FORM 10-QSB
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                   QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

For Quarter Ended February 29, 2008                   Commission File No. 0-8765
                  -----------------                                       ------

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

Delaware                                                     95-2645573
--------------------------------------------------------------------------------
(State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                               Identification No.)

1533 Monrovia Avenue, Newport Beach, California              92663
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(Address of principal executive offices)                     (Zip Code)

Registrant's telephone number including area code:      (949) 645-2111
--------------------------------------------------------------------------------

                                (Not applicable)
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             (Former name, former address and former fiscal year, if
                           changed since last report.)

Indicate by check mark whether the 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 the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

                          Yes  [X]        No  [ ]

Indicate by check mark whether the Registrant is an accelerated filer (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: 6,298,839 shares of common
stock as of April 14, 2008.


                                        1


                                 BIOMERICA, INC.

                                      INDEX

PART I

Item 1.  Consolidated Financial Statements:

         Consolidated Statements of Operations and
         Comprehensive Income (unaudited) - Three and Nine Months Ended
         February 29, 2008 and February 28, 2007...........................3 & 4

         Consolidated Balance Sheet (unaudited) -
         February 29, 2008.................................................5 & 6

         Consolidated Statements of Cash Flows (unaudited) -
         Nine Months Ended February 29, 2008 and February 28, 2007.........7 & 8

         Notes to Consolidated Financial Statements (unaudited)............8-13

Item 2.  Management's Discussion and Analysis of Financial Condition
         and Selected Financial Data.......................................14

Item 3.  Quantitative and Qualitative Disclosures about Market Risk........15

Item 4.  Controls and procedures...........................................15

PART II  Other Information.................................................16

Item 1.  Legal Proceedings.................................................16

Item 2.  Changes in Securities and Use of Proceeds.........................16

Item 3.  Defaults upon Senior Securities...................................16

Item 4.  Submission of Matters to a Vote of Security Holders...............16

Item 5.  Other Information.................................................16

Item 6.  Exhibits and Reports on Form 8-K..................................16

         Signatures........................................................17-21


                                        2



     
                                                   PART I - FINANCIAL INFORMATION
                                                  SUMMARIZED FINANCIAL INFORMATION
                                                    ITEM 1. FINANCIAL STATEMENTS

                                                           BIOMERICA, INC.
                                                CONSOLIDATED STATEMENTS OF OPERATIONS
                                                AND COMPREHENSIVE INCOME (UNAUDITED)


                                                                         Nine Months Ended                Three Months Ended
                                                                    February 29,     February 28,     February 29,     February 28,
                                                                        2008             2007             2008             2007
                                                                    -----------      -----------      -----------      -----------

Net sales .....................................................     $3,608,408       $ 3,797,051      $1,240,809       $ 1,311,609

     Cost of sales ............................................     (2,023,022)       (2,427,578)       (747,690)         (836,204)
                                                                    ----------       -----------      ----------       -----------
     Gross profit .............................................     $1,585,386       $1,369,473       $  493,119       $   475,405
                                                                    ----------       -----------      ----------       -----------

Operating Expenses:
     Selling, general and administrative ......................      1,044,288           943,601         302,368           308,403
     Research and development .................................        200,932           170,759          72,742            71,246
                                                                    ----------       -----------      ----------       -----------
                                                                     1,245,220         1,114,360         375,110           379,649
                                                                    ----------       -----------      ----------       -----------

Operating income from continuing operations ...................        340,166           255,113         118,009            95,756
                                                                    ----------       -----------      ----------       -----------

Other Expense (income):
     Interest expense .........................................         38,288            24,090          12,438             6,791
     Interest (income) ........................................        (26,990)           (1,464)         (7,446)             (406)
     Other income, net ........................................       (697,125)          (40,040)             10           (40,005)
                                                                    ----------       -----------      ----------       -----------
                                                                      (685,827)          (17,414)          5,002           (33,620)
                                                                    ----------       -----------      ----------       -----------
Income from continuing operations,
  before income taxes .........................................      1,025,993           272,527         113,007           129,376

Income tax expense (benefit)...................................         13,405             8,006         (10,837)            8,006
                                                                    ----------       -----------      ----------       -----------

Net income from continuing operations .........................      1,012,588           264,521         123,844           121,370


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

                                                                  3



                                                          BIOMERICA, INC.
                                               CONSOLIDATED STATEMENTS OF OPERATIONS
                                          AND COMPREHENSIVE INCOME - Continued (UNAUDITED)


                                                                           Nine Months Ended                Three Months Ended
                                                                      February 29,     February 28,     February 29,   February 28,
                                                                         2008             2007             2008            2007
                                                                     -------------    -------------   -------------    -----------
Discontinued operations:
  Income from discontinued operations, net .......................              --           27,869              --             --
                                                                     -------------    -------------   -------------    -----------
Net income........................................................       1,012,588          292,390         123,844        121,370

Other comprehensive gain (loss), net of tax:
  Unrealized gain (loss) on available-for-sale
   securities ....................................................          54,575          (36,868)            244         (8,662)
                                                                     -------------    -------------   -------------    -----------

Comprehensive income .............................................   $   1,067,163    $     255,522   $     124,088    $   112,708
                                                                     =============    =============   =============    ===========

Basic net income per common share:

     Net income from continuing operations .......................   $         .17    $         .04   $         .02    $       .02
     Net income from discontinued operations .....................             .00              .00             .00            .00
                                                                     -------------    -------------   -------------    -----------
Basic net income per common share ................................   $         .17    $         .04   $         .02    $       .02
                                                                     =============    =============   =============    ===========
Diluted net income per common share:

     Net income from continuing operations .......................   $         .14    $         .04   $         .02    $       .02
     Net income from discontinued operations .....................             .00              .00             .00            .00
                                                                     -------------    -------------   -------------    -----------

Diluted net income per common share ..............................   $         .14    $         .04   $         .02    $       .02
                                                                     =============    =============   =============    ===========

Weighted average number of common and common equivalent shares:
     Basic .......................................................       6,061,285        5,925,860       6,173,817      5,939,214
                                                                     =============    =============   =============    ===========
     Diluted .....................................................       7,129,887        6,368,245       7,213,837      6,371,192
                                                                     =============    =============   =============    ===========

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

                                                                4



                                     BIOMERICA, INC.

                                BALANCE SHEET (UNAUDITED)


                                                                             February 29,
                                                                                 2008
                                                                              ----------
Assets

Current Assets
    Cash and cash equivalents .............................................   $  822,285
    Available for-sale securities .........................................          412
    Accounts receivable, less allowance for doubtful accounts of $105,051        664,645
    Inventories............................................................    1,679,232
    Notes receivable ......................................................        1,050
    Prepaid expenses and other ............................................       93,825
    Net assets from discontinued operations ...............................          598
                                                                              ----------

          Total Current Assets ............................................    3,262,047

Available-for-sale securities .............................................      464,823

Property and Equipment, net of accumulated depreciation and amortization ..      349,608

Other Assets ..............................................................       55,368
                                                                              ----------

                                                                              $4,131,846
                                                                              ==========


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

                                            5



                                   BIOMERICA, INC.

                 CONSOLIDATED BALANCE SHEET - Continued (UNAUDITED)


                                                                      February 29,
                                                                          2008
                                                                       -----------
Liabilities and Shareholders' Equity

Current Liabilities

     Accounts payable and accrued liabilities ......................   $   401,739
     Accrued compensation ..........................................       490,823
     Current portion of shareholder loan ...........................       128,784
     Capital lease - short-term portion ............................         5,343
     Equipment loan - short-term portion............................        45,689
                                                                       -----------

          Total Current Liabilities ................................     1,072,378

Equipment loan -long-term portion ....................................     128,371

Shareholders' Equity

     Common stock, $0.08 par value authorized 25,000,000 shares,
       issued and outstanding 6,257,839               ..............       500,626
     Additional paid-in-capital ....................................    17,341,006
     Accumulated other comprehensive loss ..........................      (175,142)
     Accumulated deficit ...........................................   (14,735,393)
                                                                       -----------
Total Shareholders' Equity .........................................     2,931,097
                                                                       -----------
Total Liabilities and Equity .......................................   $ 4,131,846
                                                                       ===========


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

                                         6


                                            BIOMERICA, INC.
                           CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

                                                                             February 29,   February 28,
For the nine months,                                                            2008           2007
                                                                             -----------    -----------
Cash flows from operating activities:
Net income from continuing operations ....................................   $ 1,012,588    $   264,521
Adjustments to reconcile net income to net cash provided by (used in)
   operating activities:
     Depreciation and amortization .......................................        47,845         41,896
     Common stock, warrants and options issued for services rendered .....        14,837          5,357
     Provision for losses on accounts receivable .........................        46,268         16,385
     (Gain)on disposal of equipment ......................................            --        (40,000)
     Changes in current assets and liabilities:
       Accounts receivable ...............................................      (206,147)      (130,149)
       Inventories .......................................................      (217,519)      (303,565)
       Prepaid expenses and other current assets .........................         9,003         (2,538)
       Accounts payable and other accrued liabilities ....................      (264,511)       139,813
       Accrued compensation ..............................................       (76,769)         4,143
                                                                             -----------    -----------
Net cash provided by (used in) operating activities ......................       365,595         (4,137)
                                                                             -----------    -----------
Cash flows from investing activities:
     Purchases of property and equipment .................................      (226,828)      (100,138)
     Proceeds from sale of equipment .....................................            --         50,000
                                                                             -----------    -----------
Net cash used in investing activities ....................................      (226,828)       (50,138)
                                                                             -----------    -----------
Cash flows from financing activities:

     Payments on capital lease ...........................................        (3,231)        (2,722)
     Decrease in shareholder loan ........................................       (39,086)       (26,516)
     Exercise of stock options or warrants ...............................        96,545          5,130
     Proceeds from sale of common stock ..................................            --         24,960
     Increase in borrowings on equipment line of credit ..................       112,390             --
                                                                             -----------    -----------
Net cash provided by financing activities ................................       166,618            852
                                                                             -----------    -----------
Net increase (decrease) in cash and cash equivalents..... ................       305,385        (53,423)

Cash at beginning of period ..............................................       516,900        119,914
                                                                             -----------    -----------
Cash at end of period ....................................................   $   822,285    $    66,491
                                                                             ===========    ===========
Supplemental Disclosure of Cash Flow Information
  Cash Paid During The Year For:
     Interest ............................................................   $    37,621    $    21,675
                                                                             ===========    ===========
     Income taxes ........................................................   $     3,768    $     1,600
                                                                             ===========    ===========
Supplemental disclosures on non-cash investing & financing activity

  Change in unrealized holding loss on available-for-sale securities .....   $    54,575    $   (36,868)
                                                                             ===========    ===========
  Capital lease for purchase of fixed assets .............................   $        --    $    12,841
                                                                             ===========    ===========


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

                                                   7




NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

February 29, 2008

(1) Reference is made to Note 2 of the Notes to Consolidated Financial
Statements contained in Biomerica, Inc.'s (the "Company") Annual Report on Form
10-KSB for the fiscal year ended May 31, 2007, for a summary of significant
accounting policies utilized by the Company.

(2) As of February 29, 2008 the Company had cash and available-for-sale
securities in the amount of $822,697 and working capital of $2,189,669. The
Company also has $464,823 of long term available-for-sale securities of Lancer
Orthodontics. This stock is restricted and should the Company desire to sell
this stock on the open market, it may be subject to certain trading restrictions
as imposed by the Federal Securities Act of 1933.

(3) In December 2004, the Financial Accounting Standards Board ("FASB") Issued
Statement of Financial Accounting Standards No. 123 (revised 2004), Share-Based
Payment (SFAS No. 123R). SFAS No. 123R revised SFAS No. 123, Accounting For
Stock-Based Compensation, and supersedes APB Opinion No. 25, Accounting for
Stock Issued to Employees, and its related implementation guidance. SFAS No.
123R requires compensation costs related to share-based payment transactions to
be recognized in the financial statement (with limited exceptions). The amount
of compensation cost is measured based on the grant-date fair value of the
equity or liability instruments issued. Compensation cost is recognized over the
period that an employee provides service in exchange for the award. As of the
beginning of fiscal 2007, June 1, 2006, the Company has been required to account
for stock-based compensation using this method.

         The Black Scholes option valuation model was developed for use in
estimating the fair value of traded options which have no vesting restrictions
and are fully transferable. In addition, option valuation models require the
input of highly subjective assumptions including the expected stock price
volatility. Because the Company's employee stock options have characteristics
significantly different from those of traded options, and because changes in the
subjective input assumptions can materially affect the fair value estimate, in
management's opinion, the existing models do not necessarily provide a reliable
single measure of the fair value of its employee stock options.

         For the nine months ended February 29, 2008, the Company expensed
approximately $14,837 of stock option expense due to SFAS 123(R) in its
financial statements.


(4) The following summary presents the options granted, exercised, expired, and
 outstanding as of February 29, 2008:

                                                                       Weighted
                                                                       Average
                               Number of Options and Warrants          Exercise
                            Employee     Non-employee      Total        Price
                           ----------     ----------     ----------    ---------
Outstanding
May 31, 2007                1,836,083        217,166      2,053,249    $    0.48

Granted                        41,000             --         41,000         1.08
Exercised                    (301,625)       (12,000)      (313,625)        0.31
Expired or cancelled          (25,500)            --        (25,500)        0.63
                           ----------     ----------     ----------    ---------
Outstanding
February 29, 2008           1,549,958        205,166      1,755,124    $    0.70
                           ==========     ==========     ==========    =========

(5) The information set forth in these condensed consolidated statements is
unaudited and may be subject to normal year-end adjustments. The information
reflects all adjustments which, in the opinion of management, are necessary to
present a fair statement of the consolidated results of operations of Biomerica,
Inc., for the periods indicated. It does not include all information and
footnotes necessary for a fair presentation of financial position, results of
operations, and cash flow in conformity with generally accepted accounting
principles.

(6) Consolidated results of operations for the interim periods covered by this
report may not necessarily be indicative of results of operations for the full
fiscal year.

(7) Reference is made to Note 3 of the Notes to Consolidated Financial
Statements contained in the Company's Annual Report on Form 10-KSB for the
fiscal year ended May 31, 2007, for a description of the investments in
affiliates and consolidated subsidiaries.

(8) Reference is made to Notes 5 & 9 of the Notes to Consolidated Financial
Statements contained in the Company's Annual Report on Form 10-KSB for the
fiscal year ended May 31, 2007, for information on commitments and
contingencies.


                                       8


(9) Aggregate cost exceeded market value of available-for-sale securities by
approximately $175,000 at February 29, 2008.

(10) Earnings Per Share

         In February 1997, the Financial Accounting Standards Board ("FASB")
issued Statement of Financial Accounting Standards (SFAS) No. 128, EARNINGS PER
SHARE ("EPS"). SFAS No. 128 requires dual presentation of basic EPS and diluted
EPS on the face of all income statements issued after December 15, 1997 for all
entities with complex capital structures. Basic EPS is computed as net income
divided by the weighted average number of common shares outstanding for the
period. Diluted EPS reflects the potential dilution that could occur from common
shares issuable through stock options, warrants and other convertible
securities.

The following table illustrates the required disclosure of the reconciliation of
the numerators and denominators of the basic and diluted EPS computations.


     
                                                     Nine Months Ended             Three Months Ended
                                                  February 29,   February 28,     February 29,   February 28,
                                                    2008            2007            2008            2007
------------------------------------------------------------------------------------------------------------
Numerator:
   Income from continuing operations              $1,012,588     $  264,521        $  123,846     $  121,370
   Income from discontinued operations                    --         27,869                --             --
------------------------------------------------------------------------------------------------------------

Numerator for basic and diluted net
   income per common share                        $1,012,588     $  292,390        $  123,846     $  121,370
============================================================================================================

Denominator for basic net income
    per common share                               6,061,285      5,925,860         6,173,817      5,939,214
Effect of dilutive securities:
   Options and warrants                            1,068,602        442,385         1,040,020        431,978
------------------------------------------------------------------------------------------------------------

Denominator for diluted net income
    per common share                               7,129,887      6,368,245         7,213,837      6,371,192
============================================================================================================

Basic net income per common share:
    Income from continuing operations             $      .17     $      .04        $      .02     $      .02
    Income from discontinued operations                   --             --                --             --
------------------------------------------------------------------------------------------------------------

Basic net income per common share                 $      .17     $      .04        $      .02     $      .02
===========================================================================================================

Diluted net income per common share:
    Income from continuing operations             $      .14     $      .04        $      .02     $      .02
    Net income from discontinued operations               --             --                --             --
------------------------------------------------------------------------------------------------------------

Diluted net income per common share               $      .14     $      .04        $      .02     $      .02
============================================================================================================


(11) In December 2004, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards No. 123 (revised 2004), Share-Based
Payment (SFAS No. 123R). SFAS No. 123R revised SFAS No. 123, Accounting for
Stock-Based Compensation, and supersedes APB Opinion No. 25, Accounting for
Stock Issued to Employees, and its related implementation guidance. SFAS No.
123R requires compensation costs related to share-based payment transactions to
be recognized in the financial statement (with limited exceptions). The amount
of compensation cost is measured based on the grant-date fair value of the
equity or liability instruments issued. Compensation cost is recognized over the
expected life of the option. As of the beginning of fiscal 2007, June 1, 2006,
the Company has been required to account for stock-based compensation using this
method.

         In March 2005, the Securities and Exchange Commission ("SEC") issued
Staff Accounting Bulletin No. 107 ("SAB No. 107"), Share-Based Payment,
providing guidance on option valuation methods, the accounting for income tax
effects of share-based payment arrangements upon adoption of SFAS No. 123R, and
the disclosures in MD&A subsequent to the adoption. The Company has provided SAB
No. 107 required disclosures upon adoption of SFAS No. 123R on June 1, 2006.

         In April 2005, the Securities and Exchange Commission adopted a new
rule that amends the compliance dates for SFAS No. 123R. The Statement requires
that compensation cost relating to share-based payment transactions be
recognized in financial statements and that this cost be measured based on the
fair value of the equity or liability instruments issued. SFAS No. 123R covers a
wide range of share-based compensation arrangements including share options,
restricted share plans, performance-based awards, share appreciation rights, and
employee share purchase plans. The Company adopted SFAS No. 123R on June 1,
2006.


                                       9


         In June 2005, the FASB issued SFAS No. 154, Accounting Changes and
Errors Corrections, a replacement of APB Opinion No. 20 and FAS No. 3. The
Statement applies to all voluntary changes in accounting principle, and changes
the requirements for accounting for and reporting of a change in accounting
principle. SFAS No. 154 requires retrospective application to prior periods'
financial statements of a voluntary change in accounting principle unless it is
impractical. APB Opinion No. 20 previously required that most voluntary changes
in accounting principle be recognized by including in net income of the period
of the change the cumulative effect of changing to the new accounting principle.
SFAS No.154 improves the financial reporting because its requirements enhance
the consistency of financial reporting between periods. The Company does not
believe the adoption of this standard will have an impact on its results of
operations.

         In February 2006, the FASB issued SFAS No. 155, Accounting for Certain
Hybrid Financial Instruments-an amendment of FASB Statements No. 133 and 140
("SFAS, 155"). This statement resolves issues addressed in SFAS No. 133
Implementation Issue No. D1, Application of Statement 133 to Beneficial Interest
in Securitized Financial Assets. SFAS No. 155: a) permits fair value
remeasurement for any hybrid financial instrument that contains an imbedded
derivative that otherwise would require bifurcation; (b) clarifies which
interest-only strips and principal-only strips are not subject to the
requirements of SFAS No. 133; (c) establishes a requirement to evaluate
beneficial interests in securitized financial assets to identify interests that
are freestanding derivatives or that are hybrid financial instruments that
contain an imbedded derivative requiring bifurcation; (d) clarifies that
concentrations of credit risk in the form of subordination are not embedded
derivatives; and, (e) eliminates restriction on a qualifying special-purpose
entity's ability to hold passive derivative financial instruments that pertain
to beneficial interests that are or contain a derivative financial instrument.
SFAS No. 155 also requires presentation within the financial statements that
identifies those hybrid financial instruments for which the fair value election
has been applied and information on the income statement impact of the changes
in fair value of those instruments. The Company is required to apply SFAS No.
155 to all financial instruments acquired, issued or subject to a remeasurement
event beginning June 1, 2007. The adoption of SFAS No. 155 did not have a
material impact on the Company's financial statements.

         In March 2006, the FASB issued SFAS No. 156, Accounting for Servicing
of Financial Assets, an amendment of FASB Statement No. 140 (Accounting for
Transfers and Servicing of Financial Assets and Extinguishments of Liabilities).
This Statement requires that all separately recognized servicing assets and
servicing liabilities be initially measured at fair value, if practicable. This
Statement permits, but does not require, the subsequent measurement of
separately recognized servicing assets and servicing liabilities at fair value.
The Company was required to adopt this statement as of June 1, 2007. The
adoption of SFAS No. 156 did not have a material impact on the Company's
financial statements.

         In September 2006, the FASB issued SFAS No. 157, Defining Fair Value
Measurement. The purpose of SFAS No. 157 is to eliminate the diversity in
practice that exists due to the different definitions of fair value and the
limited guidance for applying those definitions in GAAP that are dispersed among
the many accounting pronouncements that require fair value measurements. SFAS
No. 157 is effective for financial statements issued for fiscal years beginning
after November 15, 2007, and interim periods within those fiscal years. The
Company does not believe that adoption of SFAS No. 157 has had a material impact
on its consolidated financial statements.

         In September 2006, the FASB issued SFAS No. 158, Employers' Accounting
For Defined Benefit Pension and Other Postretirement Plans. Effective in
calendar-year 2006 (with certain exceptions) for public companies and
calendar-year 2007 (with certain exceptions) for private companies, SFAS No. 158
represents the "first phase" of a planned "two-phased" project where the FASB is
working on improving financial reporting related to pension and other
postretirement (OPB) plans. SEC registrants have been required to disclose the
"expected impact" of implementing SFAS No. 158 in filings made after September
30, 2006 and before the effective date of SFAS No. 158. The adoption of SFAS No.
158 did not have a material impact on the Company's financial statements.

         In July 2006, the FASB issued FIN 48, entitled Accounting for
Uncertainty in Income Taxes. FIN 48 interprets the guidance in SFAS No. 109,
entitled Accounting for Income Taxes. Through the interpretive guidance, the
FASB clarifies the accounting for uncertainty in income taxes, provides
recognition and measurement guidance related to accounting for income taxes, and
provides guidance related to classification and disclosure of income tax-related
financial statement components. The Company does not believe the adoption of FIN
48 has had a material impact on its consolidated financial statements.


                                       10



(12) Financial information about consolidated foreign and domestic operations
and export sales is as follows:

For the nine months ended:                        2/29/08              2/28/07
                                                 ----------           ----------
Revenues from sales to unaffiliated customers:

United States                                    $  945,000           $  994,000
Asia                                                614,000              387,000
Europe                                            1,934,000            1,854,000
South America                                        51,000               56,000
Oceania                                               1,000              447,000
Other                                                63,000               59,000
                                                 ----------           ----------
                                                 $3,608,000           $3,797,000
                                                 ==========           ==========


         In July 2006 the Board of Directors granted a stock option for 10,000
options to an employee of the Company. The options vested one quarter
immediately and then one quarter per year thereafter. The option is at the
exercise price of $.50 per share and expires in five years. Management assigned
a value of $2,830 to this option.

         In February 2007 the Board of Directors granted a stock option for
50,000 options to directors of the Company. The options vested one quarter
immediately and one quarter in May 2007. One quarter will vest each year
thereafter on the grant date. The exercise price is $.57 per share and the
option expires in five years. Management assigned a value of $15,900 to these
options.

         In April 2007 the Board of Directors granted a stock option for 25,000
options to a new Company director. The options vested one half immediately and
then one quarter per year thereafter. The option is at the exercise price of
$.76 per share and expires in five years. Management assigned a value of $11,632
to this option.

         In April 2007 the Board of Directors granted stock options for 163,500
options to employees and consultants of the Company. The options vested one half
immediately and then one quarter per year thereafter. The options are at the
exercise price of $.73 and expire in five years. Management assigned a value of
$72,489 to these options.

         In May 2007 the Board of Directors granted stock options for 171,000
options to certain officers and directors. The options vested one half
immediately and then one quarter per year thereafter. The options are at the
exercise price of $.80 and expire in five years. Management assigned a value of
$78,895 to these options.

         In July 2007 the Board of Directors granted a stock option for 25,000
options to a new Company director. The options vested one half immediately and
then one quarter per year thereafter. The option is at the exercise price of
$.78 per share and expire in five years. Management assigned a value of $11,343
to this option.

         In November 2007 the Board of Directors granted stock options for
16,000 options to employees of the Company. The options vested one quarter
immediately and then will vest one quarter per year thereafter. The options are
at the exercise price of $1.30 and expire in five years. Management assigned a
value of $12,589 to these options. During the nine month period ended February
29, 2008, employees and consultants exercised warrants and stock options for
313,625 shares at purchase prices ranging from $.20-$.73 per share. The total
proceeds to the Company were $96,545.

         Options or warrants granted are assigned values according to current
market value, using the Black-Scholes model for option valuation. The term used
in the calculation of the options or warrants is the vesting period. A discount
rate equivalent to two and one half-years (or other life of the option or
warrant) Treasury constant maturity interest rates is utilized. The historical
volatility of the stock is calculated using weekly historical closing prices for
the prior year as reported by Yahoo Finance. For purposes of the SFAS 123
footnote disclosure, the Black-Scholes Model is also used for calculating
employee options and warrants valuations.

         When shares are issued for services or other non-cash consideration,
fair value is measured using the current market value on the day of the Board of
Directors approval of such issuance.



                                       11



(14) Under its bylaws, the Company has agreed to indemnify its officers and
directors for certain events or occurrences arising as a result of the officer
or director's serving in such capacity. The term of the indemnification period
is for the officer's or director's lifetime. The maximum potential amount of
future payments the Company could be required to make under these
indemnification agreements is unlimited. However, the Company has a directors
and officer liability insurance policy that limits its exposure and enables it
to recover a portion of any future amounts paid.

         As a result of its insurance policy coverage, the Company believes the
estimated fair value of these indemnification agreements is minimal and has no
liabilities recorded for these agreements as of February 29, 2008. The Company
enters into indemnification provisions under (i) its agreements with other
companies in its ordinary course of business, typically with business partners,
contractors, and customers, landlords and (ii) its agreements with investors.
Under these provisions the Company generally indemnifies and hold harmless the
indemnified party for losses suffered or incurred by the indemnified party as a
result of the Company's activities or, in some cases, as a result of the
indemnified party's activities under the agreement. These indemnification
provisions often include indemnifications relating to representations made by
the Company with regard to intellectual property rights. These indemnification
provisions generally survive termination of the underlying agreement. The
maximum potential amount of future payments the Company could be required to
make under these indemnification provisions is unlimited. The Company has not
incurred material costs to defend lawsuits or settle claims related to these
indemnification agreements. As a result, the Company believes the estimated fair
value of these agreements is minimal. Accordingly, the Company has no
liabilities recorded for these agreements as of February 29, 2008.


(15) CRITICAL ACCOUNTING POLICIES

The discussion and analysis of our financial condition and results of operations
are based on the consolidated financial statements, which have been prepared in
accordance with accounting principles generally accepted in the United States.
The preparation of these consolidated financial statements requires estimates
and assumptions that affect the reported amounts and disclosures.

We believe the following to be critical accounting policies as they require more
significant judgments and estimates used in the preparation of our consolidated
financial statements. Although we believe that our judgments and estimates are
appropriate and correct, actual future results may differ from our estimates.

In general the critical accounting policies that may require judgments or
estimates relate specifically to the recognition of revenue, the Allowance for
Doubtful Accounts, Inventory Reserves for Obsolescence and Declines in Market
Value, Impairment of Long-Lived Assets, Stock Based Compensation and Deferred
Income Tax Valuation, Valuation of Available-for-sale Securities and Allowances.

Revenues from product sales are recognized at the time the product is shipped,
customarily FOB shipping point, at which point title passes.

The Allowance for Doubtful Accounts is established for estimated losses
resulting from the inability of our customers to make required payments. The
assessment of specific receivable balances and required reserves is performed by
management and discussed with the audit committee. We have identified specific
customers where collection is not probable and have established specific
reserves, but to the extent collection is made, the allowance will be released.
Additionally, if the financial condition of our customers were to deteriorate,
resulting in an impairment of their ability to make payments, additional
allowances may be required.

Reserves are provided for excess and obsolete inventory, which are estimated
based on a comparison of the quantity and cost of inventory on hand to
management's forecast of customer demand. Customer demand is dependent on many
factors and requires us to use significant judgment in our forecasting process.
We must also make assumptions regarding the rate at which new products will be
accepted in the marketplace and at which customers will transition from older
products to newer products. Once a reserve is established, it is maintained
until the product to which it relates is sold or otherwise disposed of, even if
in subsequent periods we forecast demand for the product.

We have been in a loss position for tax purposes in prior years, and have
established a valuation allowance against deferred tax assets, and although we
are currently generating net income, we do not believe that it is likely that we
will generate sufficient taxable income in future periods to realize the full
benefit of our deferred tax assets. Predicting future taxable income is
difficult, and requires the use of significant judgment. At February 29, 2008,
all of our deferred tax assets were reserved. Accruals are made for specific tax
exposures and are generally not material to our operating results or financial
position, nor do we anticipate material changes to these reserves in the near
future.

                                       12



We have provided a full valuation reserve related to our substantial deferred
tax assets. In the future, if sufficient evidence of our ability to generate
sufficient future taxable income in certain tax jurisdictions becomes apparent,
we may be required to reduce our valuation allowances, resulting in income tax
benefits in our consolidated statement of operations. We evaluate the
realizability of the deferred tax assets and assess the need for valuation
allowance quarterly. The utilization of the net operating loss carry forwards
could be substantially limited due to restrictions imposed under federal and
state laws upon a change of ownership.


(16) Risks and Uncertainties

License Agreements - On occasion the Company enters into agreements for the
licensing of certain products. The Company currently does not have any such
agreements. Historically, the Company has successfully obtained all the licenses
it believed necessary to conduct its business.


(17) Subsequent Events

During March 2008 employees exercised options and warrants for 41,000 shares at
prices ranging from $.25 to $.33. Total proceeds to the Company were $11,100. Of
this, $4,500 was in the form of the reduction of the shareholder note payable.

Distribution - The Company has entered into various exclusive and non-exclusive
distribution agreements (the "Agreements") which generally specify territories
of distribution. The agreements range in term from one to five years. The
Company may be dependent upon such distributors for the marketing and selling of
its products worldwide during the terms of these agreements. Such distributors
are generally not obligated to sell any specified minimum quantities of the
Company's product. There can be no assurance of the volume of product sales that
may be achieved by such distributors.

Government Regulations - The Company's products are subject to regulation by the
FDA under the Medical Device Amendments of 1976 (the "Amendments"). The Company
has registered with the FDA as required by the Amendments. There can be no
assurance that the Company will be able to obtain regulatory clearances for its
current or any future products in the United States or in foreign markets.

European Community - The Company is required to obtain certification in the
European Community to sell products in those countries. The certification
requires the Company to maintain certain quality standards. The Company has been
granted certification on certain products. There is no assurance that the
Company will be able to retain its certification in future years.

Risk of Product Liability - Testing, manufacturing and marketing of the
Company's products entail risk of product liability. The Company currently has
product liability insurance. There can be no assurance, however, that the
Company will be able to maintain such insurance at a reasonable cost or in
sufficient amounts to protect the Company against losses due to product
liability. An inability to maintain such insurance at a reasonable cost or in
sufficient amounts could prevent or inhibit the commercialization of the
Company's products. In addition, a product liability claim or recall could have
a material adverse effect on the business or financial condition of the Company.



                                       13



                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                 FINANCIAL CONDITION AND SELECTED FINANCIAL DATA
                                     ITEM 2.

         CERTAIN INFORMATION CONTAINED HEREIN (AS WELL AS INFORMATION INCLUDED
IN ORAL STATEMENTS OR OTHER WRITTEN STATEMENTS MADE OR TO BE MADE BY BIOMERICA)
CONTAINS STATEMENTS THAT ARE FORWARD-LOOKING, SUCH AS STATEMENTS RELATING TO
ANTICIPATED FUTURE REVENUES OF THE COMPANY AND SUCCESS OF CURRENT PRODUCT
OFFERINGS. SUCH FORWARD-LOOKING INFORMATION INVOLVES IMPORTANT RISKS AND
UNCERTAINTIES THAT COULD SIGNIFICANTLY AFFECT ANTICIPATED RESULTS IN THE FUTURE,
AND ACCORDINGLY, SUCH RESULTS MAY DIFFER MATERIALLY FROM THOSE EXPRESSED IN ANY
FORWARD-LOOKING STATEMENTS MADE BY OR ON BEHALF OF BIOMERICA. THE POTENTIAL
RISKS AND UNCERTAINTIES INCLUDE, AMONG OTHERS, FLUCTUATIONS IN THE COMPANY'S
OPERATING RESULTS. THESE RISKS AND UNCERTAINTIES ALSO INCLUDE THE SUCCESS OF THE
COMPANY IN RAISING NEEDED CAPITAL, THE CONTINUAL DEMAND FOR THE COMPANY'S
PRODUCTS, COMPETITIVE AND ECONOMIC FACTORS OF THE MARKETPLACE, AVAILABILITY OF
RAW MATERIALS, HEALTH CARE REGULATIONS AND THE STATE OF THE ECONOMY. READERS ARE
CAUTIONED NOT TO PLACE UNDUE RELIANCE ON THESE FORWARD-LOOKING STATEMENTS, WHICH
SPEAK ONLY AS OF THE DATE HEREOF, AND THE COMPANY UNDERTAKES NO OBLIGATION TO
UPDATE THESE FORWARD-LOOKING STATEMENTS.

RESULTS OF OPERATIONS

         Consolidated net sales for Biomerica were $3,608,408 for the first nine
months of fiscal 2008 as compared to $3,797,051 for the same period in the
previous year. This represents a decrease of $188,643, or 5.0%. For the quarter
then ended sales were $1,240,809 as compared to $1,311,609 for the same period
in the previous year. This represents a decrease of $70,800, or 5.4%. The
decrease in sales from fiscal 2007 to 2008 is primarily a result of the loss of
one large customer in Australia.

         For the nine months ended February 29, 2008 as compared to 2007, cost
of sales decreased from $2,427,578, or 63.9% of sales, to $2,023,022, or 56.1%
of sales. For the quarter then ended cost of sales decreased from $836,204, or
63.8% of sales, to $747,690, or 60.3% of sales. This decrease was primarily due
to the product mix of the sales, decreases in Mexico expenses and the building
of inventory, including new products, which has associated labor and overhead
costs capitalized into the inventory value.

         For the nine months ended February 29, 2008 compared to February 28,
2007, selling, general and administrative costs increased from $943,601 to
$1,044,288, or $100,687 (10.7%). For the quarter then ended these expenses
decreased from $308,403 to $302,367, or $6,036 (2.0%). The increase for the nine
months was due to an increase in the bad debt reserve and increased accounting
expenses for the SOX compliance project.

         For the nine months ended February 29, 2008 compared to 2007, research
and development increased by $30,173, or 17.7%, and for the three months
increased by $1,496, or 2.1%. The increases were due to higher wages and
materials for the research of new products and materials used in the products.

         For the nine months ended February 29, 2008, other income of $697,124
was realized as compared to $40,040 in the prior year. This represents an
increase of $657,084. For the three months then ended other expense of $10 was
realized as compared to income of $40,005 in the prior fiscal year. The increase
for the nine months was a result of the sale of a marketable security that had
been carried on the Company's books at zero value. Interest expense increased
from $24,090 for the nine months ended February 28, 2007 to $38,288 for the
period ended February 29, 2008 and for the three month period from $6,791 to
$12,438. Increases in interest expense are due to the increased amount owed for
the equipment line of credit and for interest on accrued wages, which was not
being paid in the first nine months of fiscal 2007. Interest income increased
from $1,464 to $26,990 for the nine months ended February 29, 2008 and from $406
to $7,446 for the three months then ended. The increase was due to the increased
cash balances.

LIQUIDITY AND CAPITAL RESOURCES

         As of February 29, 2008, the Company had cash and current
available-for-sale securities in the amount of $822,697 and working capital of
$2,189,669. The Company also had long-term available-for-sale securities in the
amount of $464,823.

         During the nine months ended February 29, 2008, the Company operations
provided cash in the amount of $365,595 as compared to cash used in operations
of $4,137 in the same period in the prior fiscal year. Cash provided by
financing activities for the nine months ended February 29, 2008 was $166,618 as
compared to cash provided by financing activities of $852 in the prior fiscal
year.


                                       14



Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

         You should read the following factors in conjunction with the factors
discussed elsewhere in this and our other filings with the SEC and in materials
incorporated by reference in these filings. The following is intended to
highlight certain factors that may affect the financial condition and results of
operations of Biomerica and are not meant to be an exhaustive discussion of
risks that apply to companies such as Biomerica. Like other businesses,
Biomerica is susceptible to macroeconomic downturns in the United States or
abroad, that may affect the general economic climate and performance of
Biomerica or its' customers. Aside from general macroeconomic downturns, the
additional material factors that could affect future financial results include,
but are not limited to: Terrorist attacks and the impact of such events;
diminished access to raw materials that directly enter into our manufacturing
process; shipping labor disruption or other major degradation of the ability to
ship our products to end users; inability to successfully control our margins
which are affected by many factors including competition and product mix;
protracted shutdown of the U.S. Border due to an escalation of terrorist or
counter terrorist activity; any changes in our business relationships with
international distributors or the economic climate they operate in; any event
that has a material adverse impact on our foreign manufacturing operations may
adversely affect our operation as a whole; failure to manage the future
expansion of our business could have an adverse affect on our revenues and
profitability; possible costs in complying with government regulations and the
delays in receiving required regulatory approvals or the enactment of new
adverse regulations or regulatory requirements; numerous competitors, most of
which have substantially greater financial and other resources than we do;
potential claims and litigation brought by patients or medical professionals
alleging harm caused by the use of or exposure to our products; quarterly
variations in operating results caused by a number of factors, including
business and industry conditions and other factors beyond our control. All of
these factors make it difficult to predict operating results for any particular
period.

Item 4.  CONTROLS AND PROCEDURES

         The Company's Chief Executive Officer and Chief Financial Officer (the
Company's principal executive officer and principal financial officer,
respectively) have concluded, based on their evaluation as of February 29, 2008,
that the design and operation of the Company's "disclosure controls and
procedures" (as defined in rules 13a-15(e) under the Securities Exchange Act of
1934, as amended ("Exchange Act") are effective to ensure that information
required to be disclosed by the Company in the reports filed or submitted by the
Company under the Exchange Act is accumulated, recorded, processed, summarized
and reported to the Company's management, including the Company's principal
executive officer and principal financial officer, as appropriate to allow
timely decisions regarding whether or not disclosure is required.

         During the quarter ended February 29, 2008, there were no changes in
the Company's "internal controls over financial reporting" (as defined in Rule
13a-15(f) under the Exchange Act) that have materially affected, or are
reasonably likely to materially affect, the Company's internal controls over
financial reporting.


                                       15



                           PART II. OTHER INFORMATION

Item 1.  LEGAL PROCEEDINGS.  Inapplicable.

Item 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS. Inapplicable.

Item 3.  DEFAULTS UPON SENIOR SECURITIES.  Inapplicable.

Item 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.  Inapplicable.

Item 5.  OTHER INFORMATION.  Inapplicable.

Item 6.  EXHIBITS AND REPORTS ON FORM 8-K.  Inapplicable.

(a)      Exhibits

   31.1       Certification of CEO pursuant to Rules 13a-14(a) and 15d-14(a), as
              adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

   31.2       Certification of CFO pursuant to Rules 13a-14(a) and 15d-14(a), as
              adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

   32.1       Certification of CEO Pursuant to 18 U.S.C.
              Section 1350, as adopted pursuant to Section 906 of the
              Sarbanes-Oxley Act of 2002.

   32.2       Certification of CFO Pursuant to 18 U.S.C.
              Section 1350, as adopted pursuant to Section 906 of the
              Sarbanes-Oxley Act of 2002.




                                       16



                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has fully caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

Date: April 14, 2008

                                             BIOMERICA, INC.

                                             By: /S/ Zackary S. Irani
                                                 -----------------------
                                                 Zackary S. Irani
                                                 Chief Executive Officer


                                       17