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EXHIBIT 14
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                                 TELKONET, INC.

                                 CODE OF ETHICS


I. PURPOSE AND APPLICABILITY

         The Board of Directors of Telkonet, Inc. (the "Corporation") has
established this Code of Ethics (the "Code") for the purpose of deterring
wrongdoing and promoting:

         o    Honest and ethical conduct, including, but not limited to, the
              ethical handling of actual or apparent conflicts of interest
              between personal and professional relationships;

         o    Full, fair, accurate, timely, and understandable disclosure in
              reports and documents that the Corporation files with, or submits
              to, the United States Securities and Exchange Commission (the
              "Commission") and other public communications of the Corporation;

         o    Compliance with applicable governmental laws, rules and
              regulations;

         o    Prompt internal reporting to the audit committee of the
              Corporation's Board of Directors (the "Audit Committee") of
              violations of the Code; and

         o    Accountability for adherence to the Code.

         The Code applies to the Corporation's Chief Executive Officer, Chief
Financial Officer and Chief Operating Officer, who are the Corporation's
principal executive officers, respectively (individually a "Senior Officer" and
collectively the "Senior Officers"). The provisions contained in the Code are
designed to serve as guidelines for the Senior Officers in the performance of
their duties on behalf of the Corporation. Accordingly, the Code does not create
any new rights in any employee, customer, supplier, competitor, shareholder or
any other person or entity.

II. ADMINISTRATION

         The Audit Committee shall administer the Code and may amend the Code
from time to time as it deems necessary or appropriate. The Audit Committee
shall determine, or shall designate other individuals to determine, appropriate
action in response to violations of the Code. However, it is the individual
responsibility of each Senior Officer to comply with the Code and the policies
and procedures set forth herein.

III. STANDARDS OF CONDUCT

         It is the policy of the Corporation to comply with all applicable laws,
regulations, orders, directives and judgments of any federal, state and local
governmental agency or authority, court or administrative body (collectively
referred to herein as the "Law"). The Corporation expects that each of its
Senior Officers will obey the Law when acting on behalf of the Corporation.

         The Corporation also expects that each of its Senior Officers shall, in
the performance of his or her duties:

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         o    Engage in honest and ethical conduct in accordance with prevailing
              standards of business conduct; and

         o    Deal fairly, honestly and in good faith with the Corporation's
              customers, suppliers, competitors and employees in accordance with
              prevailing standards of business conduct.

IV. CONFLICTS OF INTEREST

         A. TRANSACTIONS AND INVESTMENTS. A Senior Officer shall not knowingly
participate in any transaction or investment that conflicts with, or would
reasonably appear to conflict with, the interests of the Corporation.

         B. USE OF POSITION OR CORPORATION PROPERTY OR INFORMATION. A Senior
Officer shall not use his or her position or the Corporation's property or
information for personal gain or the personal gain of members of his or her
family or a business in which he or she has a material financial interest.

         C. COMPETITION WITH THE CORPORATION. A Senior Officer shall not compete
directly with the Corporation while serving as an officer of the Corporation, if
such competition causes injury to or has a substantial detrimental effect on the
Corporation.

         D. BUSINESS OPPORTUNITIES. A Senior Officer shall not appropriate any
business opportunity belonging to the Corporation while serving as an officer of
the Corporation. The following factors should be considered in determining
whether a business opportunity belongs to the Corporation:

         o    The relationship between the Corporation's line of business and
              the business opportunity;

         o    The Corporation's financial ability to take the business
              opportunity;

         o    The availability of the business opportunity to the Corporation;

         o    Whether the business opportunity entails competition with the
              Corporation;

         o    The capacity in which the business opportunity was presented to
              the Senior Officer;

         o    The Corporation's interest in or expectancy of the business
              opportunity;

         o    Whether the Senior Officer utilized the Corporation's resources in
              pursuing the opportunity; and

         o    The practical advantage to the Corporation of the business
              opportunity.

         E. PROMPT DISCLOSURE OF POTENTIAL CONFLICTS. A Senior Officer shall
promptly disclose to the Audit Committee any transaction or investment that is
the subject of, or could be construed as the subject of, this Section IV.

V. COMPLIANCE WITH INTERNAL POLICIES AND PROCEDURES

         A. CONFIDENTIAL INFORMATION. A Senior Officer shall maintain the
confidentiality of the Corporation's non-public information and any non-public
information of third parties in accordance with the Corporation's
confidentiality policies and any confidentiality agreements entered into by the
Corporation.

         B. POLICY PROHIBITING INSIDER TRADING. A Senior Officer shall observe
the Corporation's policy prohibiting trading on the basis of material,
non-public information.

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         C. PUBLIC COMPANY REPORTING. A Senior Officer shall observe the
Corporation's disclosure controls and procedures with respect to filings made by
the Corporation with the Commission.

         D. OTHER POLICIES AND PROCEDURES. A Senior Officer shall observe the
Corporation's policies and procedures prohibiting retaliation, discrimination or
harassment in the workplace.

VI. REPORTING PROCEDURES AND VIOLATIONS

         A. REPORTING OF VIOLATIONS. A Senior Officer shall report promptly to
the Audit Committee any violations or suspected violations of the Code or any
Law (each, a "Violation"). The Audit Committee shall take all appropriate action
to investigate any Violations or suspected Violations

         B. NO RETALIATION. The Corporation shall not discharge, demote,
suspend, threaten, harass, or discriminate in any other manner against any
employee with respect to his or her terms or conditions of employment because
the employee lawfully:

         o    Provides information, causes information to be provided, or
              otherwise assists in an investigation regarding any conduct that
              the employee reasonably believes constitutes a Violation or a
              suspected Violation; or

         o    Files, causes to be filed, testifies, participates in, or
              otherwise assists in a proceeding filed or about to be filed,
              relating to an alleged Violation.

         C. WAIVER. The provisions of the Code may be waived only by the Board
of Directors, the Audit Committee, or other committee of the Board of Directors
to which the Board of Directors has delegated such authority. Notwithstanding
the foregoing, the Corporation may not waive Paragraph B of this Section VI. Any
changes to or waivers of any provision of the Code shall be disclosed in the
Corporation's annual report on Form 10-KSB filed with the Commission, or
otherwise as may be required or permitted by law.

         D. CONSEQUENCES OF VIOLATION. Violations of the Code shall subject the
Senior Officer to disciplinary action, including, without limitation,
suspension, demotion or discharge.

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