SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C. 20549
                          ----------------------

                               FORM 10-QSB


    [X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934

    For the quarterly period ended December 31, 2003

                         OR

    [ ]  Transition Report Pursuant to Section 13 or 15(d) of the Exchange Act

    For the transition period from _______ to ________


    Commission File Number 0-4057

                              PORTSMOUTH SQUARE, INC.
                              -----------------------
        (Exact Name of Small Business Issuer as Specified in its Charter)

           California                               94-1674111
           ----------                               ----------
   (State or Other Jurisdiction of                 (IRS Employer
    Incorporation or Organization)                Identification No.)


           820 Moraga Drive
           Los Angeles, CA                               90049
---------------------------------------               ----------
(Address of Principal Executive Offices)              (Zip Code)

                                  (310) 889-2500
                                  --------------
                (Registrant's Telephone Number, Including Area Code)

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

   State the number of shares outstanding of each of the issuer's classes of
Common equity, as of the latest practicable date: 734,183 shares of issuer's No
Par Value Common Stock were outstanding as of February 12, 2004.

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

<PAGE>




                                     INDEX

                             PORTSMOUTH SQUARE, INC.


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

  Balance Sheet - December 31, 2003 (Unaudited)                         3

  Statements of Operations (Unaudited)- Three Months ended              4
    December 31, 2003 and December 31, 2002

  Statements of Operations (Unaudited)- Six Months ended                5
    December 31, 2003 and December 31, 2002

  Statements of Cash Flows (Unaudited)- Six Months ended
    December 31, 2003 and December 31, 2002                             6

  Notes to Financial Statements                                         7

Item 2. Management's Discussion and Analysis of Financial
        Condition and Results of Operations                            12

Item 3. Controls and Procedures                                        18


PART II. OTHER INFORMATION

Item 6. Exhibits and Reports on Form 8-K                               19

SIGNATURES                                                             19


                                     -2-
<PAGE>




                         PART 1 - FINANCIAL INFORMATION

Item 1 - Financial Statements

                             PORTSMOUTH SQUARE, INC.
                                 BALANCE SHEET
                                  (Unaudited)
As of December 31,                                           2003
                                                          ----------

Assets

  Cash and cash equivalents                              $   136,517
  Investment in marketable securities                     22,837,053
  Investment in Justice Investors                          1,012,138
  Other investments                                          200,000
  Deferred income tax asset                                  264,740
  Other assets                                               128,881
                                                          ----------
Total assets                                             $24,579,329
                                                          ==========

Liabilities and Shareholders' Equity

Liabilities
  Due to securities broker                                 6,509,523
  Obligations for securities sold                          9,537,521
  Accounts payable and other liabilities                     356,137
                                                          ----------
Total liabilities                                         16,403,181
                                                          ----------
Commitments and contingencies

Shareholders' equity:
  Common stock, no par value:
    Authorized shares - 750,000
    Issued and outstanding shares - 734,183                2,092,300
  Additional paid-in capital                                 915,676
  Retained earnings                                        5,168,172
                                                          ----------

Total shareholders' equity                                 8,176,148
                                                          ----------

Total liabilities and shareholders' equity               $24,579,329
                                                          ==========


See accompanying notes to financial statements.


                                     -3-
<PAGE>


                            PORTSMOUTH SQUARE, INC.
                           STATEMENTS OF OPERATIONS
                                  (Unaudited)


For the three months ended December 31,               2003           2002
                                                  ----------     ----------
  Equity in net income of Justice
   Investors                                      $  297,146     $  371,444

  General and administrative expenses               (113,391)      (128,122)
                                                  ----------     ----------
                                                     183,755        243,322
Non-operating income (expenses):
  Net gains (losses) on marketable securities      1,256,030        265,944
  Dividend and interest income                        55,084         16,991
  Margin interest and trading expenses              (257,441)       (23,036)
  Other income, net                                    7,638          7,458
                                                  ----------     ----------
                                                   1,061,311        267,357
                                                  ----------     ----------

Income before income taxes                         1,245,066        510,679

Provision for income tax expense                    (498,027)      (208,009)
                                                  ----------     ----------
Net income                                       $   747,039    $   302,670
                                                  ==========     ==========

Basic income per share                           $      1.02    $      0.41
                                                  ==========     ==========

Weighted average number of
  shares outstanding                                 734,183        734,183
                                                  ==========     ==========


See accompanying notes to financial statements.


                                     -4-
<PAGE>





                            PORTSMOUTH SQUARE, INC.
                           STATEMENTS OF OPERATIONS
                                  (Unaudited)


For the six months ended December 31,                2003           2002
                                                  ----------     ----------
  Equity in net income of Justice
   Investors                                      $  568,518     $  870,731

  General and administrative expenses               (223,474)      (240,840)
                                                  ----------     ----------
                                                     345,044        629,891
Non-operating income (expenses):
  Net gains (losses) on marketable securities      1,661,483       (451,521)
  Dividend and interest income                       106,958         43,031
  Margin interest and trading expenses              (319,591)       (39,495)
  Other income, net                                   13,243         22,679
                                                  ----------     ----------
                                                   1,462,093       (425,306)
                                                  ----------     ----------

Income before income taxes                         1,807,137        204,585

Provision for income tax expense                    (722,855)       (83,000)
                                                  ----------     ----------
Net income                                       $ 1,084,282    $   121,585
                                                  ==========     ==========

Basic income per share                           $      1.48    $      0.17
                                                  ==========     ==========

Weighted average number of
  shares outstanding                                 734,183        734,183
                                                  ==========     ==========



See accompanying notes to financial statements.


                                     -5-
<PAGE>






                            PORTSMOUTH SQUARE, INC.
                           STATEMENTS OF CASH FLOWS
                                 (Unaudited)


For the six months ended December 31,                2003           2002
                                                  ----------     ----------
Cash flows from operating activities:
  Net income                                     $ 1,084,282   $    121,585
  Adjustments to reconcile net income
   to net cash used in operating activities:
    Equity in net income of Justice Investors       (568,518)      (870,731)
    Net unrealized gains on
     marketable securities                          (960,381)      (777,088)
    Changes in assets and liabilities:
      Investment in marketable securities         (7,083,771)    (2,061,553)
      Deferred income taxes and other assets         565,017       (238,667)
      Accounts payable and other liabilities        (189,630)        12,493
      Due to securities broker                     3,117,742      1,835,095
      Obligations for securities sold              3,779,519        345,688
                                                  ----------     ----------
  Net cash used in operating activities             (255,740)    (1,633,178)
                                                  ----------     ----------

Cash flows from investing activities:
  Cash distributions from Justice Investors          635,846      1,003,968
                                                  ----------     ----------
  Net cash provided by investing activities          635,846      1,003,968
                                                  ----------     ----------

Cash flows from financing activities:
  Dividends paid                                    (367,091)      (183,546)
                                                  ----------     ----------
  Net cash used in financing activities             (367,091)      (183,546)
                                                  ----------     ----------
Net increase (decrease) in cash and
  cash equivalents                                    13,015      (812,756)

Cash and cash equivalents at the beginning
  of the period                                      123,502      1,480,271
                                                  ----------     ----------
Cash and cash equivalents at the end of the
 period                                          $   136,517    $   667,515
                                                  ==========     ==========


See accompanying notes to financial statements.

                                     -6-
<PAGE>




                      PORTSMOUTH SQUARE, INC.

                   NOTES TO FINANCIAL STATEMENTS

1.  Basis of Presentation and Significant Accounting Policies
    ---------------------------------------------------------

The financial statements included herein have been prepared by Portsmouth
Square, Inc. ("Portsmouth" or the "Company"), without audit, according 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, although the
Company believes the disclosures that are made are adequate to make the
information presented not misleading.  Further, the financial statements
reflect, in the opinion of management, all adjustments (which included only
normal recurring adjustments) necessary to state fairly the financial position
and results of operations as of and for the periods indicated.

It is suggested that these financial statements be read in conjunction with the
audited financial statements and the notes therein included in the Company's
Form 10-KSB for the year ended June 30, 2003.

The results of operations for the three and six months ended December 31, 2003
are not necessarily indicative of results to be expected for the full fiscal
year ending June 30, 2004.


2.  Investment in Justice Investors
    -------------------------------

The Company's principal source of revenue is derived from its 49.8% interest in
Justice Investors, a California limited partnership ("Justice Investors" or
"the partnership"), in which the Company serves as one of the two general
partners.  The other general partner, Evon Garage Corporation ("Evon"), serves
as the managing general partner.  As a general and limited partner, Portsmouth
has significant control over the management and operation of the assets of
Justice Investors.  All significant partnership decisions require the active
participation and approval of both general partners.  The Company and Evon
jointly consult and determine the amount of partnership reserves and the amount
of cash to be distributed to the limited partners.

The partnership derives most of its income from a lease of its San Francisco,
California hotel property to Felcor Lodging Trust, Inc. ("Felcor") and from a
lease of the garage portion of the property to Evon.  As a general partner, the
Company is active in monitoring and overseeing the operations of the hotel and
parking garage.  The Company also derives revenue from management fees for
actively managing the hotel.  The investment in Justice Investors is recorded
on the equity basis.

Pursuant to the terms of the partnership agreement, voting rights of the
partners are determined according to the partners' entitlement to share in the
net profit and loss of the partnership.  The Company is not entitled to any
additional voting rights by virtue of its position as a general partner.
The partnership agreement also provides that no portion of the partnership real
property can be sold without the written consent of the general and limited
partners entitled to more than 72% of the net profit.

                                     -7-
<PAGE>

The compensation agreement for the general partners of Justice Investors
provides that the general partners are entitled to receive compensation equal
to 3% of the annual gross rents of the partnership.  From the first $150,000 of
compensation payable to the general partners, $120,000 is payable to Evon
Garage Corporation and $30,000 is payable to Portsmouth as the other general
partner.  Any compensation in excess of the $150,000 is to be split 50/50
between the general partners.  The partnership makes monthly advances of
$10,000 to Evon and $2,500 to Portsmouth with any balance adjusted at the end
of the year based on annual gross revenues.  For the three months and six
months ended December 31, 2003, the Company received $7,500 and $15,000,
respectively, in management fees from Justice Investors.

The Company amortizes the difference between the cost basis of its investment
in Justice Investors and its share of the net assets allocable to depreciable
assets of Justice Investors over 40 years.

For the Company's investment in Justice, to the extent that projected future
undiscounted cash flows from the operation of the Company's hotel property are
less than the carrying value of the asset, the investment would be considered
permanently impaired and the carrying value of the asset would be reduced to
its fair value.

Condensed financial statements for Justice Investors are as follows:


                            JUSTICE INVESTORS
                         CONDENSED BALANCE SHEET

As of December 31,                                            2003
                                                            ----------
Assets
Total current assets                                       $   170,315
Loan fees and deferred lease costs,
  net of accumulated amortization of $272,362                   38,050
Property, plant and equipment, net of
  accumulated depreciation of $12,951,516                    5,873,328
Construction in progress                                       138,788
Land                                                         1,124,128
                                                            ----------
    Total assets                                           $ 7,344,609
                                                            ==========

Liabilities and partners' capital
Total current liabilities                                  $   399,774
Long term debt                                               3,902,200
Partners' capital                                            3,042,635
                                                            ----------
    Total liabilities and partners' capital                $ 7,344,609
                                                            ==========

                                     -8-
<PAGE>




                                JUSTICE INVESTORS
                        CONDENSED STATEMENTS OF OPERATIONS

For the three months ended December 31,        2003            2002
                                            ----------      ----------
Revenues                                   $ 1,305,260     $   901,594
Costs and expenses                            (712,211)       (155,722)
                                            ----------      ----------
Net income                                 $   593,049     $   745,872
                                            ==========      ==========


For the six months ended December 31,          2003            2002
                                            ----------      ----------
Revenues                                   $ 2,317,141     $ 2,093,067
Costs and expenses                          (1,186,419)       (344,610)
                                            ----------      ----------
Net income                                 $ 1,130,722     $ 1,748,457
                                            ==========      ==========



3.  Investment in Marketable Securities
-----------------------------------

The Company's investment in marketable securities consists primarily of
corporate equities. The Company has also invested in corporate bonds and income
producing securities, which may include interests in real estate based
companies, where financial benefit could inure to its shareholders through
income and/or capital gain.

As part of the investment strategies, the Company may assume short positions
against its long positions in marketable securities.  Short sales are used by
the Company to potentially offset normal market risks undertaken in the course
of its investing activities and/or to provide additional return opportunities.
The Company has no naked short positions.  As of December 31, 2003, the Company
had obligations for securities sold (equities short) of $9,537,521.

Marketable securities are stated at market value as determined by the most
recently traded price of each security at the balance sheet date.  Marketable
securities are classified as trading with net unrealized gains or losses
included in earnings.

Included in the net gains on marketable securities of $1,256,030 for the three
months ended December 31, 2003 are net unrealized gains of $495,670 and net
realized gains of $760,360. Included in the net gains on marketable securities
of $265,944 for the three months ended December 31, 2002 are net unrealized
gains of $419,727 and net realized losses of $153,783.

Included in the net gains on marketable securities of $1,661,483 for the six
months ended December 31, 2003 are net unrealized gains of $960,381 and net
realized gains of $701,102. Included in the net losses on marketable securities
of $451,521 for the six months ended December 31, 2002 are net unrealized gains
of $777,088 and net realized losses of $1,228,609.

                                     -9-
<PAGE>

4.  Segment Information
    --------------------
The Company operates in two reportable segments, the operation of Justice
Investors and the investment of its cash and securities assets. These two
operating segments, as presented in the financial statements, reflect how
management internally reviews each segment's performance.  Management also
makes operational and strategic decisions based on this same information.

Information below represents reporting segments for the three and six months
ended December 31, 2003 and the three and six months ended December 31, 2002.
Operating income from Justice Investors consists of the operations of the hotel
and garage included in the equity in net income of Justice Investors.
Operating income (losses) for investment transactions consist of net investment
gains (losses) and dividend and interest income.

<TABLE>

Three months ended             Justice    Investment
December 31, 2003            Investors  Transactions      Other          Total
                            -----------  ------------   -----------   ------------
<S>                         <C>           <C>           <C>          <C>
Operating income            $   297,146   $ 1,311,114   $         -  $   1,608,260
Operating expenses                    -      (257,441)            -       (257,441)
                            -----------   -----------   -----------   ------------
Net operating income            297,146     1,053,673             -      1,350,819

General and administrative
  expenses                            -             -      (113,391)      (113,391)
Other income                          -             -         7,638          7,638
Income tax expense                    -             -      (498,027)      (498,027)
                            -----------   -----------   -----------   ------------
Net income (loss)           $   297,146   $ 1,053,673   $  (603,780)  $    747,039
                            ===========   ===========   ===========   ============
Total Assets                $ 1,012,138   $23,037,053   $   530,138   $ 24,579,329
                            ===========   ===========   ===========   ============

</TABLE>

<TABLE>

Three months ended            Justice      Investment
December 31, 2002           Investors    Transactions     Other          Total
                            -----------   -----------   -----------   ------------
<S>                         <C>           <C>          <C>           <C>
Operating income            $   371,444   $   282,935  $         -   $     654,379
Operating expenses                    -       (23,036)           -         (23,036)
                            -----------   -----------   -----------   ------------
Net operating income            371,444       259,899            -         631,343

General and administrative
  expenses                            -             -      (128,122)      (128,122)
Other income                          -             -         7,458          7,458
Income tax expense                    -             -      (208,009)      (208,009)
                            -----------   -----------   -----------   ------------
Net income (loss)           $   371,444   $   259,899   $  (328,673)  $    302,670
                            ===========   ===========   ===========   ============
Total Assets                $ 1,352,985   $ 5,377,357   $ 1,972,825   $  8,703,167
                            ===========   ===========   ===========   ============

</TABLE>

                                    -10-
<PAGE>

<TABLE>

Six months ended             Justice    Investment
December 31, 2003            Investors  Transactions      Other          Total
                            -----------  ------------   -----------   ------------
<S>                         <C>           <C>           <C>          <C>
Operating income            $   568,518   $ 1,768,441   $         -  $   2,336,959
Operating expenses                    -      (319,591)            -       (319,591)
                            -----------   -----------   -----------   ------------
Net operating income            568,518     1,448,850             -      2,017,368

General and administrative
  expenses                            -             -      (223,474)      (223,474)
Other income                          -             -        13,243         13,243
Income tax expense                    -             -      (722,855)      (722,855)
                            -----------   -----------   -----------   ------------
Net income(loss)            $   568,518   $ 1,448,850   $  (933,086)  $  1,084,282
                            ===========   ===========   ===========   ============
Total Assets                $ 1,012,138   $23,037,053   $   530,138   $ 24,579,329
                            ===========   ===========   ===========   ============
</TABLE>
<TABLE>

Six months ended               Justice    Investment
December 31, 2002             Investors  Transactions      Other          Total
                            -----------  ------------   -----------   ------------
<S>                         <C>           <C>           <C>           <C>
Operating income(loss)      $   870,731   $  (408,490)  $         -   $    462,241
Operating expenses                    -       (39,495)            -        (39,495)
                            -----------   -----------   -----------   ------------
Net operating
 income(loss)                   870,731      (447,985)            -        422,746

General and administrative
  expenses                            -             -      (240,840)      (240,840)
Other income                          -             -        22,679         22,679
Income tax expense                    -             -       (83,000)       (83,000)
                            -----------   -----------   -----------   ------------
Net income(loss)            $   870,731   $  (447,985)  $  (301,161)  $    121,585
                            ===========   ===========   ===========   ============
Total Assets                $ 1,352,985   $ 5,377,357   $ 1,972,825   $  8,703,167
                            ===========   ===========   ===========   ============

</TABLE>

5.  Related Party Transactions
    --------------------------

Certain shared costs and expenses, primarily administrative salaries, rent and
insurance are allocated among the Company, the Company's parent, Santa Fe
Financial Corporation ("Santa Fe"), and The InterGroup Corporation
("InterGroup"), parent of Santa Fe, based on management's estimate of the pro
rata utilization of resources.  For the three and six months ended December 31,
2003, these expenses were approximately $20,850 and $41,700, respectively.  For
the three and six months ended December 31, 2002, these expenses were
approximately $21,662 and $43,324, respectively.  Four of the Company's
Directors serve as directors of InterGroup and three of the Company's Directors
serve on the Board of Santa Fe.

                                    -11-
<PAGE>

John V. Winfield serves as Chief Executive Officer and Chairman of the Company,
Santa Fe, and InterGroup.  Depending on certain market conditions and various
risk factors, the Chief Executive Officer, his family, Santa Fe and InterGroup
may, at times, invest in the same companies in which the Company invests.  The
Company encourages such investments because it places personal resources of the
Chief Executive Officer and his family members, and the resources of Santa Fe
and InterGroup, at risk in connection with investment decisions made on behalf
of the Company.



Item 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
         AND RESULTS OF OPERATIONS

FORWARD-LOOKING STATEMENTS AND PROJECTIONS

The Company may from time to time make forward-looking statements and
projections concerning future expectations.  When used in this discussion, the
words "estimate," "project," "anticipate" and similar expressions, are intended
to identify forward-looking statements.  Such statements are subject to certain
risks and uncertainties, such as the impact of terrorism and war on the
national and international economies, including tourism and securities markets,
general economic conditions and increased competition in the hotel industry in
the San Francisco area, partnership distributions, securities markets,
litigation and other factors, including natural disasters, and those discussed
below and in the Company's Form 10-KSB for the year ended June 30, 2003, that
could cause actual results to differ materially from those projected.  Readers
are cautioned not to place undue reliance on these forward-looking statements,
which speak only as to the date hereof.  The Company undertakes no obligation
to publicly release the results of any revisions to those forward-looking
statements, which may be made to reflect events or circumstances after the date
hereof or to reflect the occurrence of unanticipated events.


RESULTS OF OPERATIONS

The Company's principal sources of revenue continue to be derived from its
49.8% interest in the Justice Investors limited partnership and income received
from the investment of its cash and securities assets.  The partnership derives
most of its income from a lease of its hotel property to Felcor and from a
lease of the garage portion of the property to Evon.  The Company also derives
revenue from management fees for actively managing the hotel.

Three Months Ended December 31, 2003 Compared to Three Months
Ended December 31, 2002

The Company's had net income of $747,039 for the three months ended December
31, 2003 compared to net income of $302,670 for the three months ended December
31, 2002.  The increase was primarily due to the increase in gains on
marketable securities and the increase in dividend and interest income
partially offset by the decrease in equity in net income of Justice Investors
and the increase in margin interest and trading expenses.

The equity in net income of Justice Investors decreased to $297,146 from
$371,444.  That decrease was primarily attributable to increased partnership
costs in the current quarter for consultants, experts and legal services

                                    -12-
<PAGE>

relating to the partnership's enforcement of the lessee's obligations under the
lease and additional depreciation and interest costs related to the build-out
of the new spa and meeting rooms in the hotel and other capital improvements.

Although partnership revenues increased to approximately $1,305,260 for the
three months ended December 31, 2003 from $901,594 for the three months ended,
December 31, 2002, that increase was primarily attributable to a $296,000
payment by the hotel lessee, in December 2003, for part of the replacement
costs of the sloped window system of the hotel, which amount was recorded as
other income by Justice Investors. Absent that additional nonrecurring payment,
partnership revenues increased about $100,000. Many of the factors identified
in fiscal 2003 continued to significantly impact the hotel operations in fiscal
2004.  Unlike other areas in California, the Bay Area has been especially slow
to recover from the devastating impact that the terrorist attacks of September
11, 2001, had on tourism and the hospitality industry. The continued weakness
in the Bay Area due to the failure of numerous internet and technology
companies, has also resulted in a decrease in business travel and a reduction
by airlines in the number of flights into San Francisco.  The hotel has also
faced more competition from new properties and from higher end properties that
provide greater amenities to its guests, especially for the business traveler.
These properties have also reduced room rates as hotel operators struggle to
obtain occupancy.  Average daily room rates for the three months ended December
31, 2003 increased modestly to approximately $92, compared to $89 for the three
months ended December 31, 2002 and average monthly occupancy rates increased to
approximately 64% compared to 62% during the same three month period of fiscal
2002.  Based on industry reports, management is expecting a slow recovery in
the San Francisco hotel marketplace.

General and administrative expenses decreased to $113,391 for the three months
ended December 31, 2003 from $128,122 for the three months ended December 31,
2002.   The decrease is the result of management's efforts to reduce expenses.

Net gains on marketable securities increased to $1,256,030 for the three months
ended December 31, 2003 from gains of $265,944 for the three months ended
December 31, 2002. For the three months ended December 31, 2003, the Company
had net unrealized gains of $495,670 and net realized gains of $760,360.  For
the three months ended December 31, 2002, the Company had net unrealized gains
of $419,727 and net realized losses of $153,783.  Gains and losses on
marketable securities may fluctuate significantly from period to period in the
future and could have a significant impact on the Company's net income.
However, the amount of gain or loss on marketable securities for any given
period may have no predictive value and variations in amount from period to
period may have no analytical value. For a more detailed description of the
composition of the Company's marketable securities please see the Marketable
Securities section below.

Dividend and interest income increased to $55,084 from $16,991 as a result of
the increased investment in dividend yielding securities.

Margin interest and trading expenses increased to $257,441 from $23,036
primarily due to $181,101 in performance-based compensation earned by the
Company's CEO for his management of the Company's investment portfolio for the
six months ended December 31, 2003.  The remaining increase was due to the
increase in the average daily margin balances which resulted in the increase in
margin interest expense to $56,876 from $1,450.

                                    -13-
<PAGE>

The provision for income tax expense increased to $498,027 from $208,009 due to
the higher income generated in the current quarter.


Six Months Ended December 31, 2003 Compared to Six Months
Ended December 31, 2002

The Company's had net income of $1,084,282 for the six months ended December
31, 2003 compared to a net income of $121,585 for the six months ended December
31, 2002.  The increase was primarily due to the increase in gains on
marketable securities and the increase in dividend and interest income
partially offset by the decrease in equity in net income of Justice Investors
and the increase in margin interest and trading expenses.

The equity in net income of Justice Investors decreased significantly to
$568,518 from $870,731.  That decrease was primarily attributable to increased
partnership costs during the first six months of the current fiscal year for
consultants, experts and legal services relating the physical inspection of the
hotel and the partnership's enforcement of the lessee's obligations under the
lease and additional depreciation and interest costs related to the build-out
of the new spa and meeting rooms in the hotel and other capital improvements.

Although partnership revenues increased to approximately $2,317,141 for the six
months ended December 31, 2003 from $2,093,067 for the six months ended,
December 31, 2002, that increase was attributable to a to a $296,000 payment by
the hotel lessee, in December 2003, for part of the replacement costs of the
sloped window system of the hotel, which amount was recorded as other income by
Justice Investors.  Absent that nonrecurring payment, partnership revenues
would have been down approximately $72,000. Many of the factors identified in
fiscal 2003 continued to significantly impact the hotel operations in fiscal
2004.  Unlike other areas in California, the Bay Area has been especially slow
to recover from the devastating impact that the terrorist attacks of September
11, 2001, had on tourism and the hospitality industry. The continued weakness
in the Bay Area due to the failure of numerous internet and technology
companies, has also resulted in a decrease in business travel and a reduction
by airlines in the number of flights into San Francisco.  The hotel has also
faced more competition from new properties and from higher end properties that
provide greater amenities to its guests, especially for the business traveler.
These properties have also reduced room rates as hotel operators struggle to
obtain occupancy.  Average daily room rates declined slightly to approximately
$91 for the six months ended December 31, 2003 from approximately $92 for the
six months ended December 31, 2002 and average monthly occupancy rates remained
the same at approximately 71%.  Based on industry reports, management is
expecting a slow recovery in the San Francisco hotel marketplace.

Net gains on marketable securities increased to $1,661,483 for the six months
ended December 31, 2003 from losses of $451,521 for the six months ended
December 31, 2002. For the six months ended December 31, 2003, the Company had
net unrealized gains of $960,381 and net realized gains of $701,102.  For the
six months ended December 31, 2002, the Company had net unrealized gains of
$777,088 and net realized losses of $1,228,609.  Gains and losses on marketable
securities may fluctuate significantly from period to period in the future and
could have a significant impact on the Company's net income.  However, the
amount of gain or loss on marketable securities for any given period may have
no predictive value and variations in amount from period to period may have no
analytical value. For a more detailed description of the composition of the
Company's marketable securities please see the Marketable Securities section
below.

                                    -14-
<PAGE>

Dividend and interest income increased to $106,958 from $43,031 as a result of
the increased investment in dividend yielding securities.

Margin interest and trading expenses increased to $319,591 from $39,495
primarily due $181,101 in performance-based compensation earned by Company's
CEO for his management of the Company's investment portfolio for the six months
ended December 31, 2003.  The remaining increase was due to the increase in the
average daily margin balances which resulted in the increase in margin interest
expense to $103,428 from $11,722.

The provision for income tax expense increased to $722,855 from $83,000 due to
the higher income generated the six months ended December 31, 2003.



MARKETABLE SECURITIES

As of December 31, 2003, the Company had investments in marketable equity
securities of $22,837,053.  The following table shows the composition of the
Company's marketable securities portfolio by selected industry groups as of
December 31, 2003.


                                                            % of Total
                                                              Investment
   Industry Group                      Market Value           Securities
   --------------                      ------------           ----------
   Electric, pipelines, oil and gas    $ 6,443,925               28.2%
   Telecommunications and media          3,952,476               17.3%
   Semiconductor, software, internet,
    and computer                         3,292,730               14.4%
   Insurance, banks and brokers          1,922,900                8.4%
   REITs, lodging, home builders
    and hotels                           1,738,600                7.6%
   Airlines and defense                  1,428,505                6.3%
   Pharmaceuticals and medical           1,309,415                5.7%
   Apparel, food and consumer goods      1,059,142                4.6%
   Chemicals, materials, metals,
    and mining                             951,885                4.2%
   Other                                   737,475                3.3%
                                        ----------              ------
                                       $22,837,053              100.0%
                                        ==========              ======


The Company's investment portfolio is diversified with 114 different equity
positions.  Only one individual equity security is more than 5% of the equity
value of the portfolio. That security is 5.1% of the value of the portfolio.
The amount of the Company's investment in any particular issuer may increase or
decrease, and additions or deletions to its securities portfolio may occur, at
any time.  While it is the internal policy of the Company to limit its initial
investment in any single equity to less than 5% of its total portfolio value,
that investment could eventually exceed 5% as a result of equity appreciation
or reduction of other positions.  Marketable securities are stated at market
value as determined by the most recently traded price of each security at the
balance sheet date.

                                    -15-
<PAGE>

LIQUIDITY AND SOURCES OF CAPITAL

The Company's cash flows are primarily generated through its general and
limited partnership interest in the Justice Investors limited partnership,
which derives its income from its lease with Felcor and a lease with Evon. In
addition to its monthly limited partnership distributions from Justice
Investors, the Company also receives monthly management fees as a general
partner.  The Company also derives revenue from the investment of its cash and
securities assets.

Beginning in December 2002, Justice Investors began reducing its monthly
distributions due to the continuing decline in partnership revenues. In August
2003, Justice Investors determined that a further reduction in partnership
distributions was appropriate due to the continuing poor performance of the
hotel operation, costs advanced for the construction of the spa, new meeting
rooms, the relocation of the hotels administrative offices and other
anticipated expenses.  Effective September 2003 through December 2003, monthly
partnership distributions were cut an additional 50% reducing Portsmouth's
monthly distribution amount from $158,961 to $79,480.  As a result, cash
distributions from Justice Investors decreased to $635,846 for the six months
ended December 31, 2003 from $1,003,968 for the six months ended December 31,
2002.  Justice Investors also determined that it would not borrow further
against its line of credit to support partnership distributions.  The general
partners will continue to closely monitor the operating results and partnership
expenses and will make appropriate adjustments to partnership distributions as
required.

In the later part of fiscal 2003, Justice Investors conducted a comprehensive
physical inspection of the hotel as permitted by the terms of the lease. In
July 2003, Justice delivered to the hotel lessee, Felcor Lodging Trust, Inc.
("Felcor") and Holiday Inn a notice citing certain deficiencies in the physical
condition of the hotel property and in its furniture, fixtures and equipment
and requested that those deficiencies be corrected in accordance with the
lessee's obligations under the lease.  The initial term of the hotel lease
expires on December 31, 2004; however, the lessee has the right to renew the
lease for an additional term of five years, which would extend the lease to
December 31, 2009. Under the terms of the lease, the lessee was required to
notify Justice Investors of its intention to exercise the five-year option by
December 31, 2003.  To give the parties the opportunity to amicably resolve the
issues concerning the alleged deficiencies in the condition of the hotel and
other lease obligations, Justice and Felcor agreed to extend the date by which
the lessee must give Justice notice of its intent to renew from December 31,
2003 to a date thirty days from the date that either party receives notice that
the extension of time has been terminated.  At this time, it is not certain
whether Felcor will elect to exercise its option to extend the lease.

Portsmouth does not consider Felcor and Evon, the two significant lessees of
the hotel property, to be a credit risk.  Evon has been the garage lessee since
the property became operational and has never missed a rent payment in over
thirty years of operations. The garage is subleased by Evon to Ampco Parking, a
major parking garage operating company.  Felcor is a public company listed on
the New York Stock Exchange (NYSE: FCH) and is one of the largest real estate
investment trusts in the United States. Portsmouth monitors Felcor's public
filings on a regular basis.  The hotel lease provides for significant minimum

                                    -16-
<PAGE>

annual rent of $2,500,000.  There is no indication that Felcor will not be able
to meet its rental obligations in the future if it elects to remain as lessee
of the hotel.  If the relationship between Felcor and Justice Investors
terminates, the partnership anticipates that it would renovate the hotel
property and seek a third party to manage the hotel under a recognized brand.

The Company has invested in short-term, income-producing instruments and in
equity and debt securities when deemed appropriate.  The Company's marketable
securities are classified as trading with unrealized gains and losses recorded
through the statement of operations.

The recovery of tourism, the hotel industry and general economy in the San
Francisco Bay Area continues to lag behind that of many cities.  The increase
in competition has also added additional challenges to an already difficult
business environment.  Although the Company has suffered a significant decline
in revenues and partnership distributions as a result of those factors,
management believes that the net cash flow generated from future operating
activities and its capital resources will be adequate to meet its current and
future obligations.

The Company has no off balance sheet arrangements.  The Company also does not
have any material contractual obligations or commercial commitments.

IMPACT OF INFLATION

Hotel room rates are typically impacted by supply and demand factors, not
inflation, since rental of a hotel room is usually for a limited number of
nights.  Room rates can be, and usually are, adjusted to account for
inflationary cost increases.  To the extent that the hotel lessee is able to
adjust room rates, there should be minimal impact on partnership revenues due
to inflation.  Partnership revenues are also subject to interest rate risks,
which may be influenced by inflation.  For the two most recent fiscal years,
the impact of inflation on the Company's income is not viewed by management as
material.

CRITICAL ACCOUNTING POLICIES

The Company reviews its long-lived assets and other investments for impairment
when circumstances indicate that a potential loss in carrying value may have
occurred.  For the Company's investment in Justice, to the extent that
projected future undiscounted cash flows from the operation of the Company's
hotel property are less than the carrying value of the asset, the carrying
value of the asset is reduced to its fair value.  For other investments, the
Company reviews the investment's operating results, financial position and
other relevant factors to determine whether the estimated fair value of the
asset is less than the carrying value of the asset.

Marketable securities are stated at market value as determined by the most
recently traded price of each security at the balance sheet date.  Marketable
securities are classified as trading with net unrealized gains or losses
included in earnings.

                                    -17-
<PAGE>

Item 3. Controls and Procedures

(a) Disclosure Controls and Procedures.

The Company's management, with the participation of the Company's Chief
Executive Officer and the Chief Financial Officer, has evaluated the
effectiveness of the Company's disclosure controls and procedures (as defined
in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the
fiscal period covered by this Quarterly Report on Form 10-QSB.  Based upon such
evaluation, the Chief Executive Officer and Chief Financial Officer have
concluded that, as of the end of such period, the Company's disclosure controls
and procedures are effective in ensuring that information required to be
disclosed in this filing is accumulated and communicated to management and is
recorded, processed, summarized and reported in a timely manner and in
accordance with Securities and Exchange Commission rules and regulations.

(b) Internal Control Over Financial Reporting.

There have been no changes in the Company's internal control over financial
reporting during the last quarterly period covered by this Quarterly Report on
Form 10-QSB that have materially affected, or are reasonably likely to
materially affect, the Company's internal control over financial reporting.

                                    -18-
<PAGE>


                      PART II.    OTHER INFORMATION

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

(a) Exhibits

    31.1   Certification of Chief Executive Officer of Periodic Report
            Pursuant to Rule 13a-14(a) and Rule 15d-14(a).

    31.2   Certification of Chief Financial Officer of Periodic Report
            Pursuant to Rule 13a-14(a) and Rule 15d-14(a).

    32.1   Certification of Chief Executive Officer Pursuant to 18
            U.S.C. Section 1350.

    32.2   Certification of Chief Financial Officer Pursuant to 18
            U.S.C. Section 1350.

(b) Registrant did not file any reports on Form 8-K during the period
    covered by this report.



                                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.


                                               PORTSMOUTH SQUARE, INC.
                                                     (Registrant)


Date: February 13, 2004                    by /s/ John V. Winfield
                                              ---------------------------
                                              John V. Winfield, President,
                                              Chairman of the Board and
                                              Chief Executive Officer


Date: February 13, 2004                    by /s/ Michael G. Zybala
                                              ---------------------------
                                              Michael G. Zybala,
                                              Vice President and Secretary


Date: February 13, 2004                    by /s/ David Nguyen
                                              --------------------------
                                              David Nguyen, Treasurer
                                             (Principal Accounting Officer)


                                    -19-