UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



FORM 10-QSB

(Mark One)

[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934 for the period ended February 28, 2005



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

EXCHANGE Act of 1934 for the transition period from ___ to ___.



Commission File Number 0-50703



U.S. Precious Metals, Inc.



Delaware                                       14-1839426

-------------------------------             ------------------------------------

(State or other jurisdiction of             (I.R.S. Employer Identification No.)

incorporation or organization)



6 Glory Lane, Sussex, New Jersey 07461

--------------------------------------------

(Address of principal executive offices)



(973) 875-7647

-------------------------------------------------

(Registrant's telephone number, including area code)



Securities registered under Section 12 (b) of the Act:



Title of each class              Name of exchange on which

to  be  registered              each  class is to be registered

None

None



Securities registered under Section 12(g) of the Act:



Common Stock

--------------

(Title of Class)



Indicate  by check  mark  whether  the  registrant  (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities  Exchange Act of 1934 during the  proceeding  12 months and (2) has been  subject to such filing requirements for the past 90 days.



(1) Yes: [X]   No: [ ]

(2) Yes: [X]   No: [ ]



Indicate the number of shares  outstanding  of each of the issuer's  classes of common stock, as of April 1, 2005: 26,691,184 shares of Common Stock, $.00001 par value.



Transitional Small Business Issuer Format (Check One):

Yes:      No:  [X]







Page Number

PART I  FINANCIAL INFORMATION

Item 1.   Financial Statements (Unaudited):

-Consolidated Balance Sheets at February 28, 2005 (unaudited)

and May 31, 2004 (audited)

3

-Consolidated Statements of Operations and Deficit Accumulated

During Exploration Stage for the nine months ended February 28, 2005 and

February 28, 2004, and from January 21, 1998 to February 28, 2005

4

-Consolidated Statements of Operations and Deficit Accumulated

During Exploration Stage for the three months ended February 28, 2005 and

February 28, 2004, and from January 21, 1998 to February 28, 2005

5

-Consolidated Statements of Cash Flows for the quarter

ended February 28, 2005 and February 28, 2004, and

from January 21, 1998 to February 28, 2005

6

-Notes to Financial Statements

7

Item 2. Management's Discussion and Analysis

8

Item 3. Effectiveness of the registrants disclosure controls and procedures

9



PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

10

Item 2. Changes in Securities

10

Item 3. Defaults upon Senior Securities

10

Item 4. Submission of Matters to Vote of Securityholders.

10

Item 5. Other Information.

10

Item 6. Exhibits and Reports on Form 8-K.

11

Signatures

12







































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U. S. PRECIOUS METALS, INC.

(An Exploration Stage Company)

CONSOLIDATED BALANCE SHEETS







ASSETS



February 28, 2005

May 31, 2004

(Unaudited)

(Audited)



Current Assets:

Cash

$     7,048

$   23,534









Total current assets

7,048

23,534



Other Assets:

Investments in mining rights

63,598

63,598









Total Assets

$ 70,646

$ 87,132





LIABILITIES AND STOCKHOLDERS EQUITY





Current Liabilities:

Accounts payable

$     3,732

$     3,433

Deposits for common stock

-

20,000







Total current liabilities

3,732

23,433



Stockholders Equity:

Preferred stock:  authorized 10,000,000

shares of $.00001 par value; issued

and outstanding, none

Common stock:  authorized 100,000,000

shares of $.00001 par value; issued and outstanding,

26,691,184 and 25,951,184, respectively

267



240

Additional paid in capital

777,483

592,510

Deficit accumulated during exploration stage

(710,836)

(529,051)









Total stockholders equity

66,914

63,699









Total Liabilities and Stockholders Equity

$ 70,646

$ 87,132







The accompanying notes are an integral part of these financial statements.



U. S. PRECIOUS METALS, INC.

(An Exploration Stage Company)

CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT

ACCUMULATED DURING EXPLORATION STAGE

For the Nine Month Periods Ended February 28

(Unaudited)







January 21, 1998





(Date of Inception)

2005                 2004

To February 28, 2005



Revenue

$           -

$       -

$       -





Expenses

181,785

196,960

710,836







Loss accumulated during

exploration stage

$    (181,785)

$(196,960)

$ (710,836)



Net Loss Per Share -

Basic and Diluted

$(.01)

$(.01)





Weighted Average Number of Shares

Outstanding  Basic and Diluted

26,426,459

23,538,958















(A) Includes the following expenses:



Professional fees

$83,826

99,698

Salaries

20,800

48,000























The accompanying notes are an integral part of these financial statements.





U. S. PRECIOUS METALS, INC.

(An Exploration Stage Company)

CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT

ACCUMULATED DURING EXPLORATION STAGE

For the Three Month Periods Ended February 28,

(Unaudited)







January 21, 1998





(Date of Inception)





2005

2004

to February 28, 2005





Revenue

$     -

$     -

$      -



Expenses

41,790(A)

74,594(A)

710,836













Loss accumulated during

exploration stage

$(41,790)

$(74,594)

$(710,836)



Net Loss Per Share -

Basic and Diluted

$-

$-





Weighted Average Number of Shares

Outstanding  Basic and Diluted

26,426,670

25,885,470

















(A) Includes the following expenses:



Professional fees

$7,048

$18,000

Salaries

6,525

30,000





















The accompanying notes are an integral part of these financial statements.



#





U. S. PRECIOUS METALS, INC.

(An Exploration Stage Company)

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Nine Month Periods Ended February 28,

(Unaudited)











January 21, 1998





(Date of Inception)

2005

2004

to February 28, 2005



Cash Flows From Operations:

Net loss

$ (181,785)

$(196,960)

$(710,836)

Charges not requiring the outlay of cash:

Common stock issued for services

25,000

48,750



247,750

Changes in assets and liabilities:

Increase (decrease) in accounts payable

299

(14,005)

3,732











Net Cash Consumed by

Operating Activities

(156,486)

(162,215)



(459,354)



Cash Flows From Investing Activities:

Investments in mining rights

-

-



(48,598)











Net Cash Consumed by

Investing Activities

-



-



(48,598)



Cash Flows From Financing Activities:

Sales of common stock

140,000

170,000



515,000











Net Cash Provided by

Financing Activities

140,000

170,000



515,000











Net Increase In Cash Balance

(16,486)

7,725



7,048



Cash Balance, Beginning of Period

23,534

26,980

-











Cash Balance, End of Period

$  7,048

$ 34,765

$ 7,048





















The accompanying notes are an integral part of these financial statements.



U. S. PRECIOUS METALS, INC.

(An Exploration Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

February 28, 2005

(Unaudited)







1.

BASIS OF PRESENTATION



The unaudited interim consolidated financial statements of U.S. Precious Metals, Inc. and its subsidiary (the Company) as of February 28, 2005 and for the three and nine month periods ended February 28, 2005 and February 29, 2004, have been prepared in accordance with accounting principals generally accepted in the United States of America.  In the opinion of management, such information contains all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results for such periods.  The results of operations for the nine months ended February 28, 2005 are not necessarily indicative of the results to be expected for the full fiscal year ending May 31, 2005.



Certain information and disclosures normally included in the notes to financial statements have been condensed or omitted as permitted by the rules and regulations of the Securities and Exchange Commission, although the Company believes the disclosure is adequate to make the information presented not misleading.  The accompanying unaudited financial statements should be read in conjunction with the financial statements of the Company for the year ended May 31, 2004.



2.

SUPPLEMENTARY CASH FLOWS INFORMATION



There was no cash paid for income taxes during either of the periods presented.  Similarly, there were no payments for interest during the 2005 period; payments for interest during the 2004 period totaled $13.



3.

COMMON STOCK



Shares of common stock were issued in private placement offerings during the 2005 period.  A total of 560,000 shares were issued, yielding proceeds of $140,000.  These shares were accompanied by  280,000 warrants, each permitting the purchase one-half share of common stock at $.50 per share.  These warrants expire 18 months after the date of issuance.  This brings the total warrants outstanding at February 28, 2005 to 1,380,000.  In addition, 100,000 shares of common stock were issued for services rendered which were valued at $25,000.























Item 2. Management's Discussion and Analysis.



The Company is a mineral exploration company.  The Company has acquired exploration concessions to certain mineral properties known as Solidaridad I, Solidaridad II, Solidaridad III, and Solidaridad IV, and as of the date of this report, is in the process of finalizing the acquisition of the mining concession to the Solidaridad V  (collectively, the Solidaridad Properties). The Solidaridad Properties are located in State of Michoacan, Mexico. The estimated sizes of the properties are as follows: Solidaridad I - 175 hectares, Solidaridad II - 2,164 hectares, Solidaridad III - 294 hectares, Solidaridad IV - 150 hectares and Solidaridad V- 921 hectares.  A hectare is equivalent to 2.47 acres. The Company also has received mining  reports on the  Solidaridad I property from two geologists who performed limited geological work on the Solidaridad I property.  At  the  time  of  their  respective  reports, both geologists were independent, however, subsequent to his report, the Company appointed Dr. Gerald Harper to the Company's Board of Directors. There are no known bodies of ore on the property concessioned by the Company. The Company's plan of operations is to raise funds to carry out further exploration on the Solidaridad Properties with the objective of establishing ore of commercial tonnage and grade.  Please refer to the Companys Annual Report on Form 10-KSB for the period ending May 31, 2004 for a broader description of the Companys business, the referenced geological reports, and its proposed operations with respect to the Solidaridad Properties.



During fiscal years 2002 through fiscal 2004, the Company raised $375,000  from the sale of 6,960,000  units. During the nine month period ended February 28, 2005, the Company raised an additional $140,000 from the sale of 560,000 units. Each unit consisted of one share of common stock and one-half of a stock purchase warrant. The warrants expire 18 months from issuance and are exercisable at $0.50 per share. The Company's cash requirements for the next 12 month are estimated to be $1,000,000, of which $460,000 is allocated for additional exploration on the Solidaridad I property, $250,000 for exploration on the other Solidaridad Properties  other than  Solidaridad I, $150,000 for  exploration of other claims in the region, and $140,000 for general and  administrative  costs, each as described below.



The  projected  exploration  on the  Solidaridad  I  property  will  consist  of preliminary  ground exploration work and exploratory  drilling.  The preliminary ground exploration will entail detailed geological mapping,  soil sampling,  and channel  sampling  of  road  cuts to  delineate  mineralization,  if  any.  This preliminary work will be followed by a combination of reverse circulation rotary and  diamond  core  drilling to test the grade,  thickness,  and  continuity of mineralization,  if any,  determined  or identified  by the  preliminary  ground exploration.  While the depth of drilling currently cannot be determined,  it is anticipated  that initial holes will total 150 to 300 meters in depth.  Based on existing  data, the Company  expects to drill  approximately  40-60  exploratory holes,  however,  the  actual  number  will be  dependent  upon the  results of preliminary  exploratory  work,  results of prior drill holes, and the Company's available working capital. The Company will assay sampling and core hole results for gold, copper, and silver.



Exploratory work on the other Solidaridad claims will seek to identify and drill test for gold  mineralization  in a manner  similar to the  Solidaridad I claim.  This  work will  include  geological  mapping,  geochemical  sampling  (drainage samples, soil samples, and rock-chip samples), possibly geophysical methods, and exploratory drilling.



Regional  exploration  around the Solidaridad  claims will consist of geological prospecting including rock chip and drainage sampling,  examination of satellite imagery purchased by the Company, and evaluation of known mineral prospects.



General and  administrative  costs  include  travel  expenditures  to Mexico for Company  officers  and  consultants  estimated  to be $20,000;  salaries to employees consisting of salaries to the Company's vice president and a field geologist in Mexico estimated to be $60,000;  legal and professional fees,  including legal fees for local  counsel in Mexico  estimated  to be  $40,000;  regulatory  work in Mexico estimated  to be $10,000,  and office  supplies  and  expenses  estimated  to be $10,000.



The Company is seeking to raise a minimum of $1,000,000 in the next 12 months to support its working capital needs as described  above. The funds may be procured through  the public or private  offering of its equity  securities.  The Company believes that debt  financing is not a funding  alternative at this time due to its lack of cash flow.  The Company has entered  into  discussions  with a number of investors concerning an investment in the Company, however, at this time, it has not received  commitments from any source, and has no firm arrangements in place for  its  required  funding.  The  Company  cannot  predict  whether  it will be successful in raising any capital.



The Company has no material  commitments  for capital at this time other than as described above. In addition,  the Company does not expect to incur research and development costs within the next 12 months. If the Company is successful in raising the  estimated  $1,000,000,  the Company believes that its  exploratory  programs can be completed  within 12 months from funding. If the Company is able to raise part but not all of the $1,000,000, the Company will  prioritize the allocation of such funds towards the exploration of the Solidaridad I property  discussed above,  along with the payment of salaries for  the  two  personnel  and  other   administrative costs described above.  Thereafter,  any additional funds will be allocated for exploration of the other Solidaridad  Properties,  followed  by regional  exploration.  If the Company is unable to raise any funds, it will be unable to complete its plan of operation.



Exploration for minerals is a speculative  venture  involving  substantial risk.  There is no  certainty  that the  expenditures  to be made by the Company in the exploration for gold and other minerals will result in discoveries of commercial quantities of ore.  Hazards such as unusual or unexpected  formations  and other conditions are involved in mineral  exploration and  development.  Consequently, the Company can not predict  whether it will be  successful  in  establishing  a "commercial  quantity"  of ore for the  Solidaridad  Properties.  A  "commercial quantity"  of ore is a  quantity  of ore  which is  sufficient  to  economically justify  commercial   exploitation.   In  determining  whether  a  body  of  ore economically justifies exploitation, the Company will assess those factors which impact the  economics of  production of the  Solidaridad  Properties,  including prevailing  metal prices,  the grade (or metal  content) of the ore,  mining and processing costs, cost of capital,  environmental  compliance costs, and general economic conditions.



If the Company is successful in establishing a commercial quantity of ore on the Solidaridad Proprieties, its present intention is not to engage in actual mining operations.  Rather,  it expects to sell the properties to a mining company,  or enter  into a joint  venture  with a mining  company to  conduct  actual  mining operations on the property. The Company has no such arrangements at this time.



Risk Factors.



See the Company's Annual Report on Form 10-KSB for the period ending May 31, 2004 (Form 10-KSB) for additional statements concerning operations and future capital requirements. Certain risks exist with respect to the Company and its business, which risks include: its limited assets, industry risks, limited geological work conducted on existing property, the need for additional capital; environmental risks; among other factors. Readers are urged to refer to the section entitled Cautionary Statements in the Companys Form 10-KSB for a broader discussion of such risks and uncertainties.



Item 3. Effectiveness of the registrants disclosure controls and procedures.



(a) Under the supervision and with the participation of management, including the Companys President and Chief Financial Officer, we conducted an evaluation of the effectiveness of the design and operations of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as of December 31, 2004. Based on this evaluation, our President and Chief Financial Officer concluded that our disclosure controls and procedures were effective such that the material information required to be included in our Securities and Exchange Commission ("SEC") reports is recorded, processed, summarized and reported within the time periods specified in applicable SEC rules and forms relating to our reporting obligations, and was made known to them by others within the company, particularly during the period when this report was being prepared.

(b) Changes in internal controls over financial reporting.

In addition, there were no significant changes in our internal control over financial reporting that could significantly affect these controls during our most recent quarter.





PART II



Item 1.   Legal Proceedings.

None



Item 2.   Unregistered Sale of Securities and Use of Proceeds.

During the three month period ended February 28, 2005, the Company sold a total of two units in a private placement offering to two individuals in which the Company received $20,000.00 in gross proceeds. Each unit consisted of one share of common stock and a stock purchase warrant to acquire one-half of a share of common stock. The exercise price per whole share is $.50 per share, and the warrants expire 18 months after the date of issuance.  The private placements were exempt from registration pursuant to Section 3(b) and 4(2) of the Securities Act of 1933, as amended (the Act), including Rule 506 of Regulation D promulgated under the Act. Each recipient of securities in each such transaction was an accredited investor as defined under Regulation D, and represented his or her intentions to acquire the securities for investment only and not with a view to or for sale in connection with any distribution thereof and, appropriate legends were affixed to the share certificates issued in such transactions. No advertisement or general solicitation was used in connection with any offer or sale of such securities.



Item 3.   Defaults Upon Senior Securities.

None



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

None



Item 5.   Other Information.

On May 9, 2002, the Board of Directors of the Companys former parent declared a dividend in the form of common stock of the Company to be issued to its beneficial shareholders of record on such date. On or about June 10, 2004, the former parent distributed the common stock of the Company to its shareholders of record on the record date. As a result of such action, the Company was spun-off to the shareholders of its former parent. When the spin-off was effected, the Company believed that the transaction complied with the requirements of the federal securities law, including the requirements of Staff Legal Bulletin #4 (SLB #4) issued by the staff of the Securities and Exchange Commission (Commission). Although not legally binding, Staff Legal Bulletins generally provide the position of the staff of the Commission in respect of various securities law issues, and SLB #4, in particular, addresses the staff of the Commission view on spin-off and sets forth certain requirements for compliance with Section 5 of the Securities Act for 1933, as amended (Act).



In June 2004, the Company undertook to establish a trading market for its common stock on the Over the Counter Bulletin Board by filing information with the National Association of Securities Dealers, Inc. pursuant to Rule 15c-211 of the Securities Exchange Act of 1934. In the course of that process, the Company provided to the Commission its written position that the spin-off complied with the requirements of SLB #4. The Company also has provided to the Commission its written position that the spin-off was a transaction exempt from the registration requirements under Section 5 of the Act. The Commission has advised the Company that, in their view, the spin-off transaction did not meet the requirements of SLB #4 nor was the transaction  exempt from the Section 5 of the Act.  The Company has asked the staff to reconsider its position regarding the Companys compliance with SLB#4.  As of the date of this filing, the Commission has not informed the Company of its reconsideration position. If the Commission does not concur with the position of the Company regarding the spin-off transaction, the transaction may be deemed to be in violation of federal securities laws, and the Company may be subject to civil penalties imposed by the Commission. The Company can not predict the outcome of the determination by the Commission, nor can it predict whether it will be able to establish a trading market for its common stock on the Over the Counter Bulletin Board.



Item 6.   Exhibits and Reports on Form 8-K

(a). Furnish the Exhibits required by Item 601 of Regulation S-B.

Exhibit 31  Certification Pursuant To Section 302 Of The Sarbanes-Oxley Act Of 2002.

Exhibit 32  Certification Pursuant To Section 906 Of The Sarbanes-Oxley Act Of 2002.



(b) Reports on Form 8-K.

None







#









SIGNATURES



In accordance with the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



Dated: April 21, 2005



U.S. PRECIOUS METALS, INC.







/s/ Jack Wagenti

Jack Wagenti

Chief Financial Officer





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