UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549


                                   Form 10-QSB


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

                For the quarterly period ended September 30, 2005


                       COMMISSION FILE NUMBER: 333-112754

                         Castle & Morgan Holdings, Inc.
              (Exact name of Small Business Issuer in its Charter)


          Delaware                                        32-0104570
-------------------------------             ------------------------------------
 (State or other jurisdiction of            (I.R.S. Employer Identification No.)
incorporation or organization)

                          180 Varick Street, 13th Floor
                            New York, New York 10014
                    (Address of principal executive offices)


                                  310-396-1691
                           (Issuer's telephone number)

Check whether the registrant (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 [
]

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: 3,809,570 shares of Common Stock, as
of October 31, 2005.


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



<PAGE>

                              Table of Contents




                                                                  Pages
PART 1.  FINANCIAL INFORMATION

Item 1   Financial Statements                                      2-6

Item 2   Management's Discussion and Analysis or Plan
         Of Operations                                               6

Item 3   Controls and Procedures                                     9

PART II. OTHER INFORMATION                                           9

Item 5   Other Information                                           9

Item 6   Exhibits                                                   10

Signature

Exhibits


31       Certification of Chief Executive Officer and Principal
         Financial Officer Pursuant to Section 302 of the
         Sarbanes-Oxley Act of 2002

32       Statement furnished pursuant to Section 906 of the
         Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350




<PAGE>

          SPECIAL NOTE OF CAUTION REGARDING FORWARD-LOOKING STATEMENTS

This section and other parts of this Form 10-QSB contain forward-looking
statements that are, by their nature, subject to risks and uncertainties. These
forward-looking statements include, without limitation, statements relating to
our company's operations, economic performance, financial condition, growth and
acquisition strategies, investments, and operating plans. Any such statements
that are not statements of historical fact may be deemed to be forward-looking
statements. Without limiting the generality of the foregoing, words such as
"believe", "expect", "intend", "anticipate", "may", "should", "expects",
"plans", "anticipates", "estimates", "predicts", "potential", "continue",
"projects" or the negative or other variations or comparable terminology or
derivatives thereof denote forward-looking statements. These statements are only
predictions and by their nature involve substantial risks and uncertainties,
many of which are beyond our control. Thus, actual results may differ materially
from those expressed in or implied by such forward-looking statements. Factors
that could cause actual results to differ materially include, but are not
limited to, those discussed in Item. 6 of the Company's Form 10-KSB for the year
ended December 31, 2004, Management's Discussion and Analysis or Plan of
Operation, under the heading "Risk Factors." Although we believe that the
expectations reflected in the forward-looking statements are reasonable, we
cannot guarantee future results, levels of activity, performance or
achievements. We are under no obligation to publicly update any of the
forward-looking statements to reflect events or circumstances after the date
hereof or to reflect the occurrence of unanticipated events.








                                       -1-

<PAGE>

PART I.  FINANCIAL INFORMATION

Item 1.           Financial Statements


                         CASTLE & MORGAN HOLDINGS, INC.
                                  BALANCE SHEET

                                   (Unaudited)

                               September 30, 2005

                                     ASSETS

Current assets:
 Cash and cash equivalents                                    $   --
                                                              ---------
    Total current assets                                          --

Total Assets                                                  $   --
                                                              =========

                      LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:
 Accounts payable                                             $  4,684
 Loans payable - stockholders                                   38,096
                                                              ---------
    Total current liabilities                                   42,780
                                                              ---------
Convertible Note                                                21,432


Stockholders' Deficit:
 Preferred stock, $.0001 par value, 1,000,000
  shares authorized; 0 shares issued and outstanding              --
 Common stock, $.0001 par value, 100,000,000 shares
  authorized; 3,809,570 shares issued and outstanding              381
 Additional paid-in-capital                                     91,740
 Accumulated deficit                                          (156,333)
                                                              ---------
Total stockholders' deficit                                    (64,212)
                                                              ---------
Total Liabilities and Stockholders' Deficit                   $   --
                                                              =========

                       See notes to financial statements.

                                       -2-

<PAGE>

                         CASTLE & MORGAN HOLDINGS, INC.
                            STATEMENTS OF OPERATIONS

                                   (Unaudited)

                                       Three months ended    Nine months ended
                                     ---------------------  -------------------
                                          September 30,       September 30,
                                     ---------------------  -------------------
                                        2005       2004       2005       2004
                                     ---------   ---------  --------- ---------
Operating expenses:
 General and administrative          $  4,684    $ 21,669   $62,100    $33,888
 Depreciation and amortization            --          250       --         995
 Deferred Compensation                    --          --      6,667        --
                                     ---------   ---------  --------- ---------
Total operating expenses                4,684      21,919    68,767     34,883

Other Expenses
 Interest Expense                      10,716         --     21,432        --
 Write-off of assets                      --          --        726        --
                                     ---------   ---------  --------- ---------
Total Expenses                         15,400      21,919    90,925     34,883
                                     ---------   ---------  --------- ---------

Net Loss                             $(15,400)   $(21,919)  $(90,925) $(34,883)
                                     =========   =========  ========= =========

Net loss per share-basic
 and diluted:                        $  (0.00)   $ (0.01)   $  (0.02) $  (0.01)
                                     =========   ========   ========= =========

Weighted average common shares
 Outstanding-basic and diluted       3,809,570   3,709,570  3,809,750 3,709,570
                                     =========   =========  ========= =========


                        See notes to financial statements

                                      -3-

<PAGE>

                         CASTLE & MORGAN HOLDINGS, INC.
                            STATEMENTS OF CASH FLOWS

                                   (Unaudited)

                                                    Nine months ended
                                                  ---------------------
                                                      September 30,
                                                  ---------------------
                                                    2005        2004
                                                  ----------  ---------
Cash flows from operating activities:
 Net loss                                         $ (90,925)  $(36,884)
                                                  ----------  ---------
 Adjustments to reconcile net loss to net
  cash used in operating activities:
  Depreciation and amortization                         --         995
 Changes in operating assets and liabilities:
  Increase/(Decrease) in Accounts Receivable             65        337
  Increase/(Decrease) in
  Accounts Payable                                  (13,000)     9,162
 Write-Off Deferred Compensation                      6,667        --
 Amortization of beneficial conversion feature       21,168        --
                                                  ----------  ---------
Net cash used by operating activities               (76,025)   (26,390)
                                                  ----------  ---------
Cash Flows from investment activities
 Write-off assets                                       726        --
                                                  ----------  ---------
Net cash provided by investment activities              726        --
                                                  ----------  ---------
Cash flows from financing activities:
 Capital Contributions                               25,819        --
 Additional Stockholder Loans                        51,496     26,020
 Repayments to Stockholders                          (2,604)       --
 Accrued interest on Convertible Note                   264        --
                                                  ----------  ---------
Net cash provided by financing activities            74,975     26,020
                                                  ----------  ---------
Net decrease in cash and
 cash equivalents                                      (324)      (370)
Cash at beginning of year                               324      1,668
                                                  ----------  ---------
Cash and cash equivalents at end of period        $     --    $  1,298
                                                  ==========  =========
Supplemental cash flow information:

Cash paid during the year for:
   Interest                                       $     --    $   --
                                                  ==========  =========
   Income taxes                                   $     --    $   --
                                                  ==========  =========
   Non-cash financing activities:
     Convert stockholder loans to
     Convertible note                             $  52,920   $   --
                                                  ==========  =========

                       See notes to financial statements.

                                      -4-

<PAGE>

                         CASTLE & MORGAN HOLDINGS, INC.

                     NOTES TO UNAUDITED FINANCIAL STATEMENTS



1. BASIS OF PRESENTATION

The accompanying unaudited financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial statements
pursuant to the rules and regulations of the Securities and Exchange Commission.
Accordingly, certain information and footnote disclosures required for annual
financial statements have been condensed or omitted. The Company's management
believes that all adjustments necessary to present fairly the Company's
financial position as of September 30, 2005 and the results of operations and
cash flows for the three- and nine-month periods ended September 30, 2005 and
2004 have been included and that the disclosures are adequate to make the
information presented not misleading.

2. ADDITIONAL CAPITAL INVESTMENT

During the quarter ended March 31, 2005, a stockholder and a company wholly
owned by the Company's former President invested additional capital in the
Company in the amount of $25,819. No additional shares were issued on account of
this investment and the Company is under no obligation to issue any additional
shares and does not intend to do so.

3. LOANS PAYABLE - STOCKHOLDERS

During the quarter ended September 30, 2005, stockholders made additional loans
to the Company aggregating $9,594. During the quarter ended June 30, 2005,
stockholders made additional loans to the Company aggregating $28,502. During
the quarter ended March 31, 2005, stockholders made additional loans to the
Company aggregating $13,400 and the Company paid off an aggregate of $2,604 of
Stockholder Loans. On April 1, 2005, the Company issued a Convertible Note
bearing a face value of $52,920 to certain stockholders who were the lender
under that certain Loan Agreement dated as of February 26, 2005 ("Loan
Agreement") evidencing a loan in the amount of $52,920. By its terms, the
Convertible Note superceded in its entirety the terms of the Loan Agreement (see
Note 4, below).

4. CONVERTIBLE NOTE

On April 1, 2005, the Company issued a Convertible Note in the initial face
amount of $52,920 ("Convertible Note") to the lender under the Loan Agreement.
By its terms, the indebtedness evidenced by the Convertible Note, together with
interest at a rate of 3% per annum, is due and payable on July 31, 2006
("Maturity Date"). The Convertible Note is convertible by its holders at any
time prior to the Maturity Date into common stock of the Company at conversion
price of $0.025 per share. As a result of the issuance of the Convertible Note,
the value attributable to the beneficial conversion was $52,920 of which $10,584
was amortized as interest expense during the three month period ending September
30, 2005 and $21,168 was amortized during the nine-month period ended September
30, 2005. The remaining un-amortized balance of $31,752 is shown as a reduction
to the face amount of the Convertible Note.

5. DISCONTINUANCE OF PRIOR BUSINESS.

During the quarter ended March 31, 2005, the Company discontinued its business
as a reseller of video/dvd/cd titles. As a result of such action, the Company
recorded a write-down of $726 relative to the assets related to this business.

                                       -5-

<PAGE>

6. DEFERRED COMPENSATION.

On March 10, 2005, the Company fully amortized the remaining deferred
compensation which it had carried on its balance sheet as of such date in the
amount of $6,667.

7.  GOING CONCERN

Since inception, the Company has been considered a development stage company and
has generated minimal operating revenues. There is substantial doubt that the
Company will generate sufficient revenues during 2005 to meet its operating cash
requirements. Accordingly, the Company's ability to continue operations through
2005 depends on its success in obtaining additional capital in an amount
sufficient to meet its cash needs. This raises substantial doubt about its
ability to continue as a going concern. The financial statements do not include
any adjustments that might result from this uncertainty. At this time, the
Company is dependent upon advances from its principal stockholders to satisfy
all of its financial requirements. No stockholder has made any commitment to
provide such financing.


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

Background

We were incorporated under the Laws of the State of Delaware in June 2003 and
were inactive until December 18, 2003 at which time Festive World
LLC(hereinafter "Festive"), a New York Limited Liability Company, was merged
into us. From December 2003 until March 10, 2005, we were engaged in the
business of acting as a reseller of videos, dvds and cds through our website.
From and after March 10, 2005, the Company discontinued its business as a
reseller of video/dvd/cd titles.

Plan of Operations

We are a "shell"  company that has no specific  business  plan or purpose  other
than to  engage in a merger  or  acquisition.  We will  attempt  to  locate  and
negotiate with an operating  business  entity for the combination of that target
with  us.  The  combination  will  most  likely  take  the  form  of  a  merger,
stock-for-stock  exchange or stock-for-assets  exchange. In most instances,  the
target  will  want to  structure  the  business  combination  to be  within  the
definition of a tax-free reorganization under Section 351 or 368 of the Internal
Revenue Code of 1986, as amended.  The  Company's  business plan now consists of
exploring potential targets for a business  combination with the Company through
a purchase of assets,  share  purchase or  exchange,  merger or similar  type of
transaction.  At this time,  the Company does not have any  definitive  plans or
proposals  which relate to or would result in: (a) the acquisition by any person
of  additional  securities  of  the  Company;  (b)  an  extraordinary  corporate
transaction,  such as a merger,  reorganization  or  liquidation,  involving the
Company or any of its subsidiaries;  (c) a sale or transfer of a material amount
of assets of the  Company or of any of its  subsidiaries;  (d) any change in the
present board of directors or management of the Company,  including any plans or
proposals  to change the  number or term of  directors  or to fill any  existing
vacancies on the board; (e) any material change in the present capitalization or
dividend  policy of the Company;  (f) any other material change in the Company's
business or corporate structure; (g) changes in the Company's charter, bylaws or


                                       -6-

<PAGE>

instruments  corresponding  thereto  or  other  actions  which  may  impede  the
acquisition of control of the issuer by any other person; (h) causing a class of
securities of the Company to be delisted from a national  securities exchange or
to cease to be authorized to be quoted in an inter-dealer  quotation system of a
registered national securities association;  (i) a class of equity securities of
the Company  becoming  eligible  for  termination  of  registration  pursuant to
Section  12(g)(4) of the  Securities  Act;  or (j) any  similar  action to those
enumerated above.

We own no real estate and have no full-time employees. We have not had any
operations since March 10, 2005 and will not have any operations of our own
unless we effect a business combination with an operating business.

Results of Operations for the Three Months ended September 30, 2005 compared to
the Three Months Ended September 30, 2004

The Company had no sales for either the three months ended September 30, 2005 or
the comparable period ended September 30, 2004. Total general and administrative
expenses decreased from $21,669 for the three months ended September 30, 2004 to
$4,684 for the three months ended September 30, 2005. The primary reason for the
decrease in operating expenses resulted from the discontinuation of the
Company's operations. In the three month period ended September 30, 2005, the
Company recorded no depreciation or amortization expense compared to an accrual
of $250 for the comparable period the prior year. For the three month period
ended September 30, 2005, the Company recorded interest expense of $10,716,
comprising $132 accrued interest on its Convertible Notes and $10,584
amortization of beneficial conversion feature. No interest expense was recorded
for the comparable period the prior year. As a result of the above, the Company
recorded a loss of $15,400 for the three month period ended September 30, 2005
compared with a loss of $21,919 in the comparable period ended September 30,
2004.

Results of Operations for the Nine Months ended September 30, 2005 compared to
the Nine Months Ended September 30, 2004

The Company had no sales for either the nine months ended September 30, 2005 or
the comparable period ended September 30, 2004. Total general and administrative
expenses increased from $33,888 for the nine months ended September 30, 2004 to
$62,100 for the nine months ended September 30, 2005. The primary reason for the
increase in operating expenses resulted from an increase in legal and accounting
professional fees. In the nine month period ended September 30, 2005, the
Company recorded no depreciation or amortization expense compared to an accrual
of $995 for the comparable period the prior year. For the nine month period
ended September 30, 2005, the Company recorded interest expense of $21,432,
comprising $264 accrued interest on its Convertible Notes and $21,168
amortization of beneficial conversion feature. No interest expense was recorded
for the comparable period the prior year. In the nine months ended September 30,
2005, the Company fully amortized remaining deferred compensation in the amount
of $6,667 and wrote off assets having a carrying value of $726 in connection
with the discontinuation of its primary business. As a result of the above, the
Company recorded a loss of $90,925 for the nine month period ended September 30,
2005 compared with a loss of $34,883 in the comparable period ended September
30, 2004.

LIQUIDITY AND CAPITAL RESOURCES

At September 30, 2005, the Company had total current assets of $0 and total
current liabilities of $42,780. At September 30, 2005, the Company had working
capital of ($42,780). As of September 30, 2005, we had an accumulated deficit of
$156,333.


                                       -7-

<PAGE>

Net cash used in operating activities was $76,025 during the nine months ended
September 30, 2005, consisting of net operating loss of $90,925, an increase in
accounts receivable of $65, a decrease in accounts payable of $13,000, the
amortization of remaining deferred compensation in the amount of $6,667 and
amortization of beneficial conversion in the amount of $21,168.

Net cash provided by investment activities comprised the write-off of assets
utilized in the Company's discontinued line of business with a carrying value of
$726.


Net cash provided by financing activities was $74,975 for the nine months ended
September 30, 2005, which consisted of capital contributions in the amount of
$25,819, additional stockholder loans of $51,496, repayments to stockholders of
$2,604 and accrued interest of $264 on the Convertible Note.

It is imperative that the Company raise sufficient capital to satisfy its cash
requirements until it can complete a business combination with a target company
which may result in the Company becoming a going concern. There is no guarantee
that the Company will be able to complete such a transaction within the next 12
months, if at all or that such a transaction will result in the Company becoming
a going concern. In the meantime, the Company is dependent upon advances from
its principal stockholders to satisfy all of its financial requirements. No
stockholder has made any commitment to provide such financing. There can be no
assurance that the Company will be able to raise any additional financing, or
that financing opportunities, if any, which it may encounter will be on terms
favorable to the Company. During the period ended September 30, 2005 and for
future periods, the Company will, at a minimum, incur expenses related to
compliance with applicable regulatory and financial reporting requirements,
which will include but not be limited to professional fees and financial
printing fees. The Company will also incur costs in connection with the review,
analysis and completion of any potential transactions. The Company does not
expect significant revenue or cash flows from operations until a potential
transaction is completed, if at all.


There is no assurance whatsoever that we will be able to raise necessary funds
from outside sources, if needed. Such a lack of funds could result in severe
consequences to us, including among others:

          1.   failure to make  timely  filings  with the SEC as required by the
               Exchange Act,  which also probably  would result in suspension of
               trading or  quotation  in our stock and could result in fines and
               penalties to us under the Exchange Act

          2.   curtailing  or  eliminating  our  ability to locate  and  perform
               suitable investigations of potential acquisitions; or

          3.   inability  to  complete a  desirable  acquisition  due to lack of
               funds to pay legal and  accounting  fees and  acquisition-related
               expenses.

Off-Balance Sheet Arrangements.

We do not have any off-balance sheet arrangements that have or are reasonably
likely to have a current or future effect on our financial condition, changes in
our financial condition, revenues or expenses, results of operations, liquidity,
capital expenditures or capital resources that is material to investors.

Critical Accounting Policies

The Company prepared the consolidated financial statements in accordance with
accounting principles generally accepted in the United States of America. The


                                       -8-

<PAGE>

preparation  of these  financial  statements  requires the use of estimates  and
assumptions  that affect the reported  amounts of assets and liabilities and the
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements and the reported amount of revenues and expenses during the reporting
period.  Management  periodically  evaluates the  estimates and judgments  made.
Management  bases its estimates and  judgments on historical  experience  and on
various  factors that are  believed to be  reasonable  under the  circumstances.
Actual  results  may  differ  from  these  estimates  as a result  of  different
assumptions or conditions.

Item 3. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management (consisting solely of our President) conducted an evaluation of
our "disclosure controls and procedures" (as defined in the General Rules and
Regulations under the Securities Exchange Act of 1934 at Rules 13a-15 and
15d-15) within the 90-day period prior to the filing of this Form 10-QSB.
Disclosure controls and procedures that are designed with the objective of
ensuring that information required to be disclosed in our reports filed under
the Securities Exchange Act of 1934, such as this Form 10-QSB, is recorded,
processed, summarized and reported within the time period specified by the
Securities and Exchange Commission's guidelines. Based on management's
evaluation, it was concluded that as of September 30, 2005 and as of the date
that the evaluation of our disclosure controls and procedures was completed, our
disclosure controls and procedures are effective to ensure that all material
information required to be filed in this Quarterly Report on Form 10-QSB has
been made known to him in a timely fashion.

There have been no changes (including corrective actions with regard to
significant deficiencies or material weaknesses) in our internal control over
financial reporting identified in connection with the evaluation performed that
occurred during the fiscal quarter covered by this report that has materially
affected, or is reasonably likely to materially affect, our internal control
over financial reporting.

PART II.   OTHER INFORMATION

Item 5.  Other Information:

On June 27, 2005, the Board of Directors of the Company unanimously adopted a
resolution seeking stockholder approval to amend the Company's Certificate of
Incorporation to effect a reverse stock split of the Company's common stock.
Thereafter, on June 27, 2005, pursuant to the By-Laws of the
Company and Delaware General Corporation Law ss.228, certain stockholders of the
Company holding in the aggregate 3,376,473 shares of Common Stock, representing
approximately 88.6% of the total issued and outstanding Common Stock of the
Company, adopted a resolution to authorize the Board of Directors, in its sole
discretion, to effect a reverse split of the Company's common stock based upon a
ratio of not less than one-for-one and one-half nor more than one-for-three
shares at any time prior to June 27, 2006. In addition, notwithstanding approval
of this proposal by the stockholders, the Board of Directors may, in its sole
discretion, determine not to effect, and abandon, the reverse stock split
without further action by our stockholders. On June 30, 2005, the Company filed
with the U.S. Securities & Exchange Commission a Preliminary Information
Statement pursuant to Section 14(C) of the Securities Exchange Act of 1934.
Thereafter, on July 25, 2005, the Company filed with the U.S. Securities &


                                       -9-



<PAGE>



Exchange Commission a Definitive Information Statement pursuant to Section 14(C)
of the Securities Exchange Act of 1934. A copy of the Information Statement was
mailed to all stockholders of the Company on July 25, 2005. The actions detailed
in the Information Statement became effective twenty days following such mailing
on August 14, 2005.


ITEM 6.  EXHIBITS


         Exhibits

         31* Certifications pursuant to Rule 13a-14(a) or 15d-14(a) under the
             Securities Exchange Act of 1934, as amended.


         32* Certification pursuant to 18 U.S.C. Section 1350, as adopted
             pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.


         *Filed herein

                                      -10-

<PAGE>

                                    SIGNATURE


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


Dated:   November 10, 2005
         Santa Monica, California


CASTLE & MORGAN HOLDINGS, INC.
        (Registrant)

/s/ Geoffrey Alison
--------------------------------------------
Geoffrey Alison, Chief Executive Officer,
Principal Executive Financial and Accounting
Officer