----

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|     UNITED STATES                                          |
|----------------------------------------------------------------------|
|   SECURITIES AND EXCHANGE COMMISSION                            |
|   WASHINGTON, D.C. 20549                                        |
|                                                                 |   |   |
|   FORM 10-Q                                                     |
| (Mark One)                                                           |   |
|   þ                                                        | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE |
|    SECURITIES EXCHANGE ACT OF 1934                         |
|                                                                 |   |   |
|    For the quarterly period ended September 30, 2010       |
| OR                                                                   |
|   o                                                             | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE |
| SECURITIES EXCHANGE ACT OF 1934                                      |
|                                                                 |   |   |
| For the transition period from ____________ to ____________          |
|                                                                 |   |   |
|   Commission file number:  001-15911             |
|                                                                 |   |   |
|   CELSION CORPORATION                                           |
|     (Exact name of registrant as specified in its charter) |

| Delaware                                 |   | 52-1256615             |
|------------------------------------------|--------|------------------------|
| (State or other jurisdiction of          |   | (I.R.S. Employer       |
| incorporation or organization)           |   | Identification Number) |
|                                     |   |                   |
| 10220-L Old Columbia Road                |   |                   |
| Columbia, Maryland                       |   | 21046                  |
| (Address of principal executive offices) |   | (Zip Code)             |

|  Large accelerated filer o                                       |   |  Accelerated filer   o              |
|-----------------------------------------------------------------------------------------------------|--------|----------------------------------------------------|
|                                                                                                |   |                                               |
| Non-accelerated filer   o   (Do not check if a smaller reporting company)  |   |  Smaller reporting company   þ |
|                                                                                                |   |                                               |

----

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|     |  PART I: FINANCIAL INFORMATION                                                        |   |
|----------|--------------------------------------------------------------------------------------------|--------|
|     |                                                                                       | Page   |
| Item 1.  | Financial Statements and Notes (Unaudited)                                                 |   |
|     | Balance Sheets                                                                             | 3      |
|     | Statements of Operations                                                                   | 4      |
|     | Statements of Cash Flows                                                                   | 5      |
|     | Statement of Changes in Stockholders’ (Deficit) Equity                               | 6      |
|     | Notes to Financial Statements                                                              | 7      |
|     |                                                                                       |   |
| Item 2.  | Management’s Discussion and Analysis of Financial Condition andResults of Operations | 17     |
|     |                                                                                       |   |
| Item 3.  | Quantitative and Qualitative Disclosures about Market Risk                                 | 23     |
|     |                                                                                       |   |
| Item 4.  | Controls and Procedures                                                                    | 23     |
|     |                                                                                       |   |
|     | PART II: OTHER INFORMATION                                                                 |   |
|     |                                                                                       | Page   |
| Item 1.  | Legal Proceedings                                                                          | 24     |
| Item 1A. | Risk Factors                                                                               | 24     |
| Item 2.  | Unregistered Sales of Equity Securities and Use of Proceeds                                | 24     |
| Item 3.  | Defaults Upon Senior Securities                                                            | 24     |
| Item 4.  | [Removed and Reserved]                                                                     | 24     |
| Item 5.  | Other Information                                                                          | 24     |
| Item 6.  | Exhibits                                                                                   | 25     |
|     |                                                                                       |   |
|     | SIGNATURES                                                                                 | 26     |

----

| ASSETS                                                                                                                                                                                                             |   | September 30, 2010 (unaudited) |        |    | December 31, 2009 |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------|-------------|---------|-------------------|--------|
| Current assets:                                                                                                                                                                                                    |   |                           |        |    |              |   |
| Cash and cash equivalents                                                                                                                                                                                          |   | $                              | 1,824,318   |    |              | $      | 6,923,476 |   |
| Short-term investments                                                                                                                                                                                             |   |                           | 1,379,371   |    |              |   | 5,695,466 |   |
| Refundable income taxes                                                                                                                                                                                            |   |                           | -           |    |              |   | 806,255 |   |
| Prepaid expenses and other current assets                                                                                                                                                                          |   |                           | 460,089     |    |              |   | 695,021 |   |
| Total current assets                                                                                                                                                                                               |   |                           | 3,663,778   |    |              |   | 14,120,218 |   |
|                                                                                                                                                                                                               |   |                           |        |    |              |   |   |   |
| Property and equipment (at cost, less accumulated depreciation of$1,005,388 and $881,278, respectively)                                                                                                            |   |                           | 417,789     |    |              |   | 537,407 |   |
|                                                                                                                                                                                                               |   |                           |        |    |              |   |   |   |
| Other assets:                                                                                                                                                                                                      |   |                           |        |    |              |   |   |   |
| Deposits and other assets                                                                                                                                                                                          |   |                           | 76,796      |    |              |   | 97,082 |   |
| Patent licensing fees, net                                                                                                                                                                                         |   |                           | 45,000      |    |              |   | 50,625 |   |
| Total other assets                                                                                                                                                                                                 |   |                           | 121,796     |    |              |   | 147,707 |   |
|                                                                                                                                                                                                               |   |                           |        |    |              |   |   |   |
| Total assets                                                                                                                                                                                                       |   | $                              | 4,203,363   |    |              | $      | 14,805,332 |   |
|                                                                                                                                                                                                               |   |                           |        |    |              |   |   |   |
| LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY                                                                                                                                                                     |   |                           |        |    |              |   |   |   |
| Current liabilities:                                                                                                                                                                                               |   |                           |        |    |              |   |   |   |
| Accounts payable                                                                                                                                                                                                   |   | $                              | 2,741,854   |    |              | $      | 2,190,957 |   |
| Other accrued liabilities (Note 7)                                                                                                                                                                                 |   |                           | 1,985,897   |    |              |   | 1,451,542 |   |
| Note payable - current portion                                                                                                                                                                                     |   |                           | 119,494     |    |              |   | 108,332 |   |
| Total current liabilities                                                                                                                                                                                          |   |                           | 4,847,245   |    |              |   | 3,750,831 |   |
|                                                                                                                                                                                                               |   |                           |        |    |              |   |   |   |
| Common stock warrant liability                                                                                                                                                                                     |   |                           | 109,888     |    |              |   | 821,891 |   |
| Note payable – non-current portion                                                                                                                                                                           |   |                           | 88,799      |    |              |   | 179,868 |   |
| Other liabilities – non-current                                                                                                                                                                              |   |                           | -           |    |              |   | 16,948 |   |
| Total liabilities                                                                                                                                                                                                  |   |                           | 5,045,932   |    |              |   | 4,769,538 |   |
|                                                                                                                                                                                                               |   |                           |        |    |              |   |   |   |
| Stockholders' (deficit) equity:                                                                                                                                                                                    |   |                           |        |    |              |   |   |   |
| Common stock, $0.01 par value (75,000,000 shares authorized;13,508,238 and 12,895,174 shares issued and 12,747,964 and12,134,900 shares outstanding at September 30, 2010 andDecember 31, 2009, respectively) |   |                           | 135,082     |    |              |   | 128,952 |   |
| Additional paid-in capital                                                                                                                                                                                         |   |                           | 97,755,155  |    |              |   | 95,035,165 |   |
| Accumulated other comprehensive (loss) income                                                                                                                                                                      |   |                           | (43,609     | )  |              |   | 68,173 |   |
| Accumulated deficit                                                                                                                                                                                                |   |                           | (95,612,527 | )       |              |   | (82,119,826 | ) |
|   Subtotal                                                                                                                                                                                               |   |                           | 2,234,101   |    |              |   | 13,112,464 |   |
| Treasury stock, at cost (760,274 shares at September 30, 2010 andDecember 31, 2009)                                                                                                                                |   |                           | (3,076,670  | )       |              |   | (3,076,670 | ) |
| Total stockholders' (deficit) equity                                                                                                                                                                               |   |                           | (842,569    | )       |              |   | 10,035,794 |   |
|                                                                                                                                                                                                               |   |                           |        |    |              |   |   |   |
| Total liabilities and stockholders' (deficit) equity                                                                                                                                                               |   | $                              | 4,203,363   |    |              | $      | 14,805,332 |   |
|                                                                                                                                                                                                               |   |                           |        |    |              |   |   |   |

----

|                                                                |   | Three Months Ended September 30, |       |   | Nine Months EndedSeptember 30, |   |
|---------------------------------------------------------------------|--------|----------------------------------|------------|--------|--------------------------------|--------|
|                                                                |   | 2010                             |       |   | 2009                           |   |   | 2010 |   |   | 2009 |   |
|   Operating expenses:                                          |   |                             |       |   |                           |   |   |   |   |   |   |   |
| Research and development                                            |   | $                                | 3,951,248  |   |                           | $      | 3,503,064 |   |   | $ | 10,665,845 |   |   | $ | 10,675,506 |   |
| General and administrative                                          |   |                             | 1,220,114  |   |                           |   | 1,223,709 |   |   |   | 3,544,601 |   |   |   | 2,514,351 |   |
|  Total operating expenses                                      |   |                             | 5,171,362  |   |                           |   | 4,726,773 |   |   |   | 14,210,446 |   |   |   | 13,189,857 |   |
|                                                                |   |                             |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
|   Loss from operations                                         |   |                             | (5,171,362 | )      |                           |   | (4,726,773 | ) |   |   | (14,210,446 | ) |   |   | (13,189,857 | ) |
|                                                                |   |                             |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
|  Other income (expense):                                       |   |                             |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Change in fair value of common stock warrants                       |   |                             | 453,078    |   |                           |   | - |   |   |   | 712,003 |   |   |   | - |   |
| Interest income                                                     |   |                             | 8,590      |   |                           |   | 9,619 |   |   |   | 30,740 |   |   |   | 36,490 |   |
| Interest expense                                                    |   |                             | (7,451     | )      |                           |   | - |   |   |   | (24,979 | ) |   |   | (94,920 | ) |
| Other (expense) income                                              |   |                             | -          |   |                           |   | (100 | )  |   |   | (19 | ) |   |   | 322,843 |   |
| Total other income (expense), net                                   |   |                             | 454,217    |   |                           |   | 9,519 |   |   |   | 717,745 |   |   |   | 264,413 |   |
|                                                                |   |                             |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
|   Net Loss                                                     |   | $                                | (4,717,145 | )      |                           | $      | (4,717,254 | ) |   | $ | (13,492,701 | ) |   | $ | (12,925,444 | ) |
|                                                                |   |                             |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
|                                                                |   |                             |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Net loss per common share –basic and diluted                  |   | $                                | (0.38      | )      |                           | $      | (0.47 | ) |   | $ | (1.10 | ) |   | $ | (1.27 | ) |
|                                                                |   |                             |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Weighted average common sharesoutstanding – basic and diluted |   |                             | 12,340,445 |   |                           |   | 10,117,750 |   |   |   | 12,303,195 |   |   |   | 10,166,360 |   |
|                                                                |   |                             |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |

----

|                                                     |   | Nine Months EndedSeptember 30, |        |
|----------------------------------------------------------|--------|--------------------------------|-------------|
|                                                     |   | 2010                           |        |   | 2009 |   |
| Cash flows from operating activities:                    |   |                           |        |   |   |   |
| Net loss                                                 |   | $                              | (13,492,701 | ) |   | $ | (12,925,444 | ) |
| Non-cash items included in net loss:                     |   |                           |        |   |   |   |   |   |
| Depreciation and amortization                            |   |                           | 124,110     |   |   |   | 66,077 |   |
| Amortization of indemnity reserve                        |   |                           | -           |   |   |   | (1,053,357 | ) |
| Change in fair value of common stock warrant liability   |   |                           | (712,003    | )  |   |   | - |   |
| Stock based compensation                                 |   |                           | 1,193,640   |   |   |   | 812,819 |   |
| Shares issued in exchange for services                   |   |                           | 18,060      |   |   |   | - |   |
| Reversal of provision for bad debts                      |   |                           | -           |   |   |   | (214,142 | ) |
| Amortization of patent license fee                       |   |                           | 5,625       |   |   |   | 5,625 |   |
| Net changes in:                                          |   |                           |        |   |   |   |   |   |
| Refundable income taxes                                  |   |                           | 806,255     |   |   |   | - |   |
| Due from Boston Scientific                               |   |                           | -           |   |   |   | 15,000,000 |   |
| Prepaid expenses and other                               |   |                           | 372,932     |   |   |   | (133,680 | ) |
| Deposits and other assets                                |   |                           | 20,286      |   |   |   | (381,387 | )  |
| Accounts payable                                         |   |                           | 550,897     |   |   |   | 1,653,303 |   |
| Other accrued liabilities                                |   |                           | 517,407     |   |   |   | (175,384 | ) |
| Net cash (used in) provided by operating activities:     |   |                           | (10,595,492 | ) |   |   | 2,654,430 |   |
|                                                     |   |                           |        |   |   |   |   |   |
|   Cash flows from investing activities:             |   |                           |        |   |   |   |   |   |
| Purchases of investment securities                       |   |                           | (11,601,922 | ) |   |   | (5,422,723 | ) |
| Proceeds from sale and maturity of investment securities |   |                           | 15,806,235  |   |   |   | 5,339,749 |   |
| Purchases of property and equipment                      |   |                           | (4,492      | ) |   |   | (48,113 | ) |
| Net cash provided by (used in) investing activities      |   |                           | 4,199,821   |   |   |   | (131,087) |   |
|                                                     |   |                           |        |   |   |   |   |   |
| Cash flows from financing activities:                    |   |                           |        |   |   |   |   |   |
| Proceeds from sale of equity, net of issuance costs      |   |                           | 1,376,420   |   |   |   | 6,353,639 |   |
| Principal payments on note payable                       |   |                           | (79,907     | ) |   |   | (234,735 | ) |
| Net cash provided by financing activities                |   |                           | 1,296,513   |   |   |   | 6,118,904 |   |
|                                                     |   |                           |        |   |   |   |   |   |
|  (Decrease) increase in cash and cash equivalents   |   |                           | (5,099,158  | ) |   |   | 8,642,247 |   |
|  Cash and cash equivalents at beginning of period   |   |                           | 6,923,476   |   |   |   | 3,456,225 |   |
|                                                     |   |                           |        |   |   |   |   |   |
|  Cash and cash equivalents at end of period         |   | $                              | 1,824,318   |   |   | $ | 12,098,472 |   |
|                                                     |   |                           |        |   |   |   |   |   |
|  Supplemental disclosures of cash flow information: |   |                           |        |   |   |   |   |   |
|  Interest paid                                      |   | $                              | 24,979      |   |   | $ | 94,920 |   |
|                                                     |   |                           |        |   |   |   |   |   |

----

|                                                    | Common Stock Outstanding |     | Treasury Stock                   | Accumulated Other Compr.  Income |         |                            |
|---------------------------------------------------------|--------------------------|----------|----------------------------------|--------------------------------------------|--------------|---------------------------------|
|                                                    | Shares                   | Amount   | Additional Paid–in Capital | Shares                                     | Amount       | Accumulated Deficit             | Total |
| Balance at December 31, 2009                            | 12,134,900               | $128,952 | $  95,035,165          | 760,274                                    | $(3,076,670) | $    68,173 | $(82,119,826) | $10,035,794 |
|  Shares issued under CEFF, net                     | 520,787                  | 5,208    | 1,509,212                        |                                       |         |                            |   | 1,514,420 |
|  Stock-based compensation expense                  | -                        | -        | 1,193,640                        | -                                          | -            | -                               | - | 1,193,640 |
|  Shares issued in exchange for services            | 6,000                    | 60       | 18,000                           | -                                          | -            | -                               | - | 18,060 |
|  Issuance of restricted stock upon vesting         | 86,277                   | 862      | (862)                            | -                                          | -            | -                               | - | - |
|  Unrealized loss on investments available for sale | -                        | -        | -                                | -                                          | -            | (111,782)                       | - | (111,782) |
|  Net loss                                          | -                        | -        | -                                | -                                          | -            | -                               | (13,492,701) | (13,492,701) |
|  Balance at September 30, 2010                     | 12,747,964               | $135,082 | $  97,755,155          | 760,274                                    | $(3,076,670) | $   (43,609)     | $(95,612,527) | $ (842,569) |

----

----

| Short-term investments - at fair value           |   | September  30, 2010 |      |   | December 31, 2009 |   |
|--------------------------------------------------|--------|-------------------------------|-----------|--------|-------------------|--------|
| Bonds - corporate issuances                      |   | $                             | 1,310,689 |   |              | $      | 5,528,164 |   |
| Equity securities                                |   |                          | 68,682    |   |              |   | 167,302 |   |
| Total short-term investments, available for sale |   | $                             | 1,379,371 |   |              | $      | 5,695,466 |   |

|                                 |   | September 30, 2010 |      |   | December 31, 2009 |   |
|--------------------------------------|--------|-------------------------|-----------|--------|-------------------|--------|
|                                 |   | Cost                    |      |   | FairValue         |   |   | Cost |   |   | FairValue |   |
| Short-term investments               |   |                    |      |   |              |   |   |   |   |   |   |   |
| Bonds - corporate issuances          |   | $                       | 1,310,689 |   |              | $      | 1,310,689 |   |   | $ | 5,528,164 |   |   | $ | 5,528,164 |   |
| Equity securities                    |   |                    | 108,373   |   |              |   | 68,682 |   |   |   | 108,373 |   |   |   | 167,302 |   |
| Total investments available for sale |   | $                       | 1,419,062 |   |              | $      | 1,379,371 |   |   | $ | 5,636,537 |   |   | $ | 5,695,466 |   |
|                                 |   |                    |      |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Bond maturities                      |   |                    |      |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Within 3 months                      |   | $                       | 1,005,388 |   |              | $      | 1,005,388 |   |   | $ | 1,894,022 |   |   | $ | 1,894,022 |   |
| Between 3-12 months                  |   |                    | 305,301   |   |              |   | 305,301 |   |   |   | 3,321,320 |   |   |   | 3,321,320 |   |
| Between 1-2 years                    |   |                    | -         |   |              |   | - |   |   |   | 312,822 |   |   |   | 312,822 |   |
| Total                                |   | $                       | 1,310,689 |   |              | $      | 1,310,689 |   |   | $ | 5,528,164 |   |   | $ | 5,528,164 |   |
|                                 |   |                    |      |   |              |   |   |   |   |   |   |   |   |   |   |   |

----

|   | Level 1: Quoted prices (unadjusted) or identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date; |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   |
|--------|--------|

|   | Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data; and |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   |
|--------|--------|

|   | Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions that market participants would use in pricing an asset or liability. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                             |   | Total Carrying Value on the Balance Sheet |      |   | Quoted Prices In Active Markets For Identical Assets /Liabilities (Level 1) |   |      | Significant Other Observable Inputs (Level 2) |   |   | SignificantUnobservable Inputs (Level 3) |   |
|------------------------------------------------------------------|--------|-------------------------------------------|-----------|--------|-----------------------------------------------------------------------------|--------|-----------|----------------------------------------------------|--------|--------|-----------------------------------------------|--------|
| Assets:                                                          |   |                                      |      |   |                                                                        |   |      |                                               |   |   |                                          |   |
| Short-term investments available for sale, September 30, 2010    |   | $                                         | 1,379,371 |   |                                                                        | $      | 1,310,689 |                                               |   | $      | -                                             |   |   | $ | 68,682 |   |
|                                                             |   |                                      |      |   |                                                                        |   |      |                                               |   |   |                                          |   |   |   |   |   |
| Short-term investments available for sale, December 31, 2009     |   | $                                         | 5,695,466 |   |                                                                        | $      | 5,528,164 |                                               |   | $      | -                                             |   |   | $ | 167,302 |   |
|                                                             |   |                                      |      |   |                                                                        |   |      |                                               |   |   |                                          |   |   |   |   |   |
| Liabilities:                                                     |   |                                      |      |   |                                                                        |   |      |                                               |   |   |                                          |   |   |   |   |   |
| Common stock warrant liability, September 30, 2010 (see Note 11) |   | $                                         | 109,888   |   |                                                                        | $      | -         |                                               |   | $      | -                                             |   |   | $ | 109,888 |   |
|                                                             |   |                                      |      |   |                                                                        |   |      |                                               |   |   |                                          |   |   |   |   |   |
| Common stock warrant liability, December 31, 2009                |   | $                                         | 821,891   |   |                                                                        | $      | -         |                                               |   | $      | -                                             |   |   | $ | 821,891 |   |

----

|                                                                            |   | September 30, 2010 |      |   | December 31, 2009 |   |
|---------------------------------------------------------------------------------|--------|--------------------|-----------|--------|-------------------|--------|
| Amounts due to Contract Research Organizations and other contractual agreements |   | $                  | 1,572,045 |   |              | $      | 1,122,370 |   |
| Accrued payroll and related benefits                                            |   |               | 312,618   |   |              |   | 262,396 |   |
| Accrued professional fees                                                       |   |               | 74,000    |   |              |   | 47,000 |   |
| Reimbursed expenses not yet incurred                                            |   |               | 7,234     |   |              |   | - |   |
| Other                                                                           |   |               | 20,000    |   |              |   | 19,776 |   |
|    Total                                                         |   | $                  | 1,985,897 |   |              | $      | 1,451,542 |   |

----

|                     |   | September  30, 2010 |   |   | December 31, 2009 |   |
|--------------------------|--------|-------------------------------|--------|--------|-------------------|--------|
| Risk-free interest rate  |   |                          | 1.27   | %      |              |   | 2.69 | % |
| Expected volatility      |   |                          | 30.1   | %      |              |   | 58.9 | % |
| Expected life (in years) |   |                          | 2.3    |   |              |   | 2.6 |   |
| Expected forfeiture rate |   |                          | 0      | %      |              |   | 0 | % |
| Expected dividend yield  |   |                          | 0.00   | %      |              |   | 0.00 | % |

----

----

|                     |   | Nine months endedSeptember 30,2010 |               |   | Nine months endedSeptember 30,2009 |   |
|--------------------------|--------|------------------------------------|--------------------|--------|------------------------------------|--------|
| Risk-free interest rate  |   |                               | 2.40% – 3.24 | %      |                               |   | 1.12% - 2.17 | % |
| Expected volatility      |   |                               | 71.9% -82.8        | %      |                               |   | 72.3% -77.2 | % |
| Expected life (in years) |   |                               | 5 – 6.5      |   |                               |   | 2.7 – 6.25 |   |
| Expected forfeiture rate |   |                               | 0                  | %      |                               |   | 0% - 10 | % |
| Expected dividend yield  |   |                               | 0.00               | %      |                               |   | 0.00 | % |

----

|                                                                  |   | Stock Options      |      |   | Restricted Stock Awards             |   |   |                                  |   |
|-----------------------------------------------------------------------|--------|--------------------|-----------|--------|-------------------------------------|--------|--------|---------------------------------------|--------|
| Equity Awards                                                         |   | OptionsOutstanding |      |   | WeightedAverage Exercise Price |   |   | Non-vested RestrictedStockOutstanding |   |   | WeightedAverageGrant DateFair Value |   |   | WeightedAverageContractualTerms of Equity Awards(in years) |
| Equity awards outstanding at December 31, 2009                        |   |               | 1,641,979 |   |                                | $      | 3.96   |                                  |   |   | 78,599 |   |   | $ | 3.06 |   |   |   |   |
| Equity awards granted                                                 |   |               | 551,500   |   |                                | $      | 3.08   |                                  |   |   | 113,243 |   |   | $ | 3.16 |   |   |   |   |
| Equity awards exercised                                               |   |               | -         |   |                                |   | -      |                                  |   |   | (92,276 | ) |   | $ | 2.84 |   |   |   |   |
| Equity awards forfeited, cancelled or expired                         |   |               | (110,833  | )      |                                | $      | 3.04   |                                  |   |   | (22,166 | ) |   | $ | 3.06 |   |   |   |   |
| Equity awards outstanding at September 30, 2010                       |   |               | 2,082,646 |   |                                | $      | 3.78   |                                  |   |   | 77,400 |   |   | $ | 3.47 |   |   |   | 7.0 |   |
|                                                                  |   |               |      |   |                                |   |   |                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| Aggregate intrinsic value of outstanding awards at September 30, 2010 |   | $                  | 408,836   |   |                                |   |   |                                  |   | $ | 235,296 |   |   |   |   |   |   |   |   |   |
| Equity awards exercisable at September 30, 2010                       |   |               | 1,117,441 |   |                                | $      | 4.23   |                                  |   |   |   |   |   |   |   |   |   |   | 6.1 |   |
| Aggregate intrinsic value of vested awards at September 30, 2010      |   | $                  | 246,687   |   |                                |   |   |                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                  |   |               |      |   |                                |   |   |                                  |   |   |   |   |   |   |   |   |   |   |   |   |

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| Beginning balance, January 1, 2010                                         |   | $      | 821,891  |    |
|----------------------------------------------------------------------------|--------|--------|----------|---------|
| Issuances                                                                  |   |   | -        |    |
| Gain from the adjustment for the change in fair value included in net loss |   |   | (712,003 | )  |
| Ending balance, September 30, 2010                                         |   | $      | 109,888  |    |

| Warrants                          |   | Number Outstanding |      |   | Weighted Average Exercise Price |   |   | Weighted Average Remaining Contractual Term (in years) |   |   | Aggregate Intrinsic Value |   |
|-----------------------------------|--------|--------------------|-----------|--------|---------------------------------|--------|--------|-------------------------------------------------------------|--------|--------|---------------------------|--------|
| Outstanding at December 31, 2009  |   |               | 1,032,410 |   |                            | $      | 5.34   |                                                        |   |   |                      |   |   |   |
| Granted                           |   |               | -         |   |                            |   | -      |                                                        |   |   |                      |   |   |   |
| Exercised                         |   |               | -         |   |                            |   | -      |                                                        |   |   |                      |   |   |   |
| Canceled or expired               |   |               | (23,334   | )      |                            | $      | 9.86   |                                                        |   |   |                      |   |   |   |
| Outstanding at September 30, 2010 |   |               | 1,009,076 |   |                            | $      | 5.24   |                                                        |   |   | 4.75                      |   |   | $ | - |   |
|                              |   |               |      |   |                            |   |   |                                                        |   |   |                      |   |   |   |   |   |
| Exercisable at September 30, 2010 |   |               | 1,009,076 |   |                            | $      | 5.24   |                                                        |   |   | 4.75                      |   |   | $ | - |   |

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|                                  |   | Three Months Ended September 30,($ amounts in 000’s) |   |   | Change |   |
|---------------------------------------|--------|-----------------------------------------------------------------|--------|--------|--------|--------|
|                                  |   | 2010                                                            |   |   | 2009   |   |   |   $ |   |   |   | % |   |
|   Operating expenses:            |   |                                                            |   |   |   |   |   |   |   |   |   |   |   |
| Clinical Research                     |   | $                                                               | 3,062  |   |   | $      | 3,056 |   |   | $ | 6 |   |   |   | 0.2 | % |
| Chemistry, Manufacturing and Controls |   |                                                            | 889    |   |   |   | 447 |   |   |   | 442 |   |   |   | 98.9 | % |
| Research and development              |   |                                                            | 3,951  |   |   |   | 3,503 |   |   |   | 448 |   |   |   | 12.8 | % |
| General and administrative            |   |                                                            | 1,220  |   |   |   | 1,224 |   |   |   | (4 | ) |   |   | (0.3 | )% |
|  Total operating expenses        |   |                                                            | 5,171  |   |   |   | 4,727 |   |   |   | 444 |   |   |   | 9.4 | % |
|                                  |   |                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Loss from operations           |   | $                                                               | (5,171 | )      |   | $      | (4,727 | ) |   | $ | (444 | ) |   |   | (9.4 | )% |
|                                  |   |                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

|                                  |   | Nine Months Ended September 30,($ amounts in 000’s) |    |   | Change |   |
|---------------------------------------|--------|-----------------------------------------------------------|---------|--------|--------|--------|
|                                  |   | 2010                                                      |    |   | 2009   |   |   |   $ |   |   |   | % |   |
|   Operating expenses:            |   |                                                      |    |   |   |   |   |   |   |   |   |   |   |
| Clinical Research                     |   | $                                                         | 8,422   |   |   | $      | 8,893 |   |   | $ | (471 | ) |   |   | 5.3 | % |
| Chemistry, Manufacturing and Controls |   |                                                      | 2,244   |   |   |   | 1,783 |   |   |   | 461 |   |   |   | 25.9 | % |
| Research and development              |   |                                                      | 10,666  |   |   |   | 10,676 |   |   |   | (10 | )  |   |   | (0.1 | )% |
| General and administrative            |   |                                                      | 3,545   |   |   |   | 2,514 |   |   |   | 1,031 |   |   |   | 41.0 |  % |
|  Total operating expenses        |   |                                                      | 14,211  |   |   | $      | 13,190 |   |   |   | 1,021 |   |   |   | 7.7 |  % |
|                                  |   |                                                      |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Loss from operations           |   | $                                                         | (14,211 | )      |   | $      | (13,190 | ) |   | $ | (1,021 | ) |   |   | 7.7 | % |
|                                  |   |                                                      |    |   |   |   |   |   |   |   |   |   |   |   |   |   |

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| §   | Qualifying Therapeutic Discovery Project - On November 1, 2010, the Company was awarded a $244,000 grant under the Qualifying Therapeutic Discovery Project (QTDP) program under The Patient Protection and Affordable Care Act of 2010 (PPACA). This maximum grant amount for a single program was awarded to Celsion for its Thermodox® clinical development program, which is currently conducting clinical trials for primary liver cancer and recurrent chest wall breast cancer.  The funds will be used for development expenses. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| §   | Committed Equity Financing Facility - the Company entered into a Committed Equity Financing Facility (“CEFF”) with Small Cap Biotech Value, Ltd “(SCBV”) on June 17, 2010.  The CEFF provides that, upon the terms and subject to the conditions set forth therein, SCBV is committed to purchase up to $15.0 million worth of our shares of common stock over the 24-month term of the CEFF under certain specified conditions and limitations.  For a more complete description of the CEFF, see Footnote 9 of the Financial Statements.  On September 7, 2010, the Company completed a draw down and sale to SCBV under the CEFF of 238,997 shares of common stock for gross proceeds of $717,273. On September 27, 2010 the Company completed a second draw down and sale of 241,790 shares of common stock for gross proceeds of $700,000.  Broker fees and other expenses associated with these two draw totaled $40,854. The proceeds were used to fund unplanned expenses associated with acceleration of commercial manufacturing and related product development specifications.  The Company has registered the resale of the shares issued to SCVB pursuant to the CEFF under the Securities Act of 1933, as amended. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| 31.1   | Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. (Filed herewith)     |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                      |
| 31.2   | Certification of Principal Financial Officer pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. (Filed herewith) |
|   |                                                                                                                                                                      |
| 32.1   | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.  (Furnished herewith)                   |

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|   |  CELSION CORPORATION                        |
|--------|--------------------------------------------------|
|   |         Registrant |
|   |                                             |
|   |  By:                                   | /s/ Michael H. Tardugno |
|   |                                             | Michael H. Tardugno |
|   |                                             | President and Chief Executive Officer |

|   |  By:    | /s/ Jeffrey W. Church                      |
|--------|-----------------------------|--------------------------------------------|
|   |                        | Jeffrey W. Church                          |
|   |                        | Vice President and Chief Financial Officer |

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