VIA FACSIMILE AND U.S. MAIL


February 21, 2006

Douglas W. Sabra
Chief Financial Officer
Forward Industries, Inc.
1801 Green Road, Suite E
Pompano Beach, FL 33064

	RE:	Form 10-KSB for Fiscal Year Ended September 30, 2005
      Form 10-QSB for Fiscal Quarter Ended December 31, 2005
      File No. 0-6669

Dear Mr. Sabra:

		We have reviewed these filings and have the following
comments.  If you disagree with a comment, we will consider your
explanation as to why our comment is inapplicable or a revision is
unnecessary.  Please be as detailed as necessary in your
explanation.
In some of our comments, we may ask you to provide us with
information so we may better understand your disclosure.  After
reviewing this information, we may or may not raise additional
comments.

	Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects.  We welcome
any questions you may have about our comments or on any other
aspect
of our review.  Feel free to call us at the telephone numbers
listed
at the end of this letter.

FORM 10-QSB FOR THE PERIOD ENDED DECEMBER 31, 2005

Management`s Discussion and Analysis of Financial Condition and
Results of Operations, page 14

Results of Operations for the 2006 Quarter compared to the 2005
Quarter, page 16

1. You indicated that revenue was adversely affected by the
adoption
of a sourcing, billing and payment arrangement for one of your OEM
customers in which revenue is recognized only to the extent of the
related gross profit on sales to the customer.  However, in the
prior
year, the full sale price of the product to this customer was
recognized as revenue.  We have the following comments regarding
the
adoption of this new arrangement.
* [i] With reference to the indicators in EITF 99-19 and the
specific
terms of the sourcing, billing and payment arrangement, please
address the specific facts and circumstances that resulted in the
change from gross revenue reporting to net revenue reporting.
* [ii] Clarify why you adopted this new arrangement for one of
your
OEM customers.
* [iii] With reference to the typical terms of your other revenue
arrangements, please support the gross revenue reporting for these
arrangements as presented in your Form 10-K for the year ended
September 30, 2005.

*    *    *    *

	Please respond to these comments within 10 business days, or
tell us when you will provide us with a response.  Please provide
us
with a response letter that keys your responses to our comments
and
provides any requested information.  Detailed letters greatly
facilitate our review.  Please file your response on EDGAR as a
correspondence file.  Please understand that we may have
additional
comments after reviewing your responses to our comments.

      We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filing to be certain that the
filing includes all information required under the Securities
Exchange Act of 1934 and that they have provided all information
investors require for an informed investment decision.  Since the
company and its management are in possession of all facts relating
to
a company`s disclosure, they are responsible for the accuracy and
adequacy of the disclosures they have made.

	In connection with responding to our comments, please
provide,
in writing, a statement from the company acknowledging that:

* the company is responsible for the adequacy and accuracy of the
disclosure in their filings;
* staff comments or changes to disclosure in response to staff
comments do not foreclose the Commission from taking any action
with
respect to the filing; and
* the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.

	In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in our review of your filing or in
response to our comments on your filing.




      You may contact Ernest Greene, Staff Accountant, at (202)
551-
3733, or in his absence, Jeanne Baker, Assistant Chief Accountant,
at
(202) 551-3691, if you have questions regarding comments on the
financial statements and related matters.
								Sincerely,



								Rufus Decker
      							Accounting Branch Chief
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Mr. Douglas W. Sabra
February 21, 2006
Page 1



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-7010

         DIVISION OF
CORPORATION FINANCE