UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549
                         ______________________________

                                   FORM 10-QSB
(Mark One)

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

     For the Quarterly Period Ended December 31, 2005
                                    -----------------

[ ]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

     For the transition period from _________ to _________

                         Commission File Number 0-50666
                                                -------

                          OSAGE FEDERAL FINANCIAL, INC.
--------------------------------------------------------------------------------
        (Exact name of Small Business Issuer as specified in its Charter)

         United States                                           27-0080039
 ------------------------------                              -------------------
(State or other jurisdiction of                                (IRS Employer
 incorporation or organization)                              Identification No.)

                 239 East Main Street, Pawhuska, Oklahoma 74056
--------------------------------------------------------------------------------
                    (Address of principal executive offices)

                                 (918) 287-2919
--------------------------------------------------------------------------------
                           (Issuer's telephone number)

                                 Not applicable
--------------------------------------------------------------------------------
              (Former name, former address and former fiscal year,
                          if changed since last report)

         Check whether the issuer (1) filed all reports  required to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 12 months (or for such
shorter period that the  registrant was required to file such reports),  and (2)
has been subject to such filing  requirements for the past 90 days.
Yes [X]  No [ ]

         Indicate by check mark whether the  Registrant  is a shell  company (as
defined in Rule 12b-2 of the Exchange Act). Yes [ ]  No [X]


         As  of  December  31,  2005,   there  were  2,287,017   shares  of  the
Registrant's common stock, par value $.10 per share, outstanding.

         Transitional Small Business Issuer Disclosure Format (check one):
Yes [ ]  No [X ]

<PAGE>

                          OSAGE FEDERAL FINANCIAL, INC.

                               PAWHUSKA, OKLAHOMA

                                      INDEX

<TABLE>
<CAPTION>
                                                                                          Page
                                                                                          ----
<S>                                                                                     <C>
PART I.  FINANCIAL INFORMATION
------

Item 1.  Financial Statements

Consolidated Balance Sheets as of December 31, 2005 (Unaudited) and June 30, 2005            3
Consolidated Statements of Income - (Unaudited) for the three and six months ended
         December 31, 2005 and 2004                                                          4
Consolidated Statements of Cash Flows - (Unaudited) for the six months ended
         December 31, 2005 and 2004                                                          5
Notes to Consolidated Financial Statements (Unaudited)                                       7

Item 2.  Management's Discussion and Analysis or Plan of Operation                           9

Item 3.  Controls and Procedures                                                            13

PART II.     OTHER INFORMATION
-------

Item 4.  Submission of Matters to a Vote of Security Holders                                14

Item 6.  Exhibits                                                                           14

Signatures                                                                                  15
</TABLE>

                                       2

<PAGE>

ITEM 1.  FINANCIAL STATEMENTS

                          OSAGE FEDERAL FINANCIAL, INC.
                           Consolidated Balance Sheets

<TABLE>
<CAPTION>
Assets
                                                                             December 31,      June 30,
                                                                                2005             2005
                                                                           ------------------------------
                                                                              (unaudited)
<S>                                                                       <C>              <C>
    Cash and due from banks                                                $     581,300    $     600,208
    Interest bearing deposits with banks                                       2,097,476        1,623,837
                                                                           -------------    -------------
        Cash and cash equivalents                                              2,678,776        2,224,045

    Available-for-sale securities                                             19,140,360       14,812,020
    Held-to-maturity securities                                                9,202,337       11,378,513
    Loans, net                                                                69,619,550       65,356,288
    Premises and equipment                                                     1,179,102        1,234,408
    Foreclosed assets held for sale, net                                          76,383           31,592
    Interest receivable                                                          390,220          354,516
    Federal Home Loan Bank stock, at cost                                      1,565,600        1,082,500
    Bank owned life insurance                                                  2,049,115        2,011,772
    Income taxes refundable                                                       13,600               --
    Other                                                                        211,799          207,540
                                                                           -------------    -------------
               Total assets                                                $ 106,126,842    $  98,693,194
                                                                           =============    =============

Liabilities and Stockholders' Equity

    Liabilities
        Deposits                                                           $  60,510,755    $  62,083,797
        Federal Home Loan Bank advances                                       30,950,000       21,650,000
        Advances from borrowers held in escrow                                   517,772          754,927
        Accrued interest and other liabilities                                   265,822          459,420
        Dividends payable                                                        690,098               --
        Deferred income taxes                                                     65,686           91,795
                                                                           -------------    -------------
               Total liabilities                                              93,000,133       85,039,939
                                                                           -------------    -------------

    Commitments and Contingencies                                                     --               --
    Equity Received from Contributions to the ESOP (13,417 shares at
       December 31, 2005, and 6,077 shares at June 30, 2005)                     163,470           69,397
    Stockholders' Equity
        Preferred stock, $.10 par value (5,000,000 shares authorized;
          none outstanding)                                                           --               --
        Common stock, $.10 par value (20,000,000 shares authorized;
          2,287,017 and 2,281,313 shares issued and outstanding at
          December 31, 2005 and June 30, 2005, respectively, net of
          54,751 allocated and unallocated ESOP shares for both periods)         223,226          222,656
        Additional paid-in capital                                             5,217,880        5,275,189
        Retained earnings                                                      7,718,691        8,229,727
        Accumulated other comprehensive loss                                    (196,558)        (143,714)
                                                                           -------------    -------------
               Total stockholders' equity                                     12,963,239       13,583,858
                                                                           -------------    -------------
               Total liabilities and stockholders' equity                  $ 106,126,842    $  98,693,194
                                                                           =============    =============
</TABLE>

See Notes to Consolidated Financial Statements

                                       3
<PAGE>

                          OSAGE FEDERAL FINANCIAL, INC.
                        Consolidated Statements of Income

<TABLE>
<CAPTION>
                                                                     Three Months Ended        Six Months Ended
                                                                        December 31,             December 31,
                                                                  -------------------------------------------------
                                                                     2005         2004         2005         2004
                                                                  ----------   ----------   ----------   ----------
                                                                        (unaudited)               (unaudited)
<S>                                                              <C>          <C>          <C>          <C>
    Interest Income
        Loans                                                     $1,125,589   $  963,542   $2,209,768   $1,905,722
        Available-for-sale securities                                180,136       75,253      329,676      144,679
        Held-to-maturity securities                                  102,491      135,878      214,944      284,019
        Deposits with other financial institutions                    18,211        2,687       13,399        3,964
        Other                                                          6,107        7,791       32,087       14,679
                                                                  ----------   ----------   ----------   ----------
           Total interest income                                   1,432,534    1,185,151    2,799,874    2,353,063
                                                                  ----------   ----------   ----------   ----------

    Interest Expense
        Deposits                                                     359,415      337,922      720,521      671,611
        Advances from Federal Home Loan Bank                         313,684      161,979      569,915      326,512
                                                                  ----------   ----------   ----------   ----------
           Total interest expense                                    673,099      499,901    1,290,436      998,123
                                                                  ----------   ----------   ----------   ----------

    Net Interest Income                                              759,435      685,250    1,509,438    1,354,940
    Provision for loan losses                                         12,000           --       12,000           --
                                                                  ----------   ----------   ----------   ----------
    Net interest income after provision for loan losses              747,435      685,250    1,497,438    1,354,940
                                                                  ----------   ----------   ----------   ----------

    Noninterest Income
        Service charges on deposit accounts                          104,064       86,121      205,899      186,945
        Other service charges and fees                                13,867       14,359       30,093       29,295
        Gain on sale of mortgage loans                                11,615       15,084       34,223       32,097
        Net loan servicing fees                                        7,605        8,523       14,837       16,094
        Other income                                                  28,708       29,468       56,983       59,692
                                                                  ----------   ----------   ----------   ----------
           Total noninterest income                                  165,859      153,555      342,035      324,123
                                                                  ----------   ----------   ----------   ----------

    Noninterest Expense
        Salaries and employee benefits                               399,497      359,918      787,481      706,567
        Net occupancy expense                                         69,571       65,087      140,124      138,937
        Deposit insurance premium                                      2,146        2,330        4,350        4,878
        Other operating expenses                                     195,518      199,877      398,127      376,082
                                                                  ----------   ----------   ----------   ----------
           Total noninterest expense                                 666,732      627,212    1,330,082    1,226,464
                                                                  ----------   ----------   ----------   ----------

    Income Before Income Taxes                                       246,562      211,593      509,391      452,599

    Provision for Income Taxes                                        84,494       67,166      181,404      150,994
                                                                  ----------   ----------   ----------   ----------

    Net Income                                                    $  162,068   $  144,427   $  327,987   $  301,605
                                                                  ==========   ==========   ==========   ==========

    Basic Earnings Per Share                                      $     0.07   $     0.06   $     0.15   $     0.14
                                                                  ==========   ==========   ==========   ==========

    Diluted Earnings Per Share                                    $     0.07   $     0.06   $     0.15   $     0.14
                                                                  ==========   ==========   ==========   ==========

    Cash Dividends Paid Per Public Share                          $     0.12   $     0.06   $     0.23   $     0.11
                                                                  ==========   ==========   ==========   ==========

    Dividends Declared Per Public Share                           $     1.00   $     0.00   $     0.00   $     0.00
                                                                  ==========   ==========   ==========   ==========
</TABLE>

See Notes to Consolidated Financial Statements

                                       4


<PAGE>

                          OSAGE FEDERAL FINANCIAL, INC.
                      Consolidated Statements of Cash Flows

<TABLE>
<CAPTION>
                                                                            Six Months Ended
                                                                              December 31,
                                                                        --------------------------
                                                                            2005           2004
                                                                        --------------------------
                                                                                (unaudited)
<S>                                                                   <C>            <C>
Operating Activities
    Net income                                                          $   327,987    $   301,605
    Items not requiring (providing) cash
       Depreciation                                                          55,798         60,711
       Provision for loan losses                                             12,000             --
       Amortization                                                          56,861         58,064
       Restricted stock plan and options expense                             68,676          8,527
       Deferred income taxes                                                 21,636        (13,079)
       Gain on sale of mortgage loans                                       (34,223)       (32,097)
       (Gain) loss on sale of foreclosed assets held for sale                (4,210)           260
       Dividends on available-for-sale mutual funds                        (224,816)      (144,679)
       Stock dividends on Federal Home Loan Bank stock                      (31,900)       (14,500)
       Increase in cash surrender value of bank owned life insurance        (37,343)       (40,854)
    Originations of loans held for delivery against commitments          (4,178,620)    (3,145,347)
    Proceeds from nonrecourse sale of loans held for delivery
      against commitments                                                 4,195,930      3,078,255
    Amortization of Employee Stock Ownership Plan Shares                     94,073         69,397
    Changes in
       Interest receivable                                                  (35,704)       (14,080)
       Other assets                                                         (26,245)         1,333
       Income taxes refundable                                              (13,600)            --
       Accrued interest and other liabilities                               503,303        128,212
                                                                        -----------    -----------

           Net cash provided by operating activities                        749,603        301,728
                                                                        -----------    -----------
Investing Activities
    Net change in loans                                                  (4,341,490)    (5,317,410)
    Purchases of premises and equipment                                        (492)       (16,572)
    Purchase of Federal Home Loan Bank stock                               (451,200)       (65,000)
    Proceeds from sale of foreclosed assets                                  25,647         18,151
    Purchases of available-for-sale securities                           (5,602,278)            --
    Proceeds from maturities and paydowns of held-to-
      maturity securities                                                 2,173,842      2,710,767
    Proceeds from maturities and paydowns of available-for-sale
      securities                                                          1,397,893             --
                                                                        -----------    -----------

           Net cash used in investing activities                         (6,798,078)    (2,670,064)
                                                                        -----------    -----------

                                                                           (continued on next page)

</TABLE>
                                       5
<PAGE>

                          OSAGE FEDERAL FINANCIAL, INC.
                      Consolidated Statements of Cash Flows
                                   (Continued)
<TABLE>
<CAPTION>
                                                                         Six Months Ended
                                                                             December 31,
                                                                     ----------------------------
                                                                         2005           2004
                                                                     ----------------------------
                                                                              (Unaudited)
<S>                                                                 <C>            <C>
Financing Activities
    Net decrease  in demand, money market, NOW and savings deposits   $(1,517,081)   $  (240,414)
    Net increase (decrease) in certificates of deposit                    (55,961)       387,793
    Net increase in Federal Home Loan Bank short-term borrowings        8,300,000        400,000
    Proceeds from Federal Home Loan Bank advances                       3,000,000      4,000,000
    Repayments of Federal Home Loan Bank advances                      (2,000,000)    (2,000,000)
    Net decrease in advances from borrowers held in escrow               (237,155)      (254,229)
    Payment of dividends (net of restricted stock dividends)             (839,023)       (75,284)
    Purchase of shares for restricted stock plans                        (219,677)            --
    Proceeds from exercise of stock options (net of tax benefit)           75,782             --
    Withheld shares of restricted stock plans                              (3,679)            --
                                                                      -----------    -----------
           Net cash provided by financing activities                    6,503,206      2,217,866
                                                                      -----------    -----------

Increase (Decrease) in Cash and Cash Equivalents                          454,731       (150,470)

Cash and Cash Equivalents, Beginning of Period                          2,224,045      1,592,991
                                                                      -----------    -----------

Cash and Cash Equivalents, End of Period                              $ 2,678,776    $ 1,442,521
                                                                      ===========    ===========

Supplemental Cash Flows Information

    Real estate and other assets acquired in settlement of loans      $    66,228    $    18,844

    Interest paid                                                     $ 1,290,239    $   997,344

    Income taxes paid                                                 $   239,924    $    42,360

    Mutual fund dividends reinvested                                  $   224,816    $   144,679
</TABLE>


See Notes to Consolidated Financial Statements

                                       6

<PAGE>

                          OSAGE FEDERAL FINANCIAL, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

1.       OSAGE FEDERAL FINANCIAL, INC.

         Osage Federal  Financial,  Inc. (the  "Company") was  incorporated as a
         federally chartered corporation for the purpose of becoming the holding
         company  of Osage  Federal  Bank (the  "Bank") in  connection  with the
         Bank's mutual holding  company  reorganization.  On March 31, 2004, the
         Bank completed the reorganization and became a wholly-owned  subsidiary
         of the Company. The Company sold 684,394 shares to the public at $10.00
         per share and issued 1,596,919 shares to Osage Federal MHC. At December
         31, 2005, the consolidated financial statements of the Company included
         those of the Bank. All intercompany  items have been eliminated.  Prior
         to  consummation  of the  reorganization,  the Company had no assets or
         liabilities.

         BASIS OF PRESENTATION

         The  accompanying  unaudited  consolidated  financial  statements  were
         prepared in accordance with instructions for Form 10-QSB and therefore,
         do not include all disclosures necessary for a complete presentation of
         the balance  sheet,  statement of income and statement of cash flows in
         conformity with accounting  principles generally accepted in the United
         States of  America.  However,  all  adjustments  (all of which are of a
         normal  recurring  nature)  which are,  in the  opinion of  management,
         necessary for the fair presentation of the interim financial statements
         have been  included.  The  balance  sheet of the Company as of June 30,
         2005 has been derived from the audited  balance sheet of the Company as
         of that date.  The  statements  of income for periods  presented is not
         necessarily  indicative  of the results  which may be expected  for the
         entire year.

         Certain  information  and note  disclosures  normally  included  in the
         Company's  annual  financial  statements  prepared in  accordance  with
         accounting  principles  generally  accepted  in the  United  States  of
         America  have been  condensed  or omitted.  These  condensed  financial
         statements should be read in conjunction with the financial  statements
         and notes  thereto  included  in the  Company's  Annual  Report on Form
         10-KSB for the year ended June 30, 2005 filed with the  Securities  and
         Exchange Commission.

2.       EARNINGS PER SHARE

         Earnings per share (EPS) were computed as follows for the three  months
         and six months ended December 31:

<TABLE>
<CAPTION>

                                                      Three months ended         Six months ended
                                                       2005         2004         2005         2004
                                                   -------------------------------------------------
<S>                                               <C>          <C>          <C>          <C>
       Net income                                  $  162,068   $  144,427   $  327,987   $  301,605
                                                   -------------------------------------------------

       Average common shares outstanding            2,199,646    2,226,628    2,201,044    2,226,595
                                                   -------------------------------------------------
       Average common diluted shares outstanding    2,213,932    2,227,503    2,213,697    2,226,595
                                                   -------------------------------------------------

       Basic earnings per share                    $     0.07   $     0.06   $     0.15   $     0.14
                                                   =================================================
       Fully diluted earnings per share            $     0.07   $     0.06   $     0.15   $     0.14
                                                   =================================================

</TABLE>

                                       7

<PAGE>

3.       PLAN OF MUTUAL HOLDING COMPANY REORGANIZATION AND STOCK ISSUANCE

         On November  24, 2003,  the Board of Directors of the Bank,  subject to
         regulatory approval,  adopted a proposed Plan of Mutual Holding Company
         Reorganization  and Stock  Issuance  (the  "Plan")  to  convert  from a
         federally   chartered  mutual  savings  association  into  a  federally
         chartered  mutual  holding  company  structure  under  the name  "Osage
         Federal MHC" (the "Mutual Holding Company") pursuant to the laws of the
         United States of America and the Rules and Regulations of the Office of
         Thrift Supervision ("OTS"). A principal part of the reorganization into
         the  Mutual  Holding  Company  was  the  incorporation  of a  federally
         chartered  stock  holding  company.  The Bank  became  a  wholly  owned
         subsidiary of a concurrently formed holding company.  The Plan provided
         that the  holding  company  would  offer  nontransferable  subscription
         rights to purchase common stock of the holding company. The rights were
         to be offered  first to eligible  account  holders,  the  tax-qualified
         employee stock benefit plans, supplemental eligible account holders and
         other  members.  Any  shares  remaining  were then to be offered to the
         general  public.  All stock was issued to eligible  account holders and
         the tax-qualified employee stock benefit plan.

         Upon completion of the reorganization, the Mutual Holding Company owned
         70% of the  outstanding  stock of the Company,  with the  remaining 30%
         held by the public.  The Company  owned 100% of the Bank.  The Bank may
         not pay dividends to the Company if the dividends  would cause the Bank
         to fall below the "well capitalized" capital threshold.

         The  Company  contributed  approximately  50%  of the  proceeds  of the
         offering  to the  Bank.  The  Company  also  lent  its  employee  stock
         ownership  plan cash to enable the plan to buy 8% of the shares  issued
         in the  offering to persons  other than the MHC.  The  balance  will be
         retained as the Company's  initial  capitalization  and may be used for
         general  business  purposes,   including  the  purchase  of  investment
         securities,   repurchasing  shares  of  its  common  stock  and  paying
         dividends.  The funds  received  by the Bank  will be used for  general
         business   purposes,   including   originating   loans  and  purchasing
         securities.

         Offering  costs were  deferred  and  deducted  from the proceeds of the
         shares  sold in the  stock  offering.  If the  offering  had  not  been
         completed,  all costs would have been  charged to expense.  At December
         31, 2005, $426,900 in such costs had been incurred.

4.       OTHER COMPREHENSIVE INCOME

         Other comprehensive income is comprised of the following:

<TABLE>
<CAPTION>
                                                                           Three Months Ended          Six Months Ended
                                                                              December 31,                December 31,
                                                                         ------------------------------------------------
                                                                           2005         2004         2005         2004
                                                                         ------------------------------------------------
                                                                                           (Unaudited)
<S>                                                                     <C>          <C>          <C>          <C>
        Net Income                                                       $ 162,068    $ 144,427    $ 327,987    $ 301,605
                                                                         ---------    ---------    ---------    ---------

        Other Comprehensive Income (Loss)

            Unrealized gain (loss) on available-for-
              sale securities, net of income taxes                         (27,218)      (6,067)     (52,844)      (6,096)
                                                                         ---------    ---------    ---------    ---------

        Comprehensive Income                                             $ 134,850    $ 138,360    $ 275,143    $ 295,509
                                                                         =========    =========    =========    =========
</TABLE>

                                       8

<PAGE>

ITEM 2.
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                              OR PLAN OF OPERATION

GENERAL

         The  following  discussion  and  analysis  is  intended  to  assist  in
understanding the financial condition and results of operations of the Company.

FORWARD-LOOKING STATEMENTS

         When used in this discussion and elsewhere in this Quarterly  Report on
Form 10-QSB, the words or phrases "will likely result," "are expected to," "will
continue," "is anticipated,"  "estimate,"  "project," or similar expressions are
intended  to  identify  "forward-looking  statements"  within the meaning of the
Private  Securities  Litigation Reform Act of 1995. The Company cautions readers
not to place undue reliance on any such forward-looking statements,  which speak
only as of the date made, and advises  readers that various  factors,  including
regional  and  national  economic  conditions,  substantial  changes in level of
market  interest  rates,  credit  and  other  risks of  lending  and  investment
activities and  competitive  and  regulatory  factors could affect the Company's
financial  performance  and could cause the Company's  actual results for future
periods to differ  materially from those  anticipated or projected.  The Company
does not  undertake  and  specifically  disclaims  any  obligation to update any
forward-looking statements to reflect occurrence of anticipated or unanticipated
events or circumstances after the date of such statements.

Comparison of Financial Condition at December 31, 2005 and June 30, 2005

         Our  total  assets  increased  by $7.4  million  to $106.1  million  at
December 31, 2005 from $98.7  million at June 30, 2005  primarily  due to a $4.3
million, or 29.2%, increase in available-for-sale securities and a $4.3 million,
or 6.5%,  increase in loans  receivable,  net.  These  increases  were partially
offset by a $2.2 million,  or 19.1%,  decrease in  held-to-maturity  securities.
Loans receivable, net increased to $69.6 million at December 31, 2005 from $65.4
million at June 30,  2005.  This  increase in loans  receivable,  net  primarily
resulted  from  a $2.4  million,  or  5.0%,  increase  in  one-  to  four-family
mortgages.  This increase reflects our decision to retain more of our originated
loans in our own portfolio.  There were increases in almost all other categories
of loans,  including  construction loans (a $1.1 million  increase),  automobile
loans (a $708,000  increase),  and mortgages secured by junior liens (a $306,000
increase). There were no loans held for sale at December 31 or June 30, 2005. We
are selling some of our one- to four-family  loans in the secondary market where
we anticipate  the borrower will be in the home for a long period of time.  Cash
and cash  equivalents  increased  to $2.7 million  (consisting  primarily of our
Federal Home Loan Bank ("FHLB")  demand  account) at December 31, 2005 from $2.2
million  at June 30,  2005.  Total  securities  increased  to $28.3  million  at
December 31, 2005 from $26.2  million at June 30, 2005.  Beginning in the fourth
quarter 2005, the Company  undertook a wholesale  strategy using short-term FHLB
advances  to  acquire  a  diversified   portfolio  of  high-quality  fixed-  and
variable-rate  mortgage-related securities. This program will likely extend over
the next few years. Our objective is to build an  interest-sensitive  investment
portfolio that will enhance  earnings in all rate  environments.  As of December
31, 2005, we had acquired $7.3 million of these  securities.  Normal paydowns on
these and our held-to-maturity securities partially offset these purchases.

         Our total liabilities  increased $8.0 million, or 9.4% mostly due to an
increase in FHLB  advances to $31.0  million at December  31,  2005,  from $21.7
million at June 30, 2005, a $9.3 million,  or 43.0%

                                       9

<PAGE>

increase. Advances used to fund our investment program comprised $7.5 million of
the total advances,  increasing  $4.3 million from program  advances at June 30,
2005. Deposits decreased $1.6 million to $60.5 million at December 31, 2005 from
$62.1 million at June 30, 2005.  Money market  accounts  decreased  $1.1 million
during the period, while passbook savings decreased $581,000.  Our deposits have
been  affected  by the  payout  of  estates,  as well as rate  competition.  NOW
accounts,  non-interest bearing deposits,  and certificates of deposit have been
stable  during  the  period.  We have been  promoting  our  high-yield  checking
account,  as well as 9-,13-,  25-, and 61-month  certificates  to counter strong
rate competition from area financial institutions.

         Stockholders'  equity  decreased  $621,000 to $13.0 million at December
31, 2005 from $13.6  million at June 30, 2005,  primarily due to a special $1.00
per share dividend,  or $690,000,  to stockholders other than Osage Federal MHC.
This was  partially  offset by net income of $328,000  for the six months  ended
December 31, 2005.  The Company paid a regular cash  dividend of $0.23 per share
to  stockholders  other than Osage  Federal MHC, or $149,000  (net of restricted
stock dividends of $8,000), in the period ending December 31, 2005.

Comparison of Operating Results for the Three Months Ended December 31, 2005 and
2004

         General.  Net income for the three months  ended  December 31, 2005 was
$162,000 ($0.07 per diluted share), an $18,000,  or 12.2%,  increase compared to
net income of $144,000  ($0.06 per  diluted  share) for the three  months  ended
December 31, 2004. The increase in net income  resulted  mainly from an increase
in net interest income, partly offset by an increase in noninterest expense.

         Interest Income. Total interest income increased by $247,000, or 20.9%,
to $1.4 million for the three  months ended  December 31, 2005 from $1.2 million
for the same  period  in 2004  primarily  due to a 25 basis  point  increase  in
average yield on  interest-earning  assets.  The yield on earning assets for the
period was 5.64%  compared to a yield of 5.39% in the same  period in 2004.  The
average balance of total  interest-earning  assets  increased $13.2 million from
the three months ended December 31, 2004.

         The primary factor for the increase in interest  income was a $162,000,
or 16.8% increase in interest from loans.  Average loans increased $9.6 million,
or 16.0%, from $59.7 million in 2004 to $69.3 million in 2005. The average yield
on loans  increased  slightly,  to 6.44%  from  6.42% for the two  periods.  Our
portfolio yield reflects continuing low long-term interest rates.

         Our average  investment  portfolio and cash  investments  totaled $30.0
million for the three  months  ended  December 31, 2005, a $2.9 million or 10.8%
increase from the same period in 2004. The yield on these  investments  improved
to 3.82%  compared  to 3.14% in 2004.  This yield  increase is  attributable  to
general  short-term  interest  rate  increases  as well as higher  yields on new
securities purchases.

         Interest Expense.  Total interest expense increased $173,000, or 34.6%,
to $673,000 for the three months ended  December 31, 2005 from  $500,000 for the
three months ended December 31, 2004. The increase in interest  expense resulted
from  a 46  basis  point  increase  in  the  average  cost  of  interest-bearing
liabilities  combined with an $11.0 million,  or 14.9%,  increase in the average
balance,  to $84.9 million for the 2005 period compared to $73.9 million for the
2004 period.  The increase in the average cost of  interest-bearing  liabilities
was most notably due to short-term  market rate increases.  We had $17.0 million
of short-term  advances at December 31, 2005 which are subject to rate increases
every 30 days or more  frequently.  Interest-bearing  deposits  were  down  $2.2
million between the two quarters,  with certificates of deposit accounting for a
$474,000  increase.  For the same time  periods,  money market  savings  account
balances  dropped  $3.7  million.  Most of this  year-over-year  decline was the
result   of   public   fund   disbursements,   which   had   been   anticipated.
Interest-bearing   checking  balances   increased  $1.2  million,

                                       10

<PAGE>

due to the  introduction of our high-yield  checking  account.  Average rates on
certificates are up 23 basis points between the two periods.

         Interest  expense on FHLB  advances  increased  $152,000  for the three
months ended  December 31,  2005,  or 93.7%,  compared to the three months ended
December 31, 2004,  reflecting an increase in the average balance of advances to
$27.8  million for the 2005 period from $14.6  million for the 2004  period.  In
addition,  the average cost of these advances increased by 6 basis points in the
same time period.  As older advances have matured,  we have been able to replace
them  with  lower-rate  advances.  However,  because  much of our  borrowing  is
currently  short-term in nature, and because the yield curve is almost flat, our
cost to borrow has increased slightly.

         Net Interest  Income.  Net  interest  income  increased by $74,000,  or
10.8%,  to $759,000 for the three months ended  December 31, 2005 from  $685,000
for the three months  ended  December  31,  2004.  The net interest  rate spread
decreased to 2.50% for the 2005 period from 2.69% for the 2004 period, while the
net interest margin  decreased to 2.99% from 3.11%.  The decreases in spread and
margin reflect our wholesale strategy using  available-for-sale  investments and
short-term advances.  This plan, which should increase net interest income, will
have the effect of lowering our net interest spread and net interest margin over
time.

         Provision for Loan Losses.  The provision for loan losses for the three
months  ended  December  31, 2005 was  $12,000,  with none  recorded in the same
period in 2004.  There were $11,000 of net charge-offs in the three months ended
December 31, 2005 and less than $1,000 in the same period in 2004. The provision
was needed to keep our reserves adequate,  because of net charge-offs as well as
significant  loan growth.  Based on our  stratification  of the loan  portfolios
using  historical  loss  factors and other data,  management  believes  that the
recorded  allowance  would cover both known and inherent losses in the portfolio
that were both probable and estimable.

         The  evaluation  of the  level of loan  loss  allowance  is  inherently
subjective as it requires estimates that are susceptible to significant revision
as more information  becomes available or as future events change.  The level of
the allowance is based on estimates and the ultimate  losses may vary from these
estimates.  The  allowance for loan losses was $385,000 at December 31, 2005 and
$408,000 at December 31, 2004,  and as a percentage  of total loans  outstanding
was 0.55% and 0.66% at December 31, 2005 and 2004, respectively. The decrease in
this ratio is mainly reflective of the increase in total loans outstanding.

         Management  assesses  the  allowance  for loan  losses  monthly.  While
management  uses available  information to estimate  losses on loans,  loan loss
provisions  may be  necessary  based  on  changes  in  economic  conditions.  In
addition, regulatory agencies, as an integral part of their examination process,
periodically  review the  allowance  for loan losses and may require the Bank to
recognize additional provisions based on their judgment of information available
to them at the time of their  examination.  The  allowance for loan losses as of
December 31, 2005 was maintained at a level that represented  management's  best
estimate of losses in the loan  portfolio to the extent they were both  probable
and reasonably estimable.  However,  there can be no assurance that the level of
loan losses will be sufficient to offset any future loan losses.

         Noninterest  Income.  Noninterest  income increased to $166,000 for the
three  months ended  December 31, 2005 from  $154,000 for the three months ended
December  31,  2004.  Service  charges  were up $18,000,  or 20.8%.  The Company
implemented a new fee schedule in April 2005.

         Noninterest  Expense.  Noninterest  expense was  $667,000 for the three
months ended December 31, 2005,  increasing  $40,000 from $627,000 for the three
months ended  December 31, 2004.  Salaries and

                                       11

<PAGE>

benefits increased $40,000,  or 11.0%. The addition of the stock option plan and
restricted stock plan increased  expenses by $31,000.  These plans were approved
by the  shareholders  November 17, 2004.  Regular  salaries  increased  $12,000,
reflecting normal salary  increases.  These increases were partially offset by a
slight decline in medical  insurance  costs.  Occupancy  increased $4,000 due to
some higher equipment costs. Other operating expenses decreased $4,000 primarily
as a result of an  $11,000  decrease  in audit and  other SEC  filing  expenses,
partially offset by $4,000 increase in advertising relating to deposit products.

         Provision  for Income Taxes.  The provision for income taxes  increased
$17,000,  or 25.8%,  reflecting an increase in pretax income.  The effective tax
rate was 34% for the three months ended December 31, 2005, and 32% for the three
months ended December 31, 2004. The increase in our effective tax rate primarily
reflects  certain  nondeductible  compensation  expense  relating  to our  stock
benefit plans.

Comparison of Operating  Results for the Six Months Ended  December 31, 2005 and
2004

         General.  Net income for the six months  ended  December  31,  2005 was
$328,000 ($0.15 per diluted share), a $26,000, or 8.7%, increase compared to net
income of $302,000  ($0.14 per diluted  share) for the six months ended December
31,  2004.  The increase in net income  resulted  mainly from an increase in net
interest income, partly offset by an increase in noninterest expense.

         Interest Income. Total interest income increased by $447,000, or 19.0%,
to $2.8 million for the six months ended December 31, 2005 from $2.4 million for
the same period in 2004  primarily  due to a $12.1  million  increase in earning
assets and a 22 basis point  increase in average  yield earned on those  assets.
The yield on earning  assets for the  period  was 5.61%  compared  to a yield of
5.39% in the same period in 2004.

         The primary  factor for the increase in interest  income was a $304,000
or 16.0% increase in interest from loans.  Average loans increased $9.8 million,
or 16.6%, from $58.5 million in 2004 to $68.3 million in 2005. The average yield
on loans  decreased  slightly,  to 6.42%  from  6.48% for the two  periods.  Our
portfolio yield reflects continuing low long-term interest rates.

         Our average  investment  portfolio and cash  investments  totaled $29.4
million for the six months  ended  December  31,  2005,  a $1.8  million or 6.4%
increase from the same period in 2004. The yield on these  investments  improved
to 3.76%  compared  to 3.11% in 2004.  This yield  increase is  attributable  to
general  short-term  interest  rate  increases  as well as higher  yields on new
securities purchases.

         Interest Expense.  Total interest expense increased $292,000, or 29.3%,
to $1.3 million for the six months ended December 31, 2005 from $998,000 for the
six months ended  December 31, 2004. The increase in interest  expense  resulted
from  a 36  basis  point  increase  in  the  average  cost  of  interest-bearing
liabilities  combined with a $10.1  million,  or 13.9%,  increase in the average
balance,  to $83.3 million for the 2005 period compared to $73.2 million for the
2004 period.  The increase in the average cost of  interest-bearing  liabilities
was most  notably  due to  short-term  market rate  increases.  Interest-bearing
deposits were down $1.4 million  between the two periods,  with  certificates of
deposit  accounting for a $976,000  increase.  For the same time periods,  money
market savings account balances  dropped $4.2 million.  Most of this decline was
the  result  of  public  fund   disbursements,   which  had  been   anticipated.
Interest-bearing   checking  balances   increased  $1.8  million,   due  to  the
introduction of our high-yield  checking account.  Average rates on certificates
are up 22 basis points between the two periods.

         Interest expense on FHLB advances increased $243,000 for the six months
ended December 31, 2005, or 74.5%, compared to the six months ended December 31,
2004, reflecting an increase in the

                                       12

<PAGE>

average  balance of  advances  to $25.7  million  for the 2005 period from $14.2
million for the 2004 period.  The average cost of these advances decreased by 19
basis points in the same time period.  As older  advances have matured,  we have
been able to replace them with lower-rate advances.

         Net Interest  Income.  Net interest  income  increased by $154,000,  or
11.4%,  to $1.5  million for the six months  ended  December  31, 2005 from $1.4
million for the six months ended December 31, 2004. The net interest rate spread
decreased to 2.54% for the 2005 period from 2.67% for the 2004 period, while the
net interest margin  decreased to 3.02% from 3.10%.  The decreases in spread and
margin reflect our wholesale strategy using  available-for-sale  investments and
short-term advances.  This plan, which should increase net interest income, will
have the effect of lowering our net interest spread and net interest margin over
time.

         Provision  for Loan Losses.  The  provision for loan losses for the six
months  ended  December  31, 2005 was  $12,000,  with none  recorded in the same
period in 2004.  There were $21,000 of net  charge-offs  in the six months ended
December 31, 2005 and less than $1,000 in the same period in 2004. The provision
was needed to keep our reserves adequate,  because of net charge-offs as well as
significant  loan growth.  Based on our  stratification  of the loan  portfolios
using  historical  loss  factors and other data,  management  believes  that the
recorded  allowance  would cover both known and inherent losses in the portfolio
that were both probable and estimable.

         Noninterest  Income.  Noninterest  income increased to $342,000 for the
six months  ended  December  31,  2005 from  $324,000  for the six months  ended
December  31,  2004.  Service  charges  were up  $19,000 or 10.1%.  The  Company
implemented a new fee schedule in April 2005.

         Noninterest  Expense.  Noninterest expense was $1.3 million for the six
months ended  December 31, 2005,  increasing  $104,000 from $1.2 million for the
six months ended December 31, 2004.  Salaries and benefits increased $81,000, or
11.5%. The addition of the stock option plan and restricted stock plan increased
expenses by $70,000.  These plans were approved by the shareholders November 17,
2004.  Partially  offsetting  normal raises of $23,000 was a $7,000  decrease in
medical  insurance.  Other operating  expenses  increased $22,000 primarily as a
result of an $11,000 increase in advertising and public relations.  We have been
doing targeted advertising for deposit products.  Losses on charged off checking
accounts were $9,000 higher than the previous period.

         Provision  for Income Taxes.  The provision for income taxes  increased
$30,000,  or 20.1%,  reflecting an increase in pretax income.  The effective tax
rate was 36% for the six months ended  December 31, 2005,  and 33% for the three
months ended December 31, 2004. The increase in our effective tax rate primarily
reflects certain nondeductible  compensation expense, including expense relating
to our stock benefit plans.

         Liquidity  and  Capital  Resources.  We are  required  to  have  enough
investments  that  qualify  as  liquid  assets in order to  maintain  sufficient
liquidity to ensure a safe and sound banking  operation.  Liquidity may increase
or decrease  depending upon the availability of funds and comparative  yields on
investments in relation to the return on loans. Historically, we have maintained
liquid assets above levels  believed to be adequate to meet the  requirements of
normal operations,  including potential deposit outflows.  Cash flow projections
are  regularly  reviewed  and  updated  to assure  that  adequate  liquidity  is
maintained.

         Our liquidity,  represented by cash and cash equivalents,  is a product
of our operating,  investing and financing  activities.  Our primary  sources of
funds  are  deposits,   scheduled   payments,   prepayments  and  maturities  of
outstanding  loans and  mortgage-backed  securities,  maturities  of  investment
securities and other short-term  investments and funds provided from operations.
While  scheduled  payments from the

                                       13

<PAGE>

amortization  of loans and  mortgage-backed  securities and maturing  investment
securities and short-term  investments  are  relatively  predictable  sources of
funds,  deposit  flows and loan  prepayments  are greatly  influenced by general
interest rates,  economic  conditions and  competition.  In addition,  we invest
excess funds in short-term  interest-earning  assets, which provide liquidity to
meet lending requirements.  We also generate cash through borrowings. We utilize
FHLB  advances to leverage our capital base and provide a portion of the funding
needed to manage  the  interest  rate risk  presented  by our core  business  of
attracting and retaining retail deposits to fund mortgage and consumer loans. On
March 31, 2004, we raised additional capital of $5.9 million,  net of a $548,000
loan made to the Osage Federal  Employees'  Stock  Ownership  Plan, and $100,000
paid to capitalize  the Mutual  Holding  Company.  This  additional  capital was
originally invested in mortgage-backed securities.

         Liquidity management is both a daily and long-term function of business
management.  Excess  liquidity is generally  invested in short-term  investments
such  as  overnight   deposits,   mutual  funds,  and  collateralized   mortgage
obligations.  On a longer term basis,  we  maintain a strategy of  investing  in
various loan products. We use our sources of funds primarily to meet our ongoing
commitments, to pay maturing certificates of deposit and savings withdrawals, to
fund  loan  commitments  and  to  maintain  our  portfolio  of   mortgage-backed
securities and investment  securities.  At December 31, 2005, the total approved
loan origination  commitments  outstanding amounted to $3.0 million. At the same
date,  construction loans in process were $1.6 million.  We also had $707,000 of
unfunded  commitments  on lines of credit on that date. We had no commitments to
sell  loans to  Freddie  Mac at  December  31,  2005.  Certificates  of  deposit
scheduled  to mature in one year or less at December  31,  2005,  totaled  $17.2
million.  Management's  policy is to maintain  deposit  rates at levels that are
competitive  with other local financial  institutions.  Based on the competitive
rates and on  historical  experience,  management  believes  that a  significant
portion of maturing  deposits will remain with Osage  Federal.  In addition,  at
December 31, 2005, our total collateralized borrowing limit was $42.3 million of
which we had $30.9  million  outstanding,  giving us the ability at December 31,
2005 to borrow an additional  $11.4 million from the FHLB of Topeka as a funding
source to meet commitments and for liquidity purposes.

                                       14

<PAGE>

ITEM 3.  CONTROLS AND PROCEDURES

The Company's  management  evaluated,  with the  participation  of the Company's
Chief Executive  Officer and Chief Financial  Officer,  the effectiveness of the
Company's  disclosure  controls  and  procedures,  as of the  end of the  period
covered by this report.  Based on that evaluation,  the Chief Executive  Officer
and Chief Financial Officer concluded that the Company's disclosure controls and
procedures are effective to ensure that information  required to be disclosed by
the  Company  in the  reports  that it files or  submits  under  the  Securities
Exchange Act of 1934 is recorded, processed,  summarized and reported within the
time periods  specified in the  Securities and Exchange  Commission's  rules and
forms.

There were no changes in the Company's internal control over financial reporting
that occurred  during the  Company's  last fiscal  quarter that have  materially
affected,  or are reasonably likely to materially affect, the Company's internal
control over financial reporting.

                                       15

<PAGE>

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
         ---------------------------------------------------

         On  November  16,  2005,   the  Company  held  its  annual  meeting  of
stockholders at which the following items were voted on.

         (1)      Election of Directors

              Nominee                                For            Withheld
         ---------------------------------     --------------     ------------
         Milton Labadie                           2,128,474          13,345
         Mark A. Formby                           2,128,449          13,370

         There  were no  abstentions  or broker  non-votes  in the  election  of
directors.

         (2)      Ratification of Auditors

                                                                   Broker
                     For           Against      Abstain           Non-Vote
                     ---           -------      -------           --------
                  2,114,075        4,900        22,844               0

ITEM 6.  EXHIBITS
         --------

         The following  exhibits are either being filed with or  incorporated by
reference in this quarterly report on Form 10-QSB:

<TABLE>
<CAPTION>

         Number   Description
         ------   -----------
        <S>      <C>
           3(i)    Articles of Incorporation *
           3(ii)   Bylaws *
           4       Form of Common Stock Certificate *
          10.1     Executive Salary Continuation Plan and Split Dollar Agreements with Mark S. White**
          10.2     Executive Salary Continuation Plan and Split Dollar Agreements with Richard Trolinger**
          10.3     Executive Salary Continuation Plan and Split Dollar Agreements with Martha Hayes**
          10.4     Executive Salary Continuation Plan and Split Dollar Agreements with Sue Allen Smith**
          10.5     Director Supplemental Income Plan and Split Dollar Agreements with Mark A. Formby**
          10.6     Director Supplemental Income Plan and Split Dollar Agreements with Harvey Payne**
          10.7     Director Supplemental Income Plan and Split Dollar Agreements with Gary Strahan**
          10.8     Osage Federal Financial, Inc. 2004 Stock Option Plan***
          10.9     Osage Federal Bank 2004 Restricted Stock Plan***
          31.1     Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer
          31.2     Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer
          32       Section 1350 Certification

          _______________
          *    Incorporated by reference from the Registrant's Registration Statement on Form SB-2 (File No. 333-111219).
          **   Incorporated by reference from the Quarterly Report on Form 10-QSB for the Quarter Ended March 31, 2005.
          ***  Incorporated by reference to the Registrants Registration Statement on Form S-8 (File No. 333-121866).

</TABLE>

                                       16

<PAGE>

                                   SIGNATURES

In accordance with the  requirements of the Exchange Act, the registrant  caused
this  report to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.


                                            OSAGE FEDERAL FINANCIAL, INC.



Date: February 10, 2006                     /s/Mark S. White
                                            --------------------------------
                                            Mark S. White, President
                                            (Duly Authorized Representative)


Date: February 10, 2006                     /s/Sue Allen Smith
                                            --------------------------------
                                            Sue Allen Smith, Vice President
                                            (Principal Financial Officer)


                                       17