|   | [X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES      EXCHANGE ACT OF 1934 For the quarterly period ended March 31,      2009 |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | [        ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES      EXCHANGE ACT OF 1934 For the transition period from _ to  _ |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

| Nevada                               | 76-0640970                     |
|--------------------------------------|--------------------------------|
| (State      or other jurisdiction of | (I.R.S.      Employer          |
| incorporation      or organization)  |  Identification      No.) |
|                                 |                           |

| 701      North Post Oak Road, Suite 600, Houston,Texas | 77024                        |
|--------------------------------------------------------|------------------------------|
| (Address      of principal executive offices)          | (Zip      Code)              |
|                                                   |                         |
| voice:  713-686-1100                         | fax:  713-682-7402 |
| Issuer's      telephone number                         |

| Large      accelerated filer | [        ] | Accelerated      filer         | [        ] |
|------------------------------|----------------------|--------------------------------|----------------------|
| Non-accelerated      filer   | [        ] | Smaller      reporting company | [X]                  |

----

| TABLE OF CONTENTS                                                                                                     |   |
|-----------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                                                  |   |
| PART I. FINANCIAL      INFORMATION                                                                               |   |
|                                                                                                                  |   |
| ITEM      1. FINANCIAL STATEMENTS                                                                                     |   |
|                                                                                                                  |   |
| Unaudited Consolidated Financial      Statements                                                                      | F-1    |
|                                                                                                                  |   |
|   Consolidated Balance Sheets as of March 31, 2009 and      December 31, 2008                               | F-1    |
|                                                                                                                  |   |
|   Consolidated Statements of Operations for the      three months ended March 31, 2009 and 2008             | F-2    |
|                                                                                                                  |   |
|   Consolidated Statement of Stockholders’      Deficit for the three months ended March 31, 2009 | F-3    |
|                                                                                                                  |   |
|   Consolidated Statements of Cash Flows for the three      months ended March 31, 2009 and 2008             | F-4    |
|                                                                                                                  |   |
|   Notes to Consolidated Financial      Statements                                                           | F-5    |
|                                                                                                                  |   |
| ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL      CONDITION AND RESULTS OF OPERATIONS                    | I-1    |
|                                                                                                                  |   |
| ITEM 4T. CONTROLS AND PROCEDURES                                                                                      | I-7    |
|                                                                                                                  |   |
| PART II. OTHER      INFORMATION                                                                                       |   |
|                                                                                                                  |   |
| ITEM 1. LEGAL PROCEEDINGS                                                                                             | II-1   |
|                                                                                                                  |   |
| ITEM 2. UNREGISTERED      SALES OF EQUITY SECURITIES AND USE OF PROCEEDS                                              | II-1   |
|                                                                                                                  |   |
| ITEM 5. OTHER INFORMATION                                                                                             | II-1   |
|                                                                                                                  |   |
| ITEM 6. EXHIBITS                                                                                                      | II-1   |
|                                                                                                                  |   |
| SIGNATURES                                                                                                            | II-2   |
|                                                                                                                  |   |
| CERTIFICATIONS                                                                                                        | II-3   |

----

ITEM  1.   FINANCIALSTATEMENTS

| BLUEGATE CORPORATION                                                                                                                                                                                                                                                                   |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
| CONSOLIDATED      BALANCE SHEETS                                                                                                                                                                                                                                                       |   |
| UNAUDITED                                                                                                                                                                                                                                                                              |   |
|                                                                                                                                                                                                                                                                                   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                   |   | March      31, |   |   | December      31, |   |
|                                                                                                                                                                                                                                                                                   |   | 2009 |   |   | 2008 |   |
| ASSETS                                                                                                                                                                                                                                                                                 |   |   |   |   |   |   |
| Current      assets:                                                                                                                                                                                                                                                                   |   |   |   |   |   |   |
| Cash      and cash equivalents                                                                                                                                                                                                                                                         |   | $ | 79,448 |   |   | $ | 11,283 |   |
| Accounts      receivable, net                                                                                                                                                                                                                                                          |   |   | 484,581 |   |   |   | 502,631 |   |
| Prepaid      expenses and other                                                                                                                                                                                                                                                        |   |   | 19,197 |   |   |   | 22,498 |   |
| Total      current assets                                                                                                                                                                                                                                                              |   |   | 583,226 |   |   |   | 536,412 |   |
| Property      and equipment, net                                                                                                                                                                                                                                                       |   |   | 35,471 |   |   |   | 44,381 |   |
| Total      assets                                                                                                                                                                                                                                                                      |   | $ | 618,697 |   |   | $ | 580,793 |   |
| LIABILITIES AND STOCKHOLDERS’      DEFICIT                                                                                                                                                                                                                                       |   |   |   |   |   |   |   |   |
| Current      liabilities:                                                                                                                                                                                                                                                              |   |   |   |   |   |   |   |   |
| Accounts      payable                                                                                                                                                                                                                                                                  |   | $ | 246,535 |   |   | $ | 230,325 |   |
| Accounts      payable to related party                                                                                                                                                                                                                                                 |   |   | 8,975 |   |   |   | 10,750 |   |
| Accrued      liabilities                                                                                                                                                                                                                                                               |   |   | 57,031 |   |   |   | 139,046 |   |
| Notes      payable                                                                                                                                                                                                                                                                     |   |   | 12,800 |   |   |   | 12,800 |   |
| Notes      payable to related parties                                                                                                                                                                                                                                                  |   |   | 1,369,079 |   |   |   | 1,169,079 |   |
| Accrued      liabilities to related parties                                                                                                                                                                                                                                            |   |   | 132,606 |   |   |   | 178,655 |   |
| Deferred      revenue                                                                                                                                                                                                                                                                  |   |   | 194,709 |   |   |   | 194,472 |   |
| Derivative      liabilities                                                                                                                                                                                                                                                            |   |   | 175,000 |   |   |   | - |   |
| Total      current liabilities                                                                                                                                                                                                                                                         |   |   | 2,196,735 |   |   |   | 1,935,127 |   |
| Stockholders’      deficit:                                                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |
| Undesignated      preferred stock, $.001 par value, 9,999,952 shares authorized, none issued      and outstanding                                                                                                                                                                      |   |   | - |   |   |   | - |   |
| Series      C Convertible Non-Redeemable preferred stock, $.001 par value, 48 shares      authorized, issued and outstanding at March 31, 2009 and December 31,      2008; $12,500 per share liquidation preference ($600,000 aggregate      liquidation preference at March 31, 2009) |   |   | - |   |   |   | - |   |
| Common      stock, $.001 par value, 50,000,000 shares authorized, 26,033,565 shares      issued and outstanding at March 31, 2009 and December 31,    2008                                                                                                                             |   |   | 26,034 |   |   |   | 26,034 |   |
| Additional      paid-in capital                                                                                                                                                                                                                                                        |   |   | 21,642,704 |   |   |   | 26,240,785 |   |
| Accumulated      deficit                                                                                                                                                                                                                                                               |   |   | (23,246,776 | ) |   |   | (27,621,153 | ) |
| Total      stockholders’ deficit                                                                                                                                                                                                                                                 |   |   | (1,578,038 | ) |   |   | (1,354,334 | ) |
| Total      liabilities and stockholders’ deficit                                                                                                                                                                                                                                 |   | $ | 618,697 |   |   | $ | 580,793 |   |
|                                                                                                                                                                                                                                                                                   |   |   |   |   |   |   |   |   |

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| BLUEGATE CORPORATION                                       |   |
|------------------------------------------------------------|--------|
| CONSOLIDATED      STATEMENTS OF OPERATIONS                 |   |
| THREE      MONTHS ENDED MARCH 31, 2009 AND 2008            |   |
| UNAUDITED                                                  |   |
|                                                       |   |   |   |   |   |   |
|                                                       |   |   |   |   |   |   |
|                                                       |   | 2009 |   |   | 2008 |   |
| Service      revenue                                       |   | $ | 1,013,955 |   |   | $ | 1,042,527 |   |
| Cost      of services                                      |   |   | 620,814 |   |   |   | 737,847 |   |
| Gross      profit                                          |   |   | 393,141 |   |   |   | 304,680 |   |
| Selling,      general and administrative expenses          |   |   | 145,370 |   |   |   | 260,217 |   |
| Compensation      expense                                  |   |   | 252,176 |   |   |   | 1,106,191 |   |
| Loss      from operations                                  |   |   | (4,405 | ) |   |   | (1,061,728 | ) |
| Interest      expense                                      |   |   | (67,650 | ) |   |   | (27,320 | ) |
| Other      income                                          |   |   | 21,432 |   |   |   | 2,228 |   |
| Loss      on derivative financial instruments              |   |   | (91,000 | ) |   |   | - |   |
| Net      loss                                              |   | $ | (141,623 | ) |   | $ | (1,086,820 | ) |
|                                                       |   |   |   |   |   |   |   |   |
| Net      loss per common share - basic and diluted         |   | $ | (0.00 | ) |   | $ | (0.05 | ) |
|                                                       |   |   |   |   |   |   |   |   |
| Basic      and diluted weighted average shares outstanding |   |   | 26,033,565 |   |   |   | 21,523,235 |   |
|                                                       |   |   |   |   |   |   |   |   |

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| BLUEGATE CORPORATION                                                                                                                                                                             |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
| CONSOLIDATED      STATEMENT OF STOCKHOLDERS' DEFICIT                                                                                                                                             |   |
| THREE      MONTHS ENDED MARCH 31, 2009                                                                                                                                                           |   |
| UNAUDITED                                                                                                                                                                                        |   |
|                                                                                                                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   | ADDITIONAL |   |   |   |   |   |   |   |
|                                                                                                                                                                                             |   | COMMON      STOCK |   |   | PREFERRED      STOCK |   |   | PAID-IN |   |   | ACCUMULATED |   |   |   |   |
|                                                                                                                                                                                             |   | SHARES |   |   | CAPITAL |   |   | SHARES |   |   | CAPITAL |   |   | CAPITAL |   |   | DEFICIT |   |   | TOTAL |   |
|                                                                                                                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance      at December 31, 2008                                                                                                                                                                |   |   | 26,033,565 |   |   | $ | 26,034 |   |   |   | 48 |   |   | $ | - |   |   | $ | 26,240,785 |   |   | $ | (27,621,153 | ) |   | $ | (1,354,334 | ) |
|  Cumulative      effect of change in accounting principle - January 1, 2009      reclassification of embedded feature of equity-linked financial      instruments to derivative liabilities |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | (4,600,000 | ) |   |   | 4,516,000 |   |   |   | (84,000 | ) |
| Common      stock options issued for employee services                                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 1,919 |   |   |   |   |   |   |   | 1,919 |   |
| Net      loss                                                                                                                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | (141,623 | ) |   |   | (141,623 | ) |
| Balance      at March 31, 2009                                                                                                                                                                   |   |   | 26,033,565 |   |   | $ | 26,034 |   |   |   | 48 |   |   | $ | - |   |   | $ | 21,642,704 |   |   | $ | (23,246,776 | ) |   | $ | (1,578,038 | ) |

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| BLUEGATE CORPORATION                                                                                                       |   |
|----------------------------------------------------------------------------------------------------------------------------|--------|
| CONSOLIDATED      STATEMENTS OF CASH FLOWS                                                                                 |   |
| THREE      MONTHS ENDED MARCH 31, 2009 AND 2008                                                                            |   |
| UNAUDITED                                                                                                                  |   |
|                                                                                                                       |   | 2009 |   |   | 2008 |   |
| Cash      flows from operating activities:                                                                                 |   |   |   |   |   |   |
| Net      loss                                                                                                              |   | $ | (141,623 | ) |   | $ | (1,086,820 | ) |
| Adjustments      to reconcile net loss to net cash used in operating      activities:                                      |   |   |   |   |   |   |   |   |
| Depreciation      and amortization                                                                                         |   |   | 8,910 |   |   |   | 13,668 |   |
| Common      stock options issued for employee services                                                                     |   |   | 1,919 |   |   |   | 147,206 |   |
| Common      stock warrants issued to borrow funds from related party                                                       |   |   | - |   |   |   | 109,028 |   |
| Common      stock issued for compensation                                                                                  |   |   | - |   |   |   | 535,500 |   |
| Derivative      loss                                                                                                       |   |   | 91,000 |   |   |   | - |   |
| Amortization      of debt issuance cost                                                                                    |   |   | 20,000 |   |   |   | - |   |
| Changes      in operating assets and liabilities:                                                                          |   |   |   |   |   |   |   |   |
| Accounts      receivable                                                                                                   |   |   | 18,050 |   |   |   | 80,108 |   |
| Prepaid      expenses and other current assets                                                                             |   |   | 3,301 |   |   |   | 3,612 |   |
| Accounts      payable and accrued liabilities                                                                              |   |   | (65,805 | ) |   |   | (155,752 | ) |
| Accounts      payable to related party                                                                                     |   |   | (1,775 | ) |   |   | 3,521 |   |
| Accrued      liabilities to related parties                                                                                |   |   | (46,049 | ) |   |   | 87,559 |   |
| Deferred      revenue                                                                                                      |   |   | 237 |   |   |   | 12,422 |   |
| Net      cash used in operating activities                                                                                 |   |   | (111,835 | ) |   |   | (249,948 | ) |
|                                                                                                                       |   |   |   |   |   |   |   |   |
| Cash      flows from investing activities:                                                                                 |   |   |   |   |   |   |   |   |
| Purchase      of property and equipment                                                                                    |   |   | - |   |   |   | (9,370 | ) |
| Net      cash used in investing activities                                                                                 |   |   | - |   |   |   | (9,370 | ) |
|                                                                                                                       |   |   |   |   |   |   |   |   |
| Cash      flows from financing activities:                                                                                 |   |   |   |   |   |   |   |   |
| Proceeds      from related party short term debt                                                                           |   |   | 180,000 |   |   |   | 200,000 |   |
| Payments      on related party short term debt                                                                             |   |   | - |   |   |   | (39,602 | ) |
| Common      stock and warrants issued for cash                                                                             |   |   | - |   |   |   | 95,000 |   |
| Net      cash provided by financing activities                                                                             |   |   | 180,000 |   |   |   | 255,398 |   |
|                                                                                                                       |   |   |   |   |   |   |   |   |
| Net      increase (decrease) in cash and cash equivalents                                                                  |   |   | 68,165 |   |   |   | (3,920 | ) |
| Cash      and cash equivalents at beginning of period                                                                      |   |   | 11,283 |   |   |   | 43,703 |   |
| Cash      and cash equivalents at end of period                                                                            |   | $ | 79,448 |   |   | $ | 39,783 |   |
|                                                                                                                       |   |   |   |   |   |   |   |   |
| Non      Cash Transactions:                                                                                                |   |   |   |   |   |   |   |   |
| Issuance      of common stock for conversion of related party accounts payable, accrued      expenses and accrued interest |   | $ | - |   |   | $ | 305,000 |   |
| Derivative      liability at January 1, 2009                                                                               |   |   | 84,000 |   |   |   | - |   |
| Supplemental      information:                                                                                             |   |   |   |   |   |   |   |   |
| Cash      paid for interest                                                                                                |   |   | 67,650 |   |   |   | 25,458 |   |
|                                                                                                                       |   |   |   |   |   |   |   |   |

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BLUEGATE

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|                      |         |                     |          |         |         |         |         |   |   |         |    |    |
|---------------------------|--------------|--------------------------|---------------|--------------|--------------|--------------|--------------|--------|--------|--------------|---------|---------|
|                      |    | March 31,      2009 |
|                      |    | Level      1             |     | Level      2 |    | Level 3 |    | Total  |
| Embedded      derivatives |    |                     | -   |    | $       | 175,000      |    |   | -      |    | $  | 175,000 |
|                      |    |                     |          |    |         |         |    |   |   |    |    |    |

| 3.   | NOTES      PAYABLE |
|----------------|--------------------|

| Notes      payable at March 31, 2009 and December 31, 2008 are summarized      below:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   | 3/31/2009 |      |   | 12/31/2008 |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------|-----------|--------|------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |      |      |   |       |   |
| Unsecured notes      payable:                                                                   10%      note payable due upon demand                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   | $         | 12,800    |   |       | $      | 12,800 |   |
| Notes      payable to related parties:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |      |      |   |       |   |   |   |
| Secured note payable to related      party: During 2007, the Company entered into a line of credit      agreement with SAI Corporation ("SAIC"), a corporation controlled by our      CEO, Stephen Sperco, to borrow up to $500,000. On February 28, 2008, the      line of credit agreement with SAIC was amended to increase the borrowing      to $700,000 and on February 28, 2008, Bluegate borrowed the additional      $200,000 from SAIC for working capital purposes. As condition to and as      additional consideration for SAIC’s agreement to lend the funds to the      Company, the Company granted SAIC a security interest in its assets as      more specifically detailed in the Promissory Note and Security Agreement,      and increased the interest rate from 12% to 15% per annum. On July 14,      2008, the line of credit agreement with SAIC was amended to increase the      borrowing to $900,000 and on July 31, 2008, Bluegate borrowed the      additional $200,000 from SAIC for working capital purposes. Upon Bluegate      borrowing the additional $200,000, the Company agreed to pay (1) SAIC a      $40,000 origination fee and (2) Sperco Technology Group, Inc. (“STG”), a      corporation controlled by our CEO, Stephen Sperco, all past due amounts      totaling $104,972. On August 14, 2008, the Company entered into a short      term unsecured loan with SAIC to meet its working capital needs to borrow      $65,000. Upon borrowing the $65,000, the Company agreed to pay SAIC a      $6,500 origination fee and to repay SAIC with the first available funds      once the August 15, 2008 payroll and medical insurance premium was paid.      The Company paid the $65,000 loan and $6,500 fee on August 15, 2008. On      August 28, 2008, the Company borrowed $50,000 from SAIC and agreed to pay      SAIC a $5,000 origination fee. The Company paid the $50,000 funds borrowed      and $5,000 fee on September 11, 2008. On October 16, 2008, the line of      credit agreement with SAIC was amended to increase the borrowing to      $1,100,000 and on October 21, 2008, Bluegate borrowed the additional      $200,000 from SAIC for working capital purposes. Upon Bluegate borrowing      the additional $200,000, the Company agreed to pay (1) SAIC a $20,000      origination fee and (2) Sperco Technology Group, Inc. all past due      amounts. On      February 23, 2009, the line of credit agreement with SAIC was amended to      increase the borrowing to $1,300,000 and on February 26, 2009, Bluegate      borrowed the additional $200,000 from SAIC for working capital purposes.      Upon Bluegate borrowing the additional $200,000, the Company agreed to pay      SAIC a $20,000 origination fee.Note      payable to SAI Corporation due on demand |   | $         | 1,300,000 |   |       | $      | 1,100,000 |   |
| Unsecured notes payable to      related parties: During 2006, the Company entered into a line of      credit agreement with Manfred Sternberg ("MS"), Chief Strategy Officer and      William Koehler ("WK"), President and COO, for Bluegate to borrow up to      $500,000 from each of them. As of March 31, 2009, the interest rates on      the underlying credit cards pertaining to funds borrowed from MS and WK      were 17.24% and 17.23%, respectively.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |      |      |   |       |   |   |   |
| Notes      payable to William Koehler due on demand                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |      | 34,628    |   |       |   | 34,628 |   |
| Notes      payable to Manfred Sternberg due on demand                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |      | 34,451    |   |       |   | 34,451 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |      |      |   |       |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   | $         | 1,369,079 |   |       | $      | 1,169,079 |   |

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|    |   |     |                         |   |   |                                |   |     |   |        |   |   |                                |
|---------|--------|----------|------------------------------|--------|--------|-------------------------------------|--------|----------|--------|-------------|--------|--------|-------------------------------------|
|    |   |     |                         |   |   |                                |   |     |   |        |   |   |                                |
|    |   | Exercise |                         | Fair   |   | Expiration                          |   | Vesting  |   | 2009        |
| Options |   | Price    |                         | Value  |   | Date                                |   | Period   |   | Expense     |
| 50,000  |   | $        |     0.10 |   | $      |      1,769 |   | 3/4/2012 |   | Immediately |   | $      |      1,769 |

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ITEM  2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIALCONDITION AND RESULTS OF OPERATIONS

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| -   | Access      and content providers, such as AOL, Microsoft, EarthLink and Time      Warner; |
|---------------|--------------------------------------------------------------------------------------------|

| -   | Professional      Service organizations, such as IBM, CSC, Perot Systems, and      EDS; |
|---------------|-----------------------------------------------------------------------------------------|

| -   | Regional,      national and international telecommunications companies, such as AT&T,      Verizon, Qwest, and Sprint; |
|---------------|----------------------------------------------------------------------------------------------------------------------------|

| -   | On-line      services offered by incumbent cable providers such as Comcast and      Cox; |
|---------------|------------------------------------------------------------------------------------------|

| -   | DSL      providers such as the RBOC’s andCLEC’s. |
|---------------|--------------------------------------------------------------|

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|                                    |   | Three Months Ended March31, |       |
|-----------------------------------------|--------|-----------------------------|------------|
|                                    |   | 2009                        |       |   | 2008 |   |
|                                    |   |                        |       |   |   |   |
| Net      loss                           |   | $                           | (141,623   | ) |   | $ | (1,086,820 | ) |
| Negative      cash flow from operations |   |                        | (111,835   | ) |   |   | (249,948 | ) |
| Negative      working capital           |   |                        | (1,613,509 | ) |   |   | (1,025,753 | ) |
| Stockholders'      deficit              |   |                        | (1,578,038 | ) |   |   | (959,751 | ) |

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|   | -      Our ability to locate sources of debt or equity funding to meet current      commitments and near-term futurerequirements. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------|

|   | -      Our ability to achieve profitability and ultimately generate sufficient      cash flow from operations to sustain our continuing      operations. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                              |   | Three      Months Ended March 31, |      |   | Increase      (Decrease) |   |
|---------------------------------------------------|--------|-----------------------------------|-----------|--------|--------------------------|--------|
|                                              |   | 2009                              |      |   | 2008                     |   |   | 2007 |   |   | 2009      from 2008 |   |   | 2008      from 2007 |   |
| Service      revenue                              |   | $                                 | 1,013,955 |   |                     | $      | 1,042,527 |   |   | $ | 1,361,067 |   |   | $ | (28,572 | ) |   | $ | (318,540 | ) |
| Cost      of services                             |   |                              | 620,814   |   |                     |   | 737,847 |   |   |   | 733,512 |   |   |   | (117,033 | ) |   |   | 4,335 |   |
| Gross      profit                                 |   |                              | 393,141   |   |                     |   | 304,680 |   |   |   | 627,555 |   |   |   | 88,461 |   |   |   | (322,875 | ) |
| Selling,      general and administrative expenses |   |                              | 145,370   |   |                     |   | 260,217 |   |   |   | 867,459 |   |   |   | (114,847 | ) |   |   | (607,242 | ) |
| Compensation      expense                         |   |                              | 252,176   |   |                     |   | 1,106,191 |   |   |   | 1,797,125 |   |   |   | (854,015 | ) |   |   | (690,934 | ) |
| Loss      from operations                         |   |                              | (4,405    | )      |                     |   | (1,061,728 | ) |   |   | (2,037,029 | ) |   |   | (1,057,323 | ) |   |   | (975,301 | ) |
| Interest      expense                             |   |                              | (67,650   | )      |                     |   | (27,320 | ) |   |   | (39,177 | ) |   |   | 40,330 |   |   |   | (11,857 | ) |
| Other      income                                 |   |                              | 21,432    |   |                     |   | 2,228 |   |   |   | - |   |   |   | 19,204 |   |   |   | 2,228 |   |
| Loss      on derivative financial instruments     |   |                              | (91,000   | )      |                     |   | - |   |   |   | - |   |   |   | (91,000 | ) |   |   | - |   |
| Net      loss                                     |   | $                                 | (141,623  | )      |                     | $      | (1,086,820 | ) |   | $ | (2,076,206 | ) |   | $ | (945,197 | ) |   | $ | (989,386 | ) |
|                                              |   |                              |      |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

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| Compensation      Expense.                                                                                              |
|-------------------------------------------------------------------------------------------------------------------------|
| The      decrease in Compensation Expense of $690,934 from 2007 to 2008 is      principally comprised of the following: |
| $                                                                                                                       | (864,000 | ) | decrease      related to options issued for employee services |
|                                                                                                                    | (335,000 | ) | decrease      related to changes in personnel |
|                                                                                                                    | (136,000 | ) | decrease      related to issuance of shares for employee compensation |
|                                                                                                                    | 519,000 |   | increase      related to conversion of related party debt for common    stock |
|                                                                                                                    | 109,000 |   | increase      related to warrants issued to borrow funds from a related      party |
|                                                                                                                    | 17,000 |   | increase      related to related party purchase of common stock for  cash |
|                                                                                                                    |   |   |   |
| The      decrease in Compensation Expense of $854,015 from 2008 to 2009 is      principally comprised of the following: |
| $                                                                                                                       | (519,000 | ) | decrease      related to conversion of related party debt for common    stock |
|                                                                                                                    | (145,000 | ) | decrease      related to options issued for employee services |
|                                                                                                                    | (109,000 | ) | decrease      related to warrants issued to borrow funds from a related      party |
|                                                                                                                    | (60,000 | ) | decrease      related to a reduction in personnel |
|                                                                                                                    | (17,000 | ) | decrease      related to related party purchase of common stock for  cash |
|                                                                                                                    |   |   |   |
|                                                                                                                    |   |   |   |

|                                           |   | Three      Months Ended March 31, |     |   | Increase      (Decrease) |   |
|------------------------------------------------|--------|-----------------------------------|----------|--------|--------------------------|--------|
|                                           |   | 2009                              |     |   | 2008                     |   |   | 2007 |   |   | 2009      from 2008 |   |   | 2008      from 2007 |   |
| Net      cash (used in) operating activities   |   | $                                 | (111,835 | )      |                     | $      | (249,948 | ) |   | $ | (773,040 | ) |   | $ | (138,113 | ) |   | $ | (523,092 | ) |
| Net      cash (used in) investing activities   |   |                              | -        |   |                     |   | (9,370 | ) |   |   | (17,287 | ) |   |   | (9,370 | ) |   |   | (7,917 | ) |
| Net      cash provided by financing activities |   |                              | 180,000  |   |                     |   | 255,398 |   |   |   | 743,264 |   |   |   | (75,398 | ) |   |   | (487,866 | ) |
|                                           |   |                              |     |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      increase (decrease) in cash           |   | $                                 | 68,165   |   |                     | $      | (3,920 | ) |   | $ | (47,063 | ) |   | $ | 72,085 |   |   | $ | 43,143 |   |
|                                           |   |                              |     |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash      balance at end of period             |   | $                                 | 79,448   |   |                     | $      | 39,783 |   |   | $ | 209,058 |   |   |   |   |   |   |   |   |   |
|                                           |   |                              |     |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

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| -   | The      cost of operating delivering the Medical Grade Network®      services |
|---------------|-------------------------------------------------------------------------------------|

| -   | The      cost of sales and marketing |
|---------------|--------------------------------------|

| -   | The      rate at which we expand ouroperations |
|---------------|------------------------------------------------|

| -   | Attractive      acquisition opportunities |
|---------------|-------------------------------------------|

| -   | The      response of competitors |
|---------------|----------------------------------|

| -   | Capital      expenditures |
|---------------|---------------------------|

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ITEM 4

|   | (a)      Evaluation of disclosure controls and  procedures. |
|--------|-------------------------------------------------------------|

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PART II

ITEM1

ITEM2.                      UNREGISTEREDSALES OF EQUITY SECURITIES AND USE OF PROCEEDS

ITEM5

ITEM6

| Exhibit |                                                                                                                                                                                                                                                                                                                                                                                          |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Number  | Name                                                                                                                                                                                                                                                                                                                                                                                          |
|    |                                                                                                                                                                                                                                                                                                                                                                                          |
| 31.1    | CERTIFICATION      REQUIRED BY RULE 13a - 14(a) OR RULE 15d - 14(a) OF THE SECURITIES      EXCHANGE ACT      OF  1934,  AS  ADOPTED  PURSUANT  TO  SECTION  302  OF  THE  SARBANES-OXLEY  ACT      OF 2002 OF THE CHIEF EXECUTIVE OFFICER                                       |
|    |                                                                                                                                                                                                                                                                                                                                                                                          |
| 31.2    | CERTIFICATION      REQUIRED BY RULE 13a - 14(a) OR RULE 15d - 14(a) OF THE SECURITIES      EXCHANGE ACT      OF  1934,  AS  ADOPTED  PURSUANT  TO  SECTION  302  OF  THE  SARBANES-OXLEY  ACT      OF 2002 OF THE CHIEF FINANCIAL OFFICER AND PRINCIPAL ACCOUNTING      OFFICER |
|    |                                                                                                                                                                                                                                                                                                                                                                                          |
| 32.1    | CERTIFICATION      PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 (18 U.S.C.      SECTION 1350), OF THE CHIEF EXECUTIVE OFFICER                                                                                                                                                                                                                                                    |
|    |                                                                                                                                                                                                                                                                                                                                                                                          |
| 32.2    | CERTIFICATION      PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 (18 U.S.C.      SECTION 1350), OF THE CHIEF FINANCIAL OFFICER AND PRINCIPAL ACCOUNTING      OFFICER                                                                                                                                                                                                              |

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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. |
|                                                                                                                                                                                                    |   |   |   |
| Bluegate      Corporation                                                                                                                                                                               |
|                                                                                                                                                                                                    |   |   |   |
| Date:                                                                                                                                                                                                   | April 24,      2009 | /s/ | Stephen      J. Sperco |
|                                                                                                                                                                                                    |   |   |   |
|                                                                                                                                                                                                    |   |   | Stephen      J. Sperco, |
|                                                                                                                                                                                                    |   |   | Chief      Executive Officer |
|                                                                                                                                                                                                    |   |   |   |
|                                                                                                                                                                                                    |   |   |   |
| Bluegate      Corporation                                                                                                                                                                               |
|                                                                                                                                                                                                    |   |   |   |
| Date:                                                                                                                                                                                                   | April 24,      2009 | /s/ | Charles      E. Leibold |
|                                                                                                                                                                                                    |   |   |   |
|                                                                                                                                                                                                    |   |   | Charles      E. Leibold, |
|                                                                                                                                                                                                    |   |   | Chief      Financial Officer and Principal Accounting Officer |
|                                                                                                                                                                                                    |   |   |   |