UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON D. C. 20549

                                   FORM 10-QSB

(X)      Quarterly report pursuant to Section 13 or 15(d) of the Securities and
         Exchange Act of 1934.

                FOR THE QUARTERLY PERIOD ENDED FEBRUARY 28, 2005.


( )      Transition report pursuant to Section 13 or 15(d) of the Exchange Act
         for the transition period from ____________ to ____________.


                         COMMISSION FILE NUMBER: 0-20936


                                DIVERSIFAX, INC.
                                ----------------
               (Exact name of registrant as specified in charter)


           DELAWARE                                     13-3637458
           --------                                     ----------
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
 incorporation or organization)


              4274 INDEPENDENCE COURT, SARASOTA, FLORIDA 34234-2109
              -----------------------------------------------------
                    (Address of principal executive offices)


                                 (941) 351-2720
                                 --------------
              (Registrant's Telephone Number, Including Area Code)


Check whether the registrant: (1) has filed all reports required to be filed by
Section by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days.

                                 YES ( ) NO (X)

State the number of shares outstanding of each of the issuer's classes of common
equity as of September 15, 2005

                                26,262,200 SHARES


Transitional Small Business Disclosure Format:

                                 YES ( ) NO (X)
<PAGE>

PART I - FINANCIAL INFORMATION

     Item 1 - Financial Statements

         Consolidated Balance Sheets for February 28, 2005 (unaudited)
         and November 30, 2004 ................................................1

         Consolidated Statements of Operations (unaudited) for the
         three months ended February 28, 2005 and February 29, 2004 ...........2

         Consolidated Statements of Cash Flows (unaudited) for the
         three months ended February 28, 2005 and February 29, 2004 ...........3

         Notes to Consolidated Condensed Financial Statements .................4

     Item 2 - Management's Discussion and Analysis of Financial Condition
              and Results of Operations .......................................6

     Item 3 - Controls and Procedures .........................................9


PART II - OTHER INFORMATION

     Item 1 - Legal Proceedings ...............................................9

     Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds .....9

     Item 3 - Defaults Upon Senior Securities .................................9

     Item 4 - Submission of Matters To A Vote of Security Holders .............9

     Item 5 - Other Information ...............................................9

     Item 6 - Exhibits ........................................................9

<PAGE>

                        DIVERSIFAX, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS


                                                                   FEBRUARY 28,
                                                                       2005
                                                                    (UNAUDITED)
                                                                   ------------
ASSETS
CURRENT ASSETS
Cash and cash equivalents ......................................   $    241,942
Other current assets ...........................................            320
                                                                   ------------

     TOTAL CURRENT ASSETS ......................................        242,262

Equipment and vehicles, net ....................................         28,994
Note receivable, less allowance ................................         65,456
                                                                   ------------

                                                                   $    336,712
                                                                   ============


LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES
Current maturities of long-term debt and notes payable .........   $     10,287
Accounts payable ...............................................         23,334
Accrued expenses and other current liabilities .................         14,345
Accrued payroll, stockholder ...................................        951,905
Loan payable, officer/stockholder ..............................      1,856,451
Deferred revenue ...............................................        206,250
                                                                   ------------

     TOTAL CURRENT LIABILITIES .................................      3,062,572
                                                                   ------------

Long-term debt and notes payables, less current maturities .....         21,697
                                                                   ------------

STOCKHOLDERS' DEFICIT
Common stock, $.001 par value, 40,000,000 shares authorized;
    26,626,200 shares issued; 26,299,702 shares outstanding ....         26,626
Additional paid-in capital .....................................     11,641,395
Accumulated deficit ............................................    (14,147,230)
                                                                   ------------
                                                                     (2,479,209)
Less:  Treasury stock; 326,498 shares at cost ..................       (268,348)
                                                                   ------------
     TOTAL STOCKHOLDERS' DEFICIT ...............................     (2,747,557)
                                                                   ------------

                                                                   $    336,712
                                                                   ============

    The accompanying notes are an integral part of the financial statements.

                                        1
<PAGE>

                        DIVERSIFAX, INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)


                                                       THREE MONTHS ENDED
                                                  FEBRUARY 28, AND FEBRUARY 29,
                                                  -----------------------------
                                                      2005             2004
                                                  ------------     ------------

SALES ........................................    $    145,320     $    181,146
                                                  ------------     ------------

COSTS AND EXPENSES
    Cost of sales ............................          85,791          101,444
    Depreciation expense .....................           2,876            4,244
    Selling, general and administrative ......          89,453           94,456
                                                  ------------     ------------
                                                       178,120          200,144
                                                  ------------     ------------

NET OPERATING LOSS ...........................         (32,800)         (18,998)
                                                  ------------     ------------

OTHER INCOME (EXPENSES):
    Other income .............................          19,125           18,750
    Interest income ..........................           1,580            3,050
    Interest expense .........................         (10,072)         (10,057)
                                                  ------------     ------------
                                                        10,633           11,743
                                                  ------------     ------------

NET LOSS BEFORE INCOME TAXES .................         (22,167)          (7,255)

INCOME TAX PROVISION .........................              --               --
                                                  ------------     ------------

NET LOSS .....................................    $    (22,167)    $     (7,255)
                                                  ============     ============

WEIGHTED AVERAGE COMMON SHARES
    OUTSTANDING - BASIC ......................      26,299,702       26,299,702
                                                  ============     ============

EARNINGS PER SHARE OF COMMON
    STOCK - BASIC ............................    $       0.00     $       0.00
                                                  ============     ============

    The accompanying notes are an integral part of the financial statements.

                                        2
<PAGE>

                        DIVERSIFAX, INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)


                                                       THREE MONTHS ENDED
                                                  FEBRUARY 28, AND FEBRUARY 29,
                                                  -----------------------------
                                                      2005             2004
                                                  ------------     ------------
OPERATING ACTIVITIES:
Net loss .....................................    $    (22,167)    $     (7,255)
                                                  ------------     ------------
Adjustments to reconcile net loss to net cash
  used by operating activities:
    Depreciation and amortization ............           2,876            4,244
    Amortization of deferred revenue .........         (18,750)         (18,750)
    Decrease in other current assets .........             180            1,392
    Increase (decrease) in:
      Accrued expenses .......................         (31,520)         (39,283)
      Accrued payroll, stockholder ...........          33,080           33,079
                                                  ------------     ------------
Total adjustments ............................         (14,134)         (19,318)
                                                  ------------     ------------
Net cash used by operating activities ........         (36,301)         (26,573)
                                                  ------------     ------------

INVESTING ACTIVITIES:
  Capital expenditures .......................               -             (185)
  Collections on note receivable .............             260            1,725
                                                  ------------     ------------
Net cash provided by investing activities ....             260            1,540
                                                  ------------     ------------

FINANCING ACTIVITIES:
  Net repayments under loan payable to
    officer/stockholder ......................          (7,112)        (179,723)
  Repayments on long-term debt and notes
    payable ..................................          (2,379)            (686)
                                                  ------------     ------------
Net cash used by financing activities ........          (9,491)        (180,409)
                                                  ------------     ------------

NET DECREASE IN CASH AND CASH EQUIVALENTS ....         (45,532)        (205,442)

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD         287,477          461,140
                                                  ------------     ------------

CASH AND CASH EQUIVALENTS, END OF PERIOD .....    $    241,942     $    255,698
                                                  ============     ============

SUPPLEMENTAL DISCLOSURE CASH FLOW INFORMATION:
  Interest paid ..............................    $         50     $         58
                                                  ============     ============

    The accompanying notes are an integral part of the financial statements.

                                        3
<PAGE>

                        DIVERSIFAX, INC. AND SUBSIDIARIES
              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS


NOTE A.  NATURE OF BUSINESS AND INTERIM FINANCIAL STATEMENTS

Nature of business:
-------------------

DiversiFax, Inc. (the "Company") has been engaged, since November 1993, in the
business of owning, leasing, and operating coin and debit card pay-per-copy
photocopy machines, fax machines, microfilm reader-printers and accessory
equipment.

Due to the increased use of internet services, demand for the services provided
by the Company has declined sharply.

The Company was incorporated under the laws of the State of Delaware on February
28, 1989. The Company's principal executive offices and operations center are
located at 4274 Independence Court, Sarasota, Florida 34234-2109, telephone
number (941) 351-2720.

Interim financial statements:
-----------------------------

The interim consolidated financial statements presented herein are unaudited and
have been prepared in accordance with the instructions to Form 10-QSB and Item
310 of Regulation S-B These statements should be read in conjunction with the
audited consolidated financial statements and notes thereto included in our
annual report on Form 10-KSB for the year ended November 30, 2004. In the
opinion of management the interim statements include all adjustments (consisting
only of normal recurring adjustments) necessary to summarize fairly our
financial position, results of operations, and cash flows. The results of
operations and cash flows for the three months ended February 28, 2005 may not
be indicative of the results that may be expected for the year ending November
30, 2005.

NOTE B.  GOING CONCERN

The accompanying consolidated financial statements have been prepared on a going
concern basis, which contemplates the realization of assets and liabilities. In
the ordinary course of business, operating losses have been incurred resulting
in an accumulated deficit of $14,147,230 at February 28, 2005 and $14,150,353 at
February 29, 2004. Currently, the Company's Chief Executive Officer funds any
operating deficits, and management believes that actions presently being taken
to restructure operations provide the opportunity for the Company to continue as
a going concern; however, no assurance can be given. These conditions raise
substantial doubt about the Company's ability to continue as a going concern.
The consolidated financial statements of the Company do not include any
adjustments relating to the recoverability and classification of recorded asset
amounts or the amounts and classification of liabilities that might be necessary
should the Company be unable to continue as a going concern.

                                        4
<PAGE>

                        DIVERSIFAX, INC. AND SUBSIDIARIES
              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS


NOTE C.  SUBSEQUENT EVENT

On March 15, 2005, DiversiFax entered into a Management Agreement with Evolve
One whereby DiversiFax will make available to Evolve One its facilities at 39
Stringham Avenue, Valley Stream, New York; the services on a part-time basis of
7 persons presently employed by DiversiFax for approximately 100 hours per week;
equipment, hardware and software of DiversiFax; and related utilities and
overhead functions at that facility. The term of the agreement is for six months
and may be terminated prior to the conclusion of its term on ten days' prior
written notice by either party, or the agreement may be renewed for a successive
six-month term.

In consideration for the management services and facilities provided by
DiversiFax during the initial six-month term, Evolve One has issued to
DiversiFax 2,900,000 shares of its common stock. In addition, in the event the
market price of the common stock of Evolve One on the six-month anniversary date
is below $0.15 per share, Evolve One will issue to DiversiFax additional shares
of its common stock so that the common shares provided to DiversiFax plus such
additional shares of common stock will be equal in value to $435,000. In
addition, DiversiFax will receive 10% of the total amount of the monies received
as a result of their efforts with regard to auctions being completed for
accounts they have introduced to AuctionStore.com, Evolve One's wholly-owned
subsidiary. Payment of the percentage fee will be made in cash or stock as
determined by DiversiFax .

                                        5
<PAGE>

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

The following discussions should be read in conjunction with our Consolidated
Financial Statements and the notes thereto presented in "Item 1 - Financial
Statements" and our audited financial statements and the related Management's
Discussion and Analysis of Financial Condition and Results of Operations
included in our report on Form 10-KSB for the year ended November 30, 2004. The
information set forth in this "Management's Discussion and Analysis of Financial
Condition and Results of Operations" includes forward-looking statements that
involve risks and uncertainties. Many factors could cause actual results to
differ materially from those contained in the forward-looking statements below.

OVERVIEW

Effective November 1, 1993, DiversiFax, Inc. (the "Company") acquired all of the
outstanding common stock of IMSG Systems, Inc. ("IMSG") and its affiliated
companies, National Copy Corp. ("National"), Capital Copy Corp. ("Capital") and
Advanced Business Systems, Inc. ("Advanced") (IMSG, National, Capital and
Advanced collectively "IMSG and Affiliates") in exchange for the issuance of
662,000 shares of Series A, convertible preferred stock. The preferred stock was
automatically converted into an aggregate of 6,620,000 shares of common stock of
the Company in November, 1995.

IMSG and Affiliates owns, supplies and maintains self-service coin and card
reader operated photocopy machines in colleges, universities, libraries,
courthouses, government agencies, pharmacies and other retail establishments
throughout the eastern United States.

The Company is primarily responsible for the collection of the payments and most
locations share in the revenue from the photocopy machines.

GOING CONCERN AND MANAGEMENT'S PLANS

The accompanying consolidated financial statements have been prepared on a going
concern basis, which contemplates the realization of assets and liabilities. In
the ordinary course of business, operating losses have been incurred resulting
in an accumulated deficit of $14,147,230 at February 28, 2005 and $14,150,353 at
February 29, 2004. Currently, the Company's Chief Executive Officer funds any
operating deficits, and management believes that actions presently being taken
to restructure operations provide the opportunity for the Company to continue as
a going concern; however, no assurance can be given. These conditions raise
substantial doubt about the Company's ability to continue as a going concern.
The consolidated financial statements of the Company do not include any
adjustments relating to the recoverability and classification of recorded asset
amounts or the amounts and classification of liabilities that might be necessary
should the Company be unable to continue as a going concern.

                                        6
<PAGE>

CRITICAL ACCOUNTING POLICIES

The following discussion and analysis is based upon our consolidated financial
statements, which have been prepared in accordance with accounting principles
generally accepted in the United States of America. The preparation of our
financial statements requires management to make estimates and assumptions that
affect the reported amounts of revenues and expenses, and assets and liabilities
during the periods reported. Estimates are used when accounting for certain
items such as revenues, allowances for doubtful accounts, depreciation, taxes,
valuation of investments, and long-lived assets. We base our estimates on
historical experience, where applicable, and other assumptions that we believe
are reasonable under the circumstances. Actual results may differ from our
estimates under different assumptions or conditions. We believe that the
following critical accounting policies reflect our more significant judgments
and estimates used in preparation of our consolidated financial statements.

The consolidated financial statements include the accounts of the Company and
its wholly owned subsidiaries. All significant intercompany accounts and
transactions have been eliminated.

The Company considers all highly liquid investments purchased with an original
maturity of three months or less to be cash equivalents.

The majority of cash is maintained with a major financial institution in the
United States. Deposits with this bank may exceed the amount of insurance
provided on such deposits. Generally, these deposits may be redeemed upon demand
and, therefore, bear minimal risk.

Equipment and vehicles are recorded at cost. Depreciation is computed using the
straight-line method over the estimated useful lives of the respective assets,
ranging generally from five to ten years. For income tax purposes, the Company
uses accelerated methods for all assets. Maintenance and repairs are charged to
operations when incurred. Betterments and renewals are capitalized. When
equipment and vehicles are sold or otherwise disposed of, the asset account and
related accumulated depreciation account are relieved, and any gain or loss is
included in operations.

Loss per share has been computed using the weighted average number of common and
common equivalent shares outstanding during each period presented. Common
equivalent shares for outstanding options and warrants were not included in the
weighted average shares outstanding where the effect would be anti-dilutive.

Revenue from the Company's self-service coin and card reader operated photocopy
machines is principally recognized at the time payment is received. Revenue from
the Company's scanner units is recognized when the product is shipped.

Deferred revenue is recorded for amounts received but not earned as of the
balance sheet dates. Income from these transactions is recognized as earned or
on a straight-line basis over the term of the contract.

                                        7
<PAGE>

RESULTS OF OPERATIONS FOR THREE MONTHS ENDED FEBRUARY 28, 2005 COMPARED TO
FEBRUARY 29, 2004

Sales: Sales for the first quarter of 2005 decreased $35,826, or 20% to $145,320
from $181,146 for the first quarter of 2004. This decrease represents the
continuing decline in demand for the Company's products. The majority of the
Company's customers are maintained pursuant to contractual agreements, generally
ranging from three to five years. Over the past few years, the Company's
business has become increasingly competitive. Accordingly, when contracts come
up for renewal, the Company may be out bid by its competitors. Secondly, the
Company has continued a critical review of its customer base, and has determined
not to renew customer contracts where the costs of maintaining such customers
exceeded the benefits. This often occurs when the required commission structure
is excessive or the customer's demands for equipment are not reasonable.

Cost of Sales: Cost of sales for the first quarter of 2005 decreased $15,653, or
15% to $85,791 from $101,444 for the first quarter of 2004. Cost of sales
represented 59% of sales for the first quarter of 2005 compared to 56% of sales
for the first quarter of 2004. The decrease is generally due to reduced sales in
the current quarter.

Selling, general and administrative expenses: Selling, general and
administrative expenses decreased to $89,453 or 61% of sales for the first
quarter of 2005 from $94,456 or 52% of sales for the first quarter of 2004. This
decrease is primarily attributable to the recovery of bad debt offset by
purchases of spare parts for copy machines.

The above factors resulted in a net loss of $22,167 for the first quarter of
2005 compared to net loss of $7,255 for the first quarter of 2004.

The Company's Copier activities are subject to seasonal fluctuations. Revenues
from Copiers tend to be lower during the summer months of June through September
and in the last weeks of December and the first weeks of January due to school
and employee vacation patterns.

LIQUIDITY AND CAPITAL RESOURCES

At February 28, 2005, the Company had cash of $241,942 as compared to $287,474
at November 30, 2004.

The Company's primary need for funds is to finance working capital, capital
expenditures and the further development and the acquisition of new businesses
and the further growth of acquisitions to broaden and diversify its revenue
source making it less seasonal.

Net cash used in operating activities of $36,301 during the first quarter of
2005 resulted from the net loss of $22,167 offset by non-cash items including
depreciation of $2,876 and amortization of deferred revenue of $18,750. In
addition, net cash used in operating activities included a decrease in accrued
expenses and an increase in accrued payroll, stockholder.

Net cash used in financing activities amounted to $9,491 during the first
quarter of 2005. At February 28, 2005, the amount of the loan payable,
officer/stockholder by the Company to Dr. Irwin Horowitz was $1,856,451.

The above resulted in a net decrease in cash of $45,532 for the year first
quarter of 2005.

                                        8
<PAGE>

Management continues to believe the expected cash flow from operations, and the
willingness and ability of the Company's Chief Executive officer to fund any
operating deficit will allow the Company to continue operations over the next 12
months. However, no assurance can be given that these factors will materialize.

ITEM 3.  CONTROLS AND PROCEDURES

Evaluation of disclosure controls and procedures.
-------------------------------------------------

(a) Under the supervision and with the participation of our Management,
including our principal executive officer and principal financial officer, we
conducted an evaluation of the effectiveness of the design and operations of our
disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e)
under the Securities Exchange Act of 1934, as of February 28, 2005. Based on
this evaluation, our principal executive officer and principal financial officer
concluded that our disclosure controls and procedures were effective such that
the material information required to be included in our Securities and Exchange
Commission ("SEC") reports is recorded, processed, summarized and reported
within the time periods specified in SEC rules and forms relating to DiversiFax,
Inc., and was made known to them by others within those entities, particularly
during the period when this report was being prepared.

(b) There were no significant changes in internal controls or in other factors
that could significantly affect internal controls during the quarter. We have
not identified any significant deficiency or material weaknesses in our internal
controls, and therefore there were no corrective actions taken.

                           PART II - OTHER INFORMATION

ITEM 1 - LEGAL PROCEEDINGS -

The Company is not a party to any material legal proceedings, except as follows:

         (1) Jacksonville Public Library re breach of contract

         (2) Ikon Business Solutions re commission

The Company believes that the outcome of the above actions will not have a
material adverse effect on the Company's financial condition.

ITEM 2 - UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS - None

ITEM 3 - DEFAULTS UPON SENIOR SECURITIES - None

ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS - None

ITEM 5 - OTHER INFORMATION - None

ITEM 6 - EXHIBITS

Exhibits are filed as part of, or incorporated by reference into this report.

10.1     Material contract with Evolve One, Inc.

31.1     Certification of the Chief Executive Officer, dated September 19, 2005

32.1     Certification of the Chief Executive Officer, dated September 19, 2005

                                        9
<PAGE>

                                   SIGNATURES

         In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.


                                        DIVERSIFAX, INC.


Date: September 19, 2005                /s/ Irwin A. Horowitz
                                        ---------------------
                                        Dr. Irwin A. Horowitz
                                        Chairman of the Board,
                                        Chief Executive Officer and President
                                        (principal executive officer)


                                       10