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                     U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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                                  FORM 10-QSB/A

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                Quarterly Report Under Section 13 or 15(d) of the
                        Securities Exchange Act of 1934.


               For the quarterly period ended: September 30, 2005
                          Commission File No. 001-15819

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                               ACTIVEWORLDS CORP.
        (Exact name of small business issuer as specified in its charter)

                              --------------------


                DELAWARE                                    513-3883101
      (State or other jurisdiction of                    (I.R.S. Employer
      incorporation or organization)                  Identification Number)


                 40 Wall Street, 58th Floor, New York, NY 10005
                                 (212) 509-1700
                          (Address and telephone number
                         of principal executive offices)




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. [X]  Yes    [ ]  No

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:

We had 5,317,116 shares of our common stock outstanding as of November 11, 2005.

Transitional Small Business Disclosure Format (check one): [ ]  Yes   [X]  No

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<PAGE>


                                      INDEX

                                                                          Page
                         PART I - FINANCIAL INFORMATION

ITEM 1.  Financial Statements
         Condensed Consolidated Balance Sheets
            as of September 30, 2005 (restated) (unaudited) and
            December 31, 2004 (restated)                                   1

         Condensed Consolidated Statements of Operations
            for the three and nine months ended September 30, 2005
            (restated) and 2004 (unaudited)                                2

         Condensed Consolidated Statements of Cash Flows
            for the nine months ended September 30, 2005
            (restated) and 2004 (unaudited)                                3

         Notes to unaudited condensed consolidated interim
            financial statements                                         4 - 6

ITEM 2.  Management's Discussion and Analysis of Interim Financial
         Condition and Results of Operations                             7 - 8


                         PART II - OTHER INFORMATION

ITEM 6.  Exhibits                                                          8



<PAGE>



                                Explanatory Note

This Report has been amended to add Note 6 to our financial statements which
explains the error that we corrected in our revised Form 10-KSB for the year
ended December 31, 2004.




















<PAGE>

                         PART I - FINANCIAL INFORMATION


ITEM 1.  FINANCIAL STATEMENTS


                               ACTIVEWORLDS CORP.

                        Consolidated Financial Statements
                              for nine months ended
                    September 30, 2005 (Restated) (Unaudited)


                               ACTIVEWORLDS CORP.

                           Consolidated Balance Sheet

<TABLE>
<CAPTION>
                                                                    September 30,  December 31,
                                                                        2005          2004 *
                                                                    -----------    -----------
                                                                     (Restated)     (Restated)
                                                                    (Unaudited)
<S>                                                                 <C>            <C>
                                     Assets

Current assets
    Cash                                                            $   314,346    $   346,823
    Investments                                                          91,875         91,875
                                                                    -----------    -----------
              Total current assets                                      406,221        438,698
                                                                    -----------    -----------
              Total assets                                          $   406,221    $   438,698
                                                                    -----------    -----------

                      Liabilities and Stockholders' Equity
Current liabilities
    Accounts payable                                                $        --    $     2,602
    Accrued liabilities                                                   3,000          8,500
                                                                    -----------    -----------
              Total current liabilities                                   3,000         11,102
                                                                    -----------    -----------
Commitments and contingencies

Stockholders' equity
    Preferred stock, $.001 par value, 500,000 shares authorized,
      no shares issued  or outstanding                                       --             --
    Common stock, $.001 par value, 100,000,000 shares authorized,
      5,317,116 shares issued                                             5,317          5,317
    Additional paid-in capital                                        5,817,007      5,664,710
    Accumulated deficit                                              (5,380,201)    (5,203,529)
    Accumulated other comprehensive income (loss)                       (38,902)       (38,902)
                                                                    -----------    -----------
              Total stockholders' equity                                403,221        427,596
                                                                    -----------    -----------

              Total liabilities and stockholders' equity            $   406,221    $   438,698
                                                                    ===========    ===========

</TABLE>

------------
*  Derived from audited financial statements


                 See notes to consolidated financial statements

                                        1


<PAGE>

                               ACTIVEWORLDS CORP.

                      Consolidated Statement of Operations


<TABLE>
<CAPTION>
                                                       Three Months Ended       Nine Months Ended
                                                         September 30             September 30
                                                   ----------------------    ----------------------
                                                      2005         2004         2005         2004
                                                   ---------    ---------    ---------    ---------
                                                   (Restated)               (Restated)
                                                         (Unaudited)              (Unaudited)
<S>                                                <C>          <C>          <C>          <C>

Revenues                                           $      --    $      --    $      --    $      --
                                                   ---------    ---------    ---------    ---------
Operating expenses
    Selling, general and administrative expenses      78,121       26,246      243,750       94,320
    Research and development expenses                     --           --           --           --
                                                   ---------    ---------    ---------    ---------
              Total operating expenses                78,121       26,246      243,750       94,320
                                                   ---------    ---------    ---------    ---------

    Loss from operations                             (78,121)     (26,246)    (243,750)     (94,320)
                                                   ---------    ---------    ---------    ---------

    Loss before income taxes                         (78,121)     (26,246)    (243,750)     (94,320)
Income taxes                                              --           --           --           --
                                                   ---------    ---------    ---------    ---------

    Net loss                                       $ (78,121)   $ (26,246)   $(243,750)   $ (94,320)
                                                   ---------    ---------    ---------    ---------

Net loss per share of common stock
    Basic                                          $   (.015)   $   (.005)   $   (.045)   $   (.177)
                                                   ---------    ---------    ---------    ---------


</TABLE>





                 See notes to consolidated financial statements

                                        2

<PAGE>


                               ACTIVEWORLDS CORP.

                      Consolidated Statement of Cash Flows


<TABLE>
<CAPTION>
                                                                                      Nine Months Ended
                                                                                        September 30
                                                                                  ----------------------
                                                                                     2005        2004
                                                                                  ---------    ---------
                                                                                 (Restated)
                                                                                        (Unaudited)
<S>                                                                               <C>          <C>
Operating activities
    Net (loss)                                                                    $(243,750)   $ (94,320)
    Adjustment to reconcile net (loss) to net cash used in operating activities
       Stock options issued for services                                            219,375       45,000
    Changes in operating assets and liabilities which provided (used) cash
          Accounts payable                                                           (2,602)       2,897
          Accrued liabilities                                                        (5,500)      (4,300)
                                                                                  ---------    ---------
              Net cash used in operating activities                                 (32,477)     (50,723)
                                                                                  ---------    ---------

Net decrease in cash                                                                (32,477)     (50,723)
Cash at beginning of period                                                         346,823      407,318
                                                                                  ---------    ---------
              Cash at end of period                                               $ 314,346    $ 356,595
                                                                                  ---------    ---------
Supplemental disclosure information
    Cash paid for interest during the period                                      $      --    $      --
                                                                                  ---------    ---------
    Non-cash transaction - cancellation of Treasury stock                         $      --    $ 118,403
                                                                                  ---------    ---------

</TABLE>







                 See notes to consolidated financial statements

                                        3

<PAGE>

                               ACTIVEWORLDS CORP.

                   Notes to Consolidated Financial Statements
                               September 30, 2005


Note 1 -      Basis of presentation

              The accompanying 2005 and 2004 unaudited interim consolidated
              financial statements included herein have been prepared by the
              Company, without audit, pursuant to the rules and regulations of
              the Securities and Exchange Commission (the "SEC"). Certain
              information and footnote disclosures normally included in
              financial statements prepared in accordance with accounting
              principles generally accepted in the United States of America have
              been condensed or omitted pursuant to such rules and regulations.
              However, the Company believes that the disclosures are adequate to
              prevent the information presented from being misleading. These
              financial statements should be read in conjunction with the
              financial statements and the notes thereto included in the
              Company's Form 10-KSB, which contains financial information for
              the years ended December 31, 2004 and 2003.

              The information provided in these financial statements reflects
              all adjustments (consisting solely of normal recurring accruals)
              that are, in the opinion of management, necessary to present
              fairly the results of operations for this period. The results for
              this period are not necessarily indicative of the results to be
              expected for the full year.

              Activeworlds Corp. (the "Company") became inactive in July 2002
              when the Company entered into an agreement to sell all of the
              issued and outstanding stock of its operating subsidiary,
              Activeworlds, Inc. The agreement closed in September 2002 and the
              Company's former management purchased Activeworlds, Inc. in
              exchange for their selling 2,595,445 shares or approximately 30%
              of the Company's common stock to the Company. The Company has been
              actively seeking to merge, invest in or acquire other companies.

              On September 9, 2004, the Company entered into a letter of intent
              to acquire Hi-G-Tek, Ltd., an Israeli company, ("Hi-G") in a
              transaction expected to be treated as a reverse acquisition (the
              "Reverse Acquisition"). In connection with the Reverse
              Acquisition, the Company formed a wholly-owned subsidiary, AWLD,
              Inc., a Delaware corporation. AWLD, Inc. then formed a
              wholly-owned subsidiary AWLD, Ltd., an Israeli company.

              On December 13, 2004 the Company signed an Agreement and Plan of
              Merger (the "Plan") by and among the Company, AWLD, Inc., AWLD
              Ltd., Baytree LLC (a related company, substantially owned by a
              significant stockholder of the Company) and Hi-G. The Plan called
              for the merger of Hi-G and the Company's wholly-owned subsidiary
              AWLD, Ltd. in exchange for 24,683,303 shares of the Company's
              outstanding common stock. The terms of the Plan expired on
              February 28, 2005, although the parties continued discussions
              through March 31, 2005, at which time the parties ended
              discussions.

              All intercompany accounts and transactions have been eliminated in
              consolidation. The consolidated financial statements are presented
              as those of Activeworlds Corp.

              The Company is actively seeking to merge, invest in or acquire
              other companies to generate revenues and profits.

                                       4

<PAGE>

                               ACTIVEWORLDS CORP.

                   Notes to Consolidated Financial Statements
                               September 30, 2005

Note 2 -      Investments

              In 2001 the Company agreed to accept 9,800,000 shares of common
              stock of its largest contract customer in full and final payment
              on the work completed to date on the contract. The fair market
              value at the date the common stock was transferred was $130,777.
              The fair market value of the investment had decreased by $38,902
              at September 30, 2005 and December 31, 2004. Accordingly, the
              value of the investment has been adjusted to $91,875 at September
              30, 2005 and December 31, 2004. The trading of the common stock of
              Green X Global Limited (Green X), formerly known as 3D Global
              Limited, has been suspended pending the acquisition of Red X
              Property Pty. Ltd. ("Red X"). The acquisition of Red X continues
              under negotiation. In anticipation of the acquisition Green X
              consolidated its share capital through a reverse stock split
              wherein the Company received one share for every 20 shares held.
              After the reverse split the Company holds 490,000 shares of Green
              X. It is difficult to predict the outcome of the proposed
              acquisition at this time or the effect that it may have on the
              value of Green X's stock value. In light of this uncertainty the
              Company will continue to carry the value of the investment at
              $91,875, the value at December 31, 2004.

Note 3 -      Income taxes

              At September 30, 2005, the Company has a net operating loss
              carryforward of approximately $1,785,000 that may be used to
              offset future taxable income.

              An allowance has been established for the full amount of gross
              deferred tax asset of approximately $714,000 due to the
              uncertainty of utilizing the deferred taxes in the future.

Note 4 -      Net (loss) per share of common stock

              The number of shares on which the basic net (loss) per share of
              common stock has been calculated is as follows:

                                                             Weighted Average
                   Nine Months Ended September 30,           Number of Shares
                   -------------------------------           ----------------
                          (Unaudited)

                              2005                               5,317,116

                              2004                               5,317,116

              Diluted net (loss) per share of common stock has not been
              presented for the nine months ended September 30, 2005 and 2004
              since the effect of including the stock options and warrants
              outstanding would be antidilutive.

  Note 5 -    Related party transactions - warrants

              In December 2004 the Company issued 750,000 common stock warrants
              to a company controlled by its principal stockholder. The
              consulting contract is for two years from the date of the contract
              (measurement date). The warrants are fully-vested, can be
              exercised at $2.00 per share and expire three years from the date
              of the contract. The fair value of the warrants of $585,000 issued
              for the consulting services will be expensed over the life of the
              consulting contract and is not affected by changes in the fair
              value of the Company's stock subsequent to the measurement date.

                                       5

<PAGE>

                               ACTIVEWORLDS CORP.

                   Notes to Consolidated Financial Statements
                               September 30, 2005


              Expenses for consulting services under the contract were
              recognized in the amount of $219,375 for the nine months ended
              September 30, 2005. The fair value has been determined using the
              Black Scholes Model with the following assumptions:

                    Risk-free interest rate                         3.09%
                    Volatility                                      100.0%
                    Expected life                                   3 years
                    Expected dividend yield                          0.00%

Note 6 -      Correction of an error

              The accompanying financial statements for the three months and
              nine months ended September 30, 2005 have been restated in
              connection with a non-cash expense to correct an error in the
              calculation of the fair value of the warrants disclosed in note 5.
              The Company previously valued common stock warrants granted for
              consulting services at $337,500 using the Black Scholes Model and
              assuming certain discounts. The error pertains to the use of
              discounts in the valuation of the warrants. The fair value of the
              warrants has now been determined to be $585,000 using the Black
              Scholes Model. The effect of the restatement was to increase the
              net loss for the three months and the nine months ended September
              30, 2005 by $30,939 and $92,817, respectively, and increase the
              net loss per share by $.006 and $.017, respectively.







                                       6

<PAGE>


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

         The following discussion of our financial condition and results of
operations should be read together with the financial statements and related
notes included in this Report. This discussion contains forward-looking
statements that involve risks and uncertainties. Our actual results may differ
materially from those anticipated in those forward-looking statements as a
result of certain factors, including, but not limited to, those contained in the
discussion on forward-looking statements that follows this section.

OVERVIEW

         We are a Delaware corporation organized on September 5, 1995. Beginning
in 1999, through our wholly-owned subsidiary Activeworlds, Inc., we operated the
business of providing Internet software products and services that enabled the
delivery of three dimensional content over the Internet. We operated this
business until July 10, 2002 when we entered into an agreement to sell the
subsidiary to our former management. The sale closed on September 11, 2002, at
which time we became inactive. We are now seeking business opportunities. We
have not had revenues from operations since entering into the agreement to sell
our subsidiary on July 10, 2002.

         Our primary expenses relate to our reporting obligations under the
Securities Exchange Act of 1934 and expenses related to the acquisition of
another business opportunity. We will incur expenses due to the legal and
accounting services required to prepare periodic reports and the costs of filing
these reports with the Securities and Exchange Commission. In addition, during
2005 and 2006, we will incur a non cash expense of approximately $73,000 per
quarter in connection with amortizing warrants granted to a company controlled
by our principal stockholder pursuant to a consulting agreement entered into in
December 2004. During 2004, we incurred expenses related to evaluating three
acquisition candidates, none of which was consummated.

         Our plan of operations does not call for any product research or
development, nor do we plan to purchase any equipment. We believe we have enough
working capital to meet our operational needs for the next 12 months.

            We currently have no employees. Our management expects to confer
with consultants, attorneys and accountants as necessary. We do not anticipate a
need to engage any employees so long as we are seeking and evaluating business
opportunities. We will determine the need for employees based upon the specific
business opportunity once we consummate an acquisition transaction.


RESULTS OF OPERATIONS

         We had no revenue for the nine months ended September 30, 2005 and
2004. The restated loss from operations during the first nine months of 2005 was
$243,750 consisting of approximately $219,000 of non-cash expense related to
amortizing the warrants referred to above, and the remainder consisting
primarily of public company expenses and expenses related to our evaluation of a
potential acquisition in contrast to our loss from operations during the first
nine months of 2004 of $94,320 which primarily consisted of expenses related to
our evaluation of a potential acquisition and some public company expenses.

                                       7


<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

         At September 30, 2005, we had total assets of $406,221, which includes
$314,346 of cash, and total liabilities of $3,000. At December 31, 2004, we had
total assets of $438,698, which included $346,823 of cash, and total liabilities
of $11,102.

         For further information, see our report on Form 10-KSB filed on April
8, 2005 and the report on Form 10-KSB/A filed on February 1, 2006.


FORWARD-LOOKING STATEMENTS

         The statement made above relating to the adequacy of our working
capital is a forward-looking statement within the meaning of the Private
Securities Litigation Reform Act of 1995. The statements that express the
"belief", "anticipation", "plans", "expectations", "will" and similar
expressions are intended to identify forward-looking statements.

         The results anticipated by any or all of these forward-looking
statements might not occur. Important factors, uncertainties and risks that may
cause actual results to differ materially from these forward-looking statements
include matters relating to the business and financial condition of any company
we acquire. We undertake no obligation to publicly update or revise any
forward-looking statements, whether as the result of new information, future
events or otherwise.











                                       8

<PAGE>

                           PART II - OTHER INFORMATION


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

         (a)   EXHIBIT INDEX

Exhibit
Number      Description
--------    --------------------------------------------------------------------
31          Certification of CEO and CFO
32          Section 1350 certification of CEO and CFO

















                                       9

<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 on February 1, 2006 by
the undersigned, thereunto duly authorized.


                                            ACTIVEWORLDS CORP.


                                            /s/ Sean Deson
                                            ------------------------------------
                                            Sean Deson, Chief Executive Officer














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