SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

(Mark One)

[X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
         EXCHANGE ACT OF 1934

         For the quarterly period ended:   September 30, 1997

                                       OR

[  ]     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934

                           Commission File No.: 1-7986


                          Kent Financial Services, Inc.
        (Exact name of small business issuer as specified in its charter)


        Delaware                                       75-1695953
(State or other jurisdiction of                    (I.R.S. Employer
incorporation or organization)                     Identification No.)


           376 Main Street, P.O. Box 74, Bedminster, New Jersey 07921
                    (Address of principal executive offices)


                                 (908) 234-0078
                           (Issuer's telephone number)

                                       N/A
              (Former name, former address and former fiscal year,
                          if changed since last report)

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

     State the number of shares  outstanding of each of the issuer's  classes of
common stock:  As of October 31, 1997,  the issuer had  1,017,999  shares of its
common stock, par value $.10 per share, outstanding.

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





<PAGE>



PART I  - FINANCIAL INFORMATION
Item 1. - Financial Statements


<TABLE>

                 KENT FINANCIAL SERVICES, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEET

                                     ASSETS

                                   (UNAUDITED)

                                 ($000 Omitted)

<CAPTION>

                                                             September 30,
                                                                 1997
                                                             -------------

<S>                                                           <C>
Cash and cash equivalents                                      $ 8,168
Securities owned                                                 5,124
Net receivable from clearing broker                                664
Property and equipment:
     Land and building                                           1,440
     Office furniture and equipment                                225
                                                               -------
                                                                 1,665
     Accumulated depreciation                                 (    410)
                                                               -------
     Net property and equipment                                  1,255
                                                               -------
Other assets                                                       140
                                                               -------
          Total assets                                         $15,351
                                                               =======



          See accompanying notes to consolidated financial statements.

</TABLE>


<PAGE>


<TABLE>
                 KENT FINANCIAL SERVICES, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEET

                      LIABILITIES AND STOCKHOLDERS' EQUITY

                                   (UNAUDITED)

                                 ($000 Omitted)

<CAPTION>


                                                             September 30,
                                                                 1997
                                                             -------------
<S>                                                            <C>
Liabilities:
   Securities sold, not purchased                               $   755
   Accrued expenses                                               1,149
   Long-term debt                                                   525
   Accrual for discontinued operations                              408
                                                                -------
       Total liabilities                                          2,837
                                                                -------

Stockholders' equity:
   Preferred stock without par value, 500,000
     shares authorized; none issued                                   -
   Common stock, $.10 par value, 4,000,000
     shares authorized; 1,018,040 issued
       and outstanding                                              102
   Additional paid-in capital                                    15,248
   Accumulated deficit                                         (  2,836)
                                                                -------
       Total stockholders' equity                                12,514
                                                                -------
       Total liabilities and stockholders' equity               $15,351
                                                                =======



          See accompanying notes to consolidated financial statements.

</TABLE>

<PAGE>


<TABLE>


                 KENT FINANCIAL SERVICES, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS

                                   (UNAUDITED)

                      ($000 Omitted, except per share data)

<CAPTION>


                                                          Three Months Ended
                                                             September 30,
                                                       -------------------------
                                                        1997               1996
                                                       ------             ------
<S>                                                   <C>                 <C>
Revenues:
     Brokerage commissions and fees                    $  474             $  743
     Principal transactions:
          Trading                                         418                481
          Investing gains (losses)                    (     5)                44
     Interest, dividends and other                        238                251
                                                       ------             ------
                                                        1,125              1,519
                                                       ------             ------

Expenses:
     Brokerage                                            582                741
     General, administrative and other                    583                639
     Interest                                              89                 24
                                                       ------             ------
                                                        1,254              1,404
                                                       ------             ------

Earnings (loss) before income taxes                   (   129)               115
Provision (benefit)for income taxes                   (    20)                53
                                                       ------             ------
Net earnings (loss)                                   ($  109)            $   62
                                                       ======             ======

Net earnings (loss) per common share                  ($  .11)            $  .06
                                                       ======             ======


Weighted average number of common
  shares outstanding (in 000's)                         1,022              1,050
                                                       ======             ======



          See accompanying notes to consolidated financial statements.

</TABLE>


<PAGE>

<TABLE>


                 KENT FINANCIAL SERVICES, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS

                                   (UNAUDITED)

                      ($000 Omitted, except per share data)


<CAPTION>


                                                          Nine Months Ended
                                                            September 30,
                                                      --------------------------
                                                        1997               1996
                                                      -------            -------
<S>                                                  <C>                  <C>
Revenues:
     Brokerage commissions and fees                   $1,247              $2,658
     Principal transactions:
          Trading                                      1,203               1,745
          Investing gains (losses)                   (   577)              1,096
     Interest, dividends and other                       658               1,033
                                                      ------              ------

                                                       2,531               6,532
                                                      ------              ------

Expenses:
     Brokerage                                         1,638               2,936
     General, administrative and other                 1,544               2,131
     Interest                                            214                 171
                                                      ------              ------

                                                       3,396               5,238
                                                      ------              ------

Earnings (loss) before income taxes                  (   865)              1,294
Provision (benefit) for income taxes                 (    85)                339
                                                      ------              ------
Net earnings (loss)                                  ($  780)             $  955
                                                      ======              ======


Net earnings (loss) per common share                 ($  .76)             $  .91
                                                      ======              ======


Weighted average number of common
  shares outstanding (in 000's)                        1,032               1,051
                                                      ======              ======



          See accompanying notes to consolidated financial statements.

</TABLE>                                                         

<PAGE>


<TABLE>


                 KENT FINANCIAL SERVICES, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                                   (UNAUDITED)

                                 ($000 Omitted)

<CAPTION>


                                                           Nine Months Ended
                                                             September 30,
                                                       -------------------------
                                                        1997              1996
                                                       ------            -------
<S>                                                   <C>                <C>
Cash flows from operating activities:
     Net earnings (loss)                              ($  780)            $  955 
     Adjustments:
       Depreciation and amortization                       42                111
       Unrealized (gains) losses on
         marketable securities                            766            (   686)
       Change in marketable securities
         and U.S. Treasury securities                   2,505            ( 1,671)
       Change in net receivable from
         clearing broker                              (   882)               289
       Change in accounts payable and
         accrued expenses                             (   329)                69
       Other, net                                     (    25)           (    16)
                                                       ------             ------
       Net cash provided by (used in)
         operating activities                           1,297            (   949)
                                                       ------             ------


Cash flows from investing activities:
     Sale (purchase) of equipment, net                (    27)                33
     Other, net                                             -                 97
                                                       ------             ------
       Net cash provided by
         (used in) investing activities               (    27)               130
                                                       ------             ------

Cash flows from financing activities:
     Purchase of common stock                         (   188)           (    17)
     Payments on debt                                 (    23)           (    23)
     Other                                                  -            (    19)
                                                       ------             ------
       Net cash used in financing
         activities                                   (   211)           (    59)
                                                       ------             ------

Net increase (decrease) in cash and
  cash equivalents                                      1,059            (   878)
Cash and cash equivalents at
  beginning of period                                   7,109              8,259
                                                       ------             ------

Cash and cash equivalents at end of
  period                                               $8,168             $7,381
                                                       ======             ======

Supplemental disclosure of cash flow information:
     Cash paid for:
       Interest expense                                $  214             $  171
                                                       ======             ======
       Taxes                                           $  117             $   89
                                                       ======             ======


          See accompanying notes to consolidated financial statements.

</TABLE>


<PAGE>



                 KENT FINANCIAL SERVICES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           SEPTEMBER 30, 1997 AND 1996

                                   (Unaudited)


1.   Financial Condition and Operating Results
     -----------------------------------------

     The  accompanying  unaudited  consolidated  financial  statements  of  Kent
Financial  Services,  Inc. and subsidiaries  (the "Company") as of September 30,
1997 and for the three and nine month periods ended  September 30, 1997 and 1996
reflect all material adjustments consisting of only normal recurring adjustments
which,  in the opinion of management,  are necessary for a fair  presentation of
results for the interim periods.  Certain  information and footnote  disclosures
required under generally accepted  accounting  principles have been condensed or
omitted  pursuant to the rules and  regulations  of the  Securities and Exchange
Commission,  although the Company  believes that the disclosures are adequate to
make the information  presented not  misleading.  These  consolidated  financial
statements  should  be  read  in  conjunction  with  the  year-end  consolidated
financial  statements and notes thereto  included in the Company's Annual Report
on Form 10-KSB for the year ended December 31, 1996 as filed with the Securities
and Exchange Commission.

     The  preparation  of financial  statements  in  conformity  with  generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions  that  affect the  reported  amounts of assets and  liabilities  and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting period. Actual results could differ from those estimates.  Prior years
financial  statements  have been  reclassified  to conform to the current year's
presentation.

     The  results  of  operations  for the three and nine  month  periods  ended
September 30, 1997 and 1996 are not necessarily  indicative of the results to be
expected for the entire year or for any other period.

2.   Business
     --------

     The Company's  business is comprised  principally of the operation of T. R.
Winston  &  Company,  Inc.  ("Winston"),  a  wholly-owned  subsidiary,  and  the
management  of Asset  Value Fund  Limited  Partnership  ("AVF"),  an  investment
partnership  whose  primary  purpose is to make large  investments  in a limited
number of portfolio companies whose securities are considered undervalued by the
partnership's management.  Winston is a licensed securities broker-dealer and is
a member  of the  National  Association  of  Securities  Dealers,  Inc.  and the
Securities Investor Protection  Corporation.  All safekeeping,  cashiering,  and
customer   account   maintenance   activities   are  provided  by  an  unrelated
broker-dealer under a clearing agreement.

<PAGE>

     Pursuant to the net  capital  provisions  of Rule 15c3-1 of the  Securities
Exchange Act of 1934,  Winston is required to maintain  minimum net capital,  as
defined,  of $109,000.  At  September  30,  1997,  Winston had net  capital,  as
defined, of approximately  $771,000 which was $662,000 in excess of the required
minimum.


3.   Securities owned
     ----------------

     The following table describes  securities owned by the Company at September
30, 1997 (in  $000'S).  Equity  securities  are listed by  subsidiary,  with the
securities  valued at market value listed  separately from the securities valued
at fair value. Mutual funds, owned by Winston, are valued at market value.

<TABLE>
<CAPTION>


                              Marketable securities        Non-marketable
                                   valued at              securities valued        Total
                                  Market Value             at Fair Value        Securities
                              ----------------------     ------------------     -----------
<S>                                  <C>                        <C>                <C>
Equity
  securities:
          AVF                        $2,087                     $2,641             $4,728
          Winston                       260                          -                260
          Other                          35                          -                 35

Mutual funds                            101                          -                101
                                     ------                     ------             ------
             Total                   $2,483                     $2,641             $5,124
                                     ======                     ======             ======

</TABLE>


     The estimated  fair value of securities  owned has been  determined in good
faith under  consistently  applied  principles by the management of the Company,
using  available   market   information  and  other  valuation   considerations.
Considerable  judgment is required to develop the estimates of fair value, thus,
the estimates provided herein are not necessarily indicative of the amounts that
could be realized in a current market exchange.


4.   Net Earnings (Loss) Per Common Share
     ------------------------------------

     Net  earnings  (loss) per  common  share is based on the  weighted  average
number of shares  outstanding  adjusted  for the  assumed  conversion  of shares
issuable upon exercise of stock options where appropriate.

<PAGE>



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


Liquidity and Capital Resources
-------------------------------

     Kent Financial  Services,  Inc. (the "Company") had  consolidated  cash and
cash equivalents  (U.S.  Treasury bills with an original maturity of ninety days
or less) of $8.2 million and  securities  owned of $5.1 million at September 30,
1997. See Note 3 of Notes to  Consolidated  Financial  Statements for additional
information  on  the  valuation  of  securities  owned.  Net  cash  provided  by
operations was $1.3 million in the nine months ended September 30, 1997 compared
to a net use of cash by operations of $949,000 in the comparable period of 1996.
Cash flow from operations for the nine months ended September 30, 1997 increased
from the  comparable  period in 1996  principally  from the change in securities
owned and U.S.  Treasury  securities  less the change in the net receivable from
the clearing broker,  accounts payable and all other accrued expenses.  Net cash
used in financing activities of $211,000 for the nine months ended September 30,
1997 was  principally  comprised of the purchase of Company common stock,  which
was subsequently retired and payments on the mortgage loan collateralized by the
Company's  headquarters  building.  The Company  believes  that its liquidity is
sufficient for future operations.


Material Changes in Results of Operations
-----------------------------------------

     The Company had a net loss of  $109,000,  or $.11 per share,  for the three
months ended  September  30, 1997  compared to net income of $62,000 or $.06 per
share,  for the comparable  quarter in 1996. For the nine months ended September
30, 1997, the net loss was $780,000,  or $.76 per share,  compared to net income
of $955,000, or $.91 per share, for the comparable period in the prior year.

     Total  brokerage  income  (consisting  of brokerage  commissions,  fees and
trading  gains) for the three months ended  September 30, 1997 was  $892,000,  a
decrease  of  $332,000,  or  27.1%,  from  approximately  $1.2  million  in  the
comparable  1996 period.  Total  brokerage  income was $2.5 million for the nine
months ended  September  30, 1997, a decrease of $2.0 million or 44.4% from $4.4
million for the nine month period ended September 30, 1996.  Brokerage  expenses
(including  all fixed and variable  expenses)  decreased by $159,000,  or 21.5%,
from $741,000 in the quarter ended September 30, 1996, to $582,000 for the three
months ended  September 30, 1997. For the nine months ended  September 30, 1997,
brokerage expenses were $1.6 million compared to $2.9 million for the comparable
period in the prior year,  a decrease of $1.3  million or 44.2%.  Net  brokerage
income of $310,000 for the three months ended  September 30, 1997 decreased from
$483,000 from the same period in 1996, a decrease of $173,000 or 35.8%.  For the
nine month period ended  September 30, 1997, net brokerage  income was $812,000,
compared to $1,467,000 for the nine months ended  September 30, 1996, a decrease
of $655,000, or 44.7%.

<PAGE>



     The reduction in total brokerage  income,  total brokerage  expense and net
brokerage  income for the quarter ended  September 30, 1997 from the  comparable
quarter of 1996 was  primarily  due to a decrease in the total number of brokers
employed at T. R. Winston & Company,  Inc. ("Winston") in 1997 compared to 1996.
Additionally,  Winston  participated in a private placement of securities in the
third quarter of 1996 that contributed net revenue of $175,000.  The decrease in
total brokerage  income and expense and net brokerage income for the nine months
ended  September  30, 1997  compared to the  same period in 1996  was due to the
reasons mentioned above as well as the closing of the New York office of Winston
on March 31, 1996.

     Net investing losses were $5,000 and $577,000 for the three and nine months
ended  September  30, 1997,  respectively,  compared to net gains of $44,000 and
$1.1 million, respectively, for the comparable  periods in 1996. The decrease in
net investing  gains from the three and nine month  periods ended  September 30,
1996 to the comparable periods in 1997 reflected the decline in the valuation of
selected securities owned in 1997. See Note 3 of Notes of Consolidated Financial
Statements for additional information on the valuation of securities owned.

     Interest,  dividend  and other  income was  $238,000  and  $251,000 for the
quarters  ended  September 30, 1997 and 1996  respectively.  For the nine months
ended September 30, 1997,  interest,  dividend and other income was $658,000,  a
decrease of $375,000  from the same period in the prior year.  This decrease was
principally  the result of lower  interest  income on  customer  balances at the
clearing broker in 1997 compared to 1996 and the sale of Winston's Pacific Stock
Exchange seat in 1996 which resulted in a gain of $100,000.

     General and  administrative  expenses  were  $583,000  and $639,000 for the
quarters  ended  September  30,  1997 and 1996,  respectively,  a decrease  from
quarter  to  quarter  of  $56,000  or  8.8%.  The  reduction  was  due to  lower
professional  fees in 1997 than 1996. For the nine month periods ended September
30, 1997 and 1996,  general and  administrative  expenses  were $1.5 million and
$2.1 million  respectively,  a decrease of $587,000 or 27.5%.   The decrease for
the nine months ended September 30, 1997 compared to the same period in 1996 was
principally the result of lower  administrative  costs related to the closing of
Winston's New York office, as well as lower overall transaction volume.


     In June 1997, the Financial  Accounting Standards Board issued Statement of
Financial Accounting Standards (SFAS) No. 131, "Disclosures about Segments of an
Enterprise  and Related  Information,"  which will be effective  for the Company
beginning  January 1, 1998.  SFAS No. 131 redefines  how operating  segments are
determined  and  requires  expanded  quantitative  and  qualitative  disclosures
relating to a company's  operating  segments.  The Company has not yet completed
its analysis of which operating segments it will report on. The Company does not
believe  the  adoption  of SFAS No. 131 will have a  material  impact on current
disclosures.

                                                       
<PAGE>



PART II - OTHER INFORMATION

Item 4. -  Submission of Matters to a Vote of Security Holders
-------    ----------------------------------------------------

     The Company held its Annual  Meeting of  Stockholders  on October 20, 1997.
Management's  nominees,  Messrs.  Paul O. Koether,  Mathew E. Hoffman,  Casey K.
Tjang and M. Michael Witte were elected to the Board of Directors.


     The following is a tabulation for all nominees:
<TABLE>   
<CAPTION>

                                                For                    Withheld
                                             ---------                ----------
            <S>                               <C>                       <C>
            Paul O. Koether                   700,489                   21,155
            Mathew E. Hoffman                 703,210                   18,434
            Casey K. Tjang                    703,210                   18,434
            M. Michael Witte                  703,187                   18,457


</TABLE>

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

        (a)      Exhibits
                 --------

            27.     Financial Data Schedule for the nine months ended September
                    30, 1997.


        (b)    Reports on Form 8-K
               -------------------

            No reports on Form 8-K were filed  during the quarter for which this
            report is being filed.


<PAGE>

                                   SIGNATURES


     In accordance with the requirements of the Securities Exchange Act of 1934,
the registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.


                                                KENT FINANCIAL SERVICES, INC.


Dated:  November 10, 1997                       By: /s/ Mark Koscinski
                                                    -------------------------
                                                    Mark Koscinski
                                                    Vice President and
                                                    Principal Accounting Officer