        |   |
| Item 1.    | Financial Statements:                                       |   |
|       |                                                        |   |
|       | Condensed Consolidated Statements of Income                 | 1      |
|       |                                                        |   |
|       | Condensed Consolidated Balance Sheets                       | 2      |
|       |                                                        |   |
|       | Condensed Consolidated Statements of Cash Flows             | 3      |
|       |                                                        |   |
|       | Condensed Consolidated Statements of Capital Stock          |   |
|       | and Long-term Debt                                          | 4      |
|       |                                                        |   |
|       | Notes to Unaudited Condensed Consolidated                   |   |
|       | Financial Statements                                        | 5      |
|       |                                                        |   |
| Item 2.    | Management's Discussion and Analysis of Financial           |   |
|       | Condition and Results of Operations                         | 12     |
|       |                                                        |   |
| Item 3.    | Quantitative and Qualitative Disclosures of Market Risk     | 21     |
|       |                                                        |   |
| Item 4.    | Controls and Procedures                                     | 21     |
|       |                                                        |   |
| PART II.   | OTHER INFORMATION                                           |   |
|       |                                                        |   |
| Item 1.    | Legal Proceedings                                           | 22     |
|       |                                                        |   |
| Item 1A.   | Risk Factors                                                | 22     |
|       |                                                        |   |
| Item 2.    | Unregistered Sales of Equity Securities and Use of Proceeds | 22     |
|       |                                                        |   |
| Item 3.    | Defaults upon Senior Securities                             | 22     |
|       |                                                        |   |
| Item 4.    | Removed and Reserved                                        | 22     |
|       |                                                        |   |
| Item 5.    | Other Information                                           | 22     |
|       |                                                        |   |
| Item 6.    | Exhibits                                                    | 22     |
|       |                                                        |   |
| SIGNATURES | 23                                                          |

----

Index

| MIDDLESEX WATER COMPANY                      |
|----------------------------------------------|
| CONDENSED CONSOLIDATED STATEMENTS OF INCOME  |
| (Unaudited)                                  |
| (In thousands except per share amounts)      |
|                                         |   |   |   |   |   |   |   |   |   |   |   |   |
|                                         |   | Three Months Ended Sept 30, |   |   | Nine Months Ended Sept 30, |   |
|                                         |   | 2010 |   |   | 2009 |   |   | 2010 |   |   | 2009 |   |
|                                         |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating Revenues                           |   | $ | 29,585 |   |   | $ | 25,498 |   |   | $ | 77,768 |   |   | $ | 69,164 |   |
|                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating Expenses:                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Operations and Maintenance                   |   |   | 14,036 |   |   |   | 13,285 |   |   |   | 41,205 |   |   |   | 39,222 |   |
| Depreciation                                 |   |   | 2,387 |   |   |   | 2,174 |   |   |   | 6,827 |   |   |   | 6,370 |   |
| Other Taxes                                  |   |   | 3,141 |   |   |   | 2,715 |   |   |   | 8,532 |   |   |   | 7,699 |   |
|                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total Operating Expenses                     |   |   | 19,564 |   |   |   | 18,174 |   |   |   | 56,564 |   |   |   | 53,291 |   |
|                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating Income                             |   |   | 10,021 |   |   |   | 7,324 |   |   |   | 21,204 |   |   |   | 15,873 |   |
|                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other Income (Expense):                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Allowance for Funds Used During Construction |   |   | 143 |   |   |   | 245 |   |   |   | 785 |   |   |   | 727 |   |
| Other Income                                 |   |   | 172 |   |   |   | 432 |   |   |   | 532 |   |   |   | 760 |   |
| Other Expense                                |   |   | (129 | ) |   |   | (31 | ) |   |   | (181 | ) |   |   | (49 | ) |
|                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  Total Other Income, net                |   |   | 186 |   |   |   | 646 |   |   |   | 1,136 |   |   |   | 1,438 |   |
|                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest Charges                             |   |   | 1,819 |   |   |   | 1,791 |   |   |   | 5,125 |   |   |   | 4,949 |   |
|                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income before Income Taxes                   |   |   | 8,388 |   |   |   | 6,179 |   |   |   | 17,215 |   |   |   | 12,362 |   |
|                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income Taxes                                 |   |   | 2,652 |   |   |   | 2,152 |   |   |   | 5,495 |   |   |   | 4,128 |   |
|                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net Income                                   |   |   | 5,736 |   |   |   | 4,027 |   |   |   | 11,720 |   |   |   | 8,234 |   |
|                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Preferred Stock Dividend Requirements        |   |   | 52 |   |   |   | 52 |   |   |   | 156 |   |   |   | 156 |   |
|                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Earnings Applicable to Common Stock          |   | $ | 5,684 |   |   | $ | 3,975 |   |   | $ | 11,564 |   |   | $ | 8,078 |   |
|                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Earnings per share of Common Stock:          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                        |   | $ | 0.37 |   |   | $ | 0.30 |   |   | $ | 0.81 |   |   | $ | 0.60 |   |
| Diluted                                      |   | $ | 0.36 |   |   | $ | 0.29 |   |   | $ | 0.80 |   |   | $ | 0.60 |   |
|                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Average Number of                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Common Shares Outstanding :                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                        |   |   | 15,518 |   |   |   | 13,458 |   |   |   | 14,350 |   |   |   | 13,435 |   |
| Diluted                                      |   |   | 15,781 |   |   |   | 13,720 |   |   |   | 14,613 |   |   |   | 13,698 |   |
|                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash Dividends Paid per Common Share         |   | $ | 0.1800 |   |   | $ | 0.1775 |   |   | $ | 0.5400 |   |   | $ | 0.5325 |   |

----

Index

MIDDLE

| ASSETS                                          |                                                 |   | September 30,2010 |    |   | December 31,2009 |   |
|-------------------------------------------------|------------------------------------------------------|--------|-------------------|---------|--------|------------------|--------|
| UTILITY PLANT:                                  | Water Production                                     |   | $                 | 117,323 |   |             | $      | 113,124 |   |
|                                            | Transmission and Distribution                        |   |              | 303,243 |   |             |   | 293,269 |   |
|                                            | General                                              |   |              | 43,494  |   |             |   | 29,631 |   |
|                                            | Construction Work in Progress                        |   |              | 12,529  |   |             |   | 17,547 |   |
|                                            | TOTAL                                                |   |              | 476,589 |   |             |   | 453,571 |   |
|                                            | Less Accumulated Depreciation                        |   |              | 82,714  |   |             |   | 77,027 |   |
|                                            | UTILITY PLANT - NET                                  |   |              | 393,875 |   |             |   | 376,544 |   |
|                                            |                                                 |   |              |    |   |             |   |   |   |
| CURRENT ASSETS:                                 | Cash and Cash Equivalents                            |   |              | 3,090   |   |             |   | 4,278 |   |
|                                            | Accounts Receivable, net                             |   |              | 14,119  |   |             |   | 10,616 |   |
|                                            | Unbilled Revenues                                    |   |              | 6,973   |   |             |   | 4,424 |   |
|                                            | Materials and Supplies (at average cost)             |   |              | 1,924   |   |             |   | 1,618 |   |
|                                            | Prepayments                                          |   |              | 1,597   |   |             |   | 1,109 |   |
|                                            | TOTAL CURRENT ASSETS                                 |   |              | 27,703  |   |             |   | 22,045 |   |
|                                            |                                                 |   |              |    |   |             |   |   |   |
| DEFERRED CHARGES                                | Unamortized Debt Expense                             |   |              | 2,743   |   |             |   | 2,856 |   |
| AND OTHER ASSETS:                               | Preliminary Survey and Investigation Charges         |   |              | 7,004   |   |             |   | 6,999 |   |
|                                            | Regulatory Assets                                    |   |              | 32,360  |   |             |   | 33,081 |   |
|                                            | Operations Contracts Fees Receivable                 |   |              | 3,715   |   |             |   | 3,715 |   |
|                                            | Restricted Cash                                      |   |              | 4,761   |   |             |   | 5,266 |   |
|                                            | Non-utility Assets - Net                             |   |              | 7,061   |   |             |   | 7,134 |   |
|                                            | Other                                                |   |              | 470     |   |             |   | 446 |   |
|                                            | TOTAL DEFERRED CHARGES AND OTHER ASSETS              |   |              | 58,114  |   |             |   | 59,497 |   |
|                                            | TOTAL ASSETS                                         |   | $                 | 479,692 |   |             | $      | 458,086 |   |
|                                            |                                                 |   |              |    |   |             |   |   |   |
| CAPITALIZATION AND LIABILITIES                  |                                                 |   |              |    |   |             |   |   |
| CAPITALIZATION:                                 | Common Stock, No Par Value                           |   | $                 | 139,111 |   |             | $      | 109,366 |   |
|                                            | Retained Earnings                                    |   |              | 34,024  |   |             |   | 30,265 |   |
|                                            | TOTAL COMMON EQUITY                                  |   |              | 173,135 |   |             |   | 139,631 |   |
|                                            | Preferred Stock                                      |   |              | 3,362   |   |             |   | 3,373 |   |
|                                            | Long-term Debt                                       |   |              | 130,550 |   |             |   | 124,910 |   |
|                                            | TOTAL CAPITALIZATION                                 |   |              | 307,047 |   |             |   | 267,914 |   |
|                                            |                                                 |   |              |    |   |             |   |   |   |
| CURRENT                                         | Current Portion of Long-term Debt                    |   |              | 4,350   |   |             |   | 3,710 |   |
| LIABILITIES:                                    | Notes Payable                                        |   |              | 18,800  |   |             |   | 42,850 |   |
|                                            | Accounts Payable                                     |   |              | 5,516   |   |             |   | 4,348 |   |
|                                            | Accrued Taxes                                        |   |              | 9,624   |   |             |   | 5,686 |   |
|                                            | Accrued Interest                                     |   |              | 827     |   |             |   | 1,861 |   |
|                                            | Unearned Revenues and Advanced Service Fees          |   |              | 920     |   |             |   | 861 |   |
|                                            | Other                                                |   |              | 1,406   |   |             |   | 1,352 |   |
|                                            | TOTAL CURRENT LIABILITIES                            |   |              | 41,443  |   |             |   | 60,668 |   |
|                                            |                                                 |   |              |    |   |             |   |   |   |
| COMMITMENTS AND CONTINGENT LIABILITIES (Note 7) |                                                 |   |              |    |   |             |   |   |
|                                            |                                                 |   |              |    |   |             |   |   |   |
| DEFERRED CREDITS                                | Customer Advances for Construction                   |   |              | 21,190  |   |             |   | 20,806 |   |
| AND OTHER LIABILITIES:                          | Accumulated Deferred Investment Tax Credits          |   |              | 1,245   |   |             |   | 1,303 |   |
|                                            | Accumulated Deferred Income Taxes                    |   |              | 28,241  |   |             |   | 27,788 |   |
|                                            | Employee Benefit Plans                               |   |              | 24,689  |   |             |   | 25,723 |   |
|                                            | Regulatory Liability - Cost of Utility Plant Removal |   |              | 7,230   |   |             |   | 6,738 |   |
|                                            | Other                                                |   |              | 129     |   |             |   | 275 |   |
|                                            | TOTAL DEFERRED CREDITS AND OTHER LIABILITIES         |   |              | 82,724  |   |             |   | 82,633 |   |
|                                            |                                                 |   |              |    |   |             |   |   |   |
|  CONTRIBUTIONS IN AID OF CONSTRUCTION      |                                                 |   |              | 48,478  |   |             |   | 46,871  |   |
|                                            | TOTAL CAPITALIZATION AND LIABILITIES                 |   | $                 | 479,692 |   |             | $      | 458,086 |   |

----

Index

| MIDDLESEX WATER COMPANY                                                   |
|---------------------------------------------------------------------------|
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS                           |
| (Unaudited)                                                               |
| (In thousands)                                                            |
|                                                                      |   |   |   |   |   |   |
|                                                                      |   | Nine Months Ended September 30, |   |
|                                                                      |   | 2010 |   |   | 2009 |   |
| CASH FLOWS FROM OPERATING ACTIVITIES:                                     |   |   |   |   |   |   |
| Net Income                                                                |   | $ | 11,720 |   |   | $ | 8,234 |   |
| Adjustments to Reconcile Net Income to                                    |   |   |   |   |   |   |   |   |
| Net Cash Provided by Operating Activities:                                |   |   |   |   |   |   |   |   |
| Depreciation and Amortization                                             |   |   | 7,387 |   |   |   | 6,827 |   |
| Provision for Deferred Income Taxes and ITC                               |   |   | 114 |   |   |   | 2,504 |   |
| Equity Portion of AFUDC                                                   |   |   | (488 | ) |   |   | (411 | ) |
| Cash Surrender Value of Life Insurance                                    |   |   | 159 |   |   |   | (310 | ) |
| Stock Compensation Expense                                                |   |   | 277 |   |   |   | 232 |   |
| Changes in Assets and Liabilities:                                        |   |   |   |   |   |   |   |   |
| Accounts Receivable                                                       |   |   | (3,503 | ) |   |   | (3,311 | ) |
| Unbilled Revenues                                                         |   |   | (2,549 | ) |   |   | (624 | ) |
| Materials & Supplies                                                  |   |   | (306 | ) |   |   | (147 | ) |
| Prepayments                                                               |   |   | (488 | ) |   |   | (231 | ) |
| Other Assets                                                              |   |   | (477 | ) |   |   | (633 | ) |
| Accounts Payable                                                          |   |   | 1,168 |   |   |   | (1,230 | ) |
| Accrued Taxes                                                             |   |   | 3,938 |   |   |   | 309 |   |
| Accrued Interest                                                          |   |   | (1,034 | ) |   |   | (1,109 | ) |
| Employee Benefit Plans                                                    |   |   | (180 | ) |   |   | 999 |   |
| Unearned Revenue & Advanced Service Fees                              |   |   | 59 |   |   |   | 55 |   |
| Other Liabilities                                                         |   |   | (54 | ) |   |   | (1,032 | ) |
| NET CASH PROVIDED BY OPERATING ACTIVITIES                                 |   |   | 15,743 |   |   |   | 10,122 |   |
| CASH FLOWS FROM INVESTING ACTIVITIES:                                     |   |   |   |   |   |   |   |   |
| Utility Plant Expenditures, Including AFUDC of $297 in 2010, $316 in 2009 |   |   | (22,223 | ) |   |   | (15,889 | ) |
| Restricted Cash                                                           |   |   | 505 |   |   |   | 456 |   |
| NET CASH USED IN INVESTING ACTIVITIES                                     |   |   | (21,718 | ) |   |   | (15,433 | ) |
| CASH FLOWS FROM FINANCING ACTIVITIES:                                     |   |   |   |   |   |   |   |   |
| Redemption of Long-term Debt                                              |   |   | (3,720 | ) |   |   | (17,843 | ) |
| Proceeds from Issuance of Long-term Debt                                  |   |   | 10,000 |   |   |   | 12,014 |   |
| Net Short-term Bank (Payments)/Borrowings                                 |   |   | (24,050 | ) |   |   | 17,873 |   |
| Deferred Debt Issuance Expenses                                           |   |   | (7 | ) |   |   | (116 | ) |
| Common Stock Issuance Expense                                             |   |   | (133 | ) |   |   | - |   |
| Restricted Cash                                                           |   |   | - |   |   |   | (25 | ) |
| Proceeds from Issuance of Common Stock                                    |   |   | 29,469 |   |   |   | 1,167 |   |
| Repurchase of Preferred Stock                                             |   |   | (11 | ) |   |   | - |   |
| Payment of Common Dividends                                               |   |   | (7,672 | ) |   |   | (7,151 | ) |
| Payment of Preferred Dividends                                            |   |   | (156 | ) |   |   | (156 | ) |
| Construction Advances and Contributions-Net                               |   |   | 1,067 |   |   |   | (687 | ) |
| NET CASH PROVIDED BY FINANCING ACTIVITIES                                 |   |   | 4,787 |   |   |   | 5,076 |   |
| NET CHANGES IN CASH AND CASH EQUIVALENTS                                  |   |   | (1,188 | ) |   |   | (235 | ) |
| CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                          |   |   | 4,278 |   |   |   | 3,288 |   |
| CASH AND CASH EQUIVALENTS AT END OF PERIOD                                |   | $ | 3,090 |   |   | $ | 3,053 |   |
|                                                                      |   |   |   |   |   |   |   |   |
|                                                                      |   |   |   |   |   |   |   |   |
| SUPPLEMENTAL DISCLOSURE OF NON-CASH ACTIVITY:                             |   |   |   |   |   |   |   |   |
| Utility Plant received as Construction Advances and Contributions         |   | $ | 924 |   |   | $ | 2,986 |   |
|                                                                      |   |   |   |   |   |   |   |   |
| SUPPLEMENTAL DISCLOSURE OF CASH FLOWS INFORMATION:                        |   |   |   |   |   |   |   |   |
| Cash Paid During the Year for:                                            |   |   |   |   |   |   |   |   |
| Interest                                                                  |   | $ | 6,167 |   |   | $ | 6,043 |   |
| Interest Capitalized                                                      |   | $ | (297 | ) |   | $ | (316 | ) |
| Income Taxes                                                              |   | $ | 2,726 |   |   | $ | 1,431 |   |
|                                                                      |   |   |   |   |   |   |   |   |
| See Notes to Condensed Consolidated Financial Statements.                 |   |   |   |   |   |   |   |   |

----

Index

MIDDLESEX

|                                                                                                                                                                                                                                                                                         |   | September 30,2010 |    |   | December 31,2009 |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------|---------|--------|------------------|--------|
| Common Stock, No Par Value                                                                                                                                                                                                                                                                   |   |              |    |   |             |   |
| Shares Authorized - 40,000                                                                                                                                                                                                                                                                   |   |              |    |   |             |   |
| Shares Outstanding - 2010 - 15,530                                                                                                                                                                                                                                                           |   | $                 | 139,111 |   |             | $      | 109,366 |   |
|                                               2009 - 13,519 |   |              |    |   |             |   |   |   |
|                                                                                                                                                                                                                                                                                         |   |              |    |   |             |   |   |   |
| Retained Earnings                                                                                                                                                                                                                                                                            |   |              | 34,024  |   |             |   | 30,265 |   |
| TOTAL COMMON EQUITY                                                                                                                                                                                                                                                                          |   | $                 | 173,135 |   |             | $      | 139,631 |   |
|                                                                                                                                                                                                                                                                                         |   |              |    |   |             |   |   |   |
| Cumulative Preferred Stock, No Par Value:                                                                                                                                                                                                                                                    |   |              |    |   |             |   |   |   |
| Shares Authorized - 134                                                                                                                                                                                                                                                                      |   |              |    |   |             |   |   |   |
| Shares Outstanding - 32                                                                                                                                                                                                                                                                      |   |              |    |   |             |   |   |   |
| Convertible:                                                                                                                                                                                                                                                                                 |   |              |    |   |             |   |   |   |
| Shares Outstanding, $7.00 Series - 14                                                                                                                                                                                                                                                        |   | $                 | 1,457   |   |             | $      | 1,457 |   |
| Shares Outstanding, $8.00 Series -   7                                                                                                                                                                                                                                        |   |              | 816     |   |             |   | 816 |   |
| Nonredeemable:                                                                                                                                                                                                                                                                               |   |              |    |   |             |   |   |   |
| Shares Outstanding, $7.00 Series -   1                                                                                                                                                                                                                                        |   |              | 89      |   |             |   | 100 |   |
| Shares Outstanding, $4.75 Series - 10                                                                                                                                                                                                                                                        |   |              | 1,000   |   |             |   | 1,000 |   |
| TOTAL PREFERRED STOCK                                                                                                                                                                                                                                                                        |   | $                 | 3,362   |   |             | $      | 3,373 |   |
|                                                                                                                                                                                                                                                                                         |   |              |    |   |             |   |   |   |
| Long-term Debt:                                                                                                                                                                                                                                                                              |   |              |    |   |             |   |   |   |
| 8.05%, Amortizing Secured Note, due December 20, 2021                                                                                                                                                                                                                                        |   | $                 | 2,488   |   |             | $      | 2,581 |   |
| 6.25%, Amortizing Secured Note, due May 19, 2028                                                                                                                                                                                                                                             |   |              | 7,420   |   |             |   | 7,735 |   |
| 6.44%, Amortizing Secured Note, due August 25, 2030                                                                                                                                                                                                                                          |   |              | 5,577   |   |             |   | 5,787 |   |
| 6.46%, Amortizing Secured Note, due September 19, 2031                                                                                                                                                                                                                                       |   |              | 5,857   |   |             |   | 6,067 |   |
| 4.22%, State Revolving Trust Note, due December 31, 2022                                                                                                                                                                                                                                     |   |              | 603     |   |             |   | 622 |   |
| 3.30% to 3.60%, State Revolving Trust Note, due May 1, 2025                                                                                                                                                                                                                                  |   |              | 3,655   |   |             |   | 3,687 |   |
| 3.49%, State Revolving Trust Note, due January 25, 2027                                                                                                                                                                                                                                      |   |              | 664     |   |             |   | 678 |   |
| 4.03%, State Revolving Trust Note, due December 1, 2026                                                                                                                                                                                                                                      |   |              | 884     |   |             |   | 903 |   |
| 4.00% to 5.00%, State Revolving Trust Bond, due August 1, 2021                                                                                                                                                                                                                          |   |              | 524     |   |             |   | 625 |   |
| 0.00%, State Revolving Fund Bond, due August 1, 2021                                                                                                                                                                                                                                    |   |              | 397     |   |             |   | 436 |   |
| 3.64%, State Revolving Trust Note, due July 1, 2028                                                                                                                                                                                                                                          |   |              | 387     |   |             |   | 395 |   |
| 3.64%, State Revolving Trust Note, due January 1, 2028                                                                                                                                                                                                                                       |   |              | 130     |   |             |   | 132 |   |
| 6.59%, Amortizing Secured Note, due April 20, 2029                                                                                                                                                                                                                                           |   |              | 6,482   |   |             |   | 6,743 |   |
| 7.05%, Amortizing Secured Note, due January 20, 2030                                                                                                                                                                                                                                         |   |              | 4,833   |   |             |   | 5,000 |   |
| 5.69%, Amortizing Secured Note, due January 20, 2030                                                                                                                                                                                                                                         |   |              | 9,915   |   |             |   | - |   |
| First Mortgage Bonds:                                                                                                                                                                                                                                                                        |   |              |    |   |             |   |   |   |
| 5.20%, Series S, due October 1, 2022                                                                                                                                                                                                                                                         |   |              | 12,000  |   |             |   | 12,000 |   |
| 5.25%, Series T, due October 1, 2023                                                                                                                                                                                                                                                         |   |              | 6,500   |   |             |   | 6,500 |   |
| 5.25%, Series V, due February 1, 2029                                                                                                                                                                                                                                                        |   |              | 10,000  |   |             |   | 10,000 |   |
| 5.35%, Series W, due February 1, 2038                                                                                                                                                                                                                                                        |   |              | 23,000  |   |             |   | 23,000 |   |
| 0.00%, Series X, due September 1, 2018                                                                                                                                                                                                                                                       |   |              | 430     |   |             |   | 483 |   |
| 4.25% to 4.63%, Series Y, due September 1, 2018                                                                                                                                                                                                                                              |   |              | 590     |   |             |   | 650 |   |
| 0.00%, Series Z, due September 1, 2019                                                                                                                                                                                                                                                       |   |              | 1,007   |   |             |   | 1,118 |   |
| 5.25% to 5.75%, Series AA, due September 1, 2019                                                                                                                                                                                                                                             |   |              | 1,440   |   |             |   | 1,560 |   |
| 0.00%, Series BB, due September 1, 2021                                                                                                                                                                                                                                                      |   |              | 1,328   |   |             |   | 1,447 |   |
| 4.00% to 5.00%, Series CC, due September 1, 2021                                                                                                                                                                                                                                             |   |              | 1,680   |   |             |   | 1,790 |   |
| 5.10%, Series DD, due January 1, 2032                                                                                                                                                                                                                                                        |   |              | 6,000   |   |             |   | 6,000 |   |
| 0.00%, Series EE, due August 1, 2023                                                                                                                                                                                                                                                         |   |              | 5,224   |   |             |   | 5,642 |   |
| 3.00% to 5.50%, Series FF, due August 1, 2024                                                                                                                                                                                                                                                |   |              | 6,555   |   |             |   | 6,935 |   |
| 0.00%, Series GG, due August 1, 2026                                                                                                                                                                                                                                                         |   |              | 1,440   |   |             |   | 1,530 |   |
| 4.00% to 5.00%, Series HH, due August 1, 2026                                                                                                                                                                                                                                                |   |              | 1,715   |   |             |   | 1,810 |   |
| 0.00%, Series II, due August 1, 2024                                                                                                                                                                                                                                                         |   |              | 1,239   |   |             |   | 1,619 |   |
| 3.40% to 5.00%, Series JJ, due August 1, 2027                                                                                                                                                                                                                                                |   |              | 1,625   |   |             |   | 1,690 |   |
| 0.00%, Series KK, due August 1, 2028                                                                                                                                                                                                                                                         |   |              | 1,616   |   |             |   | 1,705 |   |
| 5.00% to 5.50%, Series LL, due August 1, 2028                                                                                                                                                                                                                                                |   |              | 1,695   |   |             |   | 1,750 |   |
| SUBTOTAL LONG-TERM DEBT                                                                                                                                                                                                                                                                      |   |              | 134,900 |   |             |   | 128,620 |   |
| Less: Current Portion of Long-term Debt                                                                                                                                                                                                                                                      |   |              | (4,350  | )      |             |   | (3,710 | ) |
| TOTAL LONG-TERM DEBT                                                                                                                                                                                                                                                                         |   | $                 | 130,550 |   |             | $      | 124,910 |   |

----

Index

MIDDLESEX WATER COMPANY

----

Index

----

Index

|                 |   | (Thousands of Dollars) |   |
|----------------------|--------|------------------------|--------|
|                 |   | September 30, 2010     |   |   | December 31, 2009 |   |
|                 |   | Carrying               |   |   | Fair |   |   | Carrying |   |   | Fair |   |
|                 |   | Amount                 |   |   | Value |   |   | Amount |   |   | Value |   |
| First Mortgage Bonds |   | $                      | 85,084 |   |   | $ | 85,556 |   |   | $ | 87,230 |   |   | $ | 84,429 |   |
| SRF Bonds            |   | $                      | 921    |   |   | $ | 942 |   |   | $ | 1,061 |   |   | $ | 1,091 |   |

|   |                                                    |   | (In Thousands Except per Share Amounts) |   |
|--------|---------------------------------------------------------|--------|-----------------------------------------|--------|
|   |                                                    |   | Three Months Ended September 30,        |   |
|   | Basic:                                                  |   | 2010                                    |   |   | Shares |   |   | 2009 |   |   | Shares |   |
|   | Net Income                                              |   | $                                       | 5,736  |   |   |   | 15,518 |   |   | $ | 4,027 |   |   |   | 13,458 |   |
|   | Preferred Dividend                                      |   |                                    | (52    | ) |   |   | - |   |   |   | (52 | ) |   |   | - |   |
|   | Earnings Applicable to Common Stock                     |   | $                                       | 5,684  |   |   |   | 15,518 |   |   | $ | 3,975 |   |   |   | 13,458 |   |
|   |                                                    |   |                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   | Basic EPS                                               |   | $                                       | 0.37   |   |   |   |   |   |   | $ | 0.30 |   |   |   |   |   |
|   |                                                    |   |                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   | Diluted:                                                |   |                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   | Earnings Applicable to Common Stock                     |   | $                                       | 5,684  |   |   |   | 15,518 |   |   | $ | 3,975 |   |   |   | 13,458 |   |
|   | $7.00 Series Preferred Dividend                         |   |                                    | 24     |   |   |   | 167 |   |   |   | 24 |   |   |   | 166 |   |
|   | $8.00 Series Preferred Dividend                         |   |                                    | 14     |   |   |   | 96 |   |   |   | 14 |   |   |   | 96 |   |
|   | Adjusted Earnings Applicable to  Common Stock |   | $                                       | 5,722  |   |   |   | 15,781 |   |   | $ | 4,013 |   |   |   | 13,720 |   |
|   |                                                    |   |                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   | Diluted EPS                                             |   | $                                       | 0.36   |   |   |   |   |   |   | $ | 0.29 |   |   |   |   |   |

----

Index

|   |                                                    |   | (In Thousands Except per Share Amounts) |   |
|--------|---------------------------------------------------------|--------|-----------------------------------------|--------|
|   |                                                    |   | Nine Months Ended September 30,         |   |
|   | Basic:                                                  |   | 2010                                    |   |   | Shares |   |   | 2009 |   |   | Shares |   |
|   | Net Income                                              |   | $                                       | 11,720 |   |   |   | 14,350 |   |   | $ | 8,234 |   |   |   | 13,435 |   |
|   | Preferred Dividend                                      |   |                                    | (156   | ) |   |   | - |   |   |   | (156 | )  |   |   | - |   |
|   | Earnings Applicable to Common Stock                     |   | $                                       | 11,564 |   |   |   | 14,350 |   |   | $ | 8,078 |   |   |   | 13,435 |   |
|   |                                                    |   |                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   | Basic EPS                                               |   | $                                       | 0.81   |   |   |   |   |   |   | $ | 0.60 |   |   |   |   |   |
|   |                                                    |   |                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   | Diluted:                                                |   |                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   | Earnings Applicable to Common Stock                     |   | $                                       | 11,564 |   |   |   | 14,350 |   |   | $ | 8,078 |   |   |   | 13,435 |   |
|   | $7.00 Series Preferred Dividend                         |   |                                    | 73     |   |   |   | 167 |   |   |   | 73 |   |   |   | 167 |   |
|   | $8.00 Series Preferred Dividend                         |   |                                    | 42     |   |   |   | 96 |   |   |   | 42 |   |   |   | 96 |   |
|   | Adjusted Earnings Applicable to  Common Stock |   | $                                       | 11,679 |   |   |   | 14,613 |   |   | $ | 8,193 |   |   |   | 13,698 |   |
|   |                                                    |   |                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   | Diluted EPS                                             |   | $                                       | 0.80   |   |   |   |   |   |   | $ | 0.60 |   |   |   |   |   |

|   |                          |   | (In Thousands)                        |   |
|--------|-------------------------------|--------|---------------------------------------|--------|
|   |                          |   | Three Months Ended September 30, |   |   | Nine Months Ended September 30, |   |
|   | Operations by Segments:       |   | 2010                                  |   |   | 2009 |   |   | 2010 |   |   | 2009 |   |
|   | Revenues:                     |   |                                  |   |   |   |   |   |   |   |   |   |   |
|   | Regulated                     |   | $                                     | 27,062 |   |   | $ | 22,943 |   |   | $ | 70,083 |   |   | $ | 61,407 |   |
|   | Non – Regulated         |   |                                  | 2,826  |   |   |   | 2,806 |   |   |   | 8,183 |   |   |   | 8,197 |   |
|   | Inter-segment Elimination     |   |                                  | (303   | ) |   |   | (251 | ) |   |   | (498 | ) |   |   | (440 | ) |
|   | Consolidated Revenues         |   | $                                     | 29,585 |   |   | $ | 25,498 |   |   | $ | 77,768 |   |   | $ | 69,164 |   |
|   | Operating Income:             |   |                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   | Regulated                     |   | $                                     | 9,560  |   |   | $ | 6,607 |   |   | $ | 19,781 |   |   | $ | 14,248 |   |
|   | Non – Regulated         |   |                                  | 461    |   |   |   | 717 |   |   |   | 1,423 |   |   |   | 1,625 |   |
|   | Consolidated Operating Income |   | $                                     | 10,021 |   |   | $ | 7,324 |   |   | $ | 21,204 |   |   | $ | 15,873 |   |
|   |                          |   |                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   | Net Income:                   |   |                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   | Regulated                     |   | $                                     | 5,433  |   |   | $ | 3,580 |   |   | $ | 10,799 |   |   | $ | 7,179 |   |
|   | Non – Regulated         |   |                                  | 303    |   |   |   | 447 |   |   |   | 921 |   |   |   | 1,055 |   |
|   | Consolidated Net Income       |   | $                                     | 5,736  |   |   | $ | 4,027 |   |   | $ | 11,720 |   |   | $ | 8,234 |   |

----

Index

|   |                       |   | (In Thousands)                        |    |
|--------|----------------------------|--------|---------------------------------------|---------|
|   |                       |   | Three Months Ended September 30, |    |   | Nine Months Ended September 30, |   |
|   |                       |   | 2010                                  |    |   | 2009 |   |   | 2010 |   |   | 2009 |   |
|   | Capital Expenditures:      |   |                                  |    |   |   |   |   |   |   |   |   |   |
|   | Regulated                  |   | $                                     | 6,211   |   |   | $ | 3,943 |   |   | $ | 22,121 |   |   | $ | 15,877 |   |
|   | Non – Regulated      |   |                                  | 31      |   |   |   | 3 |   |   |   | 102 |   |   |   | 12 |   |
|   | Total Capital Expenditures |   | $                                     | 6,242   |   |   | $ | 3,946 |   |   | $ | 22,223 |   |   | $ | 15,889 |   |
|   |                       |   |                                  |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   | Assets:                    |   | As ofSeptember 30,2010                |    |   | As ofDecember 31,2009 |   |   |   |   |   |   |   |   |   |
|   |                       |   |                                  |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   | Regulated                  |   | $                                     | 475,467 |   |   | $ | 451,734 |   |   |   |   |   |   |   |   |   |
|   | Non – Regulated      |   |                                  | 9,816   |   |   |   | 11,022 |   |   |   |   |   |   |   |   |   |
|   | Inter-segment Elimination  |   |                                  | (5,591  | ) |   |   | (4,670 | ) |   |   |   |   |   |   |   |   |
|   | Consolidated Assets        |   | $                                     | 479,692 |   |   | $ | 458,086 |   |   |   |   |   |   |   |   |   |

|   |                              |   | ($ In Thousands)                      |   |
|--------|-----------------------------------|--------|---------------------------------------|--------|
|   |                              |   | Three Months Ended September 30, |   |   | Nine Months Ended September 30, |   |
|   |                              |   | 2010                                  |   |   | 2009 |   |   | 2010 |   |   | 2009 |   |
|   |                              |   |                                  |   |   |   |   |   |   |   |   |   |   |
|   | Average Daily Amounts Outstanding |   | $                                     | 14,902 |   |   | $ | 41,657 |   |   | $ | 29,297 |   |   | $ | 39,038 |   |
|   | Weighted Average Interest Rates   |   |                                  | 1.53   | % |   |   | 1.61 | % |   |   | 1.59 | % |   |   | 1.77 | % |

----

Index

|        |   | (In Thousands)                        |   |
|-------------|--------|---------------------------------------|--------|
|        |   | Three Months Ended September 30, |   |   | Nine Months Ended September 30, |   |
|        |   | 2010                                  |   |   | 2009 |   |   | 2010 |   |   | 2009 |   |
|        |   |                                  |   |   |   |   |   |   |   |   |   |   |
| Treated     |   | $                                     | 737    |   |   | $ | 720 |   |   | $ | 2,168 |   |   | $ | 1,827 |   |
| Untreated   |   |                                  | 618    |   |   |   | 625 |   |   |   | 1,753 |   |   |   | 1,736 |   |
| Total Costs |   | $                                     | 1,355  |   |   | $ | 1,345 |   |   | $ | 3,921 |   |   | $ | 3,563 |   |

----

Index

|   |                                            | (In Thousands)                   |   |
|--------|-------------------------------------------------|----------------------------------|--------|
|   |                                            | Pension Plan                     |   | Other Benefits Plan |   |
|   |                                            | Three Months Ended September 30, |   |
|   |                                            | 2010                             |   | 2009 |   | 2010 |   | 2009 |   |
|   |                                            |                             |   |   |   |   |   |   |   |
|   | Service Cost                                    |                             | $      | 349 |   |   | $ | 343 |   |   | $ | 256 |   |   | $ | 223 |   |
|   | Interest Cost                                   |                             |   | 557 |   |   |   | 525 |   |   |   | 334 |   |   |   | 272 |   |
|   | Expected Return on Assets                       |                             |   | (505 | ) |   |   | (401 | ) |   |   | (190 | ) |   |   | (149 | ) |
|   | Amortization of Unrecognized Losses             |                             |   | 127 |   |   |   | 154 |   |   |   | 133 |   |   |   | 123 |   |
|   | Amortization of Unrecognized Prior Service Cost |                             |   | 2 |   |   |   | 2 |   |   |   | - |   |   |   | - |   |
|   | Amortization of Transition Obligation           |                             |   | - |   |   |   | - |   |   |   | 34 |   |   |   | 34 |   |
|   | Net Periodic Benefit Cost                       |                             | $      | 530 |   |   | $ | 623 |   |   | $ | 567 |   |   | $ | 503 |   |
|   |                                            |                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   |                                            | Nine Months Ended September 30,  |   |
|   |                                            |                             |   | 2010 |   |   |   | 2009 |   |   |   | 2010 |   |   |   | 2009 |   |
|   |                                            |                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   | Service Cost                                    |                             | $      | 1,047 |   |   | $ | 1,029 |   |   | $ | 769 |   |   | $ | 668 |   |
|   | Interest Cost                                   |                             |   | 1,671 |   |   |   | 1,575 |   |   |   | 1,001 |   |   |   | 815 |   |
|   | Expected Return on Assets                       |                             |   | (1,515 | ) |   |   | (1,202 | ) |   |   | (569 | ) |   |   | (447 | ) |
|   | Amortization of Unrecognized Losses             |                             |   | 380 |   |   |   | 462 |   |   |   | 399 |   |   |   | 370 |   |
|   | Amortization of Unrecognized Prior Service Cost |                             |   | 7 |   |   |   | 7 |   |   |   | - |   |   |   | - |   |
|   | Amortization of Transition Obligation           |                             |   | - |   |   |   | - |   |   |   | 101 |   |   |   | 101 |   |
|   | Net Periodic Benefit Cost                       |                             | $      | 1,590 |   |   | $ | 1,871 |   |   | $ | 1,701 |   |   | $ | 1,507 |   |

----

Index

| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
|---------|---------------------------------------------------------------------------------------------|

|   | - | statements as to expected financial condition, performance, prospects and earnings of the Company; |
|--------|---|----------------------------------------------------------------------------------------------------|

|   | - | statements regarding strategic plans for growth; |
|--------|---|--------------------------------------------------|

|   | - | statements regarding the amount and timing of rate increases and other regulatory matters, including the recovery of certain costs recorded as regulatory assets; |
|--------|---|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | - | statements as to the Company’s expected liquidity needs during the upcoming fiscal year and beyond and statements as to the sources and availability of funds to meet its liquidity needs; |
|--------|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | - | statements as to expected rates, consumption volumes, service fees, revenues, margins, expenses and operating results; |
|--------|---|------------------------------------------------------------------------------------------------------------------------|

|   | - | statements as to the Company’s compliance with environmental laws and regulations and estimations of the materiality of any related costs; |
|--------|---|--------------------------------------------------------------------------------------------------------------------------------------------------|

|   | - | statements as to the safety and reliability of the Company’s equipment, facilities and operations; |
|--------|---|----------------------------------------------------------------------------------------------------------|

|   | - | statements as to financial projections; |
|--------|---|-----------------------------------------|

|   | - | statements as to the ability of the Company to pay dividends; |
|--------|---|---------------------------------------------------------------|

|   | - | statements as to the Company’s plans to renew municipal franchises and consents in the territories it serves; |
|--------|---|---------------------------------------------------------------------------------------------------------------------|

|   | - | expectations as to the amount of cash contributions to fund the Company’s retirement benefit plans, including statements as to anticipated discount rates and rates of return on plan assets; |
|--------|---|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | - | statements as to trends; and |
|--------|---|------------------------------|

|   | - | statements regarding the availability and quality of our water supply. |
|--------|---|------------------------------------------------------------------------|

|   | - | the effects of general economic conditions; |
|--------|---|---------------------------------------------|

|   | - | increases in competition in the markets served by the Company; |
|--------|---|----------------------------------------------------------------|

|   | - | the ability of the Company to control operating expenses and to achieve efficiencies in its operations; |
|--------|---|---------------------------------------------------------------------------------------------------------|

|   | - | the availability of adequate supplies of water; |
|--------|---|-------------------------------------------------|

|   | - | actions taken by government regulators, including decisions on rate increase requests; |
|--------|---|----------------------------------------------------------------------------------------|

|   | - | new or additional water quality standards; |
|--------|---|--------------------------------------------|

|   | - | weather variations and other natural phenomena; |
|--------|---|-------------------------------------------------|

|   | - | the existence of financially attractive acquisition candidates and the risks involved in pursuing those acquisitions; |
|--------|---|-----------------------------------------------------------------------------------------------------------------------|

|   | - | acts of war or terrorism; |
|--------|---|---------------------------|

|   | - | significant changes in the housing starts in Delaware; |
|--------|---|--------------------------------------------------------|

|   | - | the availability and cost of capital resources; |
|--------|---|-------------------------------------------------|

|   | - | the ability to translate Preliminary Survey & Investigation charges into viable projects; and |
|--------|---|---------------------------------------------------------------------------------------------------|

|   | - | other factors discussed elsewhere in this quarterly report. |
|--------|---|-------------------------------------------------------------|

----

Index

----

Index

----

Index

|                                |   | (In Thousands)                   |   |
|-------------------------------------|--------|----------------------------------|--------|
|                                |   | Three Months Ended September 30, |   |
|                                |   | 2010                             |   |   | 2009 |   |
|                                |   | Regulated                        |   |   | Non-Regulated |   |   | Total |   |   | Regulated |   |   | Non-Regulated |   |   | Total |   |
| Revenues                            |   | $                                | 27,062 |   |   | $ | 2,523 |   |   | $ | 29,585 |   |   | $ | 22,943 |   |   | $ | 2,555 |   |   | $ | 25,498 |   |
| Operations and maintenance expenses |   |                             | 12,079 |   |   |   | 1,957 |   |   |   | 14,036 |   |   |   | 11,545 |   |   |   | 1,740 |   |   |   | 13,285 |   |
| Depreciation expense                |   |                             | 2,351  |   |   |   | 36 |   |   |   | 2,387 |   |   |   | 2,131 |   |   |   | 43 |   |   |   | 2,174 |   |
| Other taxes                         |   |                             | 3,072  |   |   |   | 69 |   |   |   | 3,141 |   |   |   | 2,660 |   |   |   | 55 |   |   |   | 2,715 |   |
|   Operating income        |   |                             | 9,560  |   |   |   | 461 |   |   |   | 10,021 |   |   |   | 6,607 |   |   |   | 717 |   |   |   | 7,324 |   |
|                                |   |                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other income, net                   |   |                             | 113    |   |   |   | 73 |   |   |   | 186 |   |   |   | 572 |   |   |   | 74 |   |   |   | 646 |   |
| Interest expense                    |   |                             | 1,791  |   |   |   | 28 |   |   |   | 1,819 |   |   |   | 1,749 |   |   |   | 42 |   |   |   | 1,791 |   |
| Income taxes                        |   |                             | 2,449  |   |   |   | 203 |   |   |   | 2,652 |   |   |   | 1,850 |   |   |   | 302 |   |   |   | 2,152 |   |
|   Net income              |   | $                                | 5,433  |   |   | $ | 303 |   |   | $ | 5,736 |   |   | $ | 3,580 |   |   | $ | 447 |   |   | $ | 4,027 |   |

----

Index

|   | · | Revenues in our Middlesex System increased $3.4 million, primarily as a result of the following: |
|--------|--------|--------------------------------------------------------------------------------------------------|

|   | § | Contract Sales to Municipalities increased by $1.0 million from higher customer demand for water and the March 2010 base rate increase; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------|

|   | § | Sales to General Metered Service (GMS) customers, which includes residential, commercial and industrial classes of customers, increased by $2.0 million, primarily from the effects of the March 2010 base water rate increase ($1.1 million) and increased customer demand for water ($0.9 million).  The increased demand primarily resulted from hot, dry weather and an increase in demand by our commercial and industrial customers.  In 2009 and through the 2nd quarter of 2010, water consumption by our commercial and industrial customer class was below the historical average; and |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | § | Facilities Charges increased by $0.4 million, primarily from the March 2010 rate increase. |
|--------|--------|--------------------------------------------------------------------------------------------|

|   | · | Revenues from our Tidewater System increased $0.7 million, primarily as a result of the following: |
|--------|--------|----------------------------------------------------------------------------------------------------|

|   | § | Higher demand by our GMS customers ($0.6 million); and |
|--------|--------|--------------------------------------------------------|

|   | § | A contract to temporarily provide water to Dover Air Force Base in Delaware ($0.1 million). |
|--------|--------|---------------------------------------------------------------------------------------------|

|   | · | Increased costs of $0.1 million resulting from water main breaks in our Middlesex and Tidewater Systems; |
|--------|--------|----------------------------------------------------------------------------------------------------------|

|   | · | Increased labor costs of $0.2 million related to higher average labor rates and increased overtime related to higher water production and increased water main breaks in our Tidewater System; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Increased costs of $0.2 million from the implementation of a Company-wide information technology platform in 2010; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------|

|   | · | Increased purchased power costs of $0.1 million primarily related to increased water production; and |
|--------|--------|------------------------------------------------------------------------------------------------------|

|   | · | All other operating and maintenance expense categories increased $0.2 million. |
|--------|--------|--------------------------------------------------------------------------------|

----

Index

|   | · | A decrease in Allowance for Funds Used During Construction (AFUDC) due to the completion of several longer term, large capital projects that were actively under construction during the prior year period ($0.1 million); |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Decreased Other Income of $0.3 million, primarily related to the sale of a non-operating asset in the third quarter of 2009; and |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------|

|   | · | Increased Other Expenses of $0.1 million for costs related to potential projects at our Delaware subsidiaries. |
|--------|--------|----------------------------------------------------------------------------------------------------------------|

----

Index

|                                |   | (In Thousands)                  |   |
|-------------------------------------|--------|---------------------------------|--------|
|                                |   | Nine Months Ended September 30, |   |
|                                |   | 2010                            |   |   | 2009 |   |
|                                |   | Regulated                       |   |   | Non-Regulated |   |   | Total |   |   | Regulated |   |   | Non-Regulated |   |   | Total |   |
| Revenues                            |   | $                               | 70,083 |   |   | $ | 7,685 |   |   | $ | 77,768 |   |   | $ | 61,407 |   |   | $ | 7,757 |   |   | $ | 69,164 |   |
| Operations and maintenance expenses |   |                            | 35,263 |   |   |   | 5,942 |   |   |   | 41,205 |   |   |   | 33,380 |   |   |   | 5,842 |   |   |   | 39,222 |   |
| Depreciation expense                |   |                            | 6,713  |   |   |   | 114 |   |   |   | 6,827 |   |   |   | 6,256 |   |   |   | 114 |   |   |   | 6,370 |   |
| Other taxes                         |   |                            | 8,326  |   |   |   | 206 |   |   |   | 8,532 |   |   |   | 7,523 |   |   |   | 176 |   |   |   | 7,699 |   |
| Operating income                    |   |                            | 19,781 |   |   |   | 1,423 |   |   |   | 21,204 |   |   |   | 14,248 |   |   |   | 1,625 |   |   |   | 15,873 |   |
|                                |   |                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other income, net                   |   |                            | 914    |   |   |   | 222 |   |   |   | 1,136 |   |   |   | 1,175 |   |   |   | 263 |   |   |   | 1,438 |   |
| Interest expense                    |   |                            | 5,018  |   |   |   | 107 |   |   |   | 5,125 |   |   |   | 4,798 |   |   |   | 151 |   |   |   | 4,949 |   |
| Income taxes                        |   |                            | 4,878  |   |   |   | 617 |   |   |   | 5,495 |   |   |   | 3,446 |   |   |   | 682 |   |   |   | 4,128 |   |
| Net income                          |   | $                               | 10,799 |   |   | $ | 921 |   |   | $ | 11,720 |   |   | $ | 7,179 |   |   | $ | 1,055 |   |   | $ | 8,234 |   |

|   | · | Revenues in our Middlesex System increased $6.1 million, primarily as a result of the following: |
|--------|--------|--------------------------------------------------------------------------------------------------|

|   | § | Contract Sales to Municipalities increased by $2.2 million due to higher customer demand for water and the March 2010 rate increase; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------|

|   | § | Sales to GMS Customers increased by $2.3 million from the implementation of the March 2010 base water rate increase ($2.1 million) and increased customer demand for water ($0.2 million). The increased demand primarily resulted from hot, dry weather and an increase in demand by our commercial and industrial customers in the 3rd quarter of 2010, which mitigated decreased demand through the six months ended June 30, 2010.  In 2009 and through the 2nd quarter of 2010, water consumption by our commercial and industrial customer class was below the historical average; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | § | Facilities Charges increased by $1.5 million from the March 2010 rate increase; and |
|--------|--------|-------------------------------------------------------------------------------------|

|   | § | All other revenue categories increased $0.1 million. |
|--------|--------|------------------------------------------------------|

|   | · | Revenues in our Tidewater System increased $2.4 million primarily from the following: |
|--------|--------|---------------------------------------------------------------------------------------|

|   | § | Higher demand by our GMS customers ($1.3 million); |
|--------|--------|----------------------------------------------------|

|   | § | Increased base water rates that went into effect during 2009 ($0.4 million); |
|--------|--------|------------------------------------------------------------------------------|

|   | § | A contract to temporarily provide water to Dover Air Force Base in Delaware ($0.4 million); and |
|--------|--------|-------------------------------------------------------------------------------------------------|

|   | § | New customer growth increased connection fees and facilities charges ($0.3 million). |
|--------|--------|--------------------------------------------------------------------------------------|

|   | · | Additional services provided by White Marsh under non-regulated contracts increased revenues by $0.1 million. |
|--------|--------|---------------------------------------------------------------------------------------------------------------|

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Index

|   | · | Increased costs of $0.6 million due to water main breaks in our Middlesex System; |
|--------|--------|-----------------------------------------------------------------------------------|

|   | · | Increased purchased water costs of $0.4 million in our Middlesex System, primarily from the aforementioned increased customer demand; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Increased costs of $0.5 million from the implementation of a Company-wide information technology platform; and |
|--------|--------|----------------------------------------------------------------------------------------------------------------|

|   | · | Increased labor costs of $0.5 million related to higher average labor rates and increased overtime related to higher water production and increased main breaks in our Middlesex and Tidewater Systems. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Decreased Other Income of $0.2 million, primarily related to the sale of a non-operating asset in the third quarter of 2009; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------|

|   | · | Increased Other Expenses of $0.1 million for certain costs related to potential projects at our Delaware subsidiaries; and |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------|

|   | · | Increased AFUDC on several longer term, large capital projects that were actively under construction through June 30, 2010 which have since been placed into service ($0.1 million). |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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Index

|   | · | Internally generated funds; |
|--------|--------|-----------------------------|

|   | · | Proceeds from the sale of common stock through the DRP; |
|--------|--------|---------------------------------------------------------|

|   | · | Funds available and held in trust under existing New Jersey SRF loans (currently, $3.4 million) and Delaware SRF loans (currently, $1.1 million). The SRF programs provide low cost financing for projects that meet certain water quality and system improvement benchmarks; and |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Short-term borrowings, if necessary, through $58.0 million of available lines of credit with several financial institutions.  As of September 30, 2010, the outstanding borrowings under these credit lines had been reduced to $18.8 million as compared to $42.9 million at December 31, 2009, primarily resulting from the $27.8 million of proceeds from the June 2010 common stock public offering of 1.9 million shares. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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Index

| Item 3. | Quantitative and Qualitative Disclosures of Market Risk |
|---------|---------------------------------------------------------|

| Item 4. | Controls and Procedures |
|---------|-------------------------|

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Index

| Item 1. | Legal Proceedings |
|---------|-------------------|

| Item 1A. | Risk Factors |
|----------|--------------|

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

| Item 3. | Defaults Upon Senior Securities |
|---------|---------------------------------|

| Item 4. | Removed and Reserved |
|---------|----------------------|

| Item 5. | Other Information |
|---------|-------------------|

| Item 6. | Exhibits |
|---------|----------|

| 31.1 | Section 302 Certification by Dennis W. Doll pursuant to Rules 13a-14 and 15d-14 of the Securities Exchange Act of 1934. |
|------|-------------------------------------------------------------------------------------------------------------------------|

| 31.2 | Section 302 Certification by A. Bruce O’Connor pursuant to Rules 13a-14 and 15d-14 of the Securities Exchange Act of 1934. |
|------|----------------------------------------------------------------------------------------------------------------------------------|

| 32.1 | Section 906 Certification by Dennis W. Doll pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------|

| 32.2 | Section 906 Certification by A. Bruce O’Connor pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

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Index

SIGNATURES

|                                                                                                                          | MIDDLESEX WATER COMPANY |
|-------------------------------------------------------------------------------------------------------------------------------|-------------------------|
|                                                                                                                          |                    |   |
|                                                                                                                          | By:                     | /s/A. Bruce O’Connor                                 |
|                                                                                                                          |                    | A. Bruce O’Connor |
|                                                                                                                          |                    | Vice President and |
|                                                                                                                          |                    | Chief Financial Officer |
|                                                                                                                          |                    | (Principal Accounting Officer) |
|                                                                                                                          |                    |   |
|                                                                                                                          |                    |   |
|                  Date:  November 3, 2010 |                    |   |

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