August 23, 2005


Securities and Exchange Commission
100 F. Street, N.E.
Washington, D.C. 20549
Attn:  Maryse Mills-Apenteng

RE:     GSE Systems, Inc.
        Registration Statement on Form S-3
        Filed July 8, 2005
        File No. 333-126472
        Form 10-K for the year ended December 31, 2004
        File No. 1-14785

Dear Ms. Mills-Apenteng:

Following  are our  responses  to the  August 5, 2005  letter  from Mr.  Mark P.
Shuman.

General
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1.   While a spin-off  transaction may be registered  using Form S-3, it appears
     that you do not meet the transactional  requirements of General Instruction
     I.B.1 of Form S-3 as GSE Systems,  Inc.  has an  aggregate  market value of
     less than $75 million. Please see telephone interpretation G.26 relating to
     Form S-3. We suggest therefore that you amend this filing on an appropriate
     form such as Form S-2 or S-1.

     We will  file  Amendment  No. 1 on Form  S-2 to the  Form S-3  registration
     statement.

2.   In view of the  role of  General  Physics  Corp  and GP  Strategies  in the
     spin-off  transaction  in which  GSE  Systems  shares  will  ultimately  be
     distributed to the  shareholders  of GP Strategies,  please provide us with
     your analysis of why General  Physics Corp and GP Strategies  should not be
     named as  underwriters,  as defined in Section 2(a) (11) of the  Securities
     Act.

     We will disclose in the prospectus contained in Amendment No. 1 on Form S-2
     to the Form S-3  registration  statement that General  Physics Corp. and GP
     Strategies may be deemed underwriters with respect to the spin-off.


Outside Front Cover Page
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2.   Please  revise so that the outside  cover page of the document  provided to
     investors  conforms  to the  requirements  of Item 501 of  Regulation  S-K.
     Putting  the  information  required  by Item 501 on the second page of your
     document is not  appropriate.  Note that Item 501 of Regulation  S-K limits
     the  presentation  of  information  required  on the cover page to a single
     page. It appears the key information  concerning your proposed  transaction
     can be presented on a single page.

     We will revise the outside cover page of the document provided to investors
     to insure  that all  information  required  by Item 501 of  Regulation  S-K
     appears on the cover page.


Form 10-K for the year ended December 31, 2004
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Disclosure Controls and Procedure
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3.   Given the  conclusion of your  principal  executive and financial  officers
     that your  disclosure  controls  and  procedures  were not  effective as of
     December 31, 2004,  amend your  disclosure to identify the period for which
     the material weakness existed.

     We have filed an amendment to our Form 10-K to revise the disclosure  under
     "ITEM 9A. CONTROLS AND PROCEDURES" accordingly.


4.   We note your  statement  that the company "is revising its controls  around
     derivative  transactions to ensure that these transactions will be captured
     and accounted for in a timely  manner.  Revise to discuss in greater detail
     the specific steps that the company has taken,  if any, or plans to take to
     remediate the material  weakness.  Identify the costs  associated  with the
     remedial measures,  if material,  and disclose whether the company believes
     that the material weakness still existed at December 31, 2004.

     We have filed an amendment to our Form 10-K to revise the disclosure  under
     "ITEM 9A. CONTROLS AND PROCEDURES" accordingly.


5.   Your disclosure states that there were "no significant  changes in internal
     controls,  or in factors that could significantly affect internal controls,
     subsequent to the date of  the evaluation."  This language does not conform
     to the  requirements  of Item  308(c) of  Regulation  S-K,  which  requires
     disclosure  of  any  change  in  the  registrants'  internal  control  over
     financial  reporting that occurred  during the  registrant's  fourth fiscal
     quarter that has materially affected, or is reasonably likely to materially
     affect, the registrant's internal control over financial reporting.  Please
     revise accordingly.

     We have filed an amendment to our Form 10-K to revise the disclosure  under
     "ITEM 9A. CONTROLS AND PROCEDURES" accordingly.


We trust that you will find the responses to your comments complete. However, we
are  prepared to provide  any  further  information  or  documentation  that you
require. Please feel free to contact our Chief Financial Officer, Jeff Hough, or
myself.

Sincerely,

/s/ John V. Moran
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John V. Moran
Chief Executive Officer
GSE Systems, Inc.