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

                                   FORM 10-QSB

                                   (Mark One)

   [X]    QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
          ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED AUGUST 31, 2005

   [ ]    TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT FOR
          THE TRANSITION PERIOD FROM __________ TO __________


                        Commission file number 000-26331
                                               ---------

                            GREYSTONE LOGISTICS, INC.
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        (Exact name of small business issuer as specified in its charter)

           OKLAHOMA                                          75-2954680
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(State or other jurisdiction of                           (I.R.S. Employer
 incorporation or organization)                          Identification No.)

                  1613 EAST 15TH STREET, TULSA, OKLAHOMA 74120

                    (Address of principal executive offices)

                                 (918) 583-7441
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                           (Issuer's telephone number)


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              (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 registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes [X] No [ ]

Indicate by checkmark whether the registrant is a shell company (as defined in
rule 12b-2 of the Exchange Act). Yes [ ] No [X]

APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: October 7, 2005 - 24,061,201

TRANSITIONAL SMALL BUSINESS DISCLOSURE FORMAT (CHECK ONE): Yes [ ] No [X]
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<PAGE>

                            GREYSTONE LOGISTICS, INC.
                                   FORM 10-QSB
                      FOR THE PERIOD ENDED AUGUST 31, 2005

PART I.  FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS                                               PAGE

             Condensed Consolidated Balance Sheets as of August 31,
             2005 and May 31, 2005                                            1

             Condensed Consolidated Statement of Operations
             For the Three Month Periods Ended August 31, 2005 and 2004       2

             Condensed Consolidated Statements of Cash Flows
             For the Three Month Periods Ended August 31, 2005 and 2004       3

             Notes to Financial Statements                                    4

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION            5

ITEM 3.  CONTROLS AND PROCEDURES                                              9

PART II.  OTHER INFORMATION

ITEM 6.  EXHIBITS                                                             9

SIGNATURES                                                                   11

<PAGE>
ITEM 1.  FINANCIAL INFORMATION

                   GREYSTONE LOGISTICS, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEET

<TABLE><CAPTION>
                                                                             AUGUST 31,          MAY 31,
                                                                                2005              2005
                                                                            ------------      ------------
<S>                                                                         <C>               <C>
                                                   ASSETS
                                                   ------
CURRENT ASSETS:
      Cash                                                                  $     74,353      $      1,410
      Accounts receivable, net of allowance for doubtful
          accounts of $190,364 at August 31, 2005 and May 31, 2005             1,526,836         1,573,635
      Inventory                                                                  797,947           535,523
      Prepaid expenses                                                              --              10,932
                                                                            ------------      ------------
          TOTAL CURRENT ASSETS                                                 2,399,136         2,121,500

PROPERTY, PLANT AND EQUIPMENT,
      net of accumulated depreciation of $1,481,944 and
      $1,312,056 at August 31, 2005 and May 31, 2005, respectively             8,258,729         7,189,652

OTHER ASSETS:
      Patents, net of accumulated amortization                                   162,486           164,951
                                                                            ------------      ------------

TOTAL ASSETS                                                                $ 10,820,351      $  9,476,103
                                                                            ============      ============

                                  LIABILITIES AND STOCKHOLDERS' DEFICIENCY
                                  ----------------------------------------

CURRENT LIABILITIES:
      Current portion of long-term debt                                     $  2,424,180      $  2,117,222
      Advances payable - related party                                         2,127,716           952,216
      Accounts payable and accrued expenses                                    2,637,419         2,631,676
      Preferred dividends payable                                                153,237            33,785
                                                                            ------------      ------------
          TOTAL CURRENT LIABILITIES                                            7,342,552         5,734,899

LONG-TERM DEBT                                                                 8,748,088         8,026,739

STOCKHOLDERS' DEFICIENCY:
      Preferred stock, $0.0001 par value, 20,750,000 shares authorized,
        50,000 shares outstanding, liquidation preference of $5,000,000                5                 5
      Common stock, $0.0001 par value, 5,000,000,000 shares
        authorized, 24,061,201 outstanding                                         2,406             2,406
      Additional paid-in capital                                              52,214,532        52,214,532
      Deficit                                                                (57,487,232)      (56,502,478)
                                                                            ------------      ------------
          TOTAL STOCKHOLDERS' DEFICIENCY                                      (5,270,289)       (4,285,535)
                                                                            ------------      ------------

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY                              $ 10,820,351      $  9,476,103
                                                                            ============      ============

          The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>
                                                     1
<PAGE>

                   GREYSTONE LOGISTICS, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE><CAPTION>
                                                                               THREE MONTHS ENDED AUGUST 31,
                                                                               ------------------------------
                                                                                   2005              2004
                                                                               ------------      ------------
                                                                                                    (NOTE 4)
<S>                                                                            <C>               <C>
Sales                                                                          $  2,909,104      $  2,170,230

Cost of Sales, including depreciation expense of
      $179,496 and $281,920                                                       3,010,646         1,910,568
                                                                               ------------      ------------

Gross Profit (Loss)                                                                (101,542)          259,662

Expenses:
      General, selling and administration expenses                                  561,562           507,070
                                                                               ------------      ------------

Operating Loss                                                                     (663,104)         (247,408)

Other Income (Expense):
      Other income                                                                   71,016             8,006
      Interest expense                                                             (238,751)         (187,400)
                                                                               ------------      ------------
          Total Other Income (Expense)                                             (167,735)         (179,394)
                                                                               ------------      ------------

Net Loss                                                                           (830,839)         (426,802)

Preferred Dividends                                                                 153,915            92,089
                                                                               ------------      ------------

Net Loss Available to Common Stockholders                                      $   (984,754)     $   (518,891)
                                                                               ============      ============

Loss Available to Common Stockholders
      Per Share of Common Stock - Basic and Diluted                            $      (0.04)     $      (0.04)
                                                                               ============      ============

Weighted Average Shares of Common Stock Outstanding                              24,061,000        12,790,000
                                                                               ============      ============


            The accompanying notes are an integral part of these consolidated financial statements
</TABLE>
                                                       2
<PAGE>
                   GREYSTONE LOGISTICS, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE><CAPTION>
                                                                                THREE MONTHS ENDED AUGUST 31,
                                                                               ------------------------------
                                                                                   2005              2004
                                                                               ------------      ------------
                                                                                                    (NOTE 4)
<S>                                                                            <C>               <C>
Cash Flows from Operating Activities:
      Net Loss                                                                 $   (830,839)     $   (426,802)
      Adjustments to reconcile net loss to cash used
        in operating activities
          Depreciation and amortization                                             179,496           281,920
          Loss on sale of equipment                                                  12,857              --
          Changes in accounts receivable                                             46,799          (108,945)
          Changes in inventory                                                     (262,424)         (179,019)
          Changes in prepaid expenses                                                10,932              --
          Changes in accounts payable and accrued expenses                           25,743           231,144
          Changes in preferred dividends payable                                    119,452             1,713
                                                                               ------------      ------------
               Net cash used in operating activities                               (697,984)         (199,989)

Cash Flows from Investing Activities:
      Purchase of property and equipment                                         (1,278,965)         (151,154)
                                                                               ------------      ------------
                                                                                 (1,278,965)         (151,154)

Cash Flows from Financing Activities:
      Proceeds from notes and advances payable                                    2,344,225           925,000
      Payments on notes and advances payable                                       (140,418)         (528,219)
      Dividends paid on preferred stock                                            (153,915)          (92,089)
                                                                               ------------      ------------
          Cash provided by financing activities                                   2,049,892           304,692
                                                                               ------------      ------------

Net Increase (Decrease) in Cash                                                      72,943           (46,451)
Cash, beginning of period                                                             1,410           274,085
                                                                               ------------      ------------

Cash, end of period                                                            $     74,353      $    227,634
                                                                               ============      ============

Supplemental Information:
      Interest paid                                                            $    165,135      $    148,122
                                                                               ============      ============




            The accompanying notes are an integral part of these consolidated financial statements
</TABLE>
                                                       3
<PAGE>

                            GREYSTONE LOGISTICS, INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


     1. In the opinion of the Company, the accompanying unaudited consolidated
financial statements contain all adjustments and reclassifications, which are of
a normal recurring nature, necessary to present fairly its financial position as
of August 31, 2005, and the results of its operations for the three month
periods ended August 31, 2005 and 2004 and its cash flows for the three month
periods ended August 31, 2005 and 2004. These condensed consolidated financial
statements should be read in conjunction with the consolidated financial
statements as of and for the year ended May 31, 2005 and the notes thereto
included in the Company's Form 10-KSB. The financial statements have been
prepared assuming that Greystone will continue as a going concern. The working
capital deficit of approximately $4,943,416, a stockholders' deficiency of
$5,270,289 and continuing losses from operations at August 31, 2005, reflect the
uncertain financial condition of Greystone and its inability to obtain long term
financing until it is able to attain profitable operations.

     2. The results of operations for the three month periods ended August 31,
2005 and 2004 are not necessarily indicative of the results to be expected for
the full year.

     3. The computation of loss per share is computed by dividing the loss
available to common shareholders by the weighted average shares outstanding for
the periods. Loss available to common shareholders is determined by adding
preferred dividends for the periods to the net loss. For the three month periods
ended August 31, 2005 and August 31, 2004, the weighted average common shares
outstanding are 24,061,000 and 12,790,000. Convertible preferred stock and
warrants are not considered as their effect is antidilutive.

     4. As discussed in Greystone's Form 10-KSB as of May 31, 2005, Greystone's
Board of Directors concluded that the accounting treatment for the acquisition
of the assets of Greystone Plastics, Inc., as of September 8, 2003, should have
provided for an allocation of a portion of the purchase price to place a value
on the customer's purchase order in effect at the time of the acquisition. The
accounting treatment for the value of the customer's purchase order should also
provide for the amortization of such cost over the estimated life based on unit
sales. The related amortization expense for the three months ended August 31,
2004 is $169,150. Accordingly, the statements of operations and cash flows for
the three months ended August 31, 2004 have been restated. The remaining
unamortized portion of the value of the customer's purchase order was deemed to
be fully impaired at May 31, 2005 and, accordingly, was charged to expense at
that time.


                                        4
<PAGE>

ITEM 2. MANAGEMENT DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

RESULTS OF OPERATIONS
---------------------

GENERAL TO ALL PERIODS

     The consolidated statements include Greystone Logistics, Inc., or
Greystone, and its wholly-owned subsidiaries, Greystone Manufacturing, LLC, or
GSM, and Plastic Pallet Production, Inc., or PPP.

     Greystone has incurred significant losses from operations, and there is no
assurance that it will achieve profitability or obtain funds necessary to
finance its operations.

     References to fiscal year 2006 ("2006") refer to the three month period
ended August 31, 2005. References to fiscal year 2005 ("2005") refer to the
three month period ended August 31, 2004.

SALES

     Greystone's primary business is the manufacturing and selling of plastic
pallets through its wholly owned subsidiaries, GSM and PPP. Greystone
distributes its pallets through the combination of a network of independent
contractor distributors and sales by Greystone's officers and employees.

     Greystone also markets its own design of injection molding machine, the
PIPER 600, through a licensing agreement with ForcePro, LLC, which gives
ForcePro the exclusive right to market and sell the PIPER 600. Pursuant to the
terms of the licensing agreement, Greystone will receive a royalty of 5% of the
gross proceeds from sales of the PIPER 600.

PERSONNEL

     Greystone has approximately 84 full-time employees as of August 31, 2005
compared to 62 full-time employees as of August 31, 2004.

TAXES

     For all years presented, Greystone's effective tax rate is 0%. Greystone
has generated net operating losses since inception, which would normally reflect
a tax benefit in the statement of operations and a deferred asset on the balance
sheet. However, because of the current uncertainty as to Greystone's ability to
achieve profitability, a valuation reserve has been

                                        5
<PAGE>

established that offsets the amount of any tax benefit available for each period
presented in the consolidated statement of operations.


THREE MONTH PERIOD ENDED AUGUST 31, 2005, COMPARED TO THREE MONTH PERIOD ENDED
AUGUST 31, 2004

     Sales for fiscal year 2006 are $2,909,104 compared to $2,170,230 in fiscal
year 2005, for a increase of $738,874. The increase is primarily attributable to
the addition of the fourth GSM production line during the quarter ended August
31, 2005.

     Cost of sales in fiscal year 2006 is $3,010,646, or 104% of sales, compared
to $1,910,568 or 88% of sales, in fiscal year 2005. Expansion of manufacturing
capacity through operating leases is the primary cause for the increase in cost
of sales in fiscal year 2006. These expansions are fixed costs which are
necessary, in the opinion of management, for the long term growth of the
company. Because these rental costs are fixed in nature, the impact on cost of
sales will decline as production and sales continue to increase.

     General and administrative expenses increased $54,492 from $507,070 in
fiscal year 2005 to $561,562 in fiscal year 2006. The increase is primarily
attributable to an increase in payroll costs offset in fiscal 2005 by a decrease
in amortization expense. As Greystone has continued to expand its operations, it
has added personnel. Greystone added Bobby Moore as President and Chief
Executive Officer effective August 15, 2005, Robert Nelson as Chief Financial
Officer effective October 1, 2004 and other administrative personnel for the GSM
plant. The fiscal year 2005 general and administrative expense includes
amortization expense of $169,150 for an intangible asset which was written off
in the fourth quarter of fiscal year 2005 by a charge to expense as an
impairment.

     Interest expense increased $51,351 from $187,400 in fiscal year 2005 to
$238,751 in fiscal year 2006. The increase is the result of additional
borrowings to finance equipment acquisitions and working capital.

     The net loss increased $404,037 from $(426,802) in fiscal year 2005 to
$(830,839) in fiscal year 2006 for the reasons discussed above.

     Preferred dividends increased $61,826 from $92,089 in fiscal year 2005 to
$153,915 in fiscal year 2006. The dividend rate on the Series 2003 preferred
stock is the prime rate of interest plus 3.25%. The increase in the prime rate
of interest is the basis for the increase.

     After deducting preferred dividends, the net loss available to common
shareholders is $(984,754), or $(0.04) per share, in fiscal year 2006 compared
to $(518,891), or $(0.04) per share, in fiscal year 2005 for an increase of
$465,863.

                                        6
<PAGE>

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

     Greystone's cash requirements for operating activities consist principally
of accounts receivable, inventory, accounts payable, operating leases and
scheduled payments of interest on outstanding indebtedness. Greystone is
currently dependent on outside sources of cash to fund its operations. As of
August 31, 2005, revenues from sales remain insufficient to meet current
liabilities.

     A summary of cash flows for the nine months ended August 31, 2005 is as
follows:

     Cash used in operating activities                       $   (697,984)

     Cash used in investing activities                         (1,278,965)

     Cash provided by financing activities                      2,049,892

     The cash used in investing activities was primarily for the acquisition in
June 2005 of an additional plastic injection molding machine. Financing for this
machine principally came from two loans - a $424,000 note payable to NYOK
Partners, a general partnership owned equally by Marshall Cogan, Greystone's
Non-Executive Chairman, and Warren Kruger, Greyston'es Vice Chairman at prime
plus 1% rate of interest due June 2012 and a $500,000 note payable to Robert
Rosene, a director of Greystone, at prime plus 1% due June 2012. In addition,
Robert Rosene also advanced $1,100,000 to Greystone during the quarter ended
August 31, 2005 which was used for working capital and equipment acquisitions.

     The contractual obligations of Greystone are as follows:
<TABLE><CAPTION>
                                       LESS THAN                                OVER
                           TOTAL        1 YEAR      1-3 YEARS    4-5 YEARS     5 YEARS
                        -----------   ----------   ----------   ----------   ----------
<S>                     <C>           <C>          <C>          <C>          <C>
     Long-term debt     $11,172,268   $2,424,180   $6,281,395   $  816,775   $1,649,918
     Operating leases     8,193,000      876,000    1,752,000    1,752,000    3,813,000
                        -----------   ----------   ----------   ----------   ----------
     Total              $19,365,268   $3,300,180   $8,033,395   $2,568,775   $5,462,918
                        ===========   ==========   ==========   ==========   ==========
</TABLE>

     Greystone anticipates that the cash necessary for funding its operating
activities will continue to decline based on projected increases in sales
activity relating to the increased production from the two additional production
lines - one in April 2005 and the other in August 2005. To provide for the
additional cash to meet Greystone's operating activities and contractual
obligations for fiscal 2006, Greystone is exploring various options including
long-term debt and equity financing. However, there is no guarantee that
Greystone will be able to raise sufficient capital to meet these obligations.

     Greystone has accumulated a working capital deficit of approximately
$4,943,000 at August 31, 2005, which includes approximately $4,552,000 of
advances from related parties and current portion of long-term debt and
$2,637,000 in accounts payable and accrued liabilities. The

                                        7
<PAGE>

working capital deficit reflects the uncertain financial condition of Greystone
resulting from its inability to obtain long term financing until such time as it
is able to achieve profitability. There is no assurance that Greystone will
secure such financing.

     Greystone has had difficulty in obtaining financing from traditional
financing sources. Substantially all of the financing that Greystone has
received through August 31, 2005, has been provided by loans, loan guarantees
and equity financing from its officers and directors and common stock sales to
its officers, directors and unrelated third parties. There is no assurance that
the officers and directors will continue to provide loans or loan guarantees or
purchase of equity securities of Greystone in the future.

FORWARD LOOKING STATEMENTS AND MATERIAL RISKS
---------------------------------------------

     This Quarterly Report on Form 10-QSB includes certain statements that may
be deemed "forward-looking statements" within the meaning of federal securities
laws. All statements, other than statements of historical facts, that address
activities, events or developments that Greystone expects, believes or
anticipates will or may occur in the future, including decreased costs, the
profitability of Greystone, potential sales of pallets or other possible
business developments, are forward-looking statements. Such statements are
subject to a number of assumptions, risks and uncertainties. The forward-looking
statements contained in the Quarterly Report on Form 10-QSB could be affected by
any of the following factors: Greystone's prospects could be affected by changes
in availability of raw materials, competition, rapid technological change and
new legislation regarding environmental matters; Greystone may not be able to
secure additional financing necessary to sustain and grow its operations; and a
material portion of Greystone's business is and will be dependent upon a few
large customers and there is no assurance that Greystone will be able to retain
such customers. These risks and other risks that could affect Greystone's
business are more fully described in Greystone's Form 10-KSB for the fiscal year
ended May 31, 2005, which was filed on September 15, 2005. Actual results may
vary materially from the forward-looking statements. Greystone undertakes no
duty to update any of the forward-looking statements contained in this Quarterly
Report on Form 10-QSB.

ITEM 3. CONTROLS AND PROCEDURES

     As of the end of the period covered by this Current Report on Form 10-QSB,
Greystone carried out an evaluation under the supervision of Greystone's Chief
Executive Officer and Chief Financial Officer of the effectiveness of the design
and operation of Greystone's disclosure controls and procedures pursuant to the
Securities Exchange Act Rules 13a-15(e) and 15d-15(e). Based on this evaluation,
Greystone's Chief Executive Officer and Chief Financial Officer concluded that
the disclosure controls and procedures as of the end of the period covered by
this Current Report on Form 10-QSB were effective.

     During the quarter ended August 31, 2005, there was no change in
Greystone's internal controls over financial reporting that has materially
affected, or that is reasonably likely to materially affect, Greystone's
internal control over financial reporting.

                                        8
<PAGE>

PART II. OTHER INFORMATION

ITEM 6. EXHIBITS

     11.1 Computation of Loss per Share is in Note 3 in the Notes to the
          financial statements.

     31.1 Certification of Chief Executive Officer pursuant to Rules 13a-14(a)
          and 15d-14(a) promulgated under the Securities Exchange Act of 1934,
          as amended, and Item 601(b)(31) of Regulation S-B, as adopted pursuant
          to Section 302 of the Sarbanes-Oxley Act of 2002 (submitted herewith).

     31.2 Certification of Chief Financial Officer pursuant to Rules 13a-14(a)
          and 15d-14(a) promulgated under the Securities Exchange Act of 1934,
          as amended, and Item 601(b)(31) of Regulation S-B, as adopted pursuant
          to Section 302 of the Sarbanes-Oxley Act of 2002 (submitted herewith).

     32.1 Certification of Chief Executive Officer pursuant to 18 U.S.C. Section
          1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
          2002 (submitted herewith).

     32.2 Certification of Chief Financial Officer pursuant to 18 U.S.C. Section
          1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
          2002 (submitted herewith).











                                        9
<PAGE>

                                    SIGNATURE

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


                                             GREYSTONE LOGISTICS, INC.
                                                  (Registrant)


Date: October 17, 2005                       /s/ Robert H. Nelson
                                             ------------------------------
                                             Chief Financial Officer






















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