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 January 31, 2006
                                       or

/ / TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
    ACT OF 1934
    For the transition period from___________ to

                       Commission File Number 33-19048-NY

                         MURRAY UNITED DEVELOPMENT CORP.
                        --------------------------------
        (Exact Name of Small Business Issuer as specified in its charter)

             Delaware                                    22-2856171
-------------------------------             ------------------------------------
(State or other jurisdiction of             (I.R.S. employer identification no.)
incorporation or organization)

P.O. Box 224, Landing, New Jersey                            07850
----------------------------------                          --------
(Address of principal executive offices)                   (Zip Code)

Registrant's telephone number, including area code     (908)  979-3025
                                                       ----------------

                                    No Change
            --------------------------------------------------------
           (Former Name, Former Address, if changed since last report)

Indicate by check mark whether the Issuer:

(1) Has 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):
Yes    x          No
   ---------         ----------

(2) Has been subject to such filing requirements for the past 90 days.
Yes    x          No
   ---------         ----------

173,253,434 shares of the registrant's Common Stock ,$.0001 per share, were
outstanding as of March 15, 2006.






<PAGE>


                      MURRAY UNITED DEVELOPMENT CORPORATION

                                TABLE OF CONTENTS
                                   FORM 10-QSB



                    PART I FINANCIAL INFORMATION


Item Number                                                               Page

Item 1.             Financial Statements

                          Balance Sheets                                    2

                          Statements of Operations                          4

                          Statements of Stockholders' Deficiency            5

                          Statements of Cash Flow                           6

                          Notes to Financial Statements                     7

Item 2.             Management's Discussion and Analysis
                    Or Plan of Operation                                    9



                    PART II OTHER INFORMATION

Items 1- 6.                                                                15

Signatures                                                                 18


<PAGE>

                         PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

                      MURRAY UNITED DEVELOPMENT CORPORATION
                      (A Company in the Development Stage)
                                 BALANCE SHEETS
                                   (UNAUDITED)

                                     ASSETS


<TABLE>
<CAPTION>
                                           January 31, 2006             July 31, 2005
                                           ----------------             -------------
<S>                                      <C>                        <C>
Current assets


Cash & cash equivalents                  $                 506      $                 170
Loan Receivable                                          2,000                      2,000
                                         ---------------------      ---------------------
Total current assets                     $               2,506      $               2,170


Furniture & equipment, at
cost, net of accumulated
depreciation                                                 -                     33,338
                                         ---------------------      ---------------------

Total Assets                             $               2,506                   $ 35,508
                                         =====================      =====================


</TABLE>



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



                                        2

<PAGE>


                      MURRAY UNITED DEVELOPMENT CORPORATION
                      (A Company in the Development Stage)
                                 BALANCE SHEETS
                                   (UNAUDITED)

                    LIABILITIES AND STOCKHOLDERS' DEFICIENCY
<TABLE>
<CAPTION>


                                                                January 31, 2006             July 31, 2005
                                                                ----------------             --------------
<S>                                                           <C>                        <C>
Current liabilities:
     Accounts payable and Accrued Expenses                    $              26,390      $            13,820
                                                             ----------------------     --------------------

     Total current liabilities                                               26,390                   13,820

Other liabilities:
     Accrued Interest Payable                                                69,247                  143,024
     Notes payable-other stockholder                                        828,778                1,944,754
     Accrued Compensation                                                   148,128                  148,128
                                                             ----------------------     --------------------

     Total other liabilities                                              1,046,153                2,235,906
                                                             ----------------------     --------------------

     Total liabilities                                                    1,072,543                2,249,726
                                                             ----------------------     --------------------


Stockholders' deficiency:

Common Stock, par value $.0001:
     Authorized 200,000,000 shares;
     issued and outstanding
173,253,434 shares and 84,153,434                                            17,326                    8,416
Additional paid-in capital                                                3,232,518                2,572,028
Deficit accumulated in the development stage                             (4,319,881)              (4,794,662)
                                                             ----------------------      --------------------

     Total stockholders' deficiency                                      (1,070,037)              (2,214,218)
                                                             ----------------------      --------------------

     Total Liabilities and Stockholders' Deficiency           $               2,506      $            35,508
                                                             ======================      ====================


</TABLE>




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


                                        3

<PAGE>


                      MURRAY UNITED DEVELOPMENT CORPORATION
                      (A Company in the development Stage)

                            STATEMENTS OF OPERATIONS
               FOR THE SIX MONTHS ENDED JANUARY 31, 2006 AND 2005

                                   (UNAUDITED)
<TABLE>
<CAPTION>

                                                                                                CUMULATIVE
                                                                                                 AMOUNTS
                                                                                                   FROM
                                                 2006                  2005                     INCEPTION
                                                ------                ------                   -----------
<S>                                        <C>                   <C>                        <C>
Income
-------
Debt forgiveness                                     632,500                      -                      632,500
Interest income                                            -                      -                       66,465
                                           -----------------     ------------------         --------------------

Total Income                                               -                      -                      698,965

Expenses
Research and Development costs                             -                      -                      876,771
Licensing fees-stockholder and affiliate                   -                      -                       57,260
General and administrative expenses                   55,136                 48,371                    3,075,414
Interest expense-stockholder and affiliate            69,245                 70,886                    1,009,401
                                           -----------------     ------------------         --------------------
Total Expenses                                       124,381               (119,257)                   5,018,846
                                           -----------------     ------------------         --------------------

Net Gain (Loss) before tax                 $         508,119     $       $ (119,257)        $         (4,319,881)
                                           -----------------     ------------------         --------------------


Net Income (Loss)                          $         508,119                      -         $         (4,319,881)
                                           =================     ==================         ====================

Net loss per common share                  $            (nil)    $             (nil)

Weighted average number of
common shares outstanding                         92,712,067             80,153,434                  173,253,454
                                           -----------------     ------------------         --------------------

</TABLE>





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

                                        4

<PAGE>


                      MURRAY UNITED DEVELOPMENT CORPORATION
                      (A COMPANY IN THE DEVELOPMENT STAGE)
                 STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIENCY)
      SIX MONTHS ENDED JANUARY 31, 2006 AND CUMULATIVE AMOUNTS FROM OCTOBER
                          13, 1987 (DATE 0F INCEPTION)
                                   (UNAUDITED)


<TABLE>
<CAPTION>

                                                                                                   Deficit
                                                                                                  Accumulated
                                                                            Additional                the
                                        Common Stock                           Paid              Developmental
                                     Number of Shares        Amounts         Capital                 Stage                 Total
                                     ----------------        -------         -------                 -----                 ------

<S>                                   <C>                 <C>           <C>                   <C>                    <C>
Balance July 31, 2005                  $ 84,153,434         $  8,416       $ 2,572,028           $ (4,828,000)          $(2,247,556)

Issuance of
common stock for services                   100,000         $     10       $     1,890                                  $     1,900

Debt converted into stock                89,000,000         $  8,900       $   658,600                                  $   667,500

Net Gain (Loss) at 1/31/2006                                                                     $    508,119           $   508,119

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

                                        173,253,434         $ 17,326       $ 3,232,518           $ (4,319,881)          $(1,070,037)

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


</TABLE>



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

                                        5



<PAGE>



                      MURRAY UNITED DEVELOPMENT CORPORATION
                      (A Company in the Development Stage)
                            STATEMENTS OF CASH FLOWS
                   SIX MONTHS ENDED JANUARY 31, 2006 AND 2005
                    CUMULATIVE AMOUNTS FROM OCTOBER 13, 1987
                               (DATE OF INCEPTION)
                                   (UNAUDTIED)

<TABLE>
<CAPTION>
                                                                                                            Cumulative
                                                                         2006              2005           from Inception
                                                                  ----------------   ---------------     ----------------
<S>                                                                <C>                <C>               <C>
Operating activities:
Net Income (Loss)                                                     $   508,119        $(119,257)        $ (4,319,881)
Adjustments to reconcile net loss to net cash used in
operating activities:
Depreciation and Amortization                                                   -            4,166              260,495
Expenses paid through issuance of common stock by:
    Company                                                                 1,900                -              543,185
    Principal Stockholder                                                       -                -              220,900
Changes in operating assets and liabilities:
    Loan Receivable                                                             -                -               (2,000)
    Accounts Payable  Accrued Expenses                                    (61,207)         (57,680)              87,362
                                                                  ----------------   --------------      ---------------
Net cash used in operating activities                                     448,812         (172,771)          (2,809,939)
                                                                  ----------------   --------------      ---------------

Investing Activities:
    Purchase of furniture and  equipment                                        -                -             (260,497)
                                                                  ----------------   --------------      ---------------
Net cash provided by (used in) investing activities                             -                -             (260,497)
                                                                  ----------------   --------------      ---------------

Financing activities:
    Note payable to stock holder: Proceeds                            $   184,524        $ 181,648         $  2,025,849
    Principal payments                                                 (1,300,500)               -           (1,427,167)
    Proceeds from the issuance of common stock (net)                      667,500                -            2,472,260
                                                                  ----------------   --------------      ---------------
Net cash provided by financing activities                                (448,476)         181,648            3,070,942
                                                                  ----------------   --------------      ---------------
Net increase (decrease) in cash and cash equivalents                          336            8,877                  506
Cash and cash equivalents, beginning of period                                170            1,033                    -
                                                                  ----------------   --------------      ---------------
Cash and cash equivalents, end of period                              $       506        $   9,910         $        506
                                                                  ----------------   --------------      ---------------
Supplemental disclosure of cash flow data:
  Interest Paid                                                       $         -        $       -         $          -
                                                                  ----------------   --------------      ---------------
</TABLE>


                                        6



<PAGE>


                      MURRAY UNITED DEVELOPMENT CORPORATION
                          NOTES TO FINANCIAL STATEMENTS
                            January 31, 2006 and 2005


NOTE 1 - ORGANIZATION AND BUSINESS AND BASIS OF PRESENTATION

The accompanying unaudited condensed financial statements have been prepared in
accordance with Generally Accepted Accounting Principles for interim financial
information and pursuant to the Regulation S-B of the Rules and Regulations of
the Securities and Exchanged Commission. Certain financial information and
footnote disclosure normally included in annual financial statements prepared in
accordance with Generally Accepted Accounting Principles have been condensed or
omitted. Accordingly, the accompanying financial statements should be read in
conjunction with the Company's annual financial statements and notes thereto
included in its Form 10-KSB for the year ended July 31, 2005.

The Company was incorporated on October 13, 1987 under the laws of the State of
Delaware. It was organized to further develop and exploit commercially certain
technology for a rotary internal combustion engine that would utilize
alternative fuels. The patent and related rights to the use of the technology
have been assigned to the Company.

The Company has been in the development stage since inception. Activities of the
Company have been limited to the acquisition of funds from the sale of its
common stock; the acquisition of the licensing rights for and, subsequently,
title to, the engine technology; research and development related to the
development of an initial fuel-driven prototype of the engine that was
successfully tested on a preliminary basis in January 1990; additional testing
and development of the engine prototype to obtain performance data for the
demonstration of the engine to potential licensees; research relating to the
ability of a proprietary cleaning solution, which will be licensed to the
Company, to remove air pollutants from coal burning flue gas and certain air
pollutants and contaminants from building air, as well as other industrial uses;
and research and development relating to production of hydrogen for use in
hydrogen fuel cells. The proprietary cleaning solution, for which we have been
granted trademark protection under the name Klenz-Safe, is owned by a
corporation whose sole shareholders are Mr. Anthony Campo and Mr. Dwight Foster,
the Chairman of the Board and Chief Executive Officer of the Company,
respectively. The Company intends to continue research and development on the
Klenz-Safe product and hydrogen technology during the ensuing 12-month period.
Funding will be provided through loans from the Chairman of the Company, at his
sole discretion. The Company does not intend to continue its research and
development efforts with respect to its rotary engine during the next 12-month
period unless it is able to raise the funds necessary to conduct such research,
1,070,037 of which there can be no assurances.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. However, as of January 31, 2006, the
Company had not been able to commercially utilize its hydrogen or engine
technology or its cleaning solution to generate revenues or cash flows from
operating activities. As a result, it has suffered recurring losses from
operations from inception that have generated the net stockholders' deficiency
of $1,070,037 as of January 31, 2006 and have also generated significant working
capital deficiencies from time to time.

                                       7

<PAGE>


Management does not expect the Company to generate any significant revenues or
positive operating cash flows during the twelve-month period subsequent to
January 31, 2006. The limited amount of liquid resources available at January
31, 2006, and the inability to generate operating revenues and cash flows raise
substantial doubts about the Company's ability to continue as a going concern.

The Company plans to continue research and development activities on at least a
limited basis through the twelve-month period subsequent to January 31, 2006.
However, management believes that, the net liquid assets available at January
31, 2006 will not be sufficient to enable the Company to meet its obligations
and to continue as a going concern during the ensuing twelve-month period even
on this limited basis without limiting research and development and other
operating activities more severely unless it obtains additional debt or equity
financing and/or government sponsored research.

Management believes that continuation of the Company as a going concern during
the twelve-month period subsequent to January 31, 2006 and thereafter will
depend upon the Company's ability to obtain sufficient additional working
capital to fund research and development activities on its Klenz-Safe and
hydrogen technologies and the general and administrative expenses to be incurred
during the remaining development period. Potential sources of such working
capital include: the private or public sale of common stock, the exercise of a
substantial portion of the 15,398,000 outstanding Class B warrants prior to
their proposed expiration on March 11, 2007, 14,898,000 of which are exercisable
at $0.15 per share and 500,000 of which are exercisable at $.225 per share; and
borrowing additional amounts from related parties or other sources. However,
there can be no assurances that such financing will be available. The
accompanying financial statements do not include any adjustments that might
result from the uncertainties related to the ability of the Company to continue
as a going concern.

NOTE 2 - SUMMARY OF OTHER SIGNIFICANT ACCOUNTING POLICIES:

Cash and Cash Equivalents
         For purposes of the statement of cash flows, the Company considers
         highly liquid temporary cash investments with an original maturity of
         three months or less to be cash equivalents.

Depreciation:
         Depreciation of furniture and equipment is provided over the estimated
         useful lives of the related assets using declining balance methods.

Research and development:
         Costs and expenses related to research and development are expensed as
         incurred.

Net loss per common share:
         Net loss per common share was computed on the basis of the weighted
         average number of shares of common stock outstanding during each
         period. The effect of assuming the





                                       8
<PAGE>

         exercise of outstanding warrants was antidilutive and, accordingly, not
         included in the computation of net loss per share.

NOTE 3 - RELATED PARTY TRANSACTIONS:

         Information as to agreements with, and notes payable to, related
         parties is set forth in the financial statements in the July 31, 2005
         Form 10-KSB and in the Company's 8-K dated December 30, 2005.

NOTE 4 - STOCKHOLDER'S EQUITY:

         Information as to stockholders' equity is set forth in the financial
statements in the July 31, 2005 Form 10-KSB.


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

The following discussion and analysis provides information which we believe is
relevant to an assessment and understanding of our results of operations and
financial condition. This discussion should be read in conjunction with the
financial statements and notes thereto appearing elsewhere herein.

Statements in this Form 10-QSB that are not statements of historical or current
fact constitute "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward-looking statements
involve known and unknown risks, uncertainties and other unknown factors that
could cause our actual results to be materially different from the historical
results or from any future results expressed or implied by such forward-looking
statements. In addition to statements that explicitly describe such risks and
uncertainties, readers are urged to consider statements labeled with the terms
"believes," "belief," "intends," "anticipates" or "plans" to be uncertain and
forward-looking. The forward-looking statements contained herein are also
subject generally to other risks and uncertainties that are described from time
to time in our reports filed with the Securities and Exchange Commission.


RESULTS OF OPERATIONS

We have not derived any revenues from the license or sale of our technology and
have incurred cumulative losses from our inception on October 13,1987 through
January 31, 2006 of $4,319,881. Our revenues from our inception on October 13,
1987 through January 31, 2006 aggregating $66,465 were derived from interest
earned and $632,500 from the forgiveness of debt by the majority shareholder
which occurred on December 27, 2005. Interest income was zero in the periods
ended January 31, 2006 and January 31, 2005 as a result of a lack of funds
available for investment.

The cumulative loss from inception includes research and development costs of
$876,771. There were no research and development costs in the quarterly periods
ended January 31, 2006 and




                                       9
<PAGE>


January 31, 2005. We have had to reduce substantially our research and
development activities due to liquidity problems.

Our cumulative loss from inception includes general and administrative expenses
of $3,075,414. General and administrative expenses increased to $55,736 in the
period ending January 31, 2006 from $48,371 in the period ending January 31,
2005, or a 13.98% increase. Increases in general and administrative expenses can
be attributed to increased professional fees.

Our cumulative loss from inception also includes past licensing fees, of which
there were none during the period, and cumulatively $57,260 since inception. The
elimination of licensing fees is the result of the legal settlement reached in
fiscal 1994.

The cumulative loss from inception also includes interest expense of $1,009,401
on promissory notes payable to our principal stockholder and chairman. Interest
expense decreased to $69,245 in the period ending January 31, 2006 from $70,886
in the period ending January 31, 2006, primarily as a result of the forgiveness
of debt by our chairman and principal stockholder.

Our net gain of $508,119 in the period ended January 31, 2006 increased by
$627,376 over the net loss of $119,257 in January 31, 2005. The forgiveness of
debt by our chairman and principal stockholder caused the overall increase.


LIQUIDITY AND CAPITAL RESOURCES

At January 31, 2006, we had cash and short-term investments totaling $506
(compared to liquid assets of $170 at July 31, 2005), a working capital increase
of $336 (compared with a working capital decrease of $863 at July 31, 2005), and
a total stockholders' deficiency of $1,070,037 (compared to a deficiency of
$2,247,553 at July 31, 2005). The decrease in stockholders' deficiency due to
the forgiveness of debt by our chairman and principal stockholder caused the
overall increase.

At January 31, 2006, we had current liabilities in excess of current assets of
$23,884. We have not been able to commercially utilize our technologies to
generate any revenue through that date, and as a result, we have suffered
recurring losses from operations from inception that have generated the net
capital deficiencies at January 31, 2006 as well as July 31, 2005 and
significant working capital deficiencies from time to time. We do not expect to
generate any significant revenues or positive operating cash flows during the
twelve-month period subsequent to January 31, 2006. Cash flows generated and
used by operating activities were $448,812 (generated) and $172,771 (used) in
the periods ended January 31, 2006 and January 31 2005, respectively. The
limited amount of liquid resources available at January 31, 2006, and our
inability to generate operating revenues and cash flows, raise substantial
doubts about our ability to continue as a going concern.




                                       10
<PAGE>


PLAN OF OPERATION

KLENZ-SAFE CLEANING SOLUTION

In February 2002, we reached an agreement in principle with Mr. Anthony
Campo, the Chairman of the Company, and with Mr. Dwight Foster, Chief Executive
Officer of the Company, pursuant to which we would obtain a license to use and
sell a proprietary cleaning solution owned by Foster-Campo Corp.
("Foster-Campo"), a corporation owned by Mr. Foster and Mr. Campo. Under the
terms of the proposed license, Foster-Campo will manufacture the cleaning
solution and supply it to our customers. Foster-Campo will then invoice us for
their cost of doing so without any profit to Foster-Campo. Foster-Campo will
receive a royalty payment of 50% of our net profit on sales of the proprietary
solution to our customers. Calculation of our net profit will include, but not
be limited to, amounts Foster-Campo invoices us for supplying our customers with
the cleaning solution.

In June 2000 Penn State Energy Institute, which is a facility of Penn State
University, agreed to conduct laboratory tests of the application of the
Klenz-Safe solution to the reduction of sulfur from coal burning flue gas. When
coal burning flue gas was introduced through Klenz-Safe using the Company's
proprietary methodology, the capture rate of sulfur exceeded 99.2% and
maintained a minimum 98% rate throughout the testing.

Due to the success of the initial testing, Penn State Energy Institute applied
to the U.S. Department of Energy for a grant to conduct a pilot test of
Klenz-Safe's ability to capture sulfur in coal burning flue gas. Such grant
request was not funded during the Department of Energy's 2003 funding period.
During our fiscal year ended July 31,2004, Penn State informed us that the cost
of further testing, which would be conducted in a working smoke stack to
simulate actual conditions, would be approximately $100,000. We are currently
attempting to form a business relationship with one of more third parties that
may assist us in funding the cost of such testing; however, we are not able to
provide any assurances that we will be able to enter into such a business
relationship. In addition, even if we are able to enter into any such business
relationship, it is probable that we will be required to assign a partial
interest in our Klenz-Safe Technology, or the proceeds of such technology, to
such third party in consideration of such third party's agreement to assist in
funding the additional research.

If funding for the pilot study is obtained, the pilot tests would be conducted
in a working smoke stack to simulate actual conditions. If such tests are
conducted and are successful, we intend to seek distribution partners to assist
us in marketing and selling the Klenz-Safe product to the coal burning utility
market. We cannot provide any assurances that such testing will occur or, even
if it does occur, that it will be successful.

In 2001, we engaged a certified indoor air quality laboratory to perform a
series of laboratory tests on Klenz-Safe to determine Klenz-Safe's ability to
remove pollutants and contaminants from building air and to examine other
potential industrial uses. The tests simulated wet scrubber equipment, which is
commonly used device for removing pollutants from building air.

Based on generally known industry practices, management believes that the
range of


                                       11
<PAGE>


pollutants captured by Klenz-Safe and the rate of such capture have not been
previously achieved in a single operation. The following were the material
findings of the laboratory tests:

     -    Klenz-Safe captured 90% of carbon monoxide in tested air streams;

     -    Klenz-Safe captured 70% of both nitrogen dioxide and of nitrous oxide
          in tested streams;

     -    Klenz-Safe added no detectable volatile organic compounds to the air
          stream at elevated temperatures, indicating that Klenz-Safe could be
          applied to indoor air cleaning systems without the need of additional
          filtering.

     Based on our tests of Klenz-Safe, management believes that Klenz-Safe
possesses the following environmentally beneficial attributes:

o    Klenz-Safe is a non-toxic, non-hazardous composition that requires no
     special equipment to protect the personnel using it;

o    Klenz-Safe achieves a higher starting alkalinity and has a longer operating
     life than can be obtained with commercial caustic materials or lime
     slurries;

o    Klenz-Safe protects rather than corrodes metal compounds and surfaces.

     Management presently believes that Klenz-Safe may be useful in the
following applications:

o    Air pollution control in wet scrubber equipment, which are commonly used to
     remove pollutants from building air;

o    Containment and neutralization of liquids and compounds;

o    Decontamination of equipment in pharmaceutical production;

o    Air filtration in indoor air quality control;

o    Flue and combustion gas scrubbing.

To date, the cost of the research at Penn State was approximately $9,000, and
the cost of the research by the certified air quality laboratory was
approximately $5,000. Funding for the above research was provided by loans to
the Company from our Chairman, Mr. Anthony Campo. During fiscal 2006 and 2005 we
did not incur any expense for research and development relating to Klenz Safe's
ability to remove sulfur from flue burning smoke stacks.

We have presently suspended further testing of Klenz-Safe's ability to remove
sulfur and other contaminating materials from coal-burning flue gas and to
remove contaminants from building air due to a lack of funds to conduct such
testing. However, we are continuing to attempt to form business relationships
with one or more third parties that may assist us in funding the cost of such
testing. We are not able to provide any assurances that we will be able to enter


                                       12
<PAGE>


into such a business relationship. Moreover, even if we are able to enter into
such a business relationship, it is probable that we will be required to assign
a partial interest in our Klenz-Safe technology, or the proceeds of such
technology, to such third party in consideration of such third party's agreement
to assist us in funding such additional testing. We are also seeking power
plants that may be willing to conduct on-site testing.

Additionally, we are continuing to demonstrate Klenz-Safe to potential end-user
customers to demonstrate its ability to meet intended applications of such
customers.

We have been granted trademark protection for the name "Klenz-Safe" from the US
Patent and Trademark Office (PTO). The method of application of the Klenz-Safe
formula for removal of sulfur from coal burning flue gas was developed by a
consultant to the Company, who assigned to us his rights to such know-how and
his rights under a provisional patent application filed with the PTO covering
such know-how. In October 2002 we filed an application for a provisional patent,
which extends the Klenz-Safe technology into additional indoor air quality
applications. In February 2003, we filed an amendment to the October 2002
provisional patent application that revised certain data contained in the
October 2002 provisional patent with the PTO application. In February 2004 we
filed a non-provisional patent application relating to Klenz-Safe. However, we
cannot provide any assurances that the PTO will grant a patent on our Klenz-Safe
technology.

HYDROGEN PRODUCTION TECHNOLOGY

In light of the energy plan of current administration encouraging the use of
hydrogen fuel cells in place of fossil fuels such as oils and gas, management
has begun to investigate a technology that would produce hydrogen from sunlight
through the use of a proprietary device and solution. The hydrogen gas produced
would be used to supply on demand, low cost hydrogen fuel to hydrogen-oxygen
fuel cells in order to meet stationary and mobile electric power requirements.
Stationary uses would include residential and commercial heating systems, and
mobile uses would include electric and hybrid fuel cell powered vehicles.

In June 2002, we entered into an oral agreement with George Johnson and William
L. Johnson (the "Inventors") to develop a method and apparatus for production of
photo galvanic hydrogen (the "PGH Technology") and to prepare and file a
provisional patent application (the "Provisional Patent Application") relating
thereto in the PTO. The Inventors further agreed that, upon filing of the
Provisional Patent Application, they would negotiate with the Company for an
assignment of all of their interest in the PGH Technology and the Provisional
Patent Application to the Company. In consideration for the Inventors' services,
the Company agreed to issue to each of the Inventors 100,000 shares of the
Company's Common Stock and to register such shares with the Securities and
Exchange Commission. The Company subsequently formalized the oral agreement with
the Inventors by a written agreement dated as of June 1, 2002.

In July 2003, the Inventors filed the Provisional Patent Application with the
PTO. By



                                       13
<PAGE>


Agreement dated October 2, 2003, the Company entered into a Technology
Assignment Agreement with the Inventors pursuant to which the Inventors agreed
to assign to the Company all of their rights in the PGH Technology, in the
Provisional Patent Application, and in all letters patent, both domestic and
foreign, that may be granted for the PGH Technology. In consideration for such
assignment, we granted to the Inventors a right of first refusal to perform all
consulting services derived from contracts and/or grants entered into between
the Company and third parties relating to the development of the PGH Technology.
We further agreed to reimburse the Inventors up to $5,000 for their out-of
pocket expenses incurred for materials and supplies to build apparatus relating
to the PGH Technology and for collecting, and testing for, the production of
hydrogen.

Pursuant to the Technology Assignment Agreement, the Inventors executed an
Assignment of Invention & Patent Rights, dated October 2, 2003 (the
"Assignment"), under which the Inventors assigned to the Company their rights in
the PGH Technology, all applications for Letters Patent that may be filed for
the PGH Technology, and all Letters Patent for the PGH Technology in any
country.

In October 2003, but effective as of July 18, 2003, we entered into Consulting
Agreements with each of the Inventors (the "Consulting Agreements") pursuant to
which the Inventors agreed to assist the Company in obtaining grants from and/or
contracts with third parties for research and development relating to the PGH
Technology and in obtaining a patent on the technology described in the
Provisional Patent Application. Mr. George Johnson's services under his
Consulting Agreement have terminated due to his death, and Mr. William Johnson's
services have been suspended indefinitely for personal reasons.

In October 2004, we transferred the apparatus for our PGH Technology to the
University of Kansas for purposes of conducting further testing of the ability
of our PGH Technology to produce hydrogen. However, our discussions with the
University have been discontinued, and we are presently seeking other parties to
continue such testing.

During fiscal 2005 and 2006, we spent $0 on research relating to the PGH
Technology.


ROTORCAM ENGINE

We do not expect to further develop the Rotorcam Engine during the next 12-month
period. We have been advised by Southwest Research Institute that it would take
up to 4 years and $3 million in order to develop the Rotorcam Engine for
commercial sale. We therefore first intend to use any funds that may become
available to further develop our Klenz-Safe and PGH technologies, which we
believe have the potential to generate operating revenues much earlier than the
Rotorcam Engine. We will, however, continue to evaluate possible
commercialization of the Rotorcam Engine in light of future facts and
circumstances.


                                       14
<PAGE>


ITEM 3.  CONTROLS AND PROCEDURES

The Company is a development stage company and currently has no revenues,
significant assets or independent operations. Its current Chief Executive
Officer, Dwight Foster, and its current Chief Financial and Accounting Officer,
Anthony Campo, are the only individuals who accumulate financial information
required to be disclosed in the Company's financial reports. Since Mr. Foster
and Mr. Campo are the only individuals who accumulate such information, they
have concluded that the information they accumulate is obtained by them in such
a manner as to permit them to make timely decisions regarding disclosure. They
have also concluded that the Company's controls and procedures are effective to
ensure that information required to be disclosed in the reports that the Company
files under the Exchange Act is recorded, processed, summarized and reported
within the periods required by the Exchange Act.

No significant changes in the Company's financial controls over financial
reporting have come to management's attention during the Company's previous
fiscal quarter that have materially affected or are likely to materially affect
the Company's internal control over financial reporting.

As of the end of the quarterly period covered by this report, the Company
carried out an evaluation, under the supervision of the Company's Chief
Executive Officer and Chief Financial and Accounting Officer, of the
effectiveness of the design and operation of the Company's controls and
procedures, as defined in Exchange Act Rules 13a-15(e) and 15d-15(e). Based upon
that evaluation, they concluded that the Company's disclosure controls and
procedures during the prior quarterly period were effective to enable the
Company to record, process, summarize and report information required to be
included in this quarterly filing.



                           PART II - OTHER INFORMATION

Item 1.  Legal Proceedings - None

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


On December 27, 2005, Mr. Anthony Campo, the Chairman of the Board of Directors
and the Executive Vice President, Secretary and Treasurer of the Company,
acquired 89 million shares of the Company's common stock pursuant to the
exercise of a conversion right granted to him under the Company's Promissory
Note dated August 1, 2005, (the"2005 Note"). The 2005 Note had been issued to
Mr. Campo to evidence loans, including accrued interest thereon, made by him to
the Company since at least 1994. A copy of the 2005 Note was filed as Exhibit 99
to the Company's report on Form 8-K dated September 19, 2005. To the extent that
the issuance of such securities is deemed a sale, we relied on the exemption
from registration provided by Section 4(2) of the Securities Act of 1933.


                                       15
<PAGE>


Prior to exercising such Note, Mr. Campo owned 5,570,000 shares of the Company's
common stock. After exercising his conversion right, Mr. Campo owned 94,570,000
shares. Prior to exercising his conversion right, the Company had 84,253,434
shares of its common stock outstanding. After Mr. Campo exercised his conversion
right, the Company has 173,253,434 shares of its common stock outstanding. Upon
exercising his conversion right, Mr. Campo owned of record 54.6% of the
outstanding shares of the Company's common stock.

After exercising his conversion right, Mr. Campo transferred a total of 16
million shares to his adult children, thereby reducing the number of Shares he
owned of record to 78,570,000. In addition such 78,570,000 shares owned of
record by Mr. Campo, Mr. Campo has a right to acquire 1,100,000 shares upon
exercise of the Company's Class B Warrants. Also, Mr. Campo's wife owns
2,150,000 shares of the Company's common stock, and his children own 20,772,400
shares and have a right to acquire 138,700 shares upon exercise of Class B
Warrants of the Company. Under rules of the Securities and Exchange Commission,
such shares that Mr. Campo and his children have the right to acquire and any
shares that are owned by his spouse and children may be deemed to be
"beneficially owned" by Mr. Campo.


Item 3.  Defaults upon Senior Securities

We issued a promissory note to Mr. Campo, dated August 1, 2005, in the principal
amount of $2,087,278 (the "August 1, 2005 Outstanding Indebtedness"), which note
consolidated amounts we owed him under our prior notes. The August 1, 2005 Note
bears interest at 7.5% per annum, which is payable quarterly on each November 1,
February 1, May 1 and August 1, and matures on August 1, 2006. We defaulted on
our quarterly interest payments due under the August 1, 2005 Note on November 1,
2005 and February 1, 2006.

On December 27, 2005, Mr. Campo exercised his right to convert $667,500 of
indebtedness under the August 1, 2005 Note into 89,000,000 shares of our common
stock. On December 30, 2005, Mr. Campo forgave 632,500 of the balance of the
August 1, 2005 note. This amount was recorded as income on the January 31, 2006
Statement of Operations. Between August 1, 2005 and January 31, 2006, Mr. Campo
loaned the Company an additional $41,500. Therefore, the outstanding principal
amount under the 2005 Note as of January 31, 2006 was $828,778. Since we do not
have any revenues, it is doubtful that we will be able to pay any interest or
principal amounts due under the August 1, 2005 Note until such time as we have
operating revenues or we raise funds from an independent source, both of which
events may not occur at any time.


Item 4.  Submission of Matters to a Vote of Security Holders - None

Item 5.  Other Information:  None

Item 6.  Exhibits


                                       16
<PAGE>

(31)     (a) Certification of Chief Executive Officer in accordance with 18
         U.S.C. Section 1350, as adopted by Section 302 of the Sarbanes-Oxley
         Act of 2002

         (b) Certification of Principal Financial and Accounting Officer in
         accordance with 18 U.S.C. Section 1350, as adopted by Section 302 of
         the Sarbanes-Oxley Act of 2002


(32)     (a) Certification of Chief Executive Officer in accordance with 18
         U.S.C. Section 1350, as adopted by Section 906 of the Sarbanes-Oxley
         Act of 2002

         (b) Certification of Principal Financial and Accounting Officer in
         accordance with 18 U.S.C. Section 1350, as adopted by Section 906 of
         the Sarbanes-Oxley Act of 2002




                                       17
<PAGE>



                                   SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.

                                    MURRAY UNITED DEVELOPMENT CORPORATION
                                    -------------------------------------
                                                 (Registrant)


                              By:     /s/ Dwight Foster
                                      ---------------------
                                      Dwight Foster
                                      Chief Executive Officer

                              Dated:  March 15, 2006


                              By:     /s/ Anthony S. Campo
                                      ---------------------
                                      Anthony S. Campo, Executive Vice President
                                      Secretary and Treasurer
                                      Chief Financial Officer

                              Dated:  March 17, 2006





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