<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

                  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTER ENDED SEPTEMBER 30, 2006         COMMISSION FILE NUMBER: 2-22997

                                MILLS MUSIC TRUST
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

<TABLE>
<S>                                                          <C>
            NEW YORK                                              13-6183792
(STATE OR OTHER JURISDICTION OF                                (I.R.S. EMPLOYER
 INCORPORATION OR ORGANIZATION)                              IDENTIFICATION NO.)
</TABLE>

    C/O HSBC BANK USA, N/A CORPORATE TRUST ISSUER SERVICES, 452 FIFTH AVENUE,
                             NEW YORK, NY 10018-2706
              (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE (212) 525-1349

Securities Registered Pursuant to Section 12(b) of the Act:

                                      NONE
                                (Title of Class)

Securities Registered Pursuant to Section 12(g) of the Act:

                          UNITS OF BENEFICIAL INTEREST
                                (Title of Class)

INDICATE BY CHECK-MARK WHETHER THE REGISTRANT (1) HAS FILED ALL REPORTS REQUIRED
TO BE FILED BY SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 DURING
THE PRECEDING 12 MONTHS (OR FOR SUCH SHORTER PERIOD THAT THE REGISTRANT WAS
REQUIRED TO FILE SUCH REPORTS), AND (2) HAS BEEN SUBJECT TO SUCH FILING
REQUIREMENTS FOR THE PAST 90 DAYS.

                              YES  X    NO
                                  ---      ---

INDICATE BY CHECK MARK WHETHER THE REGISTRANT IS A LARGE ACCELERATED FILER, AN
ACCELERATED FILER, OR A NON-ACCELERATED FILER. SEE DEFINITION OF "ACCELERATED
FILER" AND "LARGE ACCELERATED FILER" IN RULE 12b-2 OF THE EXCHANGE ACT.

   LARGE ACCELERATED FILER     ACCELERATED FILER     NON-ACCELERATED FILER  X
                           ---                   ---                       ---

INDICATE BY CHECK MARK WHETHER THE REGISTRANT IS A SHELL COMPANY (AS DEFINED IN
RULE 12b-2 OF THE EXCHANGE ACT.)

                              YES       NO  X
                                  ---      ---

NUMBER OF TRUST UNITS OUTSTANDING AS OF SEPTEMBER 30, 2006   277,712

<PAGE>

                                                                               2


                          PART I - FINANCIAL STATEMENTS

Item 1. Financial Information

                                MILLS MUSIC TRUST
                  STATEMENTS OF CASH RECEIPTS AND DISBURSEMENTS
             THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2006 AND 2005
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                          Three Months Ended      Nine Months Ended
                                             September 30            September 30
                                         -------------------   -----------------------
                                           2006       2005        2006         2005
                                         --------   --------   ----------   ----------
<S>                                      <C>        <C>        <C>          <C>
Receipts:
From EMI                                 $456,562   $379,159   $1,141,950   $1,087,818
Undistributed cash at beginning of the
   period                                      45         48           60           48
Disbursements- administrative expenses    (19,981)   (38,201)     (52,873)     (68,494)
                                         --------   --------   ----------   ----------
Balance available for distribution       $436,626    341,006    1,089,137    1,019,372
Cash distribution to unit holders         436,591    340,949    1,089,102    1,019,315
                                         --------   --------   ----------   ----------
Undistributed cash at end of the
   period                                $     35   $     57   $       35   $       57
                                         ========   ========   ==========   ==========
Cash distribution per unit (based on
   277,712 units outstanding)            $   1.57   $   1.23   $     3.92   $     3.67
                                         ========   ========   ==========   ==========
</TABLE>

    See accompanying Notes to Statements of Cash Receipts and Disbursements.

<PAGE>

                                                                               3


                                MILLS MUSIC TRUST
             NOTES TO STATEMENTS OF CASH RECEIPTS AND DISBURSEMENTS
             THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2006 AND 2005
                                   (UNAUDITED)

NOTE 1. ACCOUNTING POLICIES AND GENERAL INFORMATION

     Mills Music Trust ("the Trust") was created in 1964 for the purpose of
acquiring the rights to receive payment of a deferred contingent purchase price
contract obligation, relating to certain copyright materials. The amounts are
currently payable by EMI (the current owner and administrative entity for the
copyrighted materials.) The contingent payments are determined quarterly and are
based on a formula which takes into account gross royalty income paid to
composers, authors and others, and less amounts deducted by EMI in accordance
with contract terms.

     Payments from EMI to the Trust are made in March, June, September, and
December, and include net royalty income received during the preceding calendar
quarter. The payments received are accounted for on a cash basis, as are
expenses. The Declaration of Trust requires the distribution of all funds
received by the Trust to the Unit holders after payment of expenses.

     The statements of cash receipts and disbursements reflect only cash
transactions and do not include transactions that would be recorded in financial
statements presented on the accrual basis of accounting, as contemplated by
accounting principles generally accepted in the United States of America.

NOTE 2. FEDERAL INCOME TAXES

     No provision for income taxes has been made since the liability therefore
is that of the unit holders and not the Trust.

NOTE 3. RELATED PARTY TRANSACTIONS

     The Declaration of Trust provides that each trustee shall receive annual
compensation of $2,500 per year for services as trustee, provided that such
aggregate compensation to the trustees as a group may not exceed 3% of the
monies received by the Trust in any year, and reimbursement for expenses
reasonably incurred in the performance of their duties. The Declaration of Trust
further provides for reimbursement to the corporate trustee for its clerical and
administrative services to the Trust. Accordingly, HSBC Bank USA, the corporate
trustee, also receives reimbursement for such services (including services
performed as Registrar and Transfer Agent of the Certificates representing
Units).

     The Declaration of Trust also provides, that if in the future any trustee
performs unusual or extraordinary services, reasonable compensation for such
services shall be paid, subject to certain limitations and to prior confirmation
by a majority in interest of Trust Certificate holders.

<PAGE>

                                                                               4


                                MILLS MUSIC TRUST
             NOTES TO STATEMENTS OF CASH RECEIPTS AND DISBURSEMENTS
             THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2006 AND 2005
                                   (CONTINUED)
                                   (UNAUDITED)

NOTE 3. RELATED PARTY TRANSACTIONS (Continued)

Pursuant to provisions, disbursements to related parties were made as follows
for the three and nine months ended September 30, 2006 and 2005:

<TABLE>
<CAPTION>
                      Three Months Ended   Nine Months Ended
                         September 30,       September 30,
                      ------------------   -----------------
                          2006    2005       2006      2005
                        ------   ------    -------   -------
<S>                   <C>        <C>       <C>       <C>
HSBC Bank USA:
   Trustee Fees         $  625   $  625    $ 1,875   $ 1,875
   Transfer agent
      and registrar      3,750    3,750     11,250    11,250
   Administration          -0-      -0-        -0-       -0-
</TABLE>

NOTE 4. ROYALTIES

     (a) In 2001 EMI charged the Trust with an adjustment for certain costs
relating to copyright renewals incurred over several years and a retroactive
adjustment relating to a recent court decision, which negatively affected all
holders of U.S. copyrights.

          According to EMI, that adjustment resulted in no amounts owing for two
quarters in 2001. However, EMI remitted $167,500 for each of those quarters as
the minimum quarterly distributions.

          EMI had taken the position that the additional distributions to make
up the $167,500 minimums would be considered advances against the future
contingent portion of earnings and the unrecouped copyright renewals (which
would have resulted in deductions from future quarterly payments). The Trust had
taken the position that such minimum distributions are due regardless based upon
the inclusion of gross royalty income of Related Companies as defined in the
relevant agreement. Since 2001, EMI has made quarterly distributions to the
Trust consistent with the Trust's position.

<PAGE>

                                                                               5


                                MILLS MUSIC TRUST
             NOTES TO STATEMENTS OF CASH RECEIPTS AND DISBURSEMENTS
             THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2006 AND 2005
                                   (CONTINUED)
                                   (UNAUDITED)

NOTE 4. ROYALTIES (Continued)

          In addition, the Trust's former auditors had evaluated the adjustment
claimed by EMI to the four years to 2001 to which it pertained. Based upon such
evaluation, the Trust submitted a letter to EMI, which recast challenged
$120,000 of the $275,000 in future contingent royalty payment reductions claimed
by EMI. The Trust has yet to receive a response from EMI despite repeated
requests.

<PAGE>

                                                                               6


                          PART I - FINANCIAL STATEMENTS

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

     The Trust's receipts are derived principally from copyrights established
prior to 1964 and such receipts fluctuate based upon public interest in the
"nostalgia" appeal of older copyrighted songs.

     The Trust's contingent fee income over the last three years has averaged
approximately $1,264,000 per year. In addition to the above, there are a number
of factors which create uncertainties with respect to the ability of the Trust
to continue to generate that level of income on a continuing, long-term basis.
Those factors include the effect that foreign and domestic copyright laws and
any changes therein have or will have on both licensing fees and renewal rights
ultimately, copyright expirations under such laws and the effect of electronic
copying of materials without permission.

     In 1976, the copyright law was changed for works that were within renewal
terms between December 31, 1976 and December 31, 1978 to add an extension of 19
years to the 28-year renewal term. The original copyright term is 28 years. That
amendment made the copyright term 75 years. The Copyright Act of 1976 provided
for a single term of life plus 70 years after author's death (with some
variations in different circumstances) for works created after January 1, 1978.
The 1976 act provided that the writer and his heirs could terminate a transfer
or license of the renewal copyright that was executed before 1978, so long as
the termination was effected in a five-year period following the end of the
initial 56-year period.

     The copyright laws were modified by the Sonny Bono 1998 Copyright Term
Extension Act (the "Act"), which generally provided an additional 20 years of
copyright protection. For works created by identified natural persons the term
now lasts from creation until 70 years after the author's death. For anonymous
works, pseudonymous works, and works made for hire, the term is 95 years from
publication or 120 years from creation whichever expires first. For works
published before 1978 with existing copyrights as of the effective date of the
Act, the Act extends the term to 95 years from publication. In January 2003, the
U.S. Supreme Court upheld the constitutionality of the Act in the Eldred v.
Ashcroft decision, which affirmed a 2001 decision of the U.S. Court of Appeals
for the District of Columbia Circuit.

     The copyright laws provide that renewals vest in any person who is entitled
under the rules of statutory succession to the renewal and extension of the
copyright at the time the application to renew is made. If no renewal is made,
renewals vest in any person entitled under the rules of statutory extension as
of the last day of the original term of copyright to the renewal and extension
of copyright. The writer (and not the publisher to whom the copyright was
originally assigned) owns the renewal right. The laws name specified classes of
persons (the writer's wife, his children, etc.) who will succeed to the renewal
right if the writer dies before the end of the original term. The Act does not
distinguish between composers and lyricists. However, if the composer and
lyricist are not the same, each owns a portion of the renewal rights. The
composer and the lyricist may, assign their respective interests in the renewal
rights to a publisher at the time of the

<PAGE>

                                                                               7


assignment of the original copyright term. Such an assignment of the renewal
term is effective, however, only if the assignor survives the original term. If
he does not, his heirs will succeed to his share of the renewal rights; and, in
such event, these heirs are not obligated by the assignment of the rights to the
publisher to whom the original assignment was made unless they joined in the
assignment. In addition, the 1998 Copyright Extension Act allows writers (or
their heirs) to elect, after either a 35 or 40-year period as specified in the
statute, to terminate a transfer of license or renewal within five years of the
expiration.

     A listing of the top 50 money earning songs of the subject copyrighted
songs of EMI (the current owner and administrative entity for the copyright
materials) with the original copyright dates shown, indicates that the copyright
dates range from 1922 to 1962. This song listing indicates that no copyrights of
the top 50 songs will reach the 95-year expiration within the next five years.
The listing does not provide an indication of the percentage of income earned by
each copyright to total income.

     The Trust cannot determine EMI's ability to secure renewals of the
copyrighted material; however, under the trust agreement, EMI must use its best
efforts to do so.

          (a) In 2001 EMI charged the Trust with an adjustment for certain costs
relating to copyright renewals incurred over several years and a retroactive
adjustment relating to a recent court decision, which negatively affected all
holders of U.S. copyrights.

          According to EMI, that adjustment resulted in no amounts owing for two
quarters in 2001. However, EMI remitted $167,500 for each of those quarters as
the minimum quarterly distributions.

          EMI had taken the position that the additional distributions to make
up the $167,500 minimums would be considered advances against the future
contingent portion of earnings and the unrecouped copyright renewals (which
would have resulted in deductions from future quarterly payments). The Trust had
taken the position that such minimum distributions are due regardless based upon
the inclusion of gross royalty income of Related Companies as defined in the
relevant agreement. Since 2001, EMI has made quarterly distributions to the
Trust consistent with the Trust's position.

          In addition, the Trust's former auditors had evaluated the adjustment
claimed by EMI to the four years to 2001 to which it pertained. Based upon such
evaluation, the Trust submitted a letter to EMI, which recast challenged
$120,000 of the $275,000 in future contingent royalty payment reductions claimed
by EMI. The Trust has yet to receive a response from EMI despite repeated
requests.

Item 3. Quantitative and Quantitative Disclosures About Market Risk.

          Not applicable.

<PAGE>

                                                                               8


Item 4. Controls and Procedures

     (a) Evaluation of Disclosure Controls and Procedures

          As of the end of the period covered by this Quarterly Report, the
Trust carried out an evaluation of the effectiveness of the design and operation
of the Trust's "disclosure controls and procedures" (as defined in Rules 13a-15
(e) and 15d-15 (e) of the Securities and Exchange Act of 1934) under the
supervision and with the participation of the Trust's management, including the
chief financial individual providing accounting services and the trust officer
of the corporate trustee. Based on that evaluation, the chief financial
individual providing accounting services and the trust officer of the corporate
trustee concluded that the Trust's disclosure controls and procedures are
effective.

     (b) Changes in Internal Controls

          There have not been any changes in the Trust's internal control over
Financial reporting (as such term if defined in R 13a-15(f) and 15d-15(f) under
the Securities Exchange Act of 1934) during the fiscal period covered by this
Quarterly Report that have materially affected, or are reasonably likely to
materially affect, the Trust's control over financial reporting.

<PAGE>

                                                                               9


                           PART II - OTHER INFORMATION

                Items 1 through 5, inclusive, are not applicable.

Item 6 Exhibits and Reports on Form 8-K

     (a)  Documents Filed As Part of This Report

<TABLE>
<CAPTION>
EXHIBIT NO.                               DESCRIPTION
-----------                               -----------
<S>           <C>
31.1          Certification of the chief financial individual providing
              accounting services (filed herewith)

31.2          Certification of the trust officer of the corporate trustee (filed
              herewith)

32.1          Certification of Chief financial individual providing accounting
              services pursuant to 18 U.S.C. Section 1350 (furnished herewith)*

32.2          Certification of trust officer for the corporate trustee pursuant
              to 18 U.S.C. Section 1350 (furnished herewith)*
</TABLE>

*    The information furnished in Exhibits 32.1 and 32.2 shall not be deemed
     "filed" for purposes of Section 18 of the Securities Exchange Act of 1934,
     as amended (the "Exchange Act"), or otherwise subject to the liabilities of
     that section, nor shall it be deemed incorporated by reference in any
     filing under the Securities Act of 1933, as amended, or the Exchange Act,
     regardless of any general incorporation language in such filing.

     (b)  Reports on Form 8-K

          None

<PAGE>

                                                                              10


                                   SIGNATURES

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

                                        MILLS MUSIC TRUST
                                           (Registrant)


Date: November 14, 2006                 By: /s/ Marcia Markowski
                                            ------------------------------------
                                            HSBC Bank USA
                                            Corporate Trustee