UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q
(Mark One)

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

                For the quarterly period ended September 30, 2010

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

                 For the transition period from _____ to _______

                          Commission File Number: None


                    NEW TAOHUAYUAN CULTURE TOURISM CO., LTD.
             (Exact Name of Registrant as Specified in its Charter)

                      Nevada                          Applied For
         (State or other jurisdiction of           (I.R.S. Employer
          incorporation or organization)          Identification No.)

                                1# Dongfeng Road
                   Xi'an Weiyang Tourism Development District
                                  Xi'an, China
               (Address of Principal Executive Offices) (Zip Code)

       Registrant's telephone number including area code: 0086-29-86671555

                                       N/A
     ----------------------------------------------------------------------
         Former name, former address, and former fiscal year, if changed
                                since last report

Indicate by check mark whether the registrant (1) filed all reports required to
be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the past 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days. Yes [X] No [ ]

Indicate by check mark whether the registrant has submitted electronically and
posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T (ss.232.405 of
this chapter) during the preceding 12 months (or for such shorter period that
the registrant was required to submit and post such files). Yes [ ] No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
definition of "large accelerated filer", "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act.

Larger accelerated filer [  ]                   Accelerated filer [  ]
Non-accelerated filer [  ]                Smaller reporting company [X]

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

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: 18,727,327 shares outstanding
as of August 15, 2010.
<PAGE>

                 NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMIITED
                                 AND SUBSIDIARY


                   UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

                               SEPTEMBER 30, 2010





                                TABLE OF CONTENTS







Unaudited Consolidated Balance Sheets as of September 30, 2010
   and December 31, 20091.................................................1

Unaudited Consolidated Statements of Income for the three and
   nine month periods ended September 30, 2010 and 2009...................2

Unaudited Consolidated Statements of Cash Flows for the nine
   month periods ended September 30, 2010 and 2009........................3

Notes to Unaudited Consolidated Financial Statements ..................  4-15
<PAGE>

         NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED AND SUBSIDIARY
                      UNAUDITED CONSLIDATED BALANCE SHEETS

                                     Assets
                                     ------
                                                       As at
                                                       -----

                                      September 30, 2010      December 31, 2009
                                      ------------------      -----------------
   Current assets
     Cash and cash equivalents               $    82,611           $   145,115
     Accounts receivable, net                     97,141                32,656
     Inventories                                  64,556                69,599
     Prepaid expenses and other
        current assets                             2,065                   195
     Due from related parties                    570,853               570,967
                                             -----------           ------------
        Total Current Assets                     817,227               818,533

   Property & equipment, net                   5,934,054             6,126,079
   Construction-in- progress                  21,214,184            17,570,430
   Land use right, net                         2,504,887             2,503,539
   Deposit for land use right                 17,935,879            17,580,099
                                             -----------           ------------
        Total assets                          48,406,231            44,598,680
                                             ===========           ============

                      Liabilities and Stockholders' Equity
                      ------------------------------------

Liabilities
   Current liabilities
      Accounts payable and accrued
        expenses                                 661,184               744,762
      Deferred revenue                           243,564               188,273
      Due to related party                       122,896                     -
      Taxes payable                            7,470,651             6,517,543
                                             -----------           ------------
        Total Current Liabilities              8,498,295             7,450,578

Stockholders' equity
    Share Capital
      Preferred stock, $.001 par
        value, 10,000,000 shares
        authorized, none issued
        and outstanding                                -                     -
      Common stock, $.001 par value,
        50,000,000 shares authorized,
        18,727,327 issued and outstanding
        as of September 30,2010 and December 31,
        2009                                      18,727                18,727
      Additional paid in capital              15,855,727            15,855,727
      Statutory reserve                        2,739,753             2,542,355
      Other comprehensive income               6,267,235             5,481,382
      Retained earnings                       15,026,494            13,249,911
                                             -----------           ------------
        Total Stockholders' equity            39,907,936            37,148,102
                                             -----------           ------------
   Total liabilites and stockholder's
       equity                                 48,406,231            44,598,680
                                             ===========           ============

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

                                       1
<PAGE>
                 NEW TAOHUAYUAN CULTURE TOURISM OMPANY LIMITED
                                 AND SUBSIDIARY
   UNAUDITED CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME

<TABLE>
<S>                                              <C>                <C>                <C>                 <C>

                                               For the Three Month Periods         For the Nine Month Periods
                                                     Ended September 30,                  Ended September 30,

                                                2010                 2009             2010                2009
                                                ----                 ----             ----                ----

Net revenue
   Catering and hotel related services
      income                                  $ 1,269,595      $ 1,256,043        $ 3,518,673         $ 3,570,610
   Management fee income                          509,794          506,648          1,520,728           1,514,944
                                              -----------      -----------        -----------         -----------
      Total net revenue                         1,779,389        1,762,691          5,039,401           5,085,554

Cost of revenue                                   419,801          411,745          1,226,444           1,284,666
                                              -----------      -----------        -----------         -----------

Gross profit                                    1,359,587        1,350,946          3,812,956           3,800,888

Operating expenses
   General and administrative expenses            218,978           50,269            786,338             883,734
   Depreciation and amortization                  190,567          344,363            382,730             560,381
                                              -----------      -----------        -----------         -----------
        Total operating expenses                  409,545          394,632          1,169,068           1,444,115
                                              -----------      -----------        -----------         -----------

Income from operations                            950,043          956,314          2,643,889           2,356,773
                                              -----------      -----------        -----------         -----------
Other Income (Expense)
   Interest income                                      -              143                  -                 382
   Other income (expense) , net                   (13,897)           4,037            (11,914)             10,779
                                              -----------      -----------        -----------         -----------
         Total other income (expense)             (13,897)           4,180            (11,914)             11,161
                                              -----------      -----------        -----------         -----------

Income before income taxes                        936,146          960,494          2,631,975           2,367,934
Provision for income taxes                        235,028          240,124            657,994             591,984
                                              -----------      -----------        -----------         -----------
       Net income                                 701,118          720,370          1,973,981           1,775,950

  Other comprehensive item:
     Foreign currency translation gain (loss)     534,403           95,176            785,853             (17,155)
                                              -----------      -----------        -----------         -----------

  Net comprehensive income                    $ 1,235,521       $  815,546        $ 2,759,834         $ 1,758,795
                                              ===========      ===========        ===========         ===========

  Earning per share:
     Basic & diluted earning per share        $      0.04       $     0.04        $     0.11          $      0.09
                                              ===========      ===========        ===========         ===========

  Weighted average number of shares
    outstanding:
       Basic & diluted weighted average
       number of shares                       18,727,327        18,727,327        18,727,327          18,727,327
                                             ===========      ===========        ===========         ===========
</TABLE>

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

                                       2
<PAGE>
                 NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED
                                 AND SUBSIDIARY
                     UNCONSOLIDATED STATEMENTS OF CASH FLOWS

                                                 For the nine month periods
                                                     ended September 30,
                                                    2010            2009
                                               -----------        ----------

Cash Flows from Operating Activities

  Net income                                    $ 1,973,981      $ 1,775,951
  Adjustments to reconcile net
    income to net cash
    provided by operating
    activities:
  Depreciation and amortization                     382,730          560,381
  Loss as sales of fixed assets                      20,277                -
  Bad debt expense                                  102,816          109,748
 (Increase) / decrease in current assets:
    Accounts receivables                            (62,742)         (37,348)
    Inventory                                         6,342           (1,184)
    Other receivables                                   (71)          (1,353)
    Prepaid expenses and other current
      assets                                          (1763)             732
    Increase/(decrease) in current
      liabilities:
    Accounts payable and accrued expenses           (96,977)          57,603
    Taxes payable                                   807,279          734,564
    Deferred revenue                                 50,607           45,661
                                                -----------       -----------
  Net cash provided by operating activities       3,182,478        3,244,755
                                                -----------       -----------
Cash Flows from Investing Activities
  Payment for construction in progress           (3,232,391)      (3,294,088)
  Purchase of fixed assets                          (47,323)             -
  Proceeds from sales of fixed asset                  3,439
  Advances to related parties                       132,282          (29,708)
                                                -----------       -----------
  Net cash used in investing activities          (3,143,993)      (3,323,796)
                                                -----------       -----------

Effect of exchange rate changes on cash
   and cash equivalents                            (100,988)            (115)

Net Increase/ (decrease) in cash and
   cash equivalents                                 (62,504)         (79,156)
  Cash and cash equivalents, beginning balance      145,115           89,252
                                                -----------       -----------
  Cash and cash equivalents, ending balance      $   82,611       $   10,096
                                                ===========       ===========
Supplemental noncash financial disclosures:

  Cash paid during the year for:
    Income tax payments                          $        -       $        -
                                                ===========       ===========
    Interest payments                            $        -       $        -
                                                ===========       ===========

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


                                       3
<PAGE>


          NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED AND SUBSIDIARY
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 2010


Note 1 - ORGANIZATION

      New Taohuayuan Culture Tourism Company Limited (the "Company") was
      incorporated under the laws of the State of Nevada on November 3, 2004.
      The Company is an investment holding company.

      Shanxi New Taohuayuan Culture Tourism Company Limited ("Shanxi NTHY") was
      incorporated in the People's Republic of China ("PRC") on August 3, 1997
      as a limited liability company. Shanxi NTHY operates a resort in Xi'an, in
      the PRC, providing catering, hotel and related services.

      Pursuant to an agreement and plan of migratory merger between the Company
      and Shanxi NTHY on November 5, 2004, the Company acquired Shanxi NTHY by
      issuing 17,027,328 shares of its common stock to the original shareholders
      of Shanxi NTHY in exchange for 100% of their membership interests (the
      "Merger"). As a result, the controlling member of Shanxi NTHY has
      effective and actual operating control of the Company. The Merger was
      approved by the Shanxi Ministry of Commerce on November 24, 2004. Since
      then, Shanxi NTHY has become a wholly owned subsidiary of the Company and
      its status has changed to a wholly owned foreign owned enterprise.

      Since the Company had no operations or net assets prior to the
      acquisition, the acquisition was considered to be a capital transaction in
      substance, rather than a business combination and no goodwill was
      recognized. For financial reporting purposes, the acquisition was treated
      as a reverse acquisition whereby Shanxi NTHY is considered to be the
      accounting survivor and the operating entity while the Company is
      considered to be the legal survivor.

Note 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      Basis of Presentation

      The accompanying consolidated financial statements have been prepared in
      conformity with accounting principles generally accepted in the United
      States of America. The Company's functional currency is the Chinese
      Renminbi (CNY); however the accompanying consolidated financial statements
      have been translated and presented in United States Dollars (USD).

      The consolidated condensed interim financial statements included herein
      have been prepared by the Company, without audit, pursuant to the rules
      and regulations of the Securities and Exchange Commission. Certain
      information and footnote disclosures normally included in financial
      statements prepared in accordance with generally accepted accounting
      principles have been condensed or omitted pursuant to such rules and
      regulations of the Securities and Exchange Commission, although the
      Company believes that the disclosures are adequate to make the information
      presented not misleading. These statements reflect all adjustments,
      consisting of normal recurring adjustments, which, in the opinion of
      management, are necessary for fair presentation of the information
      contained therein. It is suggested that these consolidated condensed
      financial statements be read in conjunction with the financial statements
      and notes thereto included in the Company's annual report on Form 10-K for
      the year ended December 31, 2009. The Company follows the same accounting
      policies in preparation of interim reports. Results of operations for the
      interim periods are not indicative of annual results.

      Foreign currency transactions and comprehensive income (loss)

      As of September 30, 2010, the accounts of Shanxi NTHY were maintained, and
      its financial statements were expressed, in Chinese Yuan Renminbi (CNY).
      Such financial statements were translated into U.S. Dollars (USD) in
      accordance with Statement of Financial Accounts Standards ("SFAS") No. 52
      (ASC830), "Foreign Currency Translation," with the CNY as the functional

                                       4
<PAGE>

      currency. According to the Statement, all assets and liabilities were
      translated at the current exchange rate, stockholder's equity are
      translated at the historical rates and income statement items are
      translated at the average exchange rate for the period. The resulting
      translation adjustments are reported under other comprehensive income in
      accordance with SFAS No. 130 (ASC 220), "Reporting Comprehensive Income"
      as a component of shareholders' equity.

      During the nine month periods ended September 30, 2010 and 2009 the
      transactions of Shanxi NTHY were denominated in foreign currency and were
      recorded in Chinese Yuan Renminbi (CNY) at the rates of exchange in effect
      when the transactions occur. Exchange gains and losses are recognized for
      the different foreign exchange rates applied when the foreign currency
      assets and liabilities are settled. Transaction gains and losses that
      arise from exchange rate fluctuations on transactions denominated in a
      currency other than the functional currency are included in the results of
      operations as incurred.

      Use of Estimates

      The preparation of financial statements in conformity with generally
      accepted accounting principles in the United States ("GAAP") requires
      management to make certain estimates and assumptions that affect the
      reported amounts of assets and liabilities and disclosure of contingent
      assets and liabilities at the date of the financial statements and the
      reported amounts of revenues and expenses during the reporting period.
      Actual results could differ from those estimates, and such differences may
      be material to the financial statements. Certain prior year amounts have
      been reclassified to conform to the current year presentation.

      Principles of Consolidation

      The consolidated financial statements include the accounts of New
      Taohuayuan Culture Tourism Company Limited and its wholly owned subsidiary
      Shanxi NTHY, collectively referred to within as the Company. All material
      inter-company accounts, transactions and profits have been eliminated in
      consolidation.

       Revenue Recognition

      The Company generates revenue from catering, hotel, and related services.
      The Company's revenue recognition policies are in compliance with Staff
      accounting bulletin (SAB) 104 (ASC 605). Revenue is generally recognized:
      (a) when persuasive evidence of an arrangement exists; (b) when services
      are rendered; (c) when the fee is fixed or determinable; and (d) when
      collectability is reasonably assured. Such service revenues are recognized
      net of discounts.

      The Company also generates management fee income in accordance with Shanxi
      New Taohuayuan Economy Trade Company Limited and its subsidiaries (related
      parties) based on terms stated in the agreement. These companies are
      controlled by a common director and stockholder of the Company. Cost of
      good sold related to management fee income is immaterial comparing with
      the total expenses incurred for the Company during its fiscal year.

      Advertising

      Advertising expenses consist primarily of costs of promotion for corporate
      image and product marketing and costs of direct advertising. The Company
      expenses all advertising costs as incurred.

      Income Taxes

      The Company utilizes SFAS No. 109 (ASC740), "Accounting for Income Taxes,"
      which requires the recognition of deferred tax assets and liabilities for
      the expected future tax consequences of events that have been included in
      the financial statements or tax returns. Under this method, deferred
      income taxes are recognized for the tax consequences in future years of
      differences between the tax bases of assets and liabilities and their
      financial reporting amounts at each period end based on enacted tax laws
      and statutory tax rates applicable to the periods in which the differences
      are expected to affect taxable income. Valuation allowances are

                                       5
<PAGE>

      established, when necessary, to reduce deferred tax assets to the amount
      expected to be realized.

      In July 2006, the Financial Accounting Standards Board ("FASB") issued
      FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes--an
      Interpretation of FASB Statement No. 109 ("FIN 48") (ASC 740). FIN 48
      seeks to reduce the diversity in practice associated with certain aspects
      of measuring and recognition in accounting for income taxes. In addition,
      FIN 48 requires expanded disclosure with respect to the uncertainty in
      income taxes and is effective for fiscal years beginning after December
      15, 2006.

      Beginning January 1, 2008, the new Enterprise Income Tax ("EIT") law of
      China has replaced the existing laws for Domestic Enterprises ("DES") and
      Foreign Invested Enterprises ("FIEs"). The new standard EIT rate of 25%
      replaced the 33% rate currently applicable to both DES and FIEs. The two
      years tax exemption, three years 50% tax reduction tax holiday for
      production-oriented FIEs have continued until it expires.

      Statement of Cash Flows

      In accordance with SFAS No. 95 (ASC 230), "Statement of Cash Flows," cash
      flows from the Company's operations is based upon the local currencies. As
      a result, amounts related to assets and liabilities reported on the
      statement of cash flows will not necessarily agree with changes in the
      corresponding balances on the balance sheet.

      Concentration of Credit Risk

      Financial instruments that potentially subject the Company to
      concentrations of credit risk are cash, and other receivables arising from
      our normal business activities. We place our cash in what we believe to be
      credit-worthy financial institutions. We have a diversified customer base,
      most of which are in China. We control credit risk by collecting the
      revenue in advance. The Company routinely assesses the financial strength
      of its customers and, based upon factors surrounding the credit risk,
      establishes an allowance, if required, for uncollectible accounts and, as
      a consequence, believes that its accounts receivable credit risk exposure
      beyond such allowance is limited.

      Segment Reporting

      Statement of Financial Accounting Standards No. 131 ("SFAS 131") (ASC
      250), "Disclosure about Segments of an Enterprise and Related Information"
      requires use of the "management approach" model for segment reporting. The
      management approach model is based on the way a company's management
      organizes segments within the company for making operating decisions and
      assessing performance. Reportable segments are based on products and
      services, geography, legal structure, management structure, or any other
      manner in which management disaggregates a company.

      Risks and Uncertainties

      The Company is subject to substantial risks from, among other things,
      intense competition associated with the industry in general, other risks
      associated with financing, liquidity requirements, rapidly changing
      customer requirements, limited operating history, foreign currency
      exchange rates and the volatility of public markets.

      The Company's operations are carried out in the PRC. Accordingly, the
      Company's business, financial condition and results of operations may be
      influenced by the political, economic and legal environments in the PRC,
      by the general state of the PRC's economy. The Company's business may be
      influenced by changes in governmental policies with respect to laws and
      regulations, anti-inflationary measures, currency conversion and
      remittance abroad, and rates and methods of taxation, among other things.

                                       6
<PAGE>


      Contingencies

      Certain conditions may exist as of the date the financial statements are
      issued, which may result in a loss to the Company but which will only be
      resolved when one or more future events occur or fail to occur. The
      Company's management and legal counsel assess such contingent liabilities,
      and such assessment inherently involves an exercise of judgment. In
      assessing loss contingencies related to legal proceedings that are pending
      against the Company or unasserted claims that may result in such
      proceedings, the Company's legal counsel evaluates the perceived merits of
      any legal proceedings or unasserted claims as well as the perceived merits
      of the amount of relief sought or expected to be sought.

      If the assessment of a contingency indicates that it is probable that a
      material loss has been incurred and the amount of the liability can be
      estimated, then the estimated liability would be accrued in the Company's
      financial statements. If the assessment indicates that a potential
      material loss contingency is not probable but is reasonably possible, or
      is probable but cannot be estimated, then the nature of the contingent
      liability, together with an estimate of the range of possible loss if
      determinable and material would be disclosed.

      Loss contingencies considered to be remote by management are generally not
      disclosed unless they involve guarantees, in which case the guarantee
      would be disclosed.

      Cash and Cash Equivalents

      Cash and cash equivalents include cash in hand and cash in time deposits,
      certificates of deposit and all highly liquid debt instruments with
      original maturities of three months or less.


      Allowance for Doubtful Accounts

      Management reviews the composition of accounts receivable, loans and
      prepaid expense and analyzes historical bad debts, aging analysis, current
      economic trends and changes in payment patterns to evaluate the adequacy
      of these reserves. Reserves are recorded primarily on a specific
      identification basis. Allowance for doubtful accounts amounted to $102,816
      and $100,776 at September 30, 2010 and December 31, 2009 respectively.

      Inventory

      Inventory is valued at the lower of cost or market. Inventory includes
      gift cards, raw materials and consumables.


      Potential losses from obsolete and slow-moving inventories are provided
      for when identified. Cost, which comprises all costs of purchase and,
      where applicable, other costs that has been incurred in bringing their
      inventories to their present location and condition, is calculated using
      the first-in, first-out method.


      Property, Plant & Equipment


      Property and equipment are stated at cost. Expenditures for maintenance
      and repairs are charged to earnings as incurred; additions, renewals and
      betterments are capitalized. When property and equipment are retired or
      otherwise disposed of, the related cost and accumulated depreciation are
      removed from the respective accounts, and any gain or loss is included in
      operations. Depreciation of property and equipment is provided using the
      straight-line method for substantially all assets with estimated lives of:

                                       7
<PAGE>

      Buildings                                               40 years
      Infrastructures and leasehold improvement               15 years
      Equipment (including electronic facilities, sports,
      Education and recreation facilities)                   5-7 years
      Automobile                                               7 years
      Furniture and Fixtures 5 years


      Intangible Assets

      The Company applies criteria specified in SFAS No. 141(ASC 805), "Business
      Combinations" to determine whether an intangible asset should be
      recognized separately from goodwill. Intangible assets acquired through
      business acquisitions are recognized as assets separate from goodwill if
      they satisfy either the "contractual-legal" or "separability" criterion.
      Per SFAS 142 (ASC 350), intangible assets with definite lives are
      amortized over their estimated useful life and reviewed for impairment in
      accordance with SFAS No. 144 (ASC 360), "Accounting for the Impairment or
      Disposal of Long-lived Assets." Intangible assets, such as purchased
      technology, trademark, customer list, user base and non-compete
      agreements, arising from the acquisitions of subsidiaries and variable
      interest entities are recognized and measured at fair value upon
      acquisition. Intangible assets are amortized over their estimated useful
      lives from one to ten years. The Company reviews the amortization methods
      and estimated useful lives of intangible assets at least annually or when
      events or changes in circumstances indicate that assets may be impaired.
      The recoverability of an intangible asset to be held and used is evaluated
      by comparing the carrying amount of the intangible asset to its future net
      undiscounted cash flows. If the intangible asset is considered to be
      impaired, the impairment loss is measured as the amount by which the
      carrying amount of the intangible asset exceeds the fair value of the
      intangible asset, calculated using a discounted future cash flow analysis.
      The Company uses estimates and judgments in its impairment tests, and if
      different estimates or judgments had been utilized, the timing or the
      amount of the impairment charges could be different.

      Effective January 1, 2005, the Company adopted Statement of Financial
      Accounting Standards No. 144 (ASC 360), "Accounting for the Impairment or
      Disposal of Long-Lived Assets" ("SFAS 144") (ASC 360), which addresses
      financial accounting and reporting for the impairment or disposal of
      long-lived assets and supersedes SFAS No. 121, "Accounting for the
      Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed
      Of," and the accounting and reporting provisions of APB Opinion No. 30,
      "Reporting the Results of Operations for a Disposal of a Segment of a
      Business." The Company periodically evaluates the carrying value of
      long-lived assets to be held and used in accordance with SFAS 144 (ASC
      360). SFAS 144 (ASC 360) requires impairment losses to be recorded on
      long-lived assets used in operations when indicators of impairment are
      present and the undiscounted cash flows estimated to be generated by those
      assets are less than the assets' carrying amounts. In that event, a loss
      is recognized based on the amount by which the carrying amount exceeds the
      fair market value of the long-lived assets. Loss on long-lived assets to
      be disposed of is determined in a similar manner, except that fair market
      values are reduced for the cost of disposal.

      Basic and Diluted Earnings Per Share

      Earnings per share are calculated in accordance with the Statement of
      financial accounting standards No. 128 (SFAS No. 128) (ASC260), "Earnings
      per share". SFAS No. 128 superseded Accounting Principles Board Opinion
      No.15 (APB 15). Net income (loss) per share for all periods presented has
      been restated to reflect the adoption of SFAS No. 128 (ASC260). Basic net
      income (loss) per share is based upon the weighted average number of
      common shares outstanding. Diluted net loss per share is based on the
      assumption that all dilutive convertible shares and stock options were
      converted or exercised. Dilution is computed by applying the treasury
      stock method. Under this method, options and warrants are assumed to be
      exercised at the beginning of the period (or at the time of issuance, if
      later), and as if funds obtained thereby were used to purchase common
      stock at the average market price during the period. Basic and diluted
      earnings per share were $0.11 and $0.09 for the nine month periods ended
      September 30, 2010 and 2009 respectively.

                                       8
<PAGE>

      Recent Accounting Pronouncements

      In January 2010, FASB issued ASU No. 2010-06 - Improving Disclosures about
      Fair Value Measurements. This update provides amendments to Subtopic
      820-10 that requires new disclosure as follows: 1) Transfers in and out of
      Levels 1 and 2. A reporting entity should disclose separately the amounts
      of significant transfers in and out of Level 1 and Level 2 fair value
      measurements and describe the reasons for the transfers. 2) Activity in
      Level 3 fair value measurements. In the reconciliation for fair value
      measurements using significant unobservable inputs (Level 3), a reporting
      entity should present separately information about purchases, sales,
      issuances, and settlements (that is, on a gross basis rather than as one
      net number). This update provides amendments to Subtopic 820-10 that
      clarifies existing disclosures as follows: 1) Level of disaggregation. A
      reporting entity should provide fair value measurement disclosures for
      each class of assets and liabilities. A class is often a subset of assets
      or liabilities within a line item in the statement of financial position.
      A reporting entity needs to use judgment in determining the appropriate
      classes of assets and liabilities. 2) Disclosures about inputs and
      valuation techniques. A reporting entity should provide disclosures about
      the valuation techniques and inputs used to measure fair value for both
      recurring and nonrecurring fair value measurements. Those disclosures are
      required for fair value measurements that fall in either Level 2 or Level
      3. The new disclosures and clarifications of existing disclosures are
      effective for interim and annual reporting periods beginning after
      December 15, 2009, except for the disclosures about purchases, sales,
      issuances, and settlements in the roll forward of activity in Level 3 fair
      value measurements. These disclosures are effective for fiscal years
      beginning after December 15, 2010, and for interim periods within those
      fiscal years. The Company does not believe that this will have a material
      impact on its consolidated financial statements.

      In February 2010, FASB issued ASU No. 2010-9 -Amendments to Certain
      Recognition and Disclosure Requirements. This update addresses certain
      implementation issues related to an entity's requirement to perform and
      disclose subsequent-events procedures, removes the requirement that public
      companies disclose the date of their financial statements in both issued
      and revised financial statements. According to the FASB, the revised
      statements include those that have been changed to correct an error or
      conform to a retrospective application of U.S. GAAP. The amendment is
      effective for interim and annual reporting periods in fiscal year ending
      after June 15, 2010. The Company does not believe that this will have a
      material impact on its consolidated financial statements.

      In March 2010, FASB issued ASU No. 2010-10 -Amendments for Certain
      Investment Funds. This update defers the effective date of the amendments
      to the consolidation requirements made by FASB Statement 167 to a
      reporting entity's interest in certain types of entities. The deferral
      will mainly impact the evaluation of reporting enterprises' interests in
      mutual funds, private equity funds, hedge funds, real estate investment
      entities that measure their investment at fair value, real estate
      investment trusts, and venture capital funds. The ASU also clarifies
      guidance in Statement 167 that addresses whether fee arrangements
      represent a variable interest for all service providers and decision
      makers. The ASU is effective for interim and annual reporting periods in
      fiscal year beginning after November 15, 2009. The adoption of this ASU
      did not have a material impact on the Company's consolidated financial
      statements.

      In March 2010, FASB issued ASU No. 2010-11 -Scope Exception Related to
      Embedded Credit Derivatives. Embedded credit-derivative features related
      only to the transfer of credit risk in the form of subordination of one
      financial instrument to another are not subject to potential bifurcation
      and separate accounting as clarified by recently issued FASB guidance.
      Other embedded credit-derivative features are required to be analyzed to
      determine whether they must be accounted for separately. This update
      provides guidance on whether embedded credit-derivative features in
      financial instruments issued by structures such as collateralized debt
      obligations (CDOs) and synthetic CDOs are subject to bifurcation and
      separate accounting. The guidance is effective at the beginning of a
      company's first fiscal quarter beginning after June 15, 2010. The Company
      does not expect the adoption of this ASU to have a material impact on the
      Company's consolidated financial statements.

                                       9
<PAGE>

      Reclassifications

      Certain reclassifications have been made in prior years' financial
      statements to conform to classifications used in the current year.

Note 3 - DEPOSIT FOR LAND USE RIGHT

      The company has deposited amounts with the local government, for land use
      rights amounting $17,935,879 and $17,580,099 (RMB 120,000,000) as of
      September 30, 2010 and December 31, 2009, for obtaining land use rights in
      PRC. The Company intends to utilize the land for the development of new
      project. To obtain the land use rights from the Government, the Company is
      required to pay the demolish fee associated with the obtaining of the land
      use rights amounting $22,419,849 (RMB 150,000,000). As of September 30,
      2010, the demolish fee was not deposited with the government, therefore,
      the official title of land use right has not been transferred to the
      Company. The deposit for land use rights was guaranteed by the asset of
      the shareholder company.

Note 4 - PROPERTY AND EQUIPMENT

      As of September 30, 2010 and December 31, 2009, the property and equipment
      of the Company consisted of the following:


                                            9/30/2010       12/31/2009
                                       --------------------------------
         Buildings                       $   7,376,631    $  7,216,389
         Infrastructure and
         Leasehold Improvement               1,820,529       1,784,416

         Furniture and fixtures              1,571,063       1,655,996

         Equipments                          1,706,731       1,971,673

         Automobiles                           319,860         313,516
                                       --------------------------------

                                            12,794,814      12,941,990

         Accumulated Depreciation          (6,860,760)     (6,815,911)
                                       --------------------------------
         Property and Equipment, Net
                                             5,934,054       6,126,079
                                       ================================


      The Company had depreciation expenses of $334,249 and $515,288 for the
      nine month periods ended September 30, 2010 and 2009 respectively. Parts
      of depreciation expenses amounted of $177,668 in nine month periods ended
      September 30, 2010 have been presented as cost of sales.

Note 5 - LAND USE RIGHT

      According to the laws of China, the State owns all the land in China.
      Companies or individuals are authorized to possess and use the land only
      through land use rights granted by the Chinese government. Land use rights
      are being amortized using the straight-line method over the lease term of
      40 to 68 years.

      As of September 30, 2010 and December 31, 2009, the land use rights of the
      Company consisted of the following:

                                              9/30/2010    12/31/2009

                  Land use rights            $3,409,048    $3,341,425
                                             ----------    ----------
                  Accumulated amortization     (904,161)     (837,886)
                                             ----------    ----------
                  Land use rights, net       $2,504,887    $2,503,539
                                             ----------    ----------

                                       10
<PAGE>

      The Company had amortization expenses of $48,481 and $45,093 as of
      September 30, 2010 and 2009. The amortization expenses for land use right
      for next five years after September 30, 2010 are as follows:

                       2010                $    16,160
                       2011                     64,641
                       2012                     64,641
                       2013                     64,641
                       2014                     64,641
                       After                 2,230,163
                                           -----------
                         Total             $ 2,504,887
                                           ===========


Note 6 - ACCOUNTS PAYABLE AND ACCRUED EXPENSES

     The Company's accounts payable and accrued expenses as of September 30,
     2010 and December 31, 2009 are summarized as follows:


                                                9/30/2010      12/31/2009
                                               ----------      ----------
            Accounts payables                  $  174,144       $ 274,171
            Other payables                        371,572         364,752
            Accrued payroll                        41,828          40,998
            Accrued expenses                       73,640          64,841
            Total accounts payables and
              accrued expenses                    661,184       $ 744,762



Note 7 - DEFERRED REVENUE

      The company has recorded deferred revenue of $243,564 and $188,273 as of
      September 30, 2010 and December 31, 2009. Deferred revenue represents
      advances from customers for using the resort facilities within the next
      twelve month period.

Note 8- TAX PAYABLES

     As of September 30, 2010 and December 31, 2009, tax payables are summarized
     as follows:


                                            9/30/2010      12/31/2009
                                          -----------     -----------

      Income tax payable                  $ 6,062,504     $ 5,286,176
      Business tax payable                  1,271,193       1,101,154
      VAT payable                                  42              42
      Other taxes payable                     136,912         130,171
      Tax payable                         $ 7,470,651     $ 6,517,543

Note 9 - INCOME TAXES

      The Company is registered in the State of Nevada and has registered
      primarily in two tax jurisdictions - the PRC and the United States. For
      certain operations in US and China, the Company has incurred net
      accumulated operating losses for income tax purposes The Company believes
      that it is more likely than not that these net accumulated operating
      losses will not be utilized in the future. Therefore, the Company has
      provided full valuation allowance for the deferred tax assets arising from
      the losses at these locations as of September 30, 2010. Accordingly, the
      Company has no net deferred tax assets.

                                       11
<PAGE>

      The provision for income taxes consists of the following for the nine
      month periods ended September 30, 2010 and 2009:


         US Current Income Tax
         Expense (Benefit)                 2010        2009
         ----------------------------------------------------
         Federal                       $       -    $       -
         State                                 -            -
                                               -            -
         PRC Current Income              657,994      591,984
         Expense (Benefit)

         Total Provision for
         Income Tax                    $ 657,994    $ 591,984


      The following is a reconciliation of the provision for income taxes at the
      U.S. federal income tax rate to the income taxes reflected in the
      Statement of Operations:

                                                 9-30-2010    9-30-2009
                                                 ---------    ---------
            Tax expense (credit) at
               statutory rate - federal             34%          34%
            State tax expense net of federal
               tax                                   6%           6%
            Valuation allowance                    (40%)        (40%)
            Foreign income tax - PRC                25%          25%
            Tax expense (benefit) at actual
               rate                                 25%          25%


      United States of America
      ------------------------

      As of September 30, 2010, the Company in the United States had
      approximately $1,298,542 in net operating loss carry forwards available to
      offset future taxable income. Federal net operating losses can generally
      be carried forward 20 years. The deferred tax assets for the United States
      entities at September 30, 2010 consists mainly of net operating loss carry
      forwards and were fully reserved as the management believes it is more
      likely than not that these assets will not be realized in the future.

      The following table sets forth the significant components of the net
      deferred tax assets for operation in the US as of September 30, 2010 and
      December 31, 2009.


                                               6/30/2010   12/31/2009
                                              ----------   ----------
               Net operation loss carry
                  forward                     $1,298,542   $1,205,880
               Total deferred tax assets         441,504      409,999
               Less: valuation allowance        (441,504)    (409,999)
               Net deferred tax assets        $        -   $        -


      People's Republic of China (PRC)

      Pursuant to the PRC Income Tax Laws, the Enterprise Income Tax ("EIT") is
      at a statutory rate of 33%, which is comprises of 30% national income tax
      and 3% local income tax. Beginning January 1, 2008, the new Enterprise
      Income Tax ("EIT") law has replaced the existing laws for Domestic
      Enterprises ("DES") and Foreign Invested Enterprises ("FIEs"). The new
      standard EIT rate of 25% replaced the 33% rate currently applicable to
      both DES and FIEs. The two years tax exemption, three years 50% tax
      reduction tax holiday for production-oriented FIEs has continued until the
      tax exemption period expires. The applicable new EIT for the Company is
      25%. The Company paid $0 of income tax payable as of September 30, 2010
      and 2009.

                                       12
<PAGE>

      Deferred income tax assets

      Deferred income taxes are determined using the liability method for the
      temporary differences between the financial reporting basis and income tax
      basis of the Company's assets and liabilities. Deferred income taxes are
      measured based on the tax rates expected to be in effect when the
      temporary differences are included in the Company's tax return. Deferred
      tax assets and liabilities are recognized based on anticipated future tax
      consequences attributable to differences between financial statement
      carrying amounts of assets and liabilities and their respective tax bases.
      The Company's deferred tax assets represent deductible temporary
      differences arising mainly from the other payables.


      The Company did not have any significant deferred income tax in PRC as of
      September 30, 2010 and December 31, 2009.



Note 10 - MANAGEMENT FEE AGREEMENTS

      The Company entered into five management agreements with Shanxi New
      Taohuayuan Economy Trade Company Limited and Shanxi Wenhao Group and its
      subsidiary on various time for a period of five years. Shanxi New
      Taohuayuan Economy Trade Company Limited and Shanxi Wenhao Group and its
      subsidiary are related parties. The annual management fees are fixed at
      approximately $2,027,623 (RMB13,800,000). For the nine month periods ended
      September 30, 2010 and 2009, the Company earned $1,520,717 and $1,514,944
      in management fees, respectively. There is a bonus management fee clause
      contained in the agreement calculated at 15% on the excess of the actual
      revenue over targeted revenue, as defined therein. No bonus management
      fees have been earned to date (See Note 12 for details).

Note 11 -RELATED PARTIES TRANSACTIONS

      The Company has identified the following related parties:

      Dongjin Taoyuan Co., Limited - a stockholder of the Company in which the
      CEO has control and a beneficial interest.

      Shanxi Wenhao Zaliang Shifu Co., Limited ("Wenhao Group") - a stockholder
      of the Company in which the CEO has control and a financial interest.

      Shanxi Xianyong Luye Developing Co., Limited - a stockholder of the
      Company in which the CEO has control and a beneficial interest.

      The Company as of September 30, 2010 had receivable $131,383 from Shanxi
      NTHY - Dongjing Taoyuan Co. Ltd. $385,702 from the Wenhao Group, $51,453
      from StateplaceShanxi Xianyong Luye Developing Co., Ltd. These receivables
      are unsecured, interest-free and have no fixed repayment terms. The
      Company has classified these receivables as due from related parties under
      current assets.

      The Company as of December 31, 2009 had receivable $169,321 from Shanxi
      NTHY - Dongjing Taoyuan Co. Ltd. $380,886 from the Wenhao Group, $20,760
      from StateplaceShanxi Xianyong Luye Developing Co., Ltd. These receivables
      are unsecured, interest-free and have no fixed repayment terms. The
      Company has classified these receivables as due from related parties under
      current assets.

      The Company as of September 30, 2010 has related parties' payable of
      $122,896 and company doesn't have related parties' payables as of December
      31, 2009.

                                       13
<PAGE>

Note 12 -- COMMITMENTS

      Following are some of the significant commitments as of September 30, 2010
and 2009:

      1.  Management Agreements with Shanxi New Taohuayuan Tourism & Trading Co.
          Ltd. - Dongjin Taoyuan Branch and Shanxi Wenhao Taoyuan Nanlu Branch

      On January 15, 2004 the Company signed two five-year agreements with
      Shanxi New Taohuayuan Tourism & Trading Co. Ltd - Dongjin Taoyuan Branch
      and Xi'an Taoyuan Nanlu Branch to manage the restaurants. The company will
      perform management and operation function including advertising,
      marketing, human resources and accounting on monthly basis. The Company
      will receive RMB 3,500,000 from each of the restaurant respectively as
      basic annual management fees, paid quarterly. In addition, if the annual
      revenue exceeds the targeted amount, the company will be compensated for
      additional 15% of the revenue as bonus. The agreements expired on Jan 14,
      2009. The company extended the agreements for 5 years and the new
      agreements will expire on Jan. 9, 2014. For the nine month periods ended
      September 30, 2010, the management fees earned amounting to $385,689 and
      $385,689 respectively based upon the agreements.

      2.  Management Agreements with Shanxi Wenhao Zaliang Co. Ltd - Xi'an
          Nanerhuan Branch, Yuantaizu Branch and Beijing Branch

      On January 10, 2006 the Company signed three five-year agreements with
      Shanxi Wenhao Zaliang Co. Ltd - Xi'an Nanerhuan Branch, Yuantaizu Branch
      and Beijing Branch respectively to manage the restaurants. The company
      will perform management and operation function including advertising,
      marketing, human resources and accounting on monthly basis. The Company
      will receive RMB 3,600,000, RMB 1,800,000 and RMB 1,400,000 from each of
      these restaurants respectively as basic annual management compensation,
      paid quarterly. In addition, if the annual revenue exceeds the targeted
      amount, the company will be compensated for additional 15% of the revenue
      as bonus. The agreements will expire on January 9, 2011. For the nine
      month periods ended September 30, 2010, the management fees earned
      amounting $396,709, $198,354 and $154,276 respectively based upon the
      agreements.

      3.  New Taohuayuan Decoration Project agreements with Shanxi Traditional
          Decoration Co., Ltd.

      On Mar. 15, 2006, the company signed a decoration agreement with Shanxi
      Traditional Decoration Co. Ltd for company's Decoration Project. The
      company hired the Shanxi Traditional Decoration Co. Ltd., to do decoration
      work on its property with the commitment to pay RMB 80,000,000 as total
      compensation. The company will pay 30% of the amount at the beginning of
      the construction, 30% will be paid on 50% completion and 40% after the
      project is completed. The company is also responsible for appointing the
      third party as supervisor to monitor the project and to protect the
      surrounding environment. The project started on April 1st, 2006 and will
      be finished in June 2012. The project was delayed because of public
      facility construction. As of September 30, 2010, the Company has paid
      $3,564,756 to the said contractor included in construction in progress.

      4. PlaceNameplaceLantian PlaceNameXintianyou PlaceTypeGarden Green Project
         Agreement with Shanxi Qinghua Green Project Co.,Ltd.

      On May 15, 2007, the company signed an agreement with Shanxi Qinghua Green
      Co. Ltd for the afforesting project of Lantian Xintianyou Garden Green.
      The company hired Shanxi Oinghua Green Project Co. Ltd., to perform
      afforesting work on the garden with the commitment to pay RMB 100,000,000
      as total compensation. The company will pay 30% of the amount at the
      inception of the construction, 35% will be paid on 50% completion and 30%
      after the project completes. The final 5% will be held as project quality
      insurance deposit. After the project completed, Shanxi Qinghua Green
      Co.,Ltd will be responsible for the maintenance of the garden and the
      company will pay RMB 1,250,000 as annual compensation for services. The
      project started on Oct. 6, 2007 and will be finished in June 2012. The
      project was delayed because of public facility construction. As of
      September 30, 2010, the Company has paid $17,649,428 to the said
      contractor included in construction in progress.

                                       14
<PAGE>

      5. Lantian Xintianyou Garden Project

      The Company entered an agreement with Lantian County, Xian City, Shanxi
      Province to offer a new project's development - Lantian Xingtianyou
      Project in 2003. The Company acquired a land (4512 Mu) in Lantian County
      and committed to finish the project in one year. The project has been
      started since 2004. However, the Company paid amount of $17,935,879 (RMB
      120,000,000) as land cost in 2006 but the title is not yet transferred to
      the Company without paying the demolish fee associated with the project
      (See note C for details).


Note 13- STATUTORY RESERVE AND STATUTORY COMMON WELFARE FUND

      As stipulated by the Company Law of the People's Republic of China (PRC),
      net income after taxation can only be distributed as dividends after
      appropriation has been made for the following:


i.       Making up cumulative prior years' losses, if any;

ii.      Allocations to the "Statutory surplus reserve" of at least 10% of
         income after tax, as determined under PRC accounting rules and
         regulations, until the fund amounts to 50% of the Company's registered
         capital;

iii.     Allocations of 5-10% of income after tax, as determined under PRC
         accounting rules and regulations, to the Company's "Statutory common
         welfare fund", which is established for the purpose of providing
         employee facilities and other collective benefits to the Company's
         employees; and

iv.      Allocations to the discretionary surplus reserve, if approved in the
         stockholders' general meeting.

      In accordance with the Chinese Company Law, the company reserved $197,398
      and $177,595 statutory fund for the nine month periods ended September 30,
      2010 and 2009 respectively.

      According to the new Company Law of the People's Republic of China (PRC)
      executed in 2006, the Company is no more required to reserve the
      "Statutory common welfare fund". Accordingly, the Company did not reserve
      the common welfare fund as of September 30, 2010.

Note 14 - STOCKHOLDERS' EQUITY

      In January 2007, the Company entered into an agreement with outside third
      party to provide consulting services. As part of agreement the Company
      agreed to issue 1,699,999 shares of common stock at discount at $0.05 per
      share or $85,000 for cash. The consulting company will provide consulting
      service to the Company during the six month periods starting January 2007.
      The fair market value of the common stocks of the company was $0.55 on the
      agreement date. Accordingly the Company booked $85,000 as compensation
      expense after accounting for the shares issued at discount price of $0.05
      for the said stock issuance as of December 31, 2007.

      Since the consulting company did not provide the services to the company's
      satisfaction, on February 28, 2008, the Company's directors adopted a
      resolution authorizing the repurchase of these shares at a price of $0.05
      per share. As of September 30, 2010, the consulting company has not sold
      any of these shares to the Company.

                                       15
<PAGE>

Note 15 - OTHER COMPREHENSIVE INCOME

      Balances of related after-tax components comprising accumulated other
      comprehensive income (loss), included in stockholders' equity, as of
      September 30, 2010 and December 31, 2009 are as follows:


                                            Foreign Currency Translation
                                                    Adjustment
                                            ----------------------------
         Balance at  December  31, 2009           $  5,481,382
         Change in 2010                                785,853
         Balance at September  30, 2010           $  6,267,235


Note 16- SEGMENT REPORTING

      The Company had two principal operating segments which were: resort income
      and management fee income. These operating segments were determined based
      on the nature of the services provided. Operating segments are defined as
      components of an enterprise about which separate financial information is
      available that is evaluated regularly by the chief operating
      decision-maker in deciding how to allocate resources and in assessing
      performance. The Company's chief executive officer and chief financial
      officer have been identified as the chief operating decision makers. The
      Company's chief operating decision makers direct the allocation of
      resources to operating segments based on the profitability, cash flows,
      and other measurement factors of each respective segment.

      The Company evaluates performance based on several factors, of which the
      primary financial measure is business segment income before taxes. The
      segments' accounting policies are the same as those described in the
      summary of significant accounting policies. The following table shows the
      operations of the Company's reportable segments:


                                           For the nine month periods ended
                                                    September 30,
                                               2010              2009
                                             -----------      -----------
Revenues
      Resort income from unaffiliated
        customers                            $ 3,518,673      $ 3,570,610
      Management fee income from
        affiliated customers                   1,520,728        1,514,944
                                             -----------      -----------
             Consolidated                    $ 5,039,401      $ 5,085,554

                                             ===========      ===========

Operating income
      Resort income                          $ 1,215,824      $   953,824
      Management fee income                    1,520,728        1,514,944
      Corporation (1)                            (92,663)        (111,995)
                                             -----------      -----------
             Consolidated                    $ 2,643,889      $ 2,356,773
                                             ===========      ===========

Net income (loss)
      Resort income                          $   545,916      $   751,738
      Management fee income                    1,520,728        1,136,208
      Corporation (1)                            (92,663)        (111,995)
                                             -----------      -----------
             Consolidated                    $ 1,973,981      $ 1,775,950
                                             ===========      ===========

                                       16
<PAGE>

Identifiable assets:
      Resort income                          $27,192,047      $26,723,694
      Corporation (1)                         21,214,184       16,424,218
                                             -----------      -----------
             Consolidated                    $48,406,231      $43,147,912
                                             ===========      ===========
Depreciation and amortization:
      Resort income                          $   382,730      $   560,381
                                             ===========      ===========
Capital expenditures:
      Resort income                          $    47,323      $         -
      Corporation (1)                          3,232,391        3,294,088
                                             -----------      -----------
              Consolidated                   $ 3,279,714      $ 3,294,088
                                             ===========      ===========


(1) Unallocated income (loss) from Operating income (loss) and Net income (loss)
   before taxes are primarily related to general corporate expenses and capital
   expenditure for new project.

                                       17
<PAGE>

Item 2.  Management's Discussion and Analysis of Financial Condition and
         Results of Operation

      You should read the following discussion and analysis of our financial
condition and results of operations in conjunction with our financial statements
and the related notes included elsewhere in this report. Our financial
statements have been prepared in accordance with U.S. GAAP. In addition, our
financial statements and the financial data included in this report reflect our
reorganization and have been prepared as if our current corporate structure had
been in place throughout the relevant periods. The following discussion and
analysis contains forward-looking statements that involve risks and
uncertainties. Actual results could differ materially from those projected in
the forward-looking statements.

                                    Overview

      We own and operate the Taohuayuan Inn hotel and resort located in the city
of Xi'an, province of Shaanxi, in the PRC. The Taohuayuan Inn has 23 courtyards
with 146 rooms and 292 beds.

      We manage the DongJin Taoyuan Villas, a hotel and resort property
approximately 10 miles from downtown Xi'an. DongJin Taoyuan Villas has 84 rooms
and 168 beds. This property closed for major remodeling in 2006 and reopened in
September 2009.

      We also manage a chain of four traditional Chinese restaurants. Two of the
restaurants are in Xi'an, and one is in Beijing.

      We receive fees for managing the DongJin Taoyuan Villas and the three
restaurants.

      Room rates in the Shaanxi province are established by the Shaanxi Price
Bureau. Room rates are established for each hotel or resort in the Shaanxi
Province and are based upon a number of factors, including the quality of the
property and amenities offered. Room rates may be changed at any time by the
Shaanxi Price Bureau based upon economic conditions in China.

      Our business is not seasonal in nature.

Results of Operations

Three Months Ended September 30, 2010

      Material changes of items in our Statement of Operations for the three
months ended September 30, 2010, as compared to the three months ended September
30, 2009, are discussed below:

                                       18
<PAGE>

                           Increase (I)
Item                      or Decrease (D)   Reason
----                      --------------    ------
Gross profit as a % of
   Total net revenue            D          Increase in cost of revenue.

General and Administrative
  Expenses                      I          Increase in fuel costs.

Foreign Currency
  Translation Gain (loss)       I          Change in currency exchange rates.

Nine Months Ended September 30, 2010

      Material changes of items in our Statement of Operations for the nine
months ended September 30, 2010, as compared to the nine months ended September
30, 2009, are discussed below:

                             Increase (I)
Item                        or Decrease (D)  Reason
----                        --------------   ------
Gross profit as a % of
   Total net revenue            I          Reduction in cost of revenue.

General and Administrative
  Expenses                      D          Reduction in fuel costs.

Foreign Currency
   Translation Gain (loss)      I          Change in currency exchange rates.


Liquidity and Capital Resources

     Our  material  sources  and  (uses) of cash  during the nine  months  ended
September  30, 2010 are shown in our  Statement  of Cash Flows which are part of
the financial statements included with this report.

      We have financed our operations to date through the sale of our common
stock and cash generated by our operations.

      We do not know of any trends, events or uncertainties that have, or are
reasonably likely to have, a material impact on our short-term or long-term
liquidity other than our need to pay the taxes and surcharges which we have
accrued as liabilities on our September 30, 2010 balance sheet.

                                       19
<PAGE>

Restrictions on currency exchange

     Substantially  all of our  projected  revenues and  operating  expenses are
denominated in Renminbi.  The Renminbi is currently freely convertible under the
"current account",  which includes dividends,  trade and service-related foreign
exchange  transactions,  but not under the  "capital  account",  which  includes
foreign direct investment and loans.

     We may  purchase  foreign  exchange  for  settlement  of  "current  account
transactions",  including payment of dividends to our shareholders,  without the
approval of the State  Administration  for Foreign Exchange.  We may also retain
foreign  exchange in our current  account,  subject to a ceiling approved by the
State   Administration  for  Foreign  Exchange,   to  satisfy  foreign  exchange
liabilities or to pay dividends.  However, the Chinese government may change its
laws or  regulations  and limit or eliminate  our ability to purchase and retain
foreign currencies in the future.

     Since a significant  amount of our future  revenues will be  denominated in
Renminbi,  the existing  and any future  restrictions  on currency  exchange may
limit our ability to utilize revenues generated in Renminbi to fund any business
activities outside China or fund expenditures denominated in foreign currencies.

     Exchange rate  fluctuations may adversely affect our financial  performance
because of our foreign  currency  denominated  assets and  liabilities,  and may
reduce the value,  translated or converted,  as applicable into U.S. dollars, of
our net fixed assets, our earnings and our declared dividends.  We do not engage
in any  hedging  activities  in order to minimize  the effect of  exchange  rate
risks.

Reserves

     In  accordance  with  current  Chinese  laws,  regulations  and  accounting
standards, we are required to set aside as a general reserve at least 10% of our
respective  after-tax  profits.  Appropriations  to the reserve  account are not
required after these reserves have reached 50% of our registered capital.  These
reserves  are  created  to  fund   potential   operating   losses  and  are  not
distributable as cash dividends. We are also required to set aside between 5% to
10% of our  after-tax  profits  to the  statutory  public  welfare  reserve.  In
addition and at the discretion of our  directors,  we may set aside a portion of
our after-tax  profits for enterprise  expansion funds,  staff welfare and bonus
funds and a surplus reserve. These statutory reserves and funds can only be used
for specific purposes and may not be used for dividends.

Critical Accounting Policies and Estimates

     We  prepare  financial  statements  in  conformity  with U.S.  GAAP,  which
requires us to make estimates and assumptions  that affect the reported  amounts
of assets and  liabilities,  disclosure of contingent  assets and liabilities on
the date of the financial  statements,  and the reported  amounts of revenue and
expenses during the financial  reporting period.  We continually  evaluate these

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estimates and assumptions based on the most recently available information,  our
own historical  experience and various other assumptions that are believed to be
reasonable  under the  circumstances,  the  results  of which form the basis for
making  judgments about the carrying  values of assets and liabilities  that are
not  readily  apparent  from other  sources.  Since the use of  estimates  is an
integral  component of the financial  reporting  process,  actual  results could
differ from those  estimates.  Some of our  accounting  policies  require higher
degrees of judgment than others in their  application.  We consider the policies
discussed below to be critical to an understanding  of our financial  statements
as their application assists management in making their business decisions

Revenue recognition

     We generally  recognize  service  revenues when  persuasive  evidence of an
arrangement exists, services are rendered, the fee is fixed or determinable, and
collectibility is probable. Service revenues are recognized net of discounts.

Foreign currency translation

     We consider Renminbi as our functional currency as a substantial portion of
our business  activities are based in Renminbi ("RMB").  However, we have chosen
the United States dollar as our reporting currency.

     Transactions  in currencies  other than the functional  currency during the
year are  translated  into the functional  currency at the  applicable  rates of
exchange  prevailing  at the  time  of the  transactions.  Monetary  assets  and
liabilities  denominated in currencies  other than the  functional  currency are
translated into the functional  currency at the applicable  rates of exchange in
effect at the balance sheet date.  Exchange gains and losses are recorded in the
statements of operations.

For translation of financial statements into the reporting currency,  assets and
liabilities  are  translated  at the  exchange  rate at the balance  sheet date,
equity  accounts are  translated at  historical  exchange  rates,  and revenues,
expenses,  gains and losses are  translated  at the  weighted  average  rates of
exchange prevailing during the period.  Translation  adjustments  resulting from
this process are  recorded in  accumulated  other  comprehensive  income  (loss)
within stockholders' equity.

Property, plant and equipment and depreciation

     Property,   plant  and  equipment  are  stated  at  cost  less  accumulated
depreciation.

     The  cost of an asset  consists  of its  purchase  price  and any  directly
attributable  costs of bringing the asset to its present  working  condition and
location for its intended use.  Expenditures incurred after the assets have been
put into operation, such as repairs and maintenance,  are normally recognized as
an expense in the period in which they are incurred.  In situations where it can
be clearly  demonstrated  that  expenditure  has  resulted in an increase in the
future economic benefits expected to be obtained from the use of the assets, the
expenditure is capitalized.

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     When assets are sold or retired,  their costs and accumulated  depreciation
are  eliminated  from the  accounts  and any gain or loss  resulting  from their
disposal is included in the statement of operations.

     Depreciation  is  calculated  to write off the cost of property,  plant and
equipment over their estimated  useful lives as set out below,  from the date on
which  they  become  fully  operational  and after  taking  into  account  their
estimated residual values, using the straight-line method.

Item 4.     Controls and Procedures

     Our  Principal   Executive   and   Financial   Officer  has  evaluated  the
effectiveness  of our  disclosure  controls and  procedures  (as defined in Rule
13a-15(e)  of the  Securities  Exchange Act of 1934) as of the end of the period
covered  by  this  report,  and in  her  opinion  our  disclosure  controls  and
procedures are effective.

     There were no changes in our internal  controls  over  financial  reporting
that  occurred  during the fiscal  quarter  ended  September  30, 2010 that have
materially affected, or are reasonably likely to materially affect, our internal
control over financial reporting as discussed above.



                                     PART II
Item 6.  Exhibits

Exhibits

  31.1  Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

  31.2  Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

  32    Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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                                   SIGNATURES


      Pursuant to 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.


                                      NEW TAOHUAYUAN CULTURE TOURISM CO., LTD.


November 15, 2010                    By:  /s/ Cai Danmei
                                          ------------------------------------
                                          Cai Danmei, Principal Executive,
                                              Financial and Accounting Officer
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