| x | Quarterly                report under Section 13 or 15(d) of the Securities Exchange Act of                1934 |
|---|-----------------------------------------------------------------------------------------------------------------|

| o | Transition                report under Section 13 or 15(d) of the Exchange                Act |
|---|-----------------------------------------------------------------------------------------------|

| For                the transition period from |   | To |   |
|-----------------------------------------------|--------|----|--------|

| Commission                file number | 0-26192 |
|---------------------------------------|---------|

| MakeMusic!                Inc.                                                                  |
|-------------------------------------------------------------------------------------------------|
| (Exact                Name of Small Business Issuer as Specified in its                Charter) |

| Minnesota                                      | 41-1716250                         |
|------------------------------------------------|------------------------------------|
| (State                or Other Jurisdiction of | (I.R.S.                Employer    |
| Incorporation                or Organization)  | Identification                No.) |

| 7615                Golden Triangle Drive, Suite M                  |
|---------------------------------------------------------------------|
| Eden                Prairie, Minnesota 55344-3848                   |
| (Address                of Principal Executive Offices)             |
|                                                                |
| (952)                937-9611                                       |
| (Issuer's                Telephone Number, Including Area Code)     |
|                                                                |
|                                                                |
| (Former                Name, Former Address and Former Fiscal Year, |
| if                Changed Since Last Report)                        |

----

**MakeMusic,          Inc.**

**INDEX**

|                  | **PART                I. FINANCIAL INFORMATION**                               | **Page                No.** |
|-----------------------|--------------------------------------------------------------------------------|-----------------------------|
|                  |                                                                           |                        |
| Item                1 | Consolidated                Financial Statements                               | 3                           |
|                  |                                                                           |                        |
|                  | Consolidated                Balance Sheets                                     |                        |
|                  | March                31, 2006 and December 31, 2005                            | 3                           |
|                  |                                                                           |                        |
|                  | Consolidated                Statement of Operations                            |                        |
|                  | Three                month periods ended March 31, 2006 and 2005               | 4                           |
|                  |                                                                           |                        |
|                  | Consolidated                Statement of Cash Flows                            |                        |
|                  | Three                month periods ended March 31, 2006 and 2005               | 5                           |
|                  |                                                                           |                        |
|                  | Notes                to Consolidated Financial Statements                      | 6                           |
|                  |                                                                           |                        |
| Item                2 | Management’s                Discussion and Analysis or Plan of Operation | 7                           |
|                  |                                                                           |                        |
| Item                3 | Controls                and Procedures                                         | 12                          |
|                  |                                                                           |                        |
|                  | **PART                II. OTHER INFORMATION**                                  |                        |
|                  |                                                                           |                        |
| Item                1 | Legal                Proceedings                                               | 13                          |
|                  |                                                                           |                        |
| Item                2 | Unregistered                Sales of Equity Securities and Use of Proceeds     | 13                          |
|                  |                                                                           |                        |
| Item                3 | Defaults                Upon Senior Securities                                 | 13                          |
|                  |                                                                           |                        |
| Item                4 | Submission                of Matters to a Vote of Security Holders             | 13                          |
|                  |                                                                           |                        |
| Item                5 | Other                Information                                               | 13                          |
|                  |                                                                           |                        |
| Item                6 | Exhibits                                                                       | 13                          |
|                  | Signatures                                                                     | 14                          |
|                  | Exhibit                Index                                                   | 14                          |

----

**PART      I. FINANCIAL INFORMATION**

**ITEM      1. Financial Statements**

**MakeMusic,      Inc.**

**Consolidated      Balance Sheets**

*(In      thousands of U.S. dollars)*

|                                                                                                                                                            |   | **March                31,** |        | **December                31,** |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------|-------------|---------------------------------|--------|
|                                                                                                                                                            |   | **2006**                     |        | **2005**                        |   |
|                                                                                                                                                            |   | (unaudited)                  |        |                            |   |
| **Assets**                                                                                                                                                      |   |                         |        |                            |   |   |   |
| Cash                                                                                                                                                            |   | **$**                        | **2,386**   |                            | $      | 2,952 |   |
| Accounts                receivable, net of allowances                                                                                                           |   |                         | **1,152**   |                            |   | 1,004 |   |
| Inventories,                net of reserves                                                                                                                     |   |                         | **388**     |                            |   | 435 |   |
| Prepaid                expenses and other current assets                                                                                                        |   |                         | **155**     |                            |   | 161 |   |
| Total                current assets                                                                                                                             |   |                         | **4,081**   |                            |   | 4,552 |   |
|                                                                                                                                                            |   |                         |        |                            |   |   |   |
| Property                and equipment, net                                                                                                                      |   |                         | **575**     |                            |   | 323 |   |
| Goodwill,                net                                                                                                                                    |   |                         | **3,630**   |                            |   | 3,630 |   |
| Capitalized                software products                                                                                                                    |   |                         | **494**     |                            |   | 471 |   |
| Other                non-current assets                                                                                                                         |   |                         | **59**      |                            |   | 66 |   |
| **Total                assets**                                                                                                                                 |   | **$**                        | **8,839**   |                            | $      | 9,042 |   |
|                                                                                                                                                            |   |                         |        |                            |   |   |   |
| **Liabilities                and Shareholders’ Equity**                                                                                                   |   |                         |        |                            |   |   |   |
| Current                portion of long-term debt and capital lease obligations                                                                                  |   | **$**                        | **6**       |                            | $      | 6 |   |
| Accounts                payable                                                                                                                                 |   |                         | **190**     |                            |   | 441 |   |
| Accrued                compensation                                                                                                                             |   |                         | **611**     |                            |   | 681 |   |
| Other                accrued liabilities                                                                                                                        |   |                         | **243**     |                            |   | 164 |   |
| Post                contract support                                                                                                                            |   |                         | **181**     |                            |   | 181 |   |
| Reserve                for product returns                                                                                                                      |   |                         | **416**     |                            |   | 339 |   |
| Current                portion of deferred rent                                                                                                                 |   |                         | **20**      |                            |   | 20 |   |
| Deferred                revenue                                                                                                                                 |   |                         | **980**     |                            |   | 916 |   |
| Total                current liabilities                                                                                                                        |   |                         | **2,647**   |                            |   | 2,748 |   |
|                                                                                                                                                            |   |                         |        |                            |   |   |   |
| Capital                lease obligations, net of current portion                                                                                                |   |                         | **8**       |                            |   | 9 |   |
| Deferred                rent, net of current portion                                                                                                            |   |                         | **115**     |                            |   | 120 |   |
|                                                                                                                                                            |   |                         | **123**     |                            |   | 129 |   |
|                                                                                                                                                            |   |                         |        |                            |   |   |   |
| Shareholders’                Equity:                                                                                                                      |   |                         |        |                            |   |   |   |
| Common                stock, $0.01 par value:                                                                                                                   |   |                         |        |                            |   |   |   |
| Authorized                shares - 10,000,000Issued                and outstanding shares - 3,980,752 and 3,856,654In                2006 and 2005 respectively |   |                         | **39**      |                            |   | 39 |   |
| Additional                paid-in capital                                                                                                                       |   |                         | **62,672**  |                            |   | 62,459 |   |
| Accumulated                deficit                                                                                                                              |   |                         | **(56,656** | **)**                           |   | (56,347 | ) |
| Other                comprehensive income                                                                                                                       |   |                         | **14**      |                            |   | 14 |   |
| Total                shareholders’ equity                                                                                                                 |   |                         | **6,069**   |                            |   | 6,165 |   |
| Total                liabilities and shareholders’ equity                                                                                                 |   | **$**                        | **8,839**   |                            | $      | 9,042 |   |

----

**MakeMusic,      Inc.**

**Consolidated      Statements of Operations**

*(In      thousands of U.S. dollars, except share and per share data)*

|                                                       |   | **Three                Months Ended** |          |
|------------------------------------------------------------|--------|---------------------------------------|---------------|
|                                                       |   | **March                31,**          |          |
|                                                       |   | **2006**                              |          | 2005 |   |
| Notation                revenue                            |   | **$**                                 | **2,511**     |   | $ | 2,074 |   |
| SmartMusic                revenue                          |   |                                  | **466**       |   |   | 345 |   |
| Other                revenue                               |   |                                  | **111**       |   |   | 105 |   |
| NET                REVENUE                                 |   |                                  | **3,088**     |   |   | 2,524 |   |
|                                                       |   |                                  |          |   |   |   |   |
| COST                OF REVENUES                            |   |                                  | **418**       |   |   | 469 |   |
|                                                       |   |                                  |          |   |   |   |   |
| GROSS                PROFIT                                |   |                                  | **2,670**     |   |   | 2,055 |   |
|                                                       |   |                                  |          |   |   |   |   |
| OPERATING                EXPENSES:                         |   |                                  |          |   |   |   |   |
| Development                expenses                        |   |                                  | **888**       |   |   | 812 |   |
| Selling                and marketing expenses              |   |                                  | **1,180**     |   |   | 1,024 |   |
| General                and administrative expenses         |   |                                  | **924**       |   |   | 850 |   |
|                                                       |   |                                  |          |   |   |   |   |
| Total                operating expenses                    |   |                                  | **2,993**     |   |   | 2,686 |   |
|                                                       |   |                                  |          |   |   |   |   |
| LOSS                FROM OPERATIONS                        |   |                                  | (323          | ) |   | (631 | ) |
|                                                       |   |                                  |          |   |   |   |   |
| Interest                income, net                        |   |                                  | **19**        |   |   | 1 |   |
| Other                income                                |   |                                  | **1**         |   |   | 21 |   |
| Net                loss before income tax                  |   |                                  | (303          | ) |   | (609 | ) |
|                                                       |   |                                  |          |   |   |   |   |
| Income                taxes                                |   |                                  | **6**         |   |   | 0 |   |
| Net                loss                                    |   | **$**                                 | (309          | ) | $ | (609 | ) |
|                                                       |   |                                  |          |   |   |   |   |
| Loss                per common share:                      |   |                                  |          |   |   |   |   |
| Basic                                                      |   |                                  | (0.08         | ) |   | (0.18 | ) |
| Diluted                                                    |   |                                  | (0.08         | ) |   | (0.18 | ) |
|                                                       |   |                                  |          |   |   |   |   |
| Weighted                average common shares outstanding: |   |                                  |          |   |   |   |   |
| Basic                                                      |   |                                  | **3,888,106** |   |   | 3,420,524 |   |
| Diluted                                                    |   |                                  | **3,888,106** |   |   | 3,420,524 |   |

----

**MakeMusic,      Inc.**

**Consolidated      Statements of Cash Flows**

*(In      thousands of U.S. dollars)*

|                                                                                                                    |   | **Three                Months Ended****March                31,** |      |
|-------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------|-----------|
|                                                                                                                    |   | **2006**                                                          |      | 2005 |   |
| **Operating                activities**                                                                                 |   |                                                              |      |   |   |   |   |
| Net                loss                                                                                                 |   | **$**                                                             | **(309**  | **)** | $ | (609 | ) |
| Adjustments                to reconcile net loss to net cash provided by (used                in) operating activities: |   |                                                              |      |   |   |   |   |
| Amortization                of intangible assets                                                                        |   |                                                              | **0**     |   |   | 226 |   |
| Depreciation                and amortization of property and equipment                                                  |   |                                                              | **79**    |   |   | 81 |   |
| Issuance                of stock options and warrants for services                                                      |   |                                                              | **93**    |   |   | 4 |   |
| Changes                in assets and liabilities:                                                                       |   |                                                              |      |   |   |   |   |
| Accounts                receivable                                                                                      |   |                                                              | **(148**  | **)** |   | 51 |   |
| Inventories                                                                                                             |   |                                                              | **47**    |   |   | (129 | ) |
| Prepaid                expenses and other current assets                                                                |   |                                                              | **11**    |   |   | 3 |   |
| Accounts                payable                                                                                         |   |                                                              | **(251**  | **)** |   | 75 |   |
| Accrued                liabilities and product returns                                                                  |   |                                                              | **80**    |   |   | (389 | ) |
| Deferred                revenue                                                                                         |   |                                                              | **65**    |   |   | 88 |   |
| Net                cash used in operating activities                                                                    |   |                                                              | **(333**  | **)** |   | (599 | ) |
|                                                                                                                    |   |                                                              |      |   |   |   |   |
| **Net                cash used in investing activities**                                                                |   |                                                              |      |   |   |   |   |
| Purchases                of property and equipment                                                                      |   |                                                              | **(292**  | **)** |   | (50 | ) |
| Capitalized                development and other intangibles                                                            |   |                                                              | **(59**   | **)** |   | (53 | ) |
| Net                cash used in investing activities                                                                    |   |                                                              | **(351**  | **)** |   | (103 | ) |
|                                                                                                                    |   |                                                              |      |   |   |   |   |
| **Net                cash provided by (used in) financing activities**                                                  |   |                                                              |      |   |   |   |   |
| Proceeds                from stock options and warrants exercised                                                       |   |                                                              | **120**   |   |   | 66 |   |
| Payments                on capital lease obligations                                                                    |   |                                                              | **(2**    | **)** |   | (2 | ) |
| Net                cash provided by financing activities                                                                |   |                                                              | **118**   |   |   | 64 |   |
|                                                                                                                    |   |                                                              |      |   |   |   |   |
| Net                decrease in cash                                                                                     |   |                                                              | **(566**  | **)** |   | (638 | ) |
| Cash,                beginning of period                                                                                |   |                                                              | **2,952** |   |   | 2,215 |   |
| Cash,                end of period                                                                                      |   | **$**                                                             | **2,386** |   | $ | 1,577 |   |
|                                                                                                                    |   |                                                              |      |   |   |   |   |
| **Supplemental                disclosure of cash flow information**                                                     |   |                                                              |      |   |   |   |   |
| Interest                paid                                                                                            |   |                                                              | **0**     |   |   | 2 |   |
| Income                taxes paid                                                                                        |   |                                                              | **6**     |   |   | 2 |   |

----

**MakeMusic,      Inc.**

**Notes      to Consolidated Financial Statements**

| Note              1 | **Accounting                Policies.**The                information furnished in this report is unaudited but reflects all                adjustments that are necessary, in the opinion of management, for                a fair                statement of the results for the interim period. The operating results                for                the three months ended March 31, 2006 are not necessarily indicative                of                the operating results to be expected for the full year. These statements                should be read in conjunction with the Company's most recent Annual                Report                on Form 10-KSB. |
|---------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Note              2 | **Net** **Loss                Per Share.**                Net loss per share was calculated by dividing the net loss by the                weighted                average number of shares outstanding during the period. The following                table summarizes the shares of stock included in calculating earnings                per                share for the three months ended March 31, 2006 and 2005 in                accordance with FASB Statement 128 (“FAS 128”), *Earnings                per Share*: |
|---------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                                  |   | **Three                Months Ended****March                31,** |      |
|-----------------------------------------------------------------------|--------|-------------------------------------------------------------------|-----------|
|                                                                  |   | **2006**                                                          |      | 2005 |   |
|                                                                  |   |                                                              |      |
| Weighted-average                common shares outstanding             |   |                                                              | 3,888,106 |   |   | 3,420,524 |   |
| Dilutive                effect of stock options and warrants          |   |                                                              | -         |   |   | - |   |
| Equivalent                average common shares outstanding - diluted |   |                                                              | 3,888,106 |   |   | 3,420,524 |   |

| Note              3 | **Income                Tax Expense.**The                Company did not record a provision for federal income tax in the                three                months ended March 31, 2006 and 2005 due to the fact the Company                recorded                a net loss for those periods.                The only income tax expense recorded in the three months ended March                31,                2006 and 2005 were for minimum income tax payments.                Due to the uncertainty regarding future realization of our federal                deferred income tax assets and net operating loss carry-forwards,                we have                recorded a valuation allowance against our income tax benefit for                2006 and                2005. |
|---------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Note              4 | **Stock-Based                Compensation.**The                company currently offers a stock based compensation plan to its employees,                directors and consultants. These plans are administered by the                compensation committee of the Board of Directors, which recommends                to the                Board persons eligible to receive awards and the number of shares                and/or                options subject to each award, the terms, conditions, performance                measures, and other provisions of the award. Readers should refer                to Note                6 of our consolidated financial statements in our Annual Report on                Form                10-KSB for the fiscal year ended December 31, 2005 for additional                information related to the Company’s stock based compensation                plans. |
|---------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Net                loss:                                                     |   |   |      |   |
|------------------------------------------------------------------------------|--------|--------|-----------|--------|
| Net                loss as reported                                          |   | **$**  | **(609**  | **)**  |
| Stock                compensation reported in net income                |   |   | **4**     |   |
| Stock                compensation under the fair value method for all awards |   |   | **(86**   | **)**  |
| Pro                forma net loss                                            |   | **$**  | **(691**  | **)**  |
| Loss                per share:                                               |   |   |      |   |
| Basic                                                                        |   |   |      |   |
| As                reported                                                   |   | **$**  | **(0.18** | **)**  |
| Pro                forma                                                     |   | **$**  | **(0.20** | **)**  |
| Diluted                                                                      |   |   |      |   |
| As                reported                                                   |   | **$**  | **(0.18** | **)**  |
| Pro                forma                                                     |   | **$**  | **(0.20** | **)**  |

*Stock      Options*

|                                   |   | March                31, |   | March                31, |   |
|----------------------------------------|--------|--------------------------|--------|--------------------------|--------|
|                                   |   | 2006                     |   | 2005                     |   |
| Black-Scholes                Model:    |   |                     |   |                     |   |   |   |
| Risk-free                interest rate |   |                     | 3.2    | %                        |   | 5.0 | % |
| Expected                life, in years |   |                     | 3.8    |                     |   | 5.9 |   |
| Expected                volatility     |   |                     | 87.3   | %                        |   | 81.5 | % |
| Dividend                yield          |   |                     | 0.0    | %                        |   | 0.0 | % |
|                                   |   |                     |   |                     |   |   |   |
| Binomial                Model:         |   |                     |   |                     |   |   |   |
| Risk-free                interest rate |   |                     | 3.6    | %                        |   | 5.0 | % |
| Expected                life, in years |   |                     | 6.0    |                     |   | 5.9 |   |
| Expected                volatility     |   |                     | 136.6  | %                        |   | 81.5 | % |
| Dividend                yield          |   |                     | 0.0    | %                        |   | 0.0 | % |

----

|                                                         |   | **Shares                Reserved for Grant** |        | **Plan                Options** |   |  **Weighted-Average                Exercise Price** |   | **Weighted                Average Remaining Contract Life** |      |
|--------------------------------------------------------------|--------|----------------------------------------------|-------------|---------------------------------|--------|----------------------------------------------------------|--------|-------------------------------------------------------------|-----------|
|                                                         |   |                                         |        |                            |   |                                                |   |                                                        |      |
| **Outstanding                at December 31, 2005**          |   |                                         | **16,675**  |                            |   | **712,473**                                              |   | **$**                                                       | **3.96**  |   |   |   |   |
| **Granted**                                                  |   |                                         | **(12,000** | **)**                           |   | **12,000**                                               |   | **$**                                                       | **10.32** |   |   |   |   |
| **Expired**                                                  |   |                                         |        |                            |   | **(1,900**                                               | **)**  | **$**                                                       | **13.75** |   |   |   |   |
| **Forfeited**                                                |   |                                         |        |                            |   |                                                     |   |                                                        |      |   |   |   |   |
| **Cancelled**                                                |   |                                         | **1,000**   |                            |   | **(1,000**                                               | **)**  | **$**                                                       | **2.35**  |   |   |   |   |
| **Exercised**                                                |   |                                         |        |                            |   | **(2,080**                                               | **)**  | **$**                                                       | **5.00**  |   |   |   |   |
| **Outstanding                at March 31, 2006**             |   |                                         | **5,675**   |                            |   | **719,493**                                              |   | **$**                                                       | **4.04**  |   |   | **3.8                Years** |   |
| **Outstanding                exercisable at March 31, 2006** |   |                                         | **na**      |                            |   | **366,467**                                              |   | **$**                                                       | **4.63**  |   |   | **3.8                Years** |   |

|                                                               |   | **Number                of Shares** |        | **Weighted                Avg.****Grant-Date                Fair Value** |   |
|--------------------------------------------------------------------|--------|-------------------------------------|-------------|--------------------------------------------------------------------------|--------|
| **Non-vested                stock options at beginning of period** |   |                                | **392,230** |                                                                     | **$**  | **1.99** |   |
| **Granted                during the period**                       |   |                                | **12,000**  |                                                                     | **$**  | **7.26** |   |
| **Vested                during the period**                        |   |                                | **(51,203** | **)**                                                                    |   | **($2.05** | **)** |
| **Forfeited                during the period**                     |   |                                | **-**       |                                                                     |   | **-** |   |
| **Non-vested                stock options at end of period**       |   |                                | **353,027** |                                                                     | **$**  | **2.26** |   |

----

**ITEM      2.**
**Management’s      Discussion And Analysis Or Plan Of Operation**

**Executive      Overview**

----

**Results      of Operations **

**Three      Months Ended**

**March      31,**

|                                               |   | **2006** |   | **2005** |   | **$****Increase****(Decrease)** |   | **%****Increase****(Decrease)** |   |
|----------------------------------------------------|--------|----------|--------|----------|--------|---------------------------------|--------|---------------------------------|--------|
| Notation                revenue                    |   | $        | 2,511  |     | $      | 2,074                           |   | $                               | 437    |   |   | 21 | % |
| SmartMusic                revenue                  |   |     | 466    |     |   | 345                             |   |                            | 121    |   |   | 35 | % |
| Other                revenue                       |   |     | 111    |     |   | 105                             |   |                            | 6      |   |   | 6 | % |
| Net                revenue                         |   |     | 3,088  |     |   | 2,524                           |   | $                               | 564    |   |   | 22 | % |
| Cost                of revenue                     |   |     | 418    |     |   | 469                             |   |                            | (51    | ) |   | (11 | %) |
| Gross                profit                        |   |     | 2,670  |     |   | 2,055                           |   |                            | 615    |   |   | 30 | % |
| Percentage                of net sales             |   |     | 86.5   | %        |   | 81.4                            | %      |                            |   |   |   |   |   |
|                                               |   |     |   |     |   |                            |   |                            |   |   |   |   |   |
| Product                development expenses        |   |     | 888    |     |   | 812                             |   |                            | 76     |   |   | 9 | % |
| Selling                and marketing expenses      |   |     | 1,180  |     |   | 1,024                           |   |                            | 156    |   |   | 15 | % |
| General                and administrative expenses |   |     | 924    |     |   | 850                             |   |                            | 74     |   |   | 9 | % |
| Total                operating expenses            |   |     | 2,993  |     |   | 2,686                           |   |                            | 307    |   |   | 11 | % |
| Operating                loss                      |   |     | (323   | )        |   | (631                            | )      |                            | 308    |   |   | 49 | % |
| Interest                income                     |   |     | 19     |     |   | 1                               |   |                            | 18     |   |   | 1800 | % |
| Interest                expense                    |   |     |   |     |   |                            |   |                            | 0      |   |   | na |   |
| Other                income, net                   |   |     | 1      |     |   | 21                              |   |                            | (20    | ) |   | (95 | %) |
| Income                tax expense                  |   |     | (6     | )        |   | 0                               | )      |                            | (6     | ) |   | na |   |
| Net                loss                            |   |     | ($309  | )        |   | ($609                           | )      | $                               | 300    |   |   | 49 | % |

***For      the three-month period ended March 31, 2006 compared to the three-month period      ended March 31, 2005.***

***Net      Revenues.***

----

***Gross      Profit.***

***Development      Expenses.***

***Sales      and Marketing Expenses.***

----

***General      and Administrative Expenses.***

***Net      Loss from Operations***

***Net      Loss***

***Liquidity      and Capital Resources***
**.**

----

**ITEM      3. Controls And Procedures**

*      Evaluation of disclosure controls and procedures*

*      Changes in internal controls*

***Cautionary      Statements***

*This      report may contain forward-looking statements within the meaning of the Private      Securities Litigation Reform Act of 1995. Forward-looking statements provide      current expectations or forecasts of future events and can be identified by      the      use of terminology such as “believe,” “estimate,” “expect,” “intend,” “may,”“could,” “will,” and similar words or expressions. Our forward-looking      statements in this report generally relate to, the growth potential of      SmartMusic, annualized “run rate” of SmartMusic revenue, stock option expenses,      sufficiency of capital, product development and new market opportunities.      Forward-looking statements cannot be guaranteed and actual results may vary      materially due to the uncertainties and risks, known and unknown, associated      with such statements. We caution investors that many important factors have      affected, and in the future could affect, our actual results of operations      and      cause such results to differ materially from those anticipated in      forward-looking statements made in this release and elsewhere by us or on our      behalf. These factors include, but are not limited to our sales efforts and      market acceptance of our products; our dependence upon new product development      effort; our dependence on and releasing of annual Finale upgrades; the      maintenance of strategic relationships; the success of our SmartMusic      subscription business; maintaining license agreements with a limited number      of      publishers; the limited and fluctuating sales of certain of our products; our      ability to implement cost saving measures as necessary to preserve adequate      capital; the intense competition we face; the rapid technological changes and      obsolescence in our industry; our dependence on key personnel and the      proprietary nature of our technology; other general business and economic      conditions; and those risks described from time to time in our reports to the      Securities and Exchange Commission (including our Annual Report on Form 10-KSB).      It is not possible to foresee or identify all factors that could cause actual      results to differ from expected or historic results. As such, investors should      not consider any list of such factors to be an exhaustive statement of all      of      the risks, uncertainties or potentially inaccurate assumptions that investors      should take into account when making investment decisions. Shareholders and      other readers are cautioned not to place undue reliance on forward-looking      statements, which speak only as of the date on which they are made. We undertake      no obligation to update publicly or revise any forward-looking      statements.*

----

**PART      II. OTHER INFORMATION**

**ITEM      1.**
**Legal      Proceedings**

**ITEM      2.**
**Unregistered      Sales of Equity Securities and Use of Proceeds**

**ITEM      3.**
**Defaults      Upon Senior Securities**

**ITEM      4.**
**Submission      of Matters to a Vote of Security Holders**

**ITEM      5.**
**Other      Information**

**ITEM      6.**
**Exhibits**

----

**SIGNATURES**

|                           |                                                     |                              |
|--------------------------------|----------------------------------------------------------|-----------------------------------|
| Date:              May 2, 2006 | MAKEMUSIC, INC.                                          |
|                      |                                                |                         |
|                           | By:                                            | /s/              William R. Wolff |
|                           | William                R. Wolff, Chief Executive Officer |
|                           | (Principal              Executive Officer)               |

|         |                                                      |                                         |
|--------------|-----------------------------------------------------------|----------------------------------------------|
|    |                                                 |                                    |
|         | By:                                             | /s/              Alan              G. Shuler |
|         | Alan              G. Shuler, Chief Financial Officer      |
|         | (Principal              Financial and Accounting Officer) |

----

**EXHIBIT      INDEX**

**Form      10-QSB**

**For      Quarter ended March 31, 2006**

| **Exhibit              No.** | **Description**                                                                                                                   |
|------------------------------|-----------------------------------------------------------------------------------------------------------------------------------|
|                         |                                                                                                                              |
| **31.1**                     | Certification                of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley                Act of 2002. |
|                         |                                                                                                                              |
| **31.2**                     | Certification                of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley                Act of 2002. |
|                         |                                                                                                                              |
| **32.1**                     | Certification                of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley                Act of 2002. |
|                         |                                                                                                                              |
| **32.2**                     | Certification                of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley                Act of 2002. |

----