|   | Form 10-QSB |   |
|--------|-------------|--------|

|   |
|--------|

|   | SECURITIES AND EXCHANGE COMMISSION Washington, D.C. |   |
|--------|-----------------------------------------------------|--------|

|   |
|--------|

|   | [ X ] Quarterly Report Pursuant to Section 13 or 15(d) of the                Securities Exchange Act of 1934 For the quarterly period ended June                30,                2007 |   |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|

| OR |
|----|

|   | [ ] Transition Report Pursuant to Section 13 or 15(d) of the                Securities Exchange Act of 1934 For the transition period from _______                to                _______. |   |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|

|   |
|--------|

|   | Commission File No. 33-19961 |   |
|--------|------------------------------|--------|

|   |
|--------|

|   | Diamond I, Inc.                                                                  |   |
|--------|----------------------------------------------------------------------------------|--------|
|   | (Exact Name of Small Business Issuer as Specified in its                Charter) |   |

|   |
|--------|

|   | DELAWARE |   | 01-0623010 |   |
|--------|----------|--------|------------|--------|

|   | (State or Other Jurisdiction of incorporation or                organization) |   | (I.R.S. Employer Identification Number) |   |
|--------|-------------------------------------------------------------------------------|--------|-----------------------------------------|--------|

|   | 8733 Siegen Lane, Suite 309, Baton Rouge, LA 70810 |   |
|--------|----------------------------------------------------|--------|

|   | (Address of Principal Executive Offices, including Zip Code) |   |
|--------|--------------------------------------------------------------|--------|

|   | (225) 341-4004 |   |
|--------|----------------|--------|

|   | (Issuer’s telephone number, including area code) |   |
|--------|--------------------------------------------------------|--------|

|   |
|--------|

| Indicate by check mark whether Registrant (1) has filed all reports                required to be filed by Section 13 or 15(d) of the Securities Exchange                Act                of 1934 during the preceding 12 months (or for such shorter period                that                Registrant is required to file such reports), and (2) has been subject                to                such filing requirements for the past 90 days: Yes [ X ] No [                ] |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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

| Indicate the number of shares outstanding of each of the issuer’s                classes of common stock as of the latest practicable                date: |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Class |   | Outstanding as of 8-13-07 |   |
|--------|-------|--------|---------------------------|--------|

|   | Common Stock, $.001 par value |   | 323,516,707 |   |
|--------|-------------------------------|--------|-------------|--------|

|         |
|--------------|
| <PAGE> |
|         |

| PART I - FINANCIAL INFORMATION |
|--------------------------------|

|   |
|--------|

| Item 1. Financial Statements. |   |
|-------------------------------|--------|

| INDEX TO CONSOLIDATED FINANCIAL STATEMENTS |
|--------------------------------------------|
| Diamond I, Inc.                            |

|   |   | Page |
|--------|--------|------|

|   | Balance Sheet as of June 30, 2007 (unaudited), and December 31,                2006 | 3 |
|--------|-------------------------------------------------------------------------------------|---|

|   | Statement of Revenues and Expenses for the Three Months and Six                Months Ended June 30, 2007 and 2006, and Period from June 17, 2003                (Inception), Through June 30, 2007 (unaudited) | 4 |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---|

|   | Statement of Stockholders’ Equity for the Six Months Ended June 30,                2007 (unaudited) | 5 |
|--------|-----------------------------------------------------------------------------------------------------------|---|

|   | Statement of Cash Flows for the Six Months Ended June 30, 2007                and                2006, and Period from June 17, 2003 (Inception), Through June 30,                2006                (unaudited) | 7 |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---|

|   | Notes to Consolidated Financial Statements | 9 |
|--------|--------------------------------------------|---|

|         |
|--------------|
| <PAGE> |
|         |

|   | DIAMOND I, INC. |   |
|--------|-----------------|--------|

|   | (a development stage company) |   |
|--------|-------------------------------|--------|

|   | CONSOLIDATED BALANCE SHEETS |   |
|--------|-----------------------------|--------|

|   | June 30, 2007,and December 31, 2006 |   |
|--------|-------------------------------------|--------|

|   | 6/30/07(unaudited) |   | 12/31/06 |
|--------|--------------------|--------|----------|

| ASSETS |
|--------|

| Current assets: |   |   |
|-----------------|--------|--------|

|   | Cash | $2,910 |   | $ 35 |
|--------|------|--------|--------|------|

|   | Total current assets | 2,910 |   | 35 |
|--------|----------------------|-------|--------|----|

| Equipment, net of accumulated depreciation of $100,749 and                $92,870 | 1,366 |   | 9,245 |
|-----------------------------------------------------------------------------------|-------|--------|-------|

| Intangible assets - Pending patent, net of accumulated amortization                of $165,231 and $94,479 | 695,902 |   | 766,654 |
|------------------------------------------------------------------------------------------------------------|---------|--------|---------|

|   | Total Assets | $700,178 |   | $775,934 |
|--------|--------------|----------|--------|----------|

| LIABILITIES AND STOCKHOLDERS' EQUITY                (DEFICIT) |
|---------------------------------------------------------------|

| Current liabilities: |   |   |
|----------------------|--------|--------|

|   | Accounts payable | $1,500 |   | $1,500 |
|--------|------------------|--------|--------|--------|

|   | Accrued expenses | 106,932 |   | 336,586 |
|--------|------------------|---------|--------|---------|

|   | Short-term account payable - third party | 30,400 |   | --- |
|--------|------------------------------------------|--------|--------|-----|

|   | Short-term note payable - related party | 41,640 |   | 41,640 |
|--------|-----------------------------------------|--------|--------|--------|

|   | Accrued interest - shareholders | 5,071 |   | --- |
|--------|---------------------------------|-------|--------|-----|

|   | Dividend payable on preferred stock | 97,500 |   | 82,500 |
|--------|-------------------------------------|--------|--------|--------|

|   | Total current liabilities | 283,043 |   | 462,226 |
|--------|---------------------------|---------|--------|---------|

| Stockholders’ equity (deficit): |   |   |
|---------------------------------------|--------|--------|

|   | Preferred stock, $.001 par value, 50,000,000 shares authorized,                500,000 Series A shares issued and outstanding | 500 |   | 500 |
|--------|-------------------------------------------------------------------------------------------------------------------------------|-----|--------|-----|

|   | Common stock, $.001 par value; 700,000,000 shares authorized,                323,516,707 and 288,513,756 shares issued and outstanding | 323,517 |   | 288,514 |
|--------|----------------------------------------------------------------------------------------------------------------------------------------|---------|--------|---------|

|   | Subscription receivable | (128,000) |   | (128,000) |
|--------|-------------------------|-----------|--------|-----------|

|   | Additional paid-in capital | 29,773,558 |   | 29,219,021 |
|--------|----------------------------|------------|--------|------------|

|   | Deficit accumulated during the development stage | (29,552,440) |   | (29,066,327) |
|--------|--------------------------------------------------|--------------|--------|--------------|

|   | Total stockholders' equity | 417,135 |   | 313,708 |
|--------|----------------------------|---------|--------|---------|

|   | Total liabilities and stockholders’ equity | $700,178 |   | $775,934 |
|--------|--------------------------------------------------|----------|--------|----------|

| The accompanying notes are an integral part of these                statements. |
|---------------------------------------------------------------------------------|

|         |
|--------------|
| <PAGE> |
|         |

|   | DIAMOND I, INC. |   |
|--------|-----------------|--------|

|   | (a development stage company) |   |
|--------|-------------------------------|--------|

|   | STATEMENTS OF REVENUES AND EXPENSES |   |
|--------|-------------------------------------|--------|

|   | For the Three Months and Six Months Ended June 30, 2007 and 2006,                andthe Period from June 17, 2003 (Inception), Through June 30,                2007(unaudited) |   |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|

|   |   | Three Months Ended June 30, |   | Six Months Ended June 30, |   |
|--------|--------|-----------------------------|--------|---------------------------|--------|

|   | 2007 |   | 2006 |   | 2007 |   | 2006 |   | Inception through6/30/2007 |
|--------|------|--------|------|--------|------|--------|------|--------|----------------------------|

| Revenues | $--- |   | $--- |   | $--- |   | $--- |   | 10,784 |
|----------|------|--------|------|--------|------|--------|------|--------|--------|

| Internet access costs | --- |   | --- |   | --- |   | --- |   | (32,850) |
|-----------------------|-----|--------|-----|--------|-----|--------|-----|--------|----------|

| Gross profit (loss) | --- |   | --- |   | --- |   | --- |   | (22,066) |
|---------------------|-----|--------|-----|--------|-----|--------|-----|--------|----------|

| OPERATING EXPENSES |   |   |   |   |   |   |   |   |   |
|--------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|

|   | Professional and consulting fees | 47,100 |   | 57,379 |   | 249,200 |   | 223,011 |   | 4,011,288 |
|--------|----------------------------------|--------|--------|--------|--------|---------|--------|---------|--------|-----------|

|   | Compensation expense | 79,200 |   | 441,155 |   | 157,200 |   | 729,730 |   | 5,032,776 |
|--------|----------------------|--------|--------|---------|--------|---------|--------|---------|--------|-----------|

|   | Depreciation and amortization | 35,156 |   | 12,583 |   | 78,631 |   | 17,162 |   | 265,981 |
|--------|-------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|---------|

|   | Impairment loss | --- |   | --- |   | --- |   | --- |   | 16,808,527 |
|--------|-----------------|-----|--------|-----|--------|-----|--------|-----|--------|------------|

|   | General and administrative (excluding professional and consulting                fees, compensation expense, depreciation and impairment loss) | 32 |   | 24,708 |   | 245 |   | 28,898 |   | 3,384,873 |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------|----|--------|--------|--------|-----|--------|--------|--------|-----------|

|   | Total Operating Expenses | 161,488 |   | 535,825 |   | 485,276 |   | 998,801 |   | 29,503,445 |
|--------|--------------------------|---------|--------|---------|--------|---------|--------|---------|--------|------------|

| LOSS FROM OPERATIONS | (161,488) |   | (535,825) |   | (485,276) |   | (998,801) |   | (29,525,511) |
|----------------------|-----------|--------|-----------|--------|-----------|--------|-----------|--------|--------------|

| OTHER INCOME (EXPENSE) | --- |   | (823) |   | (837) |   | (2,566) |   | (26,929) |
|------------------------|-----|--------|-------|--------|-------|--------|---------|--------|----------|

| NET LOSS | $(161,488) |   | $(536,648) |   | $(486,113) |   | $(1,001,367) |   | $(29,552,440) |
|----------|------------|--------|------------|--------|------------|--------|--------------|--------|---------------|

| Deemed Dividend on Preferred stock | --- |   | --- |   | --- |   | --- |   | (165,442) |
|------------------------------------|-----|--------|-----|--------|-----|--------|-----|--------|-----------|

| Cumulative Preferred Dividends | (7,500) |   | (7,500) |   | (15,000) |   | (15,000) |   | (97,500) |
|--------------------------------|---------|--------|---------|--------|----------|--------|----------|--------|----------|

| Net Loss Charged to Common Shareholders | $(168,988) |   | $(544,148) |   | $(501,113) |   | $(1,016,367) |   | $(29,815,382) |
|-----------------------------------------|------------|--------|------------|--------|------------|--------|--------------|--------|---------------|

| Net Loss Applicable to Common Shareholders |   |   |   |   |   |   |   |   |   |
|--------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|

|   | Basic and diluted | $(0.00) |   | $(0.00) |   | $(0.00) |   | $(0.00) |   |   |
|--------|-------------------|---------|--------|---------|--------|---------|--------|---------|--------|--------|

| Weighted average number of shares outstanding |   |   |   |   |   |   |   |   |   |
|-----------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|

|   | Basic and diluted | 316,153,416 |   | 241,363,099 |   | 303,027,808 |   | 237,014,445 |   |   |
|--------|-------------------|-------------|--------|-------------|--------|-------------|--------|-------------|--------|--------|

| The accompanying notes are an integral part of these                statements. |
|---------------------------------------------------------------------------------|

|         |
|--------------|
| <PAGE> |
|         |

|   | CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY (DEFICIT) |   |
|--------|----------------------------------------------------------------|--------|

|   |  For the Six Months Ended June 30, 2007(unaudited) |   |
|--------|---------------------------------------------------------|--------|

|   | Preferred Stock |   | Common Stock |   |
|--------|-----------------|--------|--------------|--------|

|   | Shares |   | Amount |   | Shares |   | Amount |   | Additional Paid-in Capital |   | Subscription Receivable |   | Deficit Accumulated During the Development Stage |   | Total |   |   |
|--------|--------|--------|--------|--------|--------|--------|--------|--------|----------------------------|--------|-------------------------|--------|--------------------------------------------------|--------|-------|--------|--------|

| Balance, December 31, 2006 | 500,000 |   | $500 |   | 288,513,756 |   | $288,514 |   | $29,219,021 |   | $(128,000) |   | $(29,066,327) |   | $313,708 |   |   |
|----------------------------|---------|--------|------|--------|-------------|--------|----------|--------|-------------|--------|------------|--------|---------------|--------|----------|--------|--------|

| Stock issued for services: |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|----------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|

| February 2007 | --- |   | --- |   | 2,040,000 |   | 2,040 |   | 35,658 |   | --- |   | --- |   | 37,698 |   |   |
|---------------|-----|--------|-----|--------|-----------|--------|-------|--------|--------|--------|-----|--------|-----|--------|--------|--------|--------|

| March 2007 | --- |   | --- |   | 7,600,000 |   | 7,600 |   | 163,400 |   | --- |   | --- |   | 171,000 |   |   |
|------------|-----|--------|-----|--------|-----------|--------|-------|--------|---------|--------|-----|--------|-----|--------|---------|--------|--------|

| Contribution to capital from shareholder | --- |   | --- |   | --- |   | --- |   | 2,220 |   | --- |   | --- |   | 2,220 |   |   |
|------------------------------------------|-----|--------|-----|--------|-----|--------|-----|--------|-------|--------|-----|--------|-----|--------|-------|--------|--------|

| Contribution to capital from contract party | --- |   | --- |   | --- |   | --- |   | 25,200 |   | --- |   | --- |   | 25,200 |   |   |
|---------------------------------------------|-----|--------|-----|--------|-----|--------|-----|--------|--------|--------|-----|--------|-----|--------|--------|--------|--------|

| Dividend payable on preferred stock | --- |   | --- |   | --- |   | --- |   | (7,500) |   | --- |   | --- |   | (7,500) |   |   |
|-------------------------------------|-----|--------|-----|--------|-----|--------|-----|--------|---------|--------|-----|--------|-----|--------|---------|--------|--------|

| Net loss | --- |   | --- |   | --- |   | --- |   | --- |   | --- |   | (324,625) |   | (324,625) |   |   |
|----------|-----|--------|-----|--------|-----|--------|-----|--------|-----|--------|-----|--------|-----------|--------|-----------|--------|--------|

| Balance, March 31, 2007 | 500,000 |   | 500 |   | 298,153,756 |   | $298,154 |   | $29,437,999 |   | $(128,000) |   | $(29,390,952) |   | $217,701 |   |   |
|-------------------------|---------|--------|-----|--------|-------------|--------|----------|--------|-------------|--------|------------|--------|---------------|--------|----------|--------|--------|

| Stock issued for services: |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|----------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|

| May 2007 | --- |   | --- |   | 8,000,000 |   | 8,000 |   | 32,000 |   | --- |   | --- |   | 40,000 |   |   |
|----------|-----|--------|-----|--------|-----------|--------|-------|--------|--------|--------|-----|--------|-----|--------|--------|--------|--------|

| Stock issued for salary | --- |   | --- |   | 16,162,951 |   | 16,163 |   | 323,259 |   | --- |   | --- |   | 339,422 |   |   |
|-------------------------|-----|--------|-----|--------|------------|--------|--------|--------|---------|--------|-----|--------|-----|--------|---------|--------|--------|

| Stock issued for bonuses | --- |   | --- |   | 200,000 |   | 200 |   | 4,000 |   | --- |   | --- |   | 4,200 |   |   |
|--------------------------|-----|--------|-----|--------|---------|--------|-----|--------|-------|--------|-----|--------|-----|--------|-------|--------|--------|

| Contribution to capital from contract party | --- |   | --- |   | --- |   | --- |   | 5,200 |   | --- |   | --- |   | 5,200 |   |   |
|---------------------------------------------|-----|--------|-----|--------|-----|--------|-----|--------|-------|--------|-----|--------|-----|--------|-------|--------|--------|

| Conversion of contribution to capital from contract party to                loan                proceeds | --- |   | --- |   | --- |   | --- |   | (30,400) |   | --- |   | --- |   | (30,400) |   |   |
|----------------------------------------------------------------------------------------------------------|-----|--------|-----|--------|-----|--------|-----|--------|----------|--------|-----|--------|-----|--------|----------|--------|--------|

| Stock issued for cash | --- |   | --- |   | 1,000,000 |   | 1,000 |   | 9,000 |   | --- |   | --- |   | 10,000 |   |   |
|-----------------------|-----|--------|-----|--------|-----------|--------|-------|--------|-------|--------|-----|--------|-----|--------|--------|--------|--------|

| Dividend payable on preferred stock | --- |   | --- |   | --- |   | --- |   | (7,500) |   | --- |   | --- |   | (7,500) |   |   |
|-------------------------------------|-----|--------|-----|--------|-----|--------|-----|--------|---------|--------|-----|--------|-----|--------|---------|--------|--------|

| Net loss | --- |   | --- |   | --- |   | --- |   | --- |   | --- |   | (161,488) |   | (161,488) |   |   |
|----------|-----|--------|-----|--------|-----|--------|-----|--------|-----|--------|-----|--------|-----------|--------|-----------|--------|--------|

| Balance, June 30, 2007 | 500,000 |   | $500 |   | 323,516,707 |   | $323,517 |   | $29,773,558 |   | $(128,000) |   | $(29,552,440) |   | $417,135 |   |   |
|------------------------|---------|--------|------|--------|-------------|--------|----------|--------|-------------|--------|------------|--------|---------------|--------|----------|--------|--------|

|   |
|--------|

| The accompanying notes are an integral part of these                statements. |
|---------------------------------------------------------------------------------|

|         |
|--------------|
| <PAGE> |
|         |

|   | DIAMOND I, INC. |   |
|--------|-----------------|--------|

|   | (a development stage company) |   |
|--------|-------------------------------|--------|

|   | STATEMENTS OF CASH FLOWS |   |
|--------|--------------------------|--------|

|   | For the Six Months Ended June 30 2007 and 2006,and the Period from June 17, 2003 (Inception), Through June 30,                2007(unaudited) |   |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------|--------|

|   |
|--------|

|   | Six Months Ended June 30, |   |   |
|--------|---------------------------|--------|--------|

|   | 2007 |   | 2006 |   | Inception through6/30/2007 |
|--------|------|--------|------|--------|----------------------------|

| CASH FLOWS FROM OPERATING ACTIVITIES |   |   |   |   |   |
|--------------------------------------|--------|--------|--------|--------|--------|

| Net loss | $(486,113) |   | $(1,001,367) |   | $(29,552,440) |
|----------|------------|--------|--------------|--------|---------------|

|   | Adjustments to reconcile net loss to cash used in operating                activities: |   |   |   |   |   |
|--------|----------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|

|   | Depreciation and amortization | 78,631 |   | 17,162 |   | 265,981 |
|--------|-------------------------------|--------|--------|--------|--------|---------|

|   | Stock issued for services and bonuses | 252,898 |   | 315,043 |   | 7,807,176 |
|--------|---------------------------------------|---------|--------|---------|--------|-----------|

|   | Impairment loss and write-down of assets | --- |   | --- |   | 16,808,527 |
|--------|------------------------------------------|-----|--------|-----|--------|------------|

|   | Warrant expense | --- |   | 103,730 |   | 2,200,389 |
|--------|-----------------|-----|--------|---------|--------|-----------|

|   | Donated capital, officers’ salaries | --- |   | --- |   | 279,808 |
|--------|-------------------------------------------|-----|--------|-----|--------|---------|

|   | Loss on debt extinguishment | --- |   | --- |   | 23,000 |
|--------|-----------------------------|-----|--------|-----|--------|--------|

|   | Changes in assets and liabilities: |   |   |   |   |   |
|--------|------------------------------------|--------|--------|--------|--------|--------|

|   | Stock payable | --- |   | 291,000 |   | --- |
|--------|---------------|-----|--------|---------|--------|-----|

|   | Accrued expenses | 114,839 |   | 174,911 |   | 451,425 |
|--------|------------------|---------|--------|---------|--------|---------|

|   | Accounts payable | 30,400 |   | (768) |   | 31,900 |
|--------|------------------|--------|--------|-------|--------|--------|

| CASH FLOWS USED IN OPERATING ACTIVITIES | (9,345) |   | (100,289) |   | (1,684,234) |
|-----------------------------------------|---------|--------|-----------|--------|-------------|

|   |
|--------|

| CASH FLOWS FROM INVESTING ACTIVITIES |   |   |   |   |   |
|--------------------------------------|--------|--------|--------|--------|--------|

|   | Purchase of equipment | --- |   | --- |   | (102,116) |
|--------|-----------------------|-----|--------|-----|--------|-----------|

| CASH FLOWS USED IN INVESTING ACTIVITIES | --- |   | --- |   | (102,116) |
|-----------------------------------------|-----|--------|-----|--------|-----------|

|   |
|--------|

| CASH FLOWS FROM FINANCING ACTIVITIES |   |   |   |   |   |
|--------------------------------------|--------|--------|--------|--------|--------|

|   | Repayment of related party advances | --- |   | (4,000) |   | (59,000) |
|--------|-------------------------------------|-----|--------|---------|--------|----------|

|   | Proceeds from related party advances | --- |   | 9,740 |   | 100,640 |
|--------|--------------------------------------|-----|--------|-------|--------|---------|

|   | Sale of preferred stock and warrants | --- |   | --- |   | 500,000 |
|--------|--------------------------------------|-----|--------|-----|--------|---------|

|   | Proceeds from exercise of warrants | --- |   | 83,400 |   | 742,400 |
|--------|------------------------------------|-----|--------|--------|--------|---------|

|   | Shareholder contributions to capital | 2,220 |   | --- |   | 2,220 |
|--------|--------------------------------------|-------|--------|-----|--------|-------|

|   | Proceeds from short-term debt | --- |   | --- |   | 25,000 |
|--------|-------------------------------|-----|--------|-----|--------|--------|

|   | Subscription receivable | --- |   | --- |   | --- |
|--------|-------------------------|-----|--------|-----|--------|-----|

|   | Sale of common stock, net | 10,000 |   | 18,000 |   | 478,000 |
|--------|---------------------------|--------|--------|--------|--------|---------|

| CASH FLOWS PROVIDED BY FINANCING ACTIVITIES | 12,220 |   | 107,140 |   | $1,789,260 |
|---------------------------------------------|--------|--------|---------|--------|------------|

|   |
|--------|

| NET CHANGE IN CASH | 2,875 |   | 6,851 |   | 2,910 |
|--------------------|-------|--------|-------|--------|-------|

| Cash, beginning of period | 35 |   | --- |   | --- |
|---------------------------|----|--------|-----|--------|-----|

| Cash, end of period | $2,910 |   | $6,851 |   | $2,910 |
|---------------------|--------|--------|--------|--------|--------|

|   |
|--------|

| Supplemental information: |   |   |   |   |   |
|---------------------------|--------|--------|--------|--------|--------|

|   | Income taxes paid | $ --- |   | $ --- |   | $ --- |
|--------|-------------------|-------|--------|-------|--------|-------|

|   | Interest paid | $ --- |   | $ --- |   | $6,600 |
|--------|---------------|-------|--------|-------|--------|--------|

|   |
|--------|

| Non-cash Investing and Financing Activities: |   |   |   |   |   |
|----------------------------------------------|--------|--------|--------|--------|--------|

|   | Cumulative dividends on preferred stock | $15,000 |   | $15,000 |   | $90,000 |
|--------|-----------------------------------------|---------|--------|---------|--------|---------|

|   | Stock issued in acquisition | $ --- |   | $ --- |   | $16,687,627 |
|--------|-----------------------------|-------|--------|-------|--------|-------------|

|   | Stock issued for wi-fi hotspots | $ --- |   | $ --- |   | $120,900 |
|--------|---------------------------------|-------|--------|-------|--------|----------|

|   | Warrants issued for patent | $ --- |   | $485,133 |   | $485,133 |
|--------|----------------------------|-------|--------|----------|--------|----------|

|   | Stock issued for software | $ --- |   | $376,000 |   | $376,000 |
|--------|---------------------------|-------|--------|----------|--------|----------|

|   | Stock issued for payment of note payable | $ --- |   | $ --- |   | $25,000 |
|--------|------------------------------------------|-------|--------|-------|--------|---------|

|   |
|--------|

| The accompanying notes are an integral part of these                statements. |
|---------------------------------------------------------------------------------|

|         |
|--------------|
| <PAGE> |
|         |

|   | DIAMOND I, INC. |   |
|--------|-----------------|--------|

|   | (a development stage company) |   |
|--------|-------------------------------|--------|

|   | NOTES TO CONSOLIDATED FINANCIAL STATEMENTS |   |
|--------|--------------------------------------------|--------|

|   | June 30, 2007 (unaudited) |   |
|--------|---------------------------|--------|

|   |
|--------|

| Note 1 | Basis of Presentation |
|--------|-----------------------|

| The consolidated balance sheet as of June 30, 2007, the statement                of                revenues and expenses and the statement of cash flows for the three                months                and six months ended June 30, 2007 and 2006, and the period from                inception                (June 17, 2003) through June 30, 2007, have been prepared by Diamond                I,                Inc. (together with its subsidiaries, “Diamond I”) without audit. In the                opinion of management, all adjustments necessary to present fairly                the                financial position, results of operations and cash flows of Diamond                I at                June 30, 2007, and for all other periods presented, have been made.                The                results of operations for interim periods are not necessarily indicative                of the results to be expected for the full year. Certain information                and                disclosures normally included in financial statements prepared in                accordance with generally accepted accounting principles have been                omitted                in accordance with the Securities and Exchange Commission’s rules for                interim reporting. Accordingly, these financial statements should                be read                in conjunction with the financial statements and accompanying notes                thereto in Diamond I’s Annual Report on Form 10-KSB for the fiscal year                ended December 31, 2006. |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Note 2 | Going Concern |
|--------|---------------|

| Diamond I has incurred losses totaling $29,552,440 through June                30,                2007, and had limited working capital at June 30, 2007. Because of                these                conditions, Diamond I will require additional working capital to                continue                operations and develop the business. Diamond I intends to raise additional                working capital either through private placements, public offerings                and/or                bank financing. |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| There are no assurances that Diamond I will be able to achieve                a                level of revenues adequate to generate sufficient cash flow from                operations or obtain additional financing through private placements,                public offerings and/or bank financing necessary to support Diamond                I’s                working capital requirements. To the extent that funds generated                from any                private placements, public offerings and/or bank financing are                insufficient, Diamond I will have to raise additional working capital.                No                assurance can be given that additional financing will be available,                or if                available, will be on terms acceptable to Diamond I. If adequate                working                capital is not available Diamond I may not continue its operations                or                execute its business plan. |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| These conditions raise substantial doubt about Diamond I's ability                to                continue as a going concern. The financial statements do not include                any                adjustments relating to the recoverability and classification of                asset                carrying amounts or the amount and classification of liabilities                that                might be necessary should Diamond I be unable to continue as a going                concern. |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Note 3 | Intangible Assets |
|--------|-------------------|

| In March 2006, Diamond I purchased pending patent rights from                Larson                Tech Ventures, LLC and Larry Shultz related                to: |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 1. | Methods and apparatus for pari-mutuel, sports book and electronic                casino gaming using speech recognition and concomitant                video. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2. | Biometrically-secured portable wireless entertainment, shopping                and                gaming system. |
|----|------------------------------------------------------------------------------------------------------------------|

| As consideration, Diamond I issued 6,500,000 warrants to purchase                common stock exercisable at $0.35 per share and expiring March 31,                2011.                The fair value of these warrants was calculated using the Black-Scholes                Model and used as the value of the patent at $485,133. The model                was based                on a term of five years, a volatility rate of 236.74% and a discount                rate                of 4.83%. |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| In May 2006, Diamond I acquired all of the capital stock of Touchdev                Limited for 8,000,000 shares of Diamond I common stock. Diamond I                analyzed                the accounting treatment of this transaction under SFAS 141, “Business                Combinations and EITF 98-3, “Determining Whether Nonmonetary Transaction                Involves Receipt of Productive Assets or of a Business”. This transaction                was accounted for as an asset purchase and not a business combination                based on Touchdev Limited’s never having engaged in active business                operations. The only material asset held by Touchdev Limited at the                date                of the agreement was proprietary software and the copyrights,                documentation and internet domains related to this software. The                software                was recorded at $376,000, which was estimated to be equal to the                fair                value of the stock issued to the original shareholders of Touchdev                Limited                based on the market price at the date of the agreement and will be                amortized over 3 years. |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Note 4 | Capital Stock |
|--------|---------------|

| Stock for Services, Salary and                Bonuses |
|-------------------------------------------------------|

| During the first six months of 2007, Diamond I issued a total                of                17,640,000 shares of common stock to third-party consultants for                services,                resulting in $248,698 in non-cash compensation expense included in                professional and legal expenses and consulting fees in the accompanying                statement of revenues and expenses. |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| During the first six months of 2006, Diamond I issued a total                of                5,213,724 shares of common stock to third-party consultants for services,                resulting in $164,403 in non-cash compensation expense included in                professional and legal expenses and consulting fees in the accompanying                statement of revenues and expenses. |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| During the first six months of 2007, Diamond I issued a total                of                16,162,951 shares of common stock in payment of $339,422 in accrued                and                unpaid salaries of two of its officers and a total of 200,000 shares                of                common stock valued at $4,200 as bonuses to certain of its                directors |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| During the first six months of 2006, Diamond I issued, as bonuses                to                certain of its officers and directors, a total of 5,100,000 shares                of                common stock, valued at $150,640. |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Diamond I measured the transactions at the respective dates of                issuance at the then-quoted market price. There are no performance                commitments or penalties for non-performance, therefore Diamond I                recorded                the expense at the date of issuance. |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Sale of Common Stock |
|----------------------|

| In May 2007, Diamond I sold 1,000,000 shares of its common stock                to                an unrelated third party for $10,000 in                cash. |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Note 5 | Agreement with NewMarket Technology,                Inc. |
|--------|----------------------------------------------------------|

| In March 2007, Diamond I entered into a securities purchase agreement                (the “Purchase Agreement”) with Diamond I Technologies, Inc., a Nevada                corporation wholly owned by Diamond I, NewMarket Technology, Inc.,                a                Nevada corporation (“NMKT”), and NewMarket Technology Acquisition                Subsidiary, a Nevada corporation, pursuant to which NewMarket Technology                Acquisition Subsidiary was to purchase 2,000,000 shares of a new                series of                Diamond I’s preferred stock, to be designated “Series B”. The closing                under the Purchase Agreement was to occur on or before June 7, 2007.                Following an extensive period of good faith negotiations between                Diamond I                and NMKT, the following conditions remained                unresolved: |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| - | the terms relating to an investment commitment for an additional                $750,000 for Diamond I’s gaming subsidiary, Diamond I Technologies, Inc.;                and |
|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| - | the terms relating to an investment commitment for an additional                $1,000,000 for Diamond I’s revived WIFI                division. |
|---|--------------------------------------------------------------------------------------------------------------------------------------------------------|

| Because the closing under the Purchase Agreement did not occur                on or                prior to June 7, 2007, the Purchase Agreement                expired. |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Due to the expiration of the Purchase Agreement, the $25,200                in cash                received by Diamond I from NMKT under the Purchase Agreement previously                accounted for as a contribution to capital by a contract party has                been                reclassified as a short-term account payable - third party in the                accompanying financial statements. |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|         |
|--------------|
| <PAGE> |
|         |

| FORWARD-LOOKING STATEMENTS |
|----------------------------|

| This report by Diamond I, Inc. contains forward-looking statements.                These are statements regarding financial and operating performance                and                results and other statements that are not historical facts. The words                "expect", "project", "estimate", "believe", "anticipate", "intend",                "plan", "forecast" and similar expressions are intended to identify                forward-looking statements. Certain important risks could cause results                to                differ materially from those anticipated by some of the forward-looking                statements. Some, but not all, of the important risks that could                cause                actual results to differ materially from those suggested by the                forward-looking statements include, among other                things: |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| - | Events that deprive us of the services of our president and largest                shareholder, David Loflin; |
|---|---------------------------------------------------------------------------------------------------------------|

| - | Whether or not we can successfully establish a market for our                wireless gaming products; |
|---|--------------------------------------------------------------------------------------------------------|

| - | Whether we are able to obtain adequate capital with which to                pursue                our full business plan; and |
|---|-------------------------------------------------------------------------------------------------------------------------------|

| - | Other uncertainties, all of which are difficult to predict and                many                of which are beyond our control. |
|---|------------------------------------------------------------------------------------------------------------------------------------|

| We do not intend to update forward-looking                statements. |
|-----------------------------------------------------------------------|

|   |
|--------|

| Item 2. | Plan of Operations. |
|---------|---------------------|

| In March 2007, Diamond I entered into a securities purchase agreement                (the “Purchase Agreement”) with Diamond I Technologies, Inc., a Nevada                corporation wholly owned by Diamond I, NewMarket Technology, Inc.,                a                Nevada corporation (“NMKT”), and NewMarket Technology Acquisition                Subsidiary, a Nevada corporation, pursuant to which NewMarket Technology                Acquisition Subsidiary was to purchase 2,000,000 shares of a new                series of                Diamond I’s preferred stock, to be designated “Series B”. The closing                under the Purchase Agreement was to occur on or before June 7, 2007.                Following an extensive period of good faith negotiations between                Diamond I                and NMKT, the following conditions remained                unresolved: |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| - | the terms relating to an investment commitment for an additional                $750,000 for Diamond I’s gaming subsidiary, Diamond I Technologies, Inc.;                and |
|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| - | the terms relating to an investment commitment for an additional                $1,000,000 for Diamond I’s revived WIFI                division. |
|---|--------------------------------------------------------------------------------------------------------------------------------------------------------|

| Because the closing under the Purchase Agreement did not occur                on or                prior to June 7, 2007, the Purchase Agreement                expired. |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Our Company Now |
|-----------------|

| Due to an increasing number of inquiries regarding our company’s                previous Wi-Fi (wireless fidelity) Internet access business, during                the                fourth quarter of 2006, our management determined to reinstate this                previously dormant segment of our company. Following this determination,                we began discussions with a third party, which eventually led to                our                entering into an agreement with that company, which agreement expired                by                its terms on June 7, 2007. We have begun the final stages of the                development of our GS2(TM) wireless hand-held gaming unit and the                WifiCasino(TM) wireless gaming system. Our business activities remain                focused on these activities. |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| It is expected that our company will not begin its full-scale                efforts                with respect to our Wi-Fi Internet access business, unless and until                we                obtain necessary funding, of which there is no                assurance. |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Business Development |
|----------------------|

| Wireless Gaming. |
|------------------|

| We have not generated any revenues from this line of business                since                acquiring DiTech. |
|---------------------------------------------------------------------------------------------------------------------|

| The development of our business has been significantly impaired                by                our lack of adequate capital. However, we have been able to begin                the                final stages of our product development activities. We expect that                our                product development will be greatly enhanced by our relationship                with                Quest Entertainment, a Houston, Texas-based provider of superior-quality,                fast-playing, innovative gaming devices. We recently executed a                development agreement with Quest, whereby our companies have joined                forces                to bring our WifiCasino (and the GS2) to the gaming                industry. |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Our business prospects in the State of Nevada were greatly enhanced                in March 2006, with the adoption of final regulations implementing                Nevada                Law AB471, which authorizes the use of mobile communication devices,                such                as our WifiCasino GS wireless gaming system, for gaming in public                areas in                Nevada casinos. |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| In furtherance of our plan to develop the business potential                of our                WifiCasino GS products, we have, to the extent permitted by our capital                position, taken the following actions: |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| - | completed final design and three-dimensional model of the first                generation of our WifiCasino GS that embodies our finger-print security                technology; |
|---|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| - | begun preparation of the application for a license from the Nevada                Gaming Commission with respect our WifiCasino                GS; |
|---|----------------------------------------------------------------------------------------------------------------------------------------------------|

| - | signed a letter of intent with The Palms Resort and Casino, a                premier                Las Vegas property, wherein The Palms has agreed to continue to develop                our working relationship relating to our WifiCasino GS wireless gaming                system; |
|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| - | signed a development agreement with Quest Entertainment (as described                above); |
|---|----------------------------------------------------------------------------------------------|

| - | pursued numerous potential opportunities to install and operate                one                of our WifiCasino GS systems on a cruise                ship; |
|---|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|

| - | pursued numerous potential opportunities with the owners of certain                horse racing facilities, with respect to our installing and operating                one                of our WifiCasino GS systems on such a facility;                and |
|---|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| - | acquired Touchdev Limited, a developer of an array of                internally-derived and copyrighted gaming software products, with                wireless                PDA and cellular-phone-based capabilities. Touchdev has created 12                different games, including Texas Hold’em                Poker. |
|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| In March 2006, we acquired the rights to pending patents relating                to                voice-recognition, or “voice-print” security technology. Our board of                directors, with the recommendation of management, determined to acquire                these patent rights, due to its belief that the security provided                by our                “voice-print” technology, when coupled with our patent-pending                finger-print security technology, would be a significant point in                our                favor, as we solicit venues. We will be able to assure venues (and                the                local government) that those who cannot game legally will not be                able to                do so. |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| We believe our acquisition of Touchdev and its proprietary software                products will allow us to further enhance our WifiCasino GS products.                We                believe that these features will provide a competitive advantage,                when we                begin our full-scale WifiCasino GS as we implement our marketing                strategy. |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Our marketing plan in Nevada revolves around establishing a greater                physical presence of our personnel, who are to conduct our marketing                activities on a face-to-face basis with the owners of target venues,                i.e.,                casinos. The success of our WifiCasino GS marketing efforts in Nevada                will, like other gaming sales efforts, be largely dependent on our                ability                to establish positive personal relationships with appropriate                decision-makers. Our management believes that it has already established                a                positive relationship with a number of such                persons. |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| To accomplish any of our business plan, we must obtain substantial                capital. Without capital, we will not be successful in doing                so. |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Also, we cannot make any assurance that we will be able to achieve                a                level of revenues adequate to generate sufficient cash flow from                operations or obtain additional financing through private placements,                public offerings and/or bank financing necessary to support our working                capital requirements. |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Wi-Fi Internet Access. |
|------------------------|

| Only if we are able to obtain necessary capital will we be able                to                re-establish our Wi-Fi Internet access services business. We cannot                assure                you that we will ever obtain the necessary capital for this part                of our                business. |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Critical Accounting Policies |
|------------------------------|

| There were no material changes to our critical accounting policies                during the period ended June 30, 2007. |
|--------------------------------------------------------------------------------------------------------------------------|

| Results of Operations |
|-----------------------|

| During the six months ended June 30 2007 and 2006, we had no                revenues                from operations and we do not expect to generate any revenues from                our                operations for the remainder of 2007, unless we are able to obtain                the                capital needed to accelerate our wireless gaming                business. |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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

| We have incurred losses from inception of $29,552,440 and we                have                lacked adequate capital with which to accomplish our business objectives.                At June 30, 2007, we had a working capital deficit of                $280,133. |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Under the terminated agreement with a third party, we obtained                $30,400 in cash with which we paid certain operating expenses and                product                development costs. This amount has been accounted for as a short-term                account payable in the accompanying financial                statements. |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Our Capital Needs. Our current level of operations can be maintained                for the next twelve months. We anticipate our capital needs will                be met                through the exercise of options and issuance of shares for services.                However, to begin the aggressive pursuit of our wireless gaming business                objectives, we will require approximately $2                million. |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Capital Expenditures |
|----------------------|

| During the six months ended June 30, 2007, we made no capital                expenditure. During the 2006 period, we purchased $458,133 in patents                and                equipment. We currently have limited capital with which to make any                significant capital expenditures. Without additional capital, we                intend to                make no capital expenditures. |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |
|--------|

| Item 3. | Controls and Procedures. |
|---------|--------------------------|

| Our Chief Executive Officer and Acting Chief Financial Officer                has                reviewed and evaluated the effectiveness of our disclosure controls                and                procedures (as defined in the Securities Exchange Act of 1934 Rules                240.13a-14(c) and 15d-14(c)) as of the end of the period covered                by this                report and has concluded that such disclosure controls and procedures                are                not effective in timely alerting him and other members of management                to                material information about our company required to be disclosed by                us in                our periodic reports that we file or submit under the Securities                Exchange                Act of 1934. The deficiencies in our disclosure controls and procedures                are a result of our lack of accounting personnel, due to our limited                financial resources. We are seeking additional financing that would                allow                us to obtain the necessary resources to execute our business plan,                including personnel and other resources to improve our disclosure                controls                and procedures. |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| There have not been any significant changes in our internal controls                over financial reporting (as such term is defined in Rules 13a-15(f)                and                15d-15(f) under the Securities Exchange Act of 1934) during the fiscal                quarter to which this report relates that have materially affected,                or are                reasonably likely to materially affect, our internal control over                financial reporting. |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |
|--------|

| PART II - OTHER INFORMATION |
|-----------------------------|

| Item 1. | Legal Proceedings. |
|---------|--------------------|

| We are not currently involved in any legal                proceeding. |
|-----------------------------------------------------------------------|

|   |
|--------|

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

| During the three months ended June 30, 2007, we issued restricted                securities as follows: |
|---------------------------------------------------------------------------------------------------------|

| 1.     | (a) | Securities Sold. In April 2007, a total of 16,162,951 shares                of our                common stock were issued.                                                                                                                                                                                                                                                                                                                                               |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | (b) | Underwriter or Other Purchasers. Such shares of common stock                were                issued to David Loflin (9,735,904 shares) and Waddell D. Loflin (6,427,047                shares).                                                                                                                                                                                                                                                                        |
|   | (c) | Consideration. Such shares of common stock were issued in payment                of                accrued salary in the aggregate amount of $339,422.                                                                                                                                                                                                                                                                                                                    |
|   | (d) | Exemption from Registration Claimed. These securities are exempt                from                registration under the Securities Act of 1933, as amended, pursuant                to the                provisions of Section 4(2) thereof and Rule 506 thereunder, as a                transaction not involving a public offering. These purchasers were                sophisticated investors capable of evaluating an investment in our                company. |

| 2.     | (a) | Securities Sold. In April 2007, a total of 200,000 shares of                our                common stock were issued.                                                                                                                                                                                                                                                                                                                                                  |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | (b) | Underwriter or Other Purchasers. Such shares of common stock                were                issued to Gregory A. Bonner (100,000 shares) and Ira R. Witkin (100,000                shares).                                                                                                                                                                                                                                                                           |
|   | (c) | Consideration. Such shares of common stock were issued as bonuses                and                were valued at $4,200, in the aggregate.                                                                                                                                                                                                                                                                                                                              |
|   | (d) | Exemption from Registration Claimed. These securities are exempt                from                registration under the Securities Act of 1933, as amended, pursuant                to the                provisions of Section 4(2) thereof and Rule 506 thereunder, as a                transaction not involving a public offering. These purchasers were                sophisticated investors capable of evaluating an investment in our                company. |

| 3.     | (a) | Securities Sold. In May 2007, 1,000,000 shares of our common                stock                were issued.                                                                                                                                                                                                                                                                                                                                                             |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | (b) | Underwriter or Other Purchasers. Such shares of common stock                were                issued to Paul Goldman.                                                                                                                                                                                                                                                                                                                                                   |
|   | (c) | Consideration. Such shares of common stock were issued in                consideration of $10,000 in cash.                                                                                                                                                                                                                                                                                                                                                                |
|   | (d) | Exemption from Registration Claimed. These securities are exempt                from                registration under the Securities Act of 1933, as amended, pursuant                to the                provisions of Section 4(2) thereof and Rule 506 thereunder, as a                transaction not involving a public offering. These purchasers were                sophisticated investors capable of evaluating an investment in our                company. |

|   |
|--------|

| Item 3. | Defaults upon Senior Securities. |
|---------|----------------------------------|

| None. |
|-------|

|   |
|--------|

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

| None. |
|-------|

|   |
|--------|

| Item 5. | Other Information. |
|---------|--------------------|

| None. |
|-------|

|   |
|--------|

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

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

| Exhibit No. |   | Description |
|-------------|--------|-------------|

| 31.1 |   | Certification of Chief Executive Officer required by Rule 13a-14(a)                or Rule 15d-14(b) |
|------|--------|------------------------------------------------------------------------------------------------------|

| 31.2 |   | Certification of Chief Accounting Officer required by Rule 13a-14(a)                or Rule 15d-14(b) |
|------|--------|-------------------------------------------------------------------------------------------------------|

| 32.1 |   | Certification of Chief Executive Officer Pursuant to 18 U.S.C.                Section 1350 |
|------|--------|--------------------------------------------------------------------------------------------|

| 32.2 |   | Certification of Chief Accounting Officer Pursuant to 18 U.S.C.                Section 1350 |
|------|--------|---------------------------------------------------------------------------------------------|

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

| During the three months ended June 30, 2007, we filed two Current                Reports on Form 8-K, as follows: |
|-------------------------------------------------------------------------------------------------------------------|

| - | Date of event: April 30, 2007, as amended, wherein we reported                information pursuant to Item 4.01 - Change in Registrant's Certifying                Accountant; and |
|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| - | Date of event: June 7, 2007, as amended, wherein we reported                information pursuant to Item 1.02 - Termination of a Material Definitive                Agreement. |
|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |
|--------|

| SIGNATURES |
|------------|

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

|   |
|--------|

| Date: August 20, 2007 | DIAMOND I, INC. |
|-----------------------|-----------------|

|   |
|--------|

|   |   | By: | /s/ DAVID LOFLIN |   |
|--------|--------|-----|------------------|--------|

|   | David Loflin, President and Acting Chief Financial Officer [Principal                Accounting Officer] |   |
|--------|----------------------------------------------------------------------------------------------------------|--------|