**UNITED      STATES**

**SECURITIES      AND EXCHANGE COMMISSION**

**FORM      10-QSB**

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

**For      the quarterly period ended March 31, 2007**

| o | TRANSITION                REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT |
|---|--------------------------------------------------------------------------------|

**YTB      INTERNATIONAL, INC.**

**Delaware**

**20-2181181**

**1901      East Edwardsville Road**

**Wood      River, Illinois 62095**

** **

**(618)      655-9477**

----

**YTB      INTERNATIONAL, INC.**

**Index      to Quarterly Report on Form 10-QSB**

**Three      months ended March 31, 2007**

| PART                I  |   | FINANCIAL                INFORMATION                                                                                                 |   |   |
|------------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------|--------|--------|
|                   |   |                                                                                                                                 |   |   |
| Item                1. |   | Financial                Statements.                                                                                                 |   |   |
|                   |   | Condensed                Consolidated Balance Sheets, March 31, 2007 (Unaudited) and December                31,                2006 |   | 2      |
|                   |   | Condensed                Consolidated Statements of Operations (Unaudited)                                                           |   |   |
|                   |   | Three                months ended March 31, 2007 and 2006                                                                            |   | 3      |
|                   |   | Condensed                Consolidated Statement of Change in Stockholders’ Equity                (Deficit) (Unaudited)    |   |   |
|                   |   | Three                months ended March, 2007                                                                                        |   | 4      |
|                   |   | Condensed                Consolidated Statements of Cash Flows (Unaudited)                                                           |   |   |
|                   |   | Three                months ended March 31, 2007 and 2006                                                                            |   | 5-6    |
|                   |   | Notes                To Condensed Consolidated Financial Statements (Unaudited)                                                      |   | 7      |
| Item                2. |   | Management's                Discussion and Analysis or Plan of Operation.                                                            |   | 12     |
| Item                3. |   | Controls                and Procedures.                                                                                              |   | 17     |
|                   |   |                                                                                                                                 |   |   |
| PART                II |   | OTHER                INFORMATION                                                                                                     |   |   |
|                   |   |                                                                                                                                 |   |   |
| Item                1. |   | Legal                Proceedings.                                                                                                    |   | 18     |
| Item                2. |   | Unregistered                Sales of Equity Securities and Use of Proceeds.                                                          |   | 18     |
| Item                3. |   | Default                Upon Senior Securities.                                                                                       |   | 18     |
| Item                4. |   | Submission                of Matters to a Vote of Securities Holders.                                                                |   | 18     |
| Item                5. |   | Other                Information.                                                                                                    |   | 18     |
| Item                6. |   | Exhibits.                                                                                                                            |   | 19     |
| Signatures             |   |                                                                                                                                 |

----

**Item            1.**
**Financial            Statements.**

**YTB      INTERNATIONAL, INC.**

**Condensed      Consolidated Balance Sheets**

|                                                                                                                                                                                                                                                                       |   | March                  31, 2007(Unaudited) |        | December                  31, 2006 |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------|-------------|------------------------------------|--------|
| ASSETS                                                                                                                                                                                                                                                                     |   |                                       |        |                               |   |
| Current                  assets:                                                                                                                                                                                                                                           |   |                                       |        |                               |   |
| Cash                  and cash equivalents                                                                                                                                                                                                                                 |   | $                                          | 1,994,244   |                               | $      | - |   |
| Restricted                  cash                                                                                                                                                                                                                                           |   |                                       | 2,485,432   |                               |   | 1,250,000 |   |
| Available-for-sale                  securities                                                                                                                                                                                                                             |   |                                       | 349,795     |                               |   | 1,014,591 |   |
| Accounts                    receivable (less allowance for doubtful accounts of $6,919 in                    2007 and                    2006)                                                                                                                             |   |                                       | 790,557     |                               |   | 103,539 |   |
| Inventory                                                                                                                                                                                                                                                                  |   |                                       | 1,037,616   |                               |   | 1,016,690 |   |
| Notes                  receivable                                                                                                                                                                                                                                          |   |                                       | 1,647,906   |                               |   | 1,233,624 |   |
| Prepaid                  marketing commissions                                                                                                                                                                                                                             |   |                                       | 19,012,700  |                               |   | 12,978,516 |   |
| Other                  prepaid expenses and current assets                                                                                                                                                                                                                 |   |                                       | 615,770     |                               |   | 394,125 |   |
|                                                                                                                                                                                                                                                                       |   |                                       |        |                               |   |   |   |
| Total                  current assets                                                                                                                                                                                                                                      |   |                                       | 27,934,020  |                               |   | 17,991,085 |   |
|                                                                                                                                                                                                                                                                       |   |                                       |        |                               |   |   |   |
| Property                  and equipment, net                                                                                                                                                                                                                               |   |                                       | 7,989,438   |                               |   | 6,191,408 |   |
| Intangible                  assets, net                                                                                                                                                                                                                                    |   |                                       | 2,450,220   |                               |   | 2,468,580 |   |
| Goodwill                                                                                                                                                                                                                                                                   |   |                                       | 2,224,322   |                               |   | 2,224,322 |   |
| Other                  assets                                                                                                                                                                                                                                              |   |                                       | 11,233      |                               |   | 14,994 |   |
| **TOTAL                  ASSETS**                                                                                                                                                                                                                                          |   | $                                          | 40,609,233  |                               | $      | 28,890,389 |   |
|                                                                                                                                                                                                                                                                       |   |                                       |        |                               |   |   |   |
| LIABILITIES                  AND STOCKHOLDERS' EQUITY (DEFICIT)                                                                                                                                                                                                            |   |                                       |        |                               |   |   |   |
| Current                  liabilities:                                                                                                                                                                                                                                      |   |                                       |        |                               |   |   |   |
| Bank                  overdraft                                                                                                                                                                                                                                            |   | $                                          | -           |                               | $      | 812,464 |   |
| Accounts                  payable and accrued expenses                                                                                                                                                                                                                     |   |                                       | 7,631,338   |                               |   | 5,099,248 |   |
| Current                  maturities of long-term debt                                                                                                                                                                                                                      |   |                                       | 21,369      |                               |   | 21,156 |   |
| Deferred                  revenue                                                                                                                                                                                                                                          |   |                                       | 22,876,401  |                               |   | 14,769,085 |   |
| Accrued                  bonuses                                                                                                                                                                                                                                           |   |                                       | 435,133     |                               |   | 7,435,132 |   |
| Short-term                  debt                                                                                                                                                                                                                                           |   |                                       | 2,500,000   |                               |   | 2,500,000 |   |
|                                                                                                                                                                                                                                                                       |   |                                       |        |                               |   |   |   |
| Total                  current liabilities                                                                                                                                                                                                                                 |   |                                       | 33,464,241  |                               |   | 30,637,085 |   |
|                                                                                                                                                                                                                                                                       |   |                                       |        |                               |   |   |   |
| Other                  long-term liabilities:                                                                                                                                                                                                                              |   |                                       |        |                               |   |   |   |
| Long-term                  debt, less current maturities                                                                                                                                                                                                                   |   |                                       | 236,237     |                               |   | 241,659 |   |
| Deferred                  revenue, less current portion                                                                                                                                                                                                                    |   |                                       | 4,366       |                               |   | 4,366 |   |
| Other                  liabilities                                                                                                                                                                                                                                         |   |                                       | 13,733      |                               |   | 23,636 |   |
|                                                                                                                                                                                                                                                                       |   |                                       |        |                               |   |   |   |
| Total                  other long-term liabilities                                                                                                                                                                                                                         |   |                                       | 254,336     |                               |   | 269,661 |   |
|                                                                                                                                                                                                                                                                       |   |                                       |        |                               |   |   |   |
| TOTAL                  LIABILITIES                                                                                                                                                                                                                                         |   |                                       | 33,718,577  |                               |   | 30,906,746 |   |
|                                                                                                                                                                                                                                                                       |   |                                       |        |                               |   |   |   |
| STOCKHOLDERS'                  EQUITY (DEFICIT)                                                                                                                                                                                                                            |   |                                       |        |                               |   |   |   |
| Preferred                    stock, $.001 par value, 5,000,000 shares authorized, none issued                    and                    outstanding at March 31, 2007 and December 31, 2006.                                                                               |   |                                       | -           |                               |   | - |   |
| Common                    stock, $.001 par value, 50,000,000 shares authorized; 31,691,109                    and                    27,870,454 shares issued and outstanding at March 31, 2007 and                    December                    31, 2006, respectively. |   |                                       | 31,691      |                               |   | 27,870 |   |
| Additional                  paid-in capital                                                                                                                                                                                                                                |   |                                       | 31,348,220  |                               |   | 20,268,006 |   |
| Retained                  earnings (deficit)                                                                                                                                                                                                                               |   |                                       | (24,489,255 | )                                  |   | (22,312,233 | ) |
|                                                                                                                                                                                                                                                                       |   |                                       |        |                               |   |   |   |
| Total                  STOCKHOLDERS' EQUITY (DEFICIT)                                                                                                                                                                                                                      |   |                                       | 6,890,656   |                               |   | (2,016,357 | ) |
|                                                                                                                                                                                                                                                                       |   |                                       |        |                               |   |   |   |
| **TOTAL                  LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)**                                                                                                                                                                                                  |   | $                                          | 40,609,233  |                               | $      | 28,890,389 |   |

*See        accompanying notes to condensed consolidated financial        statements.*

----

**YTB      INTERNATIONAL, INC.**

**Condensed      Consolidated Statements of Operations**

|                                                        |   | Three                  months ended |       |
|-------------------------------------------------------------|--------|-------------------------------------|------------|
|                                                        |   | March                  31, 2007     |       | March                  31, 2006 |   |
| NET                  REVENUES                               |   |                                |       |   |   |
| Online                  travel store sales and monthly fees |   | $                                   | 17,965,361 |   | $ | 6,061,307 |   |
| Travel                  commissions and services            |   |                                | 2,537,694  |   |   | 1,248,511 |   |
| Franchise                  service fees and other fees      |   |                                | 90,223     |   |   | 84,552 |   |
| Training                  programs and marketing materials  |   |                                | 3,361,152  |   |   | 734,710 |   |
| Other                                                       |   |                                | 224,051    |   |   | 34,246 |   |
|                                                        |   |                                |       |   |   |   |   |
| Net                  revenues                               |   |                                | 24,178,481 |   |   | 8,163,326 |   |
|                                                        |   |                                |       |   |   |   |   |
| OPERATING                  EXPENSES                         |   |                                |       |   |   |   |   |
| Marketing                  commissions                      |   |                                | 16,136,795 |   |   | 4,359,264 |   |
| Travel                  commissions                         |   |                                | 1,608,688  |   |   | 643,188 |   |
| Depreciation                  and amortization              |   |                                | 214,032    |   |   | 65,402 |   |
| Marketing                  and selling                      |   |                                | 1,379,400  |   |   | 72,877 |   |
| General                  and administrative                 |   |                                | 7,063,513  |   |   | 3,162,497 |   |
|                                                        |   |                                |       |   |   |   |   |
| Total                  operating expenses                   |   |                                | 26,402,428 |   |   | 8,303,228 |   |
|                                                        |   |                                |       |   |   |   |   |
| LOSS                  FROM OPERATIONS                       |   |                                | (2,223,947 | ) |   | (139,902 | ) |
|                                                        |   |                                |       |   |   |   |   |
| OTHER                  INCOME (EXPENSE)                     |   |                                |       |   |   |   |   |
| Interest                  and dividend income               |   |                                | 49,536     |   |   | 32,801 |   |
| Interest                  expense                           |   |                                | (2,611     | ) |   | (149,161 | ) |
|                                                        |   |                                |       |   |   |   |   |
| Total                  other income (expense)               |   |                                | 46,925     |   |   | (116,360 | ) |
|                                                        |   |                                |       |   |   |   |   |
| NET                  LOSS                                   |   | $                                   | (2,177,022 | ) | $ | (256,262 | ) |
|                                                        |   |                                |       |   |   |   |   |
| NET                  LOSS PER SHARE:                        |   |                                |       |   |   |   |   |
|                                                        |   |                                |       |   |   |   |   |
| Weighted-average                  shares outstanding        |   |                                | 31,436,441 |   |   | 27,336,260 |   |
|                                                        |   |                                |       |   |   |   |   |
| Net                  loss per share - basic and diluted     |   | $                                   | (0.07      | ) | $ | (0.01 | ) |

*See        accompanying notes to condensed consolidated financial        statements.*

----

**YTB      INTERNATIONAL, INC.**

**Condensed      Consolidated Statement of Changes in Stockholders’ Equity      (Deficit)**

**Three      months ended March 31, 2007**

|                                                                 |   |  Delaware                  Preferred |   | Delaware                  Common |   |  Additional |   | Retained |       | Total                  Stockholders' |   |
|----------------------------------------------------------------------|--------|-------------------------------------------|--------|----------------------------------|--------|------------------|--------|----------|------------|--------------------------------------|--------|
|                                                                 |   |  Stock                               |   | Stock                            |   |  Paid-in    |   | Earnings |       | Equity                               |   |
|                                                                 |   |  Shares                              |   | Amount                           |   | Shares           |   | Amount   |       |  Capital                        |   | (Deficit) |   | (Deficit) |   |
|                                                                 |   |                                 |   |                             |   |             |   |     |       |                            |   |   |   |   |   |
| Balance                  at January 1, 2007                          |   |                                      | -      |                             | $      | -                |   |     | 27,870,454 |                                 | $      | 27,870 |   | $ | 20,268,006 |   | $ | (22,312,233 | ) | $ | (2,016,357 | ) |
|                                                                 |   |                                      |   |                             |   |             |   |     |       |                                 |   |   |   |   |   |   |   |   |   |   |   |   |
| Common                      shares issued for restricted stock grant |   |                                      | -      |                             |   | -                |   |     | 3,112,901  |                                 |   | 3,113 |   |   | 9,646,880 |   |   | - |   |   | 9,649,993 |   |
|                                                                 |   |                                      |   |                             |   |             |   |     |       |                                 |   |   |   |   |   |   |   |   |   |   |   |   |
| Amortization                    of restricted stock (unvested)       |   |                                      | -      |                             |   | -                |   |     | -          |                                 |   | - |   |   | 1,222,411 |   |   | - |   |   | 1,222,411 |   |
|                                                                 |   |                                      |   |                             |   |             |   |     |       |                                 |   |   |   |   |   |   |   |   |   |   |   |   |
| Exercise                  of common stock warrants                   |   |                                      | -      |                             |   | -                |   |     | 707,754    |                                 |   | 708 |   |   | 197,729 |   |   | - |   |   | 198,437 |   |
|                                                                 |   |                                      |   |                             |   |             |   |     |       |                                 |   |   |   |   |   |   |   |   |   |   |   |   |
| Stock                  option compensation                           |   |                                      | -      |                             |   | -                |   |     | -          |                                 |   | - |   |   | 13,194 |   |   | - |   |   | 13,194 |   |
|                                                                 |   |                                      |   |                             |   |             |   |     |       |                                 |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                  loss                                            |   |                                      | -      |                             |   | -                |   |     | -          |                                 |   | - |   |   | - |   |   | (2,177,022 | ) |   | (2,177,022 | ) |
| Balance                  at March 31, 2007                           |   |                                      | -      |                             | $      | -                |   |     | 31,691,109 |                                 | $      | 31,691 |   | $ | 31,348,220 |   | $ | (24,489,255 | ) | $ | 6,890,656 |   |

*See      accompanying notes to condensed consolidated financial      statements.*

----

**YTB      INTERNATIONAL, INC.**

**Condensed      Consolidated Statements of Cash Flows**

|                                                                                                                              |   |  Three                  months ended |       |
|-----------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------|------------|
|                                                                                                                              |   |  March                  31, 2007     |       | March                  31, 2006 |   |
| CASH                  FLOWS FROM OPERATING ACTIVITIES:                                                                            |   |                                 |       |   |   |
|  Net                  Loss                                                                                                   |   | $                                         | (2,177,022 | ) | $ | (256,262 | ) |
|  Adjustments                  to reconcile net loss to net cash provided by (used in) operating                  activities: |   |                                      |       |   |   |   |   |
|  Depreciation                  and amortization                                                                              |   |                                      | 214,032    |   |   | 65,402 |   |
|  Shares                  issued for restricted stock grant                                                                   |   |                                      | 2,799,994  |   |   | - |   |
|  Amortization                  of restricted stock (unvested)                                                                |   |                                      | 1,222,411  |   |   | - |   |
|  Stock                  option expense                                                                                       |   |                                      | 13,194     |   |   | 47,846 |   |
|  Change                  in operating assets and liabilities:                                                                |   |                                      |       |   |   |   |   |
|  Accounts                  receivable, net                                                                                   |   |                                      | (687,018   | ) |   | (34,705 | ) |
|  Notes                  receivable                                                                                           |   |                                      | (414,282   | ) |   | 280 |   |
|  Inventory                                                                                                                   |   |                                      | (20,926    | ) |   | - |   |
|  Prepaid                  marketing commissions                                                                              |   |                                      | (6,034,184 | ) |   | (1,497,050 | ) |
|  Other                  prepaid expenses and current assets                                                                  |   |                                      | (221,645   | ) |   | (222,339 | ) |
|  Other                  assets                                                                                               |   |                                      | 3,761      |   |   | 1,190 |   |
|  Accounts                  payable and accrued expenses                                                                      |   |                                      | 2,462,462  |   |   | (612,041 | ) |
|  Accrued                  bonuses                                                                                            |   |                                      | (150,000   | ) |   | 502,706 |   |
|  Deferred                  revenue                                                                                           |   |                                      | 8,107,316  |   |   | 1,626,244 |   |
|  Convertible                  debt derivative                                                                                |   |                                      | -          |   |   | 185,180 |   |
|  Other                  liabilities                                                                                          |   |                                      | (9,903     | ) |   | 5,799 |   |
| NET                  CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES                                                              |   |                                      | 5,108,190  |   |   | (187,750 | ) |
|                                                                                                                              |   |                                      |       |   |   |   |   |
| CASH                  FLOWS FROM INVESTING ACTIVITIES:                                                                            |   |                                      |       |   |   |   |   |
|  Purchases                  of property and equipment                                                                        |   |                                      | (1,924,074 | ) |   | (119,924 | ) |
|  Proceeds                  from sale of available-for-sale securities                                                        |   |                                      | 664,796    |   |   | 1,282,018 |   |
|  Purchases                  of available-for-sale securities                                                                 |   |                                      | -          |   |   | (779,592 | ) |
| NET                  CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES                                                              |   |                                      | (1,259,278 | ) |   | 382,502 |   |
|                                                                                                                              |   |                                      |       |   |   |   |   |
| CASH                  FLOWS FROM FINANCING ACTIVITIES:                                                                            |   |                                      |       |   |   |   |   |
|  Repayment                  of bank overdraft                                                                                |   |                                      | (812,464   | ) |   | - |   |
|  Principal                  payments on debt                                                                                 |   |                                      | (5,209     | ) |   | (5,473 | ) |
|  Repayment                  of notes payable                                                                                 |   |                                      | -          |   |   | (88,988 | ) |
|  Restricted                  cash-collateral used as reserves for credit                  card processing                    |   |                                      | (1,235,432 | ) |   | - |   |
|  Proceeds                  from exercise of common stock warrants                                                            |   |                                      | 198,437    |   |   | - |   |
| NET                  CASH USED IN FINANCING ACTIVITIES                                                                            |   |                                      | (1,854,668 | ) |   | (94,461 | ) |
|                                                                                                                              |   |                                      |       |   |   |   |   |
| NET                  INCREASE IN CASH AND CASH EQUIVALENTS                                                                        |   |                                      | 1,994,244  |   |   | 100,291 |   |
| CASH                  AND CASH EQUIVALENTS, BEGINNING OF PERIOD                                                                   |   |                                      | -          |   |   | 230,358 |   |
| CASH                  AND CASH EQUIVALENTS, END OF PERIOD                                                                         |   | $                                         | 1,994,244  |   | $ | 330,649 |   |
|                                                                                                                              |   |                                      |       |   |   |   |   |
| SUPPLEMENTAL                  CASH FLOW INFORMATION:                                                                              |   |                                      |       |   |   |   |   |
|  Interest                  paid                                                                                              |   | $                                         | 51,446     |   | $ | 4,797 |   |
|                                                                                                                              |   |                                      |       |   |   |   |   |

----

**YTB      INTERNATIONAL, INC.**

**Condensed      Consolidated Statements of Cash Flows (continued)**

**(Unaudited)**

|                                                                                                                                             |   |  Three                  months ended |      |
|--------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------|-----------|
|                                                                                                                                             |   |  March                  31, 2007     |      | March                  31, 2006 |   |
| SUPPLEMENTAL                  NON-CASH INVESTING AND FINANCING ACTIVITIES:                                                                       |   |                                 |      |   |   |
|  Increase                  in accounts payable and property and equipment                                                                   |   | $                                         | 69,628    |   | $ | - |   |
|  Shares                  issued from a restricted stock grant in settlement                  of  bonus                  liability |   | $                                         | 6,849,999 |   | $ | - |   |
|  Shares                  issued in cashless warrant exercise                                                                                |   | $                                         | 602       |   | $ | - |   |

*See      accompanying notes to condensed consolidated financial      statements.*

----

|                                           |   | March                  31, 2007 |      | December                  31, 2006 |   |
|------------------------------------------------|--------|---------------------------------|-----------|------------------------------------|--------|
| "Success                  From Home" magazines |   | $                               | 861,872   |                               | $      | 906,600 |   |
| Printed                  marketing materials   |   |                            | 175,744   |                               |   | 110,090 |   |
| Inventory                                      |   | $                               | 1,037,616 |                               | $      | 1,016,690 |   |

----

|                                            |   | March                  31, 2007 |       | December                  31, 2006 |   |
|-------------------------------------------------|--------|---------------------------------|------------|------------------------------------|--------|
| Equipment                                       |   | $                               | 1,321,246  |                               | $      | 1,105,005 |   |
| Furniture                  and fixtures         |   |                            | 713,796    |                               |   | 436,369 |   |
| Capitalized                  software           |   |                            | 1,567,844  |                               |   | 1,555,003 |   |
| Vehicles                                        |   |                            | 312,688    |                               |   | 168,908 |   |
| Building                  and improvements      |   |                            | 4,083,789  |                               |   | 3,085,519 |   |
| Land                                            |   |                            | 1,538,693  |                               |   | 1,538,693 |   |
| Construction                  in progress       |   |                            | 346,393    |                               |   | - |   |
| Leasehold                  improvements         |   |                            | 115,272    |                               |   | 116,522 |   |
|                                            |   |                            | 9,999,721  |                               |   | 8,006,019 |   |
| Less:                  Accumulated depreciation |   |                            | (2,010,283 | )                                  |   | (1,814,611 | ) |
| Property                  and equipment, net    |   | $                               | 7,989,438  |                               | $      | 6,191,408 |   |

**Stock      Options**

----

|                                                              |   | Shares |     | Weighted-Average                  Exercise Price |   | Weighted-Average                  Fair Value |   |
|-------------------------------------------------------------------|--------|--------|----------|--------------------------------------------------|--------|----------------------------------------------|--------|
| Options                  outstanding, beginning of period         |   |   | 625,000  |                                             | $      | 1.07                                         |   | $ | 0.630 |   |
| For                  the period from January 1 to March 31, 2007: |   |   |     |                                             |   |                                         |   |   |   |   |
|  Granted                                                     |   |   | -        |                                             |   | -                                            |   |   | - |   |
|  Forfeited                                                   |   |   | -        |                                             |   | -                                            |   |   | - |   |
|  Expired                                                     |   |   | -        |                                             |   | -                                            |   |   | - |   |
|  Exercised                                                   |   |   | (400,000 | )(1)                                             |   | 1.00                                         |   |   | 0.650 |   |
| Options                  outstanding, end of period               |   |   | 225,000  |                                             | $      | 1.20                                         |   | $ | 0.600 |   |
| Options                  exercisable, end of period               |   |   | -        |                                             | $      | -                                            |   | $ | - |   |

|                                      |   |  Options                  Outstanding |    | Options                  Exercisable |   |
|-------------------------------------------|--------|--------------------------------------------|---------|--------------------------------------|--------|
|                                      |   |                                  |    | Weighted-                            |   | Weighted- |   |  |   | Weighted- |   |
|                                      |   |                                  |    | Average                              |   | Average |   |   |   | Average |   |
|                                      |   |  Number                               |    | Remaining                            |   | Exercise |   | Number |   | Exercise |   |
| Range                  of Exercise Prices |   |  Outstanding                          |    | Life                  (years)        |   |  Price |   | Outstanding |   |  Price |   |
|  $1.01                - $1.20        |   |                                       | 225,000 |                                 |   | 5.07 |   | $ | 1.20 |   |   | - |   | $ | - |   |
|                                      |   |                                       |    |                                 |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                     |   |                                       | 225,000 |                                 |   | 5.07 |   | $ | 1.20 |   |   | - |   | $ | - |   |

**Restricted      Stock**

----

|                                             |   |       |      | Weighted-                   |   |
|--------------------------------------------------|--------|------------|-----------|-----------------------------|--------|
|                                             |   |       |      | average                     |   |
|                                             |   | Restricted |      | grant-date                  |   |
|                                             |   | shares     |      | fair                  value |   |
| Non-vested                  at beginning of 2007 |   | -          |      | -                           |   |
| Granted                                          |   | $          | 9,650,009 |                        | $      | 3.10 |   |
| Vested                                           |   |       | 3,112,901 |                        | $      | 3.10 |   |
| Forfeited                                        |   |       | -         |                        |   |   |   |
| Non-vested                  at March 31, 2007    |   | $          | 6,537,108 |                        | $      | 3.10 |   |

----

*The      Fair Value Option for Financial Assets and Financial Liabilities Including      an      amendment of FASB Statement No. 115 *
*,*

| Three                  Months Ended                 |   |      |       |   |   |       |   |   |   |        |   |      |   |
|-----------------------------------------------------|--------|-----------|------------|--------|--------|------------|--------|--------|--------|-------------|--------|-----------|--------|
| March                  31, 2007                     |   | Marketing |       | Travel |   | Technology |   | Parent |   | Elimination |   | Total     |   |
|                                                |   |      |       |   |   |       |   |   |   |        |   |      |   |
| External                  and inter-segment revenue |   | $         | 21,293,428 |   | $      | 3,149,437  |   | $      | 17,373 |        | $      | -         |   | $ | (281,757 | ) | $ | 24,178,481 |   |
| Segment                  profit (loss)              |   |      | (2,221,139 | )      |   | 965,964    |   |   | (2,175 | )           |   | (919,672  | )      |   | - |   |   | (2,177,022 | ) |
| Assets                                              |   |      | 32,904,515 |   |   | 5,543,750  |   |   | -      |        |   | 9,122,750 |   |   | (6,961,782 | ) |   | 40,609,233 |   |
| Depreciation                  and amortization      |   |      | 153,748    |   |   | -          |   |   | -      |        |   | 60,284    |   |   | - |   |   | 214,032 |   |
| Capital                  expenditures               |   |      | 923,558    |   |   | -          |   |   | -      |        |   | 1,070,144 |   |   | - |   |   | 1,993,702 |   |

| Three                  Months Ended                 |   |   |      |   |   |      |   |   |       |   |   |       |   |   |        |   |   |       |   |
|-----------------------------------------------------|--------|--------|-----------|--------|--------|-----------|--------|--------|------------|--------|--------|------------|--------|--------|-------------|--------|--------|------------|--------|
| March                  31, 2006                     |   |   | Marketing |   |   | Travel    |   |   | Technology |   |   | Parent     |   |   | Elimination |   |   | Total      |   |
|                                                |   |   |      |   |   |      |   |   |       |   |   |       |   |   |        |   |   |       |   |
| External                  and inter-segment revenue |   | $      | 6,818,901 |   | $      | 1,415,798 |   | $      | 32,488     |   | $      | -          |   | $      | (103,861    | )      | $      | 8,163,326  |   |
| Segment                  profit (loss)              |   |   | 334,356   |   |   | 499,319   |   |   | 24,785     |   |   | (1,114,722 | )      |   | -           |   |   | (256,262   | )      |
| Assets                                              |   |   | 7,918,266 |   |   | 2,440,667 |   |   | -          |   |   | 7,663,747  |   |   | (2,779,802  | )      |   | 15,242,878 |   |
| Depreciation                  and amortization      |   |   | 42,042    |   |   | -         |   |   | -          |   |   | 23,360     |   |   | -           |   |   | 65,402     |   |
| Capital                  expenditures               |   |   | 119,924   |   |   | -         |   |   | -          |   |   | -          |   |   | -           |   |   | 119,924    |   |

----

**Item      2.**
**Management’s      Discussion and Analysis or Plan of Operation.**

**Overview**

----

|                                                     |   | Three                months ended |       | Three                months ended |   | Variance                      |   |
|----------------------------------------------------------|--------|-----------------------------------|------------|-----------------------------------|--------|-------------------------------|--------|
|                                                     |   | March                31, 2007     |       | %                of Net Revenues  |   | March                31, 2006 |   | %                of Net Revenues |   | Increase                (Decrease) |   | Inc.(Decr.)                % |   |
|                                                     |   |                              |       |                              |   |                          |   |   |   |   |   |   |   |
| NET                REVENUES                              |   |                              |       |                              |   |                          |   |   |   |   |   |   |   |
| Online                travel stores and monthly fees     |   | $                                 | 17,965,361 |                              |   | 74.3                          | %      | $ | 6,061,307 |   |   | 74.3 | % | $ | 11,904,054 |   |   | 196.4 | % |
| Travel                commissions and services           |   |                              | 2,537,694  |                              |   | 10.5                          | %      |   | 1,248,511 |   |   | 15.3 | % |   | 1,289,183 |   |   | 103.3 | % |
| Franchise                services fees and other fees    |   |                              | 90,223     |                              |   | 0.4                           | %      |   | 84,552 |   |   | 1.0 | % |   | 5,671 |   |   | 6.7 | % |
| Training                programs and marketing materials |   |                              | 3,361,152  |                              |   | 13.9                          | %      |   | 734,710 |   |   | 9.0 | % |   | 2,626,442 |   |   | 357.5 | % |
| Other                                                    |   |                              | 224,051    |                              |   | 0.9                           | %      |   | 34,246 |   |   | 0.4 | % |   | 189,805 |   |   | 554.2 | % |
|                                                     |   |                              |       |                              |   |                          |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                net revenues                        |   |                              | 24,178,481 |                              |   | 100.0                         | %      |   | 8,163,326 |   |   | 100.0 | % |   | 16,015,155 |   |   | 196.2 | % |
|                                                     |   |                              |       |                              |   |                          |   |   |   |   |   |   |   |   |   |   |   |   |   |
| OPERATING                EXPENSES                        |   |                              |       |                              |   |                          |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Marketing                commissions                     |   |                              | 16,136,795 |                              |   | 66.7                          | %      |   | 4,359,264 |   |   | 53.4 | % |   | 11,777,531 |   |   | 270.2 | % |
| Travel                commissions                        |   |                              | 1,608,688  |                              |   | 6.7                           | %      |   | 643,188 |   |   | 7.9 | % |   | 965,500 |   |   | 150.1 | % |
| Depreciation                and amortization             |   |                              | 214,032    |                              |   | 0.9                           | %      |   | 65,402 |   |   | 0.8 | % |   | 148,630 |   |   | 227.3 | % |
| Marketing                and selling                     |   |                              | 1,379,400  |                              |   | 5.7                           | %      |   | 72,877 |   |   | 0.9 | % |   | 1,306,523 |   |   | 1,792.8 | % |
| General                and administrative                |   |                              | 7,063,513  |                              |   | 29.2                          | %      |   | 3,162,497 |   |   | 38.7 | % |   | 3,901,016 |   |   | 123.4 | % |
|                                                     |   |                              |       |                              |   |                          |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                operating expenses                  |   |                              | 26,402,428 |                              |   | 109.2                         | %      |   | 8,303,228 |   |   | 101.7 | % |   | 18,099,200 |   |   | 218.0 | % |
|                                                     |   |                              |       |                              |   |                          |   |   |   |   |   |   |   |   |   |   |   |   |   |
| LOSS                FROM OPERATIONS                      |   |                              | (2,223,947 | )                                 |   | (9.2                          | %)     |   | (139,902 | ) |   | (1.7 | %) |   | (2,084,045 | ) |   | 1,489.6 | % |
|                                                     |   |                              |       |                              |   |                          |   |   |   |   |   |   |   |   |   |   |   |   |   |
| OTHER                INCOME/(EXPENSE)                    |   |                              |       |                              |   |                          |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest                and dividend income              |   |                              | 49,536     |                              |   | 0.2                           | %      |   | 32,801 |   |   | 0.4 | % |   | 16,735 |   |   | 51.0 | % |
| Interest                expense                          |   |                              | (2,611     | )                                 |   | 0.0                           | %      |   | (149,161 | ) |   | (1.8 | %) |   | 146,550 |   |   | (98.2 | %) |
|                                                     |   |                              |       |                              |   |                          |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                income/(expense)                    |   |                              | 46,925     |                              |   | 0.2                           | %      |   | (116,360 | ) |   | (1.4 | %) |   | 163,285 |   |   | (140.3 | %) |
|                                                     |   |                              |       |                              |   |                          |   |   |   |   |   |   |   |   |   |   |   |   |   |
| NET                LOSS                                  |   | $                                 | (2,177,022 | )                                 |   | (9.0                          | %)     | $ | (256,262 | ) |   | (3.1 | %) | $ | (1,695,760 | ) |   | 749.5 | % |

----

|   | RTAs                  as of           |   | RTAs                  as of         |   |
|--------|---------------------------------------|--------|-------------------------------------|--------|
|   | March                  31, 2007       |   | March                  31, 2006     |   |
|   | 82,932                                |   | 27,559                              |   |
|   |                                  |   |                                |   |
|   | Site                  sales for the   |   | Site                  sales for the |   |
|   | 3                  months ended       |   | 12                  months ended    |   |
|   | March                  31, 2007  |   | March                  31, 2006     |   |
|   | 33,415                                |   | 9,935                               |   |

**Three      months ended March 31, 2007 compared to three months ended March 31,      2006**

**Net      Revenues**

| ·   | Online                travel store sales and monthly fees increased $11,904,054 or 196.4%                in the                first quarter of 2007 to $17,965,361 from the $6,061,307 reported                in the                comparable prior year quarter. The increase is due to the significant                growth of YTB Marketing attributable to the increase in active                RTAs. The Company believes its significant growth in RTAs is attributable                to the emerging market shift to the Internet for travel services                which                presents the opportunity for advancement of products and services                by                referral relationships and the boom in home-based                businesses. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Travel                agency commissions for the first quarter of 2007 increased $1,289,183                or                103.3%                to                $2,537,694                from the $1,248,511 reported in the comparable prior year quarter.                The                increase is attributable to an increase in the number of customers                utilizing the Company as their travel provider in 2007 due to the                significant growth in the number of                RTAs. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Franchise                service fees and other fees increased $5,671or 6.7% in the first                quarter                of 2007 to $90,223 from $84,552 reported in the first quarter of                2006 |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Training                programs and marketing materials revenue increased $2,626,442 or                357.5% in                the first quarter of 2007 to $3,361,152 from $734,710 in the comparable                prior year quarter. This increase is due to the significant growth                of                sales revenues primarily from training programs, sales aides and                miscellaneous promotional and marketing materials purchased by an                increasing number of IMRs. Revenue from the sale of the “Success from                Home” magazine, new in 2006, accounts for approximately $1.2 million of                the increase in the first quarter of 2007. Additional increases in                the                first quarter of 2007 related to training programs revenue and sales                aides                and miscellaneous marketing materials revenue in the amount of                approximately $1.0 million and $384,198, respectively, compared to                the                first quarter of 2006. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Other                income increased in the first quarter of 2007 as compared to 2006                by                $189,805 or 554.2% to $224,051 from $34,246. This increase is primarily                related to new cruise-line incentive program revenue generated from                new                incentive programs that did not exist in the first quarter of                2006. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**Operating      Expenses **

| ·   | Marketing                commissions increased by $11,777,531 or 270.2% in the first quarter                of                2007 to $16,136,795 from $4,359,264 in the first quarter of 2006.                This                increase is due to the significant increase in active RTAs sold by                our                IMRs as well as the average amount of commissions paid per new RTA                due to                an increase in Dream Bonuses paid as well as the number of override                commissions paid. The Dream Bonus is a $10,000 bonus paid when IMRs                have                recruited and maintained 100 paying RTAs. The initial license fee                was                increased October 1, 2006 in order to cover the increased costs incurred                by the Company due to the increase in average commissions paid.                Additionally, newly implemented commission programs contributed                approximately $229,245 to the increase year over year. The first                quarter                ended March 31, 2007 also includes $4,066,559 in bonus expense for                the                Company’s IMRs earned in conjunction with a bonus program that began in                the fourth quarter of 2005 while the first quarter of 2006 includes                $502,706 of such expense. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Travel                commissions for the first quarter of 2007 increased by $965,500 or                150.1%                to $1,608,688 from $643,188 reported in the first quarter of 2006.                The                increase is attributable to an increase in the number of customers                utilizing the Company as their travel provider in 2007 due to the                significant growth in the number of                RTAs. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Depreciation                and amortization was $214,032 in the first quarter of 2007, compared                to                $65,402 in the corresponding quarter of 2006. The increase in                depreciation and amortization is primarily attributable to the new                additions related to the Company’s new headquarters building and assets                related to the growth of the Company’s                infrastructure. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Marketing                and selling expenses increased by $1,306,523 or 1,792.8% from $72,877                in                the first quarter of 2006 to $1,379,400 in the first quarter of 2007.                The                increase is attributable to an increase in promotional efforts in                connection with our Super Bowl insert and our leadership                bulletins which led to an increase in                RTAs. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | General                and administrative expenses increased $3,901,016 to $7,063,513 in                the                first quarter of 2007 from $3,162,497 in the first quarter of 2006.                As a                percentage of total net revenues, these expenses were 29.2% in 2007                and                38.7% in 2006. The increase in general and administrative expense                in 2007                is attributable to the significant growth in the number of active                RTAs                resulting in increased costs associated with the growth in the Company’s                infrastructure to support the increased volume. The increase is also                attributable to costs associated with the ongoing implementation                of new                 business strategies company-wide. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Variability      of Results**

----

**Liquidity      and Capital Resources**

|                                                 |   |  Three                  months ended |       |
|------------------------------------------------------|--------|-------------------------------------------|------------|
|                                                 |   |  March                  31, 2007     |       | March                  31, 2006 |   |
|  Net                cash provided by (used in): |   |                                 |       |   |   |
|  Operating                  activities          |   | $                                         | 5,108,190  |   | $ | (187,750 | ) |
|  Investing                  activities          |   |                                      | (1,259,278 | ) |   | 382,502 |   |
|  Financing                  activities          |   |                                      | (1,854,668 | ) |   | (94,461 | ) |
|                                                 |   |                                      |       |   |   |   |   |
|  Net                increase in cash            |   | $                                         | 1,994,244  |   | $ | 100,291 |   |

**Off        - Balance Sheet Arrangements**

**New      Accounting Pronouncements**

*The      Fair Value Option for Financial Assets and Financial Liabilities Including      an      amendment of FASB Statement No. 115 *
*,*

----

**Application      of Critical Accounting Policies**

**Forward-Looking      Statements**

**Item      3.**
**Controls      and Procedures**

**Evaluation        of Disclosure Controls and Procedures**

----

**Changes        in Internal Control Over Financial Reporting**

**PART      II - OTHER INFORMATION**

**Item        1.  Legal        Proceedings.**

**Item        2.  Unregistered        Sales of Equity Securities and Use of Proceeds.**

**Item        3.  Defaults        Upon Senior Securities.**

**Item        4.  Submission        of Matters to a Vote of Security Holders.**

**Item        5.  Other        Information.**

----

**Item  6.           **
**Exhibits.**

|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 2.1    |   | Amended                  and Restated Merger and Stock Exchange Agreement dated November                  19, 2004                  by and between REZconnect Technologies, Inc. and YourTravelBiz.com,                  Inc.,                  incorporated by reference to YTB International, Inc.’s Current Report on                  Form 8-K as amended, Exhibit 2.1, filed June 20, 2005.                                                                                                                                                                                                                                                                                      |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 3.1    |   | Certificate                  of Incorporation of the Company, incorporated by reference to YTB                  International, Inc.’s Current Report on Form 8-K, Exhibit 3.1, filed                  January 10, 2005.                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 3.2    |   | Amended                  By-Laws of the Company, incorporated by reference to YTB International,                  Inc.’s Current Report on Form 8-K, Exhibit 3.2, filed January 10,                  2005.                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 4.1    |   | Stockholders’                  Agreement dated December 8, 2004 by and among Great River Enterprises,                  LP#1, J. Scott Tomer, J. Kim Sorensen, Michael Y. Brent, Derek                  J. Brent                  and REZconnect Technologies Inc., incorporated by reference to                  YTB                  International, Inc.’s Current Report on Form 8-K, as amended, Exhibit 4.1,                  filed June 20, 2005.                                                                                                                                                                                                                          |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 4.2    |   | Agreement                  and Irrevocable Proxy, dated November 22, 2006, by and among J.                  Lloyd                  Tomer, J. Scott Tomer, J. Kim Sorensen, jointly and severally,                  and Michael                  Y. Brent, Derek Brent and Darren Brent, jointly and severally,                  with                  respect to certain matters specified therein, incorporated by reference                  to                  Exhibit 99.1 to the Schedule 13D/A filed by Great River Enterprises,                  LP                  #1, J. Lloyd Tomer, J. Scott Tomer and J. Kim Sorensen on November                  24,                  2006. |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 31.1   |   | Chief                  Executive Officer Certification pursuant to Rule 13a-14(a) or 15d-14(a)                  of                  the Securities Exchange Act of 1934, as adopted pursuant to Section                  302 of                  the Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                                                                                                                                                                                                                            |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 31.2   |   | Chief                  Financial Officer Certification pursuant to Rule 13a-14(a) or 15d-14(a)                  of                  the Securities Exchange Act of 1934, as adopted pursuant to Section                  302 of                  the Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                                                                                                                                                                                                                            |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 32.1*  |   | Chief                  Executive Officer Certification pursuant to 18 U.S.C. Section 1350,                  as                  adopted pursuant to Section 906 of the Sarbanes-Oxley Act of                  2002.                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 32.2*  |   | Chief                  Financial Officer Certification pursuant to 18 U.S.C. Section 1350,                  as                  adopted pursuant to Section 906 of the Sarbanes-Oxley Act of                  2002.                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |

----

**SIGNATURES**

|   |   |   | **YTB                International, Inc**           |
|--------|--------|--------|-----------------------------------------------------|
|   |   |   |                                                |
|   |   |   | /s/                J. Scott Tomer                   |
|        |   |   | J.                Scott Tomer                       |
|        |   |   | Chief                Executive Officer and Director |
|   |   |   |                                                |
|   |   |   | Dated:                May 15, 2007                  |

|   |   |   |                                   |
|--------|--------|--------|----------------------------------------|
|        |   |   | /s/                John D. Clagg       |
|        |   |   | John                D. Clagg,          |
|        |   |   | Chief                Financial Officer |
|   |   |   |                                   |
|   |   |   | Dated:                May 15, 2007     |

----