**Delaware**    (State or other jurisdiction of incorporation or organization)

**74-2723809**    (I.R.S. Employer Identification No.) 

----

| Part I. Financial Information |
|-------------------------------|
|                               |  |  |  |
|                               | **Item 1.** | Financial Statements |  |
|                               | **** |  |  |
|                               | **a)** | Consolidated Statements of Operations for the Three |  |
|                               | **** | Months Ended September 30, 2004 and 2003 | 2 |
|                               | **** |  |  |
|                               | **b)** | Consolidated Statements of Operations for the Nine |  |
|                               | **** | Months Ended September 30, 2004 and 2003 | 4 |
|                               | **** |  |  |
|                               | **c)** | Consolidated Balance Sheet as of September 30, 2004 | 6 |
|                               | **** |  |  |
|                               | **d)** | Consolidated Statements of Cash Flows for the Nine |  |
|                               | **** | Months Ended September 30, 2004 and 2003 | 7 |
|                               | **** |  |  |
|                               | **e)** | Notes to Consolidated Financial Statements | 9 |
|                               | **** |  |  |
|                               | **Item 2.** | Management’s Discussion and Analysis of Financial Condition |  |
|                               | **** | And Results of Operations | 17 |
|                               | **** |  |  |
| Part II. Other Information    |
|                               |  |  |  |
|                               |  | Item 6. Exhibits and Reports on Form 8-K | 19 |
|                               |  |  |  |
|                               |  | Signatures | 19 |

----

| Three Months Ended September 30,                                                                                                                     | **2004**         | **2003**         |
|------------------------------------------------------------------------------------------------------------------------------------------------------|------------------|------------------|
|                                                                                                                                                      |                  |                  |
| REVENUES:                                                                                                                                            |                  |                  |
| Entertainment                                                                                                                                        | $1,666,104       | $1,537,902       |
| Hospitality                                                                                                                                          | 492,219          | 690,669          |
| Other                                                                                                                                                | 9,322            | 10,321           |
| TOTAL REVENUES                                                                                                                                       | 2,167,645        | 2,238,892        |
|                                                                                                                                                      |                  |                  |
| DIRECT COSTS AND EXPENSES:                                                                                                                           |                  |                  |
| Direct salaries and other compensation                                                                                                               | 507,535          | 562,310          |
| Rent and utilities                                                                                                                                   | 543,016          | 533,712          |
| Other direct operating costs                                                                                                                         | 557,497          | 553,062          |
| Depreciation and amortization                                                                                                                        | 207,689          | 202,786          |
| License expense                                                                                                                                      | 8,395            | 9,354            |
| TOTAL COSTS AND EXPENSES                                                                                                                             | 1,824,132        | 1,861,224        |
|                                                                                                                                                      |                  |                  |
| GROSS MARGIN                                                                                                                                         | 343,513          | 377,668          |
|                                                                                                                                                      |                  |                  |
| GENERAL AND ADMINISTRATIVE EXPENSES                                                                                                                  |                  |                  |
| Salaries and other compensation                                                                                                                      | 141,226          | 135,916          |
| Legal and accounting fees                                                                                                                            | 85,724           | 129,862          |
| Depreciation and amortization                                                                                                                        | 24,597           | 34,237           |
| Other general and administrative                                                                                                                     | 86,623           | 79,457           |
| TOTAL GENERAL AND ADMINISTRATIVE EXPENSES                                                                                                            | 338,170          | 379,472          |
|                                                                                                                                                      |                  |                  |
| OPERATING INCOME (LOSS)                                                                                                                              | 5,343            | (1,804)          |
|                                                                                                                                                      |                  |                  |
| OTHER INCOME (EXPENSES):                                                                                                                             |                  |                  |
| Interest and investment income                                                                                                                       | 2,432            | 14,604           |
| Interest expense ($14,908 and$22,453          respectively to related parties)                                                                       | (81,371)         | (86,482)         |
| Gain (loss) on fixed asset sales                                                                                                                     | 0                | (4,738)          |
| Write-off of abandoned assets                                                                                                                        | 0                | (6,208)          |
| Other income and (expense)                                                                                                                           | 0                | -0-              |
| TOTAL OTHER INCOME (EXPENSES)                                                                                                                        | (78,939)         | (82,824)         |
|                                                                                                                                                      |                  |                  |
| NET INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES                                                                                                  | (73,596)         | (84,628)         |
|                                                                                                                                                      |                  |                  |
| PROVISION FOR INCOME TAXES                                                                                                                           | 15,000           | 15,000           |
|                                                                                                                                                      |                  |                  |
| NET INCOME (LOSS) FROM CONTINUING OPERATIONS                                                                                                         | (88,596)         | (99,628)         |
|                                                                                                                                                      |                  |                  |
| DISCONTINUED OPERATIONSNet loss from operations of discontinued Amusement division, netGain on disposal of assets of discontinued Amusement division | -0-          -0- | -0-          -0- |
|                                                                                                                                                      |                  |                  |
| **NET INCOME (LOSS)**                                                                                                                                | **(88,596)**     | **(99,628)**     |
|                                                                                                                                                      |                  |                  |
| OTHER COMPREHENSIVE INCOME (LOSS)                                                                                                                    | (2,908)          | 13,538           |
|                                                                                                                                                      |                  |                  |
| NET COMPREHENSIVE INCOME (LOSS)                                                                                                                      | $(91,504)        | (86,090)         |

See notes to consolidated financial statements.

----

| **Three Months Ended September 30,**                | **2004**  | **2003**  |
|-----------------------------------------------------|-----------|-----------|
| EARNINGS (LOSS) PER SHARE:                          |           |           |
| Basic earnings (loss) per share                     | ($.01)    | ($.01)    |
|                                                     |           |           |
| Diluted earnings (loss) per share                   | ($.01)    | ($.01)    |
|                                                     |           |           |
| Weighted average shares outstanding – basic   | 8,378,954 | 8,293,495 |
|                                                     |           |           |
| Weighted average shares outstanding – diluted | 8,380,602 | 8,293,495 |

----

**PART I - FINANCIAL INFORMATION*Item 1. Financial Statements***

***Littlefield Corporation*****CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)**

| Nine Months Ended September 30,                                                                                                                                      | **2004**           | **2003**            |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------|---------------------|
|                                                                                                                                                                      |                    |                     |
| REVENUES:                                                                                                                                                            |                    |                     |
| Entertainment                                                                                                                                                        | $4,915,834         | $4,873,930          |
| Hospitality                                                                                                                                                          | 2,170,837          | 2,497,151           |
| Other                                                                                                                                                                | 25,872             | 20,783              |
| TOTAL REVENUES                                                                                                                                                       | 7,112,543          | 7,391,864           |
|                                                                                                                                                                      |                    |                     |
| DIRECT COSTS AND EXPENSES:                                                                                                                                           |                    |                     |
| Direct salaries and other compensation                                                                                                                               | 1,706,623          | 1,886,817           |
| Rent and utilities                                                                                                                                                   | 1,628,173          | 1,610,360           |
| Other direct operating costs                                                                                                                                         | 1,698,325          | 1,788,904           |
| Depreciation and amortization                                                                                                                                        | 614,876            | 600,678             |
| License expense                                                                                                                                                      | 48,562             | 58,577              |
| TOTAL COSTS AND EXPENSES                                                                                                                                             | 5,696,559          | 5,945,336           |
|                                                                                                                                                                      |                    |                     |
| GROSS MARGIN                                                                                                                                                         | 1,415,984          | 1,446,528           |
|                                                                                                                                                                      |                    |                     |
| GENERAL AND ADMINISTRATIVE EXPENSES                                                                                                                                  |                    |                     |
| Salaries and other compensation                                                                                                                                      | 403,706            | 407,790             |
| Legal and accounting fees                                                                                                                                            | 239,644            | 342,584             |
| Depreciation and amortization                                                                                                                                        | 81,941             | 105,638             |
| Other general and administrative                                                                                                                                     | 303,910            | 301,079             |
| TOTAL GENERAL AND ADMINISTRATIVE EXPENSES                                                                                                                            | 1,029,201          | 1,157,091           |
|                                                                                                                                                                      |                    |                     |
| OPERATING INCOME (LOSS)                                                                                                                                              | 386,783            | 289,437             |
|                                                                                                                                                                      |                    |                     |
| OTHER INCOME (EXPENSES):                                                                                                                                             |                    |                     |
| Interest and investment income                                                                                                                                       | 7,931              | 33,649              |
| Interest expense ($49,889and $74,517          respectively to related parties)                                                                                       | (216,399)          | (287,204)           |
| Gain (loss) on fixed asset sales                                                                                                                                     | (5,946)            | (51,206)            |
| Write-off of abandoned assets                                                                                                                                        | 0                  | (3,000)             |
| Gain (loss) on sale of investments                                                                                                                                   | 49,628             | (51,637)            |
| Other income and (expense)                                                                                                                                           | (4,570)            | 52,255              |
| TOTAL OTHER INCOME (EXPENSES)                                                                                                                                        | (169,356)          | (307,143)           |
|                                                                                                                                                                      |                    |                     |
| NET INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES                                                                                                                  | 217,427            | ($17,706)           |
|                                                                                                                                                                      |                    |                     |
| PROVISION FOR INCOME TAXES                                                                                                                                           | 45,000             | 42,817              |
|                                                                                                                                                                      |                    |                     |
| NET INCOME (LOSS) FROM CONTINUING OPERATIONS                                                                                                                         | 172,427            | (60,523)            |
|                                                                                                                                                                      |                    |                     |
| DISCONTINUED OPERATIONSNet income/loss from operations of discontinued Amusement division,          netGain on disposal of assets of discontinued Amusement division | (338)          -0- | 41,478          -0- |
|                                                                                                                                                                      |                    |                     |
| **NET INCOME (LOSS)**                                                                                                                                                | **172,089**        | **(19,045)**        |
|                                                                                                                                                                      |                    |                     |
| OTHER COMPREHENSIVE INCOME (LOSS)                                                                                                                                    | (39,395)           | 130,206             |
|                                                                                                                                                                      |                    |                     |
| NET COMPREHENSIVE INCOME (LOSS)                                                                                                                                      | $132,694           | 111,161             |

See notes to consolidated financial statements.

----

***Littlefield Corporation*****CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)**

| **Nine Months Ended September 30,**                     | **2004**  | **2003**  |
|---------------------------------------------------------|-----------|-----------|
| **EARNINGS (LOSS) PER SHARE:**                          |           |           |
| **Basic earnings (loss) per share**                     | $.021     | ($.002)   |
|                                                         |           |           |
| **Diluted earnings (loss) per share**                   | $.021     | ($.002)   |
|                                                         |           |           |
| **Weighted average shares outstanding – basic**   | 8,367,932 | 8,265,555 |
|                                                         |           |           |
| **Weighted average shares outstanding – diluted** | 8,369,580 | 8,265,555 |

----

| **ASSETS**                                                                                                                     |
|--------------------------------------------------------------------------------------------------------------------------------|
| Current Assets:                                                                                                                | **Sept 30, 2004** |
| Cash and cash equivalents                                                                                                      | $410,027 |
| Accounts receivable, net of allowance for doubtful accounts of $26,870                                                         | 312,696 |
| Accounts receivable, other                                                                                                     | 37,410 |
| Equity Securities, available for sale                                                                                          | 2,662 |
| Other prepaid expenses and current assets                                                                                      | 238,177 |
| Total Current Assets                                                                                                           | 1,000,972 |
|                                                                                                                                |  |
| Property and Equipment – at cost, net of accumulated depreciation          and amortization                              | 7,888,764 |
|                                                                                                                                |  |
| Other Assets:                                                                                                                  |  |
| Notes receivable, net of allowance for doubtful accounts                                                                       | 845,000 |
| Notes receivable, accrued interest                                                                                             | 222,603 |
| Goodwill                                                                                                                       | 4,404,106 |
| Intangible assets, net                                                                                                         | 573,370 |
| Other non-current assets                                                                                                       | 165,261 |
| Total Other Assets                                                                                                             | 6,210,340 |
|                                                                                                                                |  |
| TOTAL ASSETS                                                                                                                   | $15,100,076 |
|                                                                                                                                |  |
| **LIABILITIES AND STOCKHOLDERS' EQUITY******                                                                                   |
|                                                                                                                                |  |
| Current Liabilities:                                                                                                           |  |
| Notes payable                                                                                                                  | $11,953 |
| Obligations under capital lease                                                                                                | 63,303 |
| Long term debt, current portion                                                                                                | 438,661 |
| Long term debt-related party, current portion                                                                                  | 529,875 |
| Trade accounts payable                                                                                                         | 124,144 |
| Reserve for settlements                                                                                                        | 1,737,500 |
| Accrued expenses                                                                                                               | 547,528 |
| Other current liabilities-related party                                                                                        | 132,881 |
| Total Current Liabilities                                                                                                      | 3,585,845 |
|                                                                                                                                |  |
| Long-term Liabilities:                                                                                                         |  |
| Obligations under capital lease, net of current                                                                                | 83,227 |
| Long term debt, net of current portion                                                                                         | 3,115,044 |
| Long term debt-related party, net of current portion                                                                           | 105,650 |
| Total Long-term Liabilities                                                                                                    | 3,303,921 |
| Total Liabilities                                                                                                              | 6,889,766 |
|                                                                                                                                |  |
| Stockholders' Equity:                                                                                                          |  |
| Common stock, $.001 par value, (authorized 20,000,000 shares, issued          10,176,890 shares, outstanding 8,378,954 shares) | 10,177 |
| Subscription receivable                                                                                                        | (745) |
| Additional paid-in-capital                                                                                                     | 23,715,026 |
| Treasury stock – 1,797,936 shares, at cost                                                                               | (2,293,490) |
| Accumulated Comprehensive Income                                                                                               | (2,966) |
| Accumulated deficit                                                                                                            | (13,217,692) |
| Total Stockholders' Equity                                                                                                     | 8,210,310 |
|                                                                                                                                |  |
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                                                                     | 15,100,076 |

----

| **Nine months Ended September 30,**                                                                        | **2004**  | **2003**    |
|------------------------------------------------------------------------------------------------------------|-----------|-------------|
|                                                                                                            |           |             |
| CASH FLOWS FROM OPERATING ACTIVITIES:                                                                      |           |             |
| Net income (loss)                                                                                          | 172,089   | ($19,045)   |
| Adjustments to reconcile net income to net cash provided by operating          activities:                 |           |             |
| Depreciation and amortization                                                                              | 696,817   | 717,530     |
| (Gain)/Loss on investment sales                                                                            | (52,380)  | 51,637      |
| Loss (gain) on sales of fixed assets                                                                       | 5,947     | (12,015)    |
| Loss on write-off of abandoned assets                                                                      | 0         | 14,996      |
| Increase (decrease) in cash flows as a result of changes in asset          and liability account balances: |           |             |
| Accounts receivable                                                                                        | 331,201   | 251,055     |
| Other assets and licenses                                                                                  | (40,197)  | 59,781      |
| Trade accounts payable                                                                                     | (262,799) | (212,010)   |
| Accrued expenses and other current liabilities                                                             | 81,641    | (17,843)    |
| NET CASH PROVIDED BY OPERATING ACTIVITIES                                                                  | 932,319   | 834,086     |
|                                                                                                            |           |             |
| CASH FLOWS FROM INVESTING ACTIVITIES:                                                                      |           |             |
| Property and equipment expenditures                                                                        | (336,672) | (250,406)   |
| Purchase of intangibles                                                                                    | (37,500)  | 0           |
| Proceeds from sale of equity securities                                                                    | 521,451   | 424,781     |
| Proceeds from sale of property and equipment                                                               | 2,875     | 207,374     |
| NET CASH PROVIDED (USED) IN INVESTING ACTIVITIES                                                           | 150,154   | 381,749     |
|                                                                                                            |           |             |
| CASH FLOWS FROM FINANCING ACTIVITIES:                                                                      |           |             |
| Payments on capital lease obligations                                                                      | (41,857)  | (26,064)    |
| Payments on notes payable                                                                                  | (897,335) | (1,037,277) |
| Expenses related to refinancing                                                                            | (23,730)  |             |
| Collections (increase) of subscribed receivables                                                           | 5,886     | 17,896      |
| Purchase treasury stock                                                                                    | (790)     | 0           |
| Proceeds from Capital Lease                                                                                | 0         | 75,691      |
| NET CASH USED IN FINANCING ACTIVITIES                                                                      | (957,826) | (969,754)   |
|                                                                                                            |           |             |
| NET INCREASE (DECREASE) IN CASH                                                                            | 124,647   | 246,081     |
|                                                                                                            |           |             |
| CASH AT BEGINNING OF PERIOD                                                                                | 285,380   | 189,055     |
|                                                                                                            |           |             |
| CASH AT END OF PERIOD                                                                                      | 410,027   | $435,136    |

See notes to consolidated financial statements.

----

| **Nine months Ended September 30,**                                 | **2004** | **2003** |
|---------------------------------------------------------------------|----------|----------|
|                                                                     |          |          |
| SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:                  |          |          |
|                                                                     |          |          |
| Cash payments:                                                      |          |          |
|                                                                     |          |          |
| Interest                                                            | $194,160 | $329,418 |
|                                                                     |          |          |
| Income taxes                                                        | $0       | $59,276  |
|                                                                     |          |          |
| Non-cash transactions:                                              |          |          |
|                                                                     |          |          |
| Acquisition of property and equipment in exchange for notes payable | $7,988   | $0       |

See notes to consolidated financial statements.

----

***Littlefield Corporation*****NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)****September 30, 2004****NOTE 1 – PRINCIPLES OF CONSOLIDATION AND BASIS OF PRESENTATION**    The unaudited consolidated financial statements include the accounts of Littlefield    Corporation and its wholly owned subsidiaries (the “Company”).    The financial statements contained herein are unaudited and, in the opinion    of management, contain all adjustments necessary for a fair presentation of    financial position, results of operations and cash flows for the periods presented.    The Company’s accounting policies and certain other disclosures are    set forth in the notes to the consolidated financial statements contained    in the Company’s Annual Report on Form 10-KSB for the fiscal year ended    December 31, 2003. The financial statements contained herein should be read    in conjunction with the notes to the Company’s audited consolidated    financial statements included in the Annual Report on Form 10-KSB for the    fiscal year ended December 31, 2003. The preparation of the condensed consolidated    financial statements in conformity with generally accepted accounting principles    requires management to make estimates and assumptions that affect the reported    amount of assets and liabilities, disclosure of contingent assets and liabilities    and the reported amount of revenue and expenses during the reported period.    Actual results could differ from these estimates. Where appropriate, items    within the consolidated condensed financial statements have been reclassified    to maintain consistency and comparability for all periods presented.    The operating results for the three-month and nine-month periods ended September    30, 2004 are not necessarily indicative of the results that may be expected    for the fiscal year ending December 31, 2004. Except for historical information    contained herein, certain matters set forth in this report are forward looking    statements that are subject to substantial risks and uncertainties, including    the impact of government regulation and taxation, customer attendance and    spending, competition, and general economic conditions, among others. This    Quarterly Report on Form 10-QSB contains “forward-looking” statements    as such term is defined in the Private Securities Litigation Reform Act of    1995 and information relating to the Company and its subsidiaries that are    based on the beliefs of the Company’s management. When used in this    report, the words “anticipate,” believe,” “estimate,”    “expect,” and “intend” and words or phrases of similar    import, as they relate to the company or its subsidiaries or Company management,    are intended to identify forward-looking statements. Such statements reflect    the current risks, uncertainties and assumptions related to certain factors    including, without limitations, competitive factors, general economic conditions,    customer relations, relationships with vendors, the interest rate environment,    governmental regulation and supervision, seasonality, distribution networks,    product introductions and acceptance, technological change, changes in industry    practices, onetime events and other factors described herein and in other    filings made by the company with the Securities and Exchange Commission, based    upon changing conditions, should any one or more of these risks or uncertainties    materialize, or should any underlying assumptions prove incorrect, actual    results may vary materially from those described herein as anticipated, believed,    estimated, expected or intended. The company does not intend to update these    forward-looking statements. 

| Land                                            | $953,725    |
|-------------------------------------------------|-------------|
| Buildings                                       | 3,587,231   |
| Building and leasehold improvements             | 4,358,889   |
| Rental inventory and bingo equipment            | 1,649,801   |
| Equipment, furniture and fixtures               | 2,320,422   |
| Automobiles                                     | 391,818     |
|                                                 | 13,261,886  |
|                                                 |             |
| Less: Accumulated depreciation and amortization | (5,373,122) |
|                                                 |             |
| Property and equipment, net                     | $7,888,764  |

----

|                                    | **Gross****Carrying****Amount** | **Accumulated****Amortization** | **Total**        |
|------------------------------------|---------------------------------|---------------------------------|------------------|
| Goodwill (includes bingo licenses) | $7,185,105                      | $(2,780,999)                    | $4,404,106       |
|                                    | **Entertainment**               | ** Hospitality **     |                  |
| Balance at December 31, 2003       | $3,908,660                 | $371,384                   | $4,280,044  |
| Goodwill acquired during the year  | 124,062                    | -0-                        | 124,062     |
| Impairment losses                  | -0-                        | -0-                        | -0-         |
| Balance at September 30, 2004      | $4,032,722                 | $ 371,384                  | $4,404,106  |

|                                                          | **Gross   ****Carrying **** Amount ** | **Accumulated****Amortization** | **Total** |
|----------------------------------------------------------|---------------------------------------------------------------------|---------------------------------|-----------|
| **Intangible Assets with Indefinite Lives:**             |                                                                     |                                 |           |
| Bingo licenses                                           | $487,745                                                            | -0-                             | $487,745  |
|                                                          |                                                                     |                                 |           |
| **Intangible Assets with Finite Lives:**                 |                                                                     |                                 |           |
| Covenants not to compete                                 | $297,500                                                            | $(211,875)                      | 85,625    |
| Capitalized acquisition costs related to note receivable | 50,950                                                              | (50,950)                        | -0-       |
| Intangible Assets, Net of Accumulated Amortization       |                                                                     |                                 | $573,370  |

| **Nine months ended September 30,**                 | **2004**  | **2004**  | **2003**  | **2003**  |
|-----------------------------------------------------|-----------|-----------|-----------|-----------|
|                                                     | Basic     | Diluted   | Basic     | Diluted   |
| Numerator:                                          |           |           |           |           |
| Net income (loss) before extra-ordinary gain        | $172,089  | $172,089  | ($19,045) | ($19,045) |
| Extra-ordinary gain                                 | 0         | 0         | 0         | 0         |
| Income (loss) available to common stockholders      | $172,089  | $172,089  | ($19,045) | ($19,045) |
|                                                     |           |           |           |           |
| Denominator:                                        |           |           |           |           |
| Weighted average shares outstanding                 | 8,367,932 | 8,369,580 | 8,265,555 | 8,265,555 |
| Effect of dilutive securities:                      |           |           |           |           |
| Stock options and warrants                          | ---       | ---       | ---       | ---       |
| Weighted average shares outstanding                 | 8,367,932 | 8,369,580 | 8,265,555 | 8,265,555 |
|                                                     |           |           |           |           |
| Earnings (loss) per share before extraordinary item | $ .021    | $ .021    | $ .01     | ($ .07)   |
| Extraordinary gain on settlement                    | 0         | 0         | 0         | 0         |
| Earnings (loss) per share                           | $ .021    | $ .021    | $ .01     | ($ .07)   |

|                                                                  | **2004** | **2003**  |
|------------------------------------------------------------------|----------|-----------|
| Net income                                                       | $172,089 | ($19,045) |
|                                                                  |          |           |
| Other comprehensive income (loss)                                |          |           |
| Net unrealized gain (loss)          on investments held for sale | (39,395) | 130,206   |
|                                                                  |          |           |
| Total comprehensive income                                       | $132,694 | $111,161  |

**NOTE 8 - RELATED PARTY TRANSACTIONS.**    Subscribed receivables from related parties totaled $745 and$13,464respectively, for the first nine    months ended September 30, 2004 and2003. Interest    income related to these notes recorded by the Company was $0 for the nine    months ended September 30, 2004 and 2003.    In June 2001, the Company entered into a warehouse lease agreement for 6,000    sq. ft. of storage space with Flournoy Management Inc. Flournoy Management    Inc.’s majority shareholders are Gene and Scott Flournoy who are employed    by the Company as Regional Managers in Alabama. The lease had a two-year term    at a rate of $1,729 per month. The warehouse was used to store amusement machines    that the Company was forced to move out of South Carolina, as discussed in    earlier reports, and as a technical center to deploy amusement machines in    other jurisdictions. This lease was terminated March 31, 2003 when all arcade    machines were sold.    In July 2001 the Company acquired Premiere Party Rentals. In conjunction with    this purchase, the Company issued two promissory notes payable in the amount    of $500,000 each to the seller (a related party), as partial consideration    for this purchase, and entered into a three-year employment agreement with    the seller. The first note payable is due in quarterly installments of $31,250    plus interest at an annual rate of 8.0% and a maturity date of July 2005.The second note originally due and payable in full, along with accrued    interest at 8% annual rate, in July 2004, was paid in full in August 2004.For the nine months ended September, 2004 and 2003, the Company recognized    $32,769and $44,985,respectively,    of interest expense related to these obligations. The balances of these twonotes at September 30, 2004 were a combined$125,000.    In August 2001 the Company acquired Word of Mouth Custom Catering. In conjunction    with this purchase, the Company issued two promissory notes payable in the    amount of $200,000 each to the two sellers (related parties), as partial consideration    for this purchase, and entered into three-year employment agreements with    the sellers. These notes payable are due in quarterly installments of $12,500,    plus interest at an annual rate of 8.0% and a maturity date of August 2005.    For the nine months endedSeptember 30, 2004    and 2003,the Company recognized $7,024and $13,500,respectively, of interest    expense related to these obligations. The balances of these two notes at September    30, 2004 were a combined $100,000.    In September 2001, the Company acquired an automobile from a current employee.    In conjunction with this purchase, the Company issued a promissory note payable    in the amount of $34,540 to the seller (a related party), as partial consideration    for this purchase. This note payable was due in monthly installments of $1,531,    with an interest rate of 6% and a maturity date of September 2003. For the    six months ended June 30, 2004 and 2003, the Company recognized $0 and $0,    respectively, of interest expense related to this obligation. The automobile    was given back to the employee for the amount of the outstanding principle    balance of the note at the end of January 2003, in exchange for a salary reduction    of over $20,000 per year. The Company recognized a loss on the asset transaction    of approximately $22,000.The President and CEO of the Company has personally    guaranteed three notes payable to a third party lender, in the total amount    of $1,152,500. The Company accrued a total of $61,275 in loan guaranty fees    to him in 2002. This amount has been added to the President’s bonus    amount accrued in 2002 in the amount of $300,000, plus accrued interest.The bonus and loan guaranty fees are presented    on the balance sheet as long term debt - current portion while the related    interest is presented on the balance sheet as a current accrued liability    – related party. Interest accrued on this note for the nine months ended    September 30, 2004 was $4,748and $10,683for the same period in 2003.The Company purchased the President’s office furniture    and antiques for a total price of $105,650 in July 2002. This amount was set    up on a note payable with interest only payable for 4 years at 6.75% with    the principal amount due in July 2006 as a balloon payment. Interest paid    on this note for the nine months ended September 30, 2004 was $5,349 and $5,346for the same period in2003.

**NOTE 9 – COMMITMENTS AND CONTINGENCIES.**    Generally speaking, the Securities and Exchange Commission guidelines require    a company to report any pending legal and/or regulatory proceedings that involves    a claim for damages in excess of ten percent (10%) of its current assets.    The litigation and proceedings discussed below do not necessarily meet this    threshold, but are included in the interest of full disclosure. In general,    the Company will vigorously defend itself against all claims to the fullest    extent possible:*Pondella Hall for Hire, Inc., d/b/a Eight Hundred v. American Bingo and    Gaming, Case No.: 97-2750, Circuit Court of the Twelfth Judicial Circuit in    and for Manatee County, Florida*. In July of 1995 the Company bought three    Florida bingo centers from Phillip Furtney and two corporations related to    Mr. Furtney (which corporations and Mr. Furtney are referred to collectively    as “Furtney”). On June 12, 1997, Furtney filed a lawsuit against    the Company in Florida, alleging breach of contract. Furtney alleged that    the Company defaulted on its original purchase note and stock obligations    under the purchase agreements. On July 12, 1997, the Company answered this    lawsuit and filed a counterclaim against Furtney alleging, among other things,    fraud, negligent misrepresentation, breach of express warranties, contractual    indemnity and tortious interference with contractual rights. The Company believes    that it was materially defrauded in its purchase of these three Florida bingo    centers from Furtney in that Furtney made no disclosure to the Company of    an ongoing criminal investigation of the operation of these bingo centers    by the Florida State Attorney General's Office, and that Furtney was fully    aware of this investigation. The state of Florida temporarily closed these    three bingo centers, as well as several other centers formerly owned by Mr.    Furtney, in November 1995. The Company sold these three bingo centers in December    of 1995. In January of 1997, the Company and the State of Florida settled    all matters regarding the Company's previous ownership and operation of these    bingo centers. The Company believes that Furtney's lawsuit against the Company    is completely without merit and that the Company will prevail in its counterclaim.    The Company completed depositions of Mr. Furtney and a corporate representative    of the Furtney controlled companies discussed above on September 20, 2000    and plans to pursue and defend this action vigorously. There can be no assurance    of this result and a decision against the Company could have a material adverse    effect on the financial position and operations of the Company. A court date    has been set forSeptember 2004.*Collins Entertainment Corp. v. Coats and Coats Rental Amusement, d/b/a    Ponderosa Bingo and Shipwatch Bingo, Wayne Coats, individually, and American    Bingo and Gaming Corp.; American Bingo and Gaming Corp. v. Coats and Coats    Rental Amusement, d/b/a Ponderosa Bingo and Shipwatch Bingo, Wayne Coats,    individually, Civil Action No. 97-CP-10-4685, South Carolina Court of Common    Pleas, Charleston County*. On October 9, 1997, Collins Entertainment, Inc.,    filed a lawsuit alleging the     Defendants had engaged in civil conspiracy and tortiously interfered with    the Plaintiff's contract, violating the South Carolina Unfair Trade Practices    Act. The Plaintiff sought actual damages in excess of $350,000 and an unspecified    amount of punitive damages. The Company believed this lawsuit was completely    without merit; however, a judgment was issued on February 12, 2001 in favor    of the plaintiff. Damages of $157,000 were awarded in addition to punitive    damages of $1,570,000. The Company appealed this decision with the South Carolina    appellate court, and the judgment was affirmed. The Company applied for a    re-hearing with the appellate court which threw out their original opinion.    However, their new opinion also reaffirmed the judgment. The Company is now    in the process of filing an appeal to the South Carolina Supreme Court. The    total amount of the award was accrued for in the financial statements in 2000,    and the actual damages of $157,000 were paid in 2001.

*Lenrich Associates LLC v. Littlefield Corporation, et al; Civil Action    No. 00-CP-10-4742, South Carolina Court of Common Pleas, County of Charleston*Lenrich Associates has brought this action against the Company based on    a commercial lease guaranty that was signed by the Company. The tenant on    the lease is Concessions Corp., a subsidiary of the Company and had been used    as the location of the “Lucky II’ facility, which was closed in    early 2000. The lease expired in February 2003. Because rental payments under    the lease are currently in arrears, Lenrich Associates sought to enforce the    guaranty against the Company. The Company’s liability under the guaranty    is capped at the lesser of two years of fixed and additional rent or the amount    of fixed and additional rent corresponding to the time period mandated by    South Carolina law. A settlement agreement had been reached for $147,500,    which has been accrued     for by the Company in June 2002. However, the plaintiff withdrew their support    of the settlement agreement shortly thereafter. The Company has petitioned    the court to enforce the settlement agreement and is currently awaiting this    decision.*Littlefield Corp. v. Dye, Civil Action No. 2002-cp-08-478.*The Company    filed an action on March 6, 2002, in Berkeley County, South Carolina for collection    on a note signed by Danny C. Dye. The note, which was executed on December    10, 1998, was in the amount of $80,000. The Company alleges that Dye still    owes $58,481.29 toward the principle balance, plus $19,257.17 in accrued interest    through December 31, 2002. On January 14, 2003, Mr. Dye amended his answer    to assert counterclaims against the Company for fraudulent breach of contract    and violation of the South Carolina Payment of Wages Act based on allegations    that the Company failed     to pay Dye amounts due under an employment contract. Mr. Dye has alleged that    the Company owes him $375,000 in unpaid salary and is seeking treble damages    under the Payment of Wages Act for a total amount of $1,250,000 in damages.    The Company believes that the counterclaims are without merit and the Company    plans to contest them vigorously.*George M. Harrison, et al. v. Littlefield Corporation*Civil    Action No. 4:04-1038-25 This action is currently pending in the United States    District Court for the District of South Carolina, Florence Division. Plaintiffs    were the owners of a parcel of real property in Darlington, South Carolina    that was leased to Darlington Music Company, a former subsidiary of Littlefield    Corporation. In 1990, Plaintiffs, who were also the owners of Darlington Music    Company at that time, caused Darlington Music Company to enter into a 15-year    lease of the real property they owned. Darlington Music Company was later    acquired from Plaintiffs by Littlefield Corporation’s predecessor, American    Bingo & Gaming. This business continued to operate as a wholly-owned subsidiary    until such time as changes in South Carolina law regarding video gaming required    that the business be wound down. In May 2001, Plaintiffs later received a    judgment in the amount of $199,148.36 against Darlington Music Company for    nonpayment of rent. Through this action, Plaintiffs are now attempting to    enforce that judgment against Littlefield Corporation on the basis of various    legal theories. Littlefield intends to vigorously defend this action and will    also ask, if possible, to have the underlying judgment against its former    subsidiary reexamined. ***Matters Settled during this Quarter:******None***

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| **September 30, 2004**        |                   |                |                 |                |                  |
|-------------------------------|-------------------|----------------|-----------------|----------------|------------------|
|                               | **Entertainment** | **Amusements** | **Hospitality** | **Adjustment** | **Consolidated** |
| Revenue                       | $4,915,833        | $0             | $2,170,836      | 25,874         | $7,112,543       |
| Depreciation and Amortization | 371,301           | 0              | 243,576         | 81,940         | 696,817          |
| Segment profit (loss)         | 1,808,208         | (338)          | (595,690)       | (1,040,091)    | 172,089          |
| Segment Assets                | 22,080,329        | 201,050        | 1,390,577       | (8,571,880)    | 15,100,076       |

|                               |                   |                |                 |                |                  |
|-------------------------------|-------------------|----------------|-----------------|----------------|------------------|
| **September 30, 2003**        |                   |                |                 |                |                  |
|                               | **Entertainment** | **Amusements** | **Hospitality** | **Adjustment** | **Consolidated** |
| Revenue                       | $4,873,930        | $83,908        | $2,497,151      | $20,783        | $7,475,772       |
| Depreciation and Amortization | 354,686           | 11,217         | 245,992         | 105,638        | 717,533          |
| Segment profit (loss)         | 1,660,004         | 41,478         | (480,092)       | (1,240,435)    | (19,045)         |
| Segment Assets                | 21,142,407        | 202,881        | 1,713,338       | (7,166,447)    | 15,892,179       |

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> a) designed such disclosure controls and procedures or caused    such disclosure controls and procedures to be designed under our supervision    to ensure that material information relating to the registrant, including    its consolidated subsidiaries, is made known to us by others within those    entities, particularly during the period in which this quarterly report is    being prepared;b) designed such internal control over financial reporting,    or caused such internal control over financial reporting to be designed under    our supervision, to provide reasonable assurance regarding the reliability    of financial reporting and the preparation of financial statements for external    purposes in accordance with generally accepted accounting principles;c) evaluated the effectiveness of the registrant's disclosure    controls and procedures and presented in this report our conclusions about    the effectiveness of the disclosure controls and procedures, as of the end    of the period of covered by this report based on such evaluation;d) disclosed in this report any change in the small business    issuer’s internal control over financial reporting that occurred during    the small business issuer’s most recent fiscal quarter that has materially    affected, or is reasonably likely to materially affect, the small business    issuer’s internal control over financial reporting; and

> a) all significant deficiencies and material weaknesses in    the design or operation of internal control over financial reporting which    are reasonably likely to adversely affect the registrant's ability to record,    process, summarize and report financial information; and
b) any fraud, whether or not material, that involves management or other      employees who have a significant role in the registrant's internal control      over financial reporting.

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**I, Troy D. Zinn, certify that:****1.** I have reviewed this quarterly report on Form 10-QSB of Littlefield    Corporation;**2.** Based on my knowledge, this report does not contain any untrue statement    of a material fact or omit to state a material fact necessary to make the    statements made, in light of the circumstances under which such statements    were made, not misleading with respect to the period covered by this report;    **3.** Based on my knowledge, the financial statements, and other financial    information included in this quarterly report, fairly present in all material    respects the financial condition, results of operations and cash flows of    the registrant as of, and for, the periods presented in this report; **4.** The registrant's other certifying officers and I are responsible    for establishing and maintaining disclosure controls and procedures (as defined    in Exchange Act Rules 13a-15e and 15d-15(e)) and internal control over financial    reporting (as defined in Exchange Act Rule 13a-15(f) and 15d-15(f)) for the    registrant and we have:

> a) designed such disclosure controls and procedures or caused    such disclosure controls and procedures to be designed under our supervision    to ensure that material information relating to the registrant, including    its consolidated subsidiaries, is made known to us by others within those    entities, particularly during the period in which this quarterly report is    being prepared;b) designed such internal control over financial reporting,    or caused such internal control over financial reporting to be designed under    our supervision, to provide reasonable assurance regarding the reliability    of financial reporting and the preparation of financial statements for external    purposes in accordance with generally accepted accounting principles;c) evaluated the effectiveness of the registrant's disclosure    controls and procedures and presented in this report our conclusions about    the effectiveness of the disclosure controls and procedures, as of the end    of the period of covered by this report based on such evaluation;d) disclosed in this report any change in the small business    issuer’s internal control over financial reporting that occurred during    the small business issuer’s most recent fiscal quarter that has materially    affected, or is reasonably likely to materially affect, the small business    issuer’s internal control over financial reporting; and

**5.**The registrant's    other certifying officers and I have disclosed, based on our most recent evaluation    of internal control over financial reporting, to the registrant's auditors    and the audit committee of registrant's board of directors (or persons performing    the equivalent function):

> a) all significant deficiencies and material weaknesses in    the design or operation of internal control over financial reporting which    are reasonably likely to adversely affect the registrant's ability to record,    process, summarize and report financial information; and
b) any fraud, whether or not material, that involves management or other      employees who have a significant role in the registrant's internal control      over financial reporting.

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Jeffrey L. Minch, President and    Chief Executive Officer

/s/ Troy D. Zinn    Troy D. Zinn, Secretary and Treasurer    and Chief Financial Officer