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**Exhibit      11**

**Nano-Proprietary,      Inc.**

**Computation      of Income (Loss) Per Share**

|                                                                   |   | Three                Months ended Sept. 30, |        | Nine                Months ended Sept. 30, |   |
|------------------------------------------------------------------------|--------|---------------------------------------------|-------------|--------------------------------------------|--------|
|                                                                   |   | 2006                                        |        | 2005                                       |   | 2006 |   | 2005 |   |
|                                                                   |   |                                        |        |                                       |   |   |   |   |   |
| Computation                of loss per common share:                   |   |                                        |        |                                       |   |   |   |   |   |
|                                                                   |   |                                        |        |                                       |   |   |   |   |   |
|                   Net loss applicable to common  shares |   | $                                           | (1,913,038  | )                                          | $      | (1,516,913 | ) | $ | (5,110,787 | ) | $ | (4,258,316 | ) |
|                                                                   |   |                                        |             |                                       |   |  |   |   |  |   |   |  |   |
|                   Weighted average number of common shares   |   |                                        | 101,862,093 |                                       |   | 99,179,808 |   |   | 100,469,473 |   |   | 98,729,768 |   |
|                                                                   |   |                                        |             |                                       |   |  |   |   |  |   |   |  |   |
|                   Net income (loss) per common share         |   | $                                           | (0.02       | )                                          | $      | (0.02 | ) | $ | (0.05 | ) | $ | (0.04 | ) |
|                                                                   |   |                                        |             |                                       |   |  |   |   |  |   |   |  |   |
|                                                                   |   |                                        |             |                                       |   |  |   |   |  |   |   |  |   |
| Computation                of income ( loss ) per common               |   |                                        |             |                                       |   |  |   |   |  |   |   |  |   |
|                   share assuming full dilution**             |   |                                        |             |                                       |   |  |   |   |  |   |   |  |   |
|                                                                   |   |                                        |             |                                       |   |  |   |   |  |   |   |  |   |
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