8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  July 19, 2006

HUMAN BIOSYSTEMS

(Exact name of registrant as specified in its charter)

000-28413

(Commission File Number)

California                                    

77-0481056

(State or other jurisdiction             (I.R.S. Employer Identification No.)

of incorporation or organization)

1127 Harker Avenue, Palo Alto, CA 94301   

(Address of Principal Executive Offices Including Zip Code)

Registrant's telephone number, including area code: (650) 323-0943

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (See General Instruction A.2. below):

[ ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[ ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[ ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[ ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 8.01 Other Events

  On July 19, 2006 Human BioSystems (“HBS”) signed a letter of intent to acquire two ethanol production facility projects from EXL III Group Corporation (“EXL III”).  HBS will also enlist the services of Claude Luster III, the principal of EXL III, to serve as the President of a new subsidiary to be formed to develop the ethanol business.  The acquisition, which is expected to close in the fall of 2006, is subject to certain conditions.  The signing of the letter of intent was announced in a Press Release issued by HBS on July 27, 2006.  Please see the attached copy of the Press Release.

Item 9.01 Financial Statements and Exhibits

(a)

Financial Statements of Business Acquired: Not Applicable

(b)

Pro Forma Financial Information: Not Applicable

(c)

Exhibits: The following exhibits are included as part of this report

Exhibit No.

Description

99.1

Press Release: Human BioSystems Signs Letter of Intent to Acquire Ethanol Projects

SIGNATURES

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

Dated: July 28, 2006

HUMAN BIOSYSTEMS

By:

/s/ Harry Masuda     

Harry Masuda

President and CEO

EX-99.01

Breaking News: Human BioSystems Signs Letter of Intent to Acquire Ethanol Projects

Palo Alto, CA – July 27, 2006 - (OTCBB:HBSC) -Human BioSystems (“HBS”), a developer of preservation platforms for organs and other biomaterials, announced today that it has signed a letter of intent (“LOI”) to acquire two ethanol production facility projects from EXL III Group Corporation (“EXL III”), an equity partner in ethanol plant ventures.  HBS will also enlist the services of Claude Luster III, the principal of EXL III Group Corporation, to serve as the President of a new subsidiary to be formed to develop the ethanol business.

The LOI provides that HBS will acquire the projects from EXL III Group Corporation for restricted HBS common stock.  In addition, HBS will enter into a Consulting Services Agreement with Mr. Luster.

“We made the decision to enter the bio energy field because it gives HBS the potential to achieve substantial revenue and profit growth within a predictable timetable, and because the opportunity and expertise to pursue the renewable energy market exists with this acquisition,” stated Harry Masuda, CEO of Human BioSystems. “This acquisition should give HBS additional financing options not previously available,” continued Mr. Masuda.

The acquisition, which is expected to close in the fall of 2006, is subject to certain conditions, including but not limited to completion of satisfactory due diligence by HBS, the  negotiation and completion of a definitive acquisition agreement and Consulting Services Agreement, approval of the HBS and EXL III boards of directors and other customary conditions.

HBS is headquartered in Palo Alto, California with research facilities in Michigan.

Contact: Human BioSystems Harry Masuda (650) 323-0943
Investor Relations Yes International (800) 631-8127
Investor Relations Concept Communications Group LLC (727) 447-0514

Certain statements contained herein are “forward-looking'' statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause results to differ materially from those expressed or implied by such forward-looking statements include, but are not limited to, failure to complete a final definitive agreement,  failure to obtain regulatory approvals for the construction of ethanol plants,  failure to obtain the required financing and to construct the ethanol plants, failure of the ethanol plants to meet standards, the inability to find raw material for the production of ethanol or to sell the ethanol at on acceptable terms, the risks involved in pursuing a business unrelated to HBS’ prior business, and other factors discussed in filings made by the Company with th e Securities and Exchange Commission