Mail Stop 4561
      July 15, 2005

Mr. Anthony Fidaleo
Chief Financial Officer
Adstar, Inc.
4553 Glencoe Avenue, Suite 300
Marina del Rey, CA 90292

	Re:	Adstar, Inc.
		Form 10-K for Fiscal Year Ended December 31, 2004
		Form 10-Q for Fiscal Quarter Ended March 31, 2005
		File No. 1-15363

Dear Mr. Fidaleo:

      We have reviewed your filings and have the following
comments.
We have limited our review to only your financial statements and
related disclosures and do not intend to expand our review to
other
portions of your documents. Where indicated, we think you should
revise your document in response to these comments.  If you
disagree,
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 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-K for the Fiscal Year ended December 31, 2004

Independent Auditor`s Report, page F-2

1. Please explain to us how your auditors considered PCAOB
Auditing
Standard No. 1 in conjunction with their audit report contained in
your Form 10-K.




Consolidated Statements of Operations, page F-4

2. Tell us how you considered the guidance in Question 1 of SAB
Topic
13.B to separately disclose the cost of revenues related to each
type
of revenue reported on the face of the income statement.

Note 8 - Convertible Preferred Stock, page F-20

3. We note that you have not shown the 7% cumulative dividend as a
deduction in deriving net income applicable to common shareholders
because it is payable upon a liquidating event.  Explain what is
considered a liquidating event.  Advise us how your accounting
treatment complies with paragraph 9 of SFAS 128 which requires the
deduction of dividends accumulated on cumulative preferred stock
whether or not it has been earned or paid to derive net income or
loss applicable to common shareholders.  Tell us the amount of
dividends that would have increased your net loss applicable to
common shareholders had you accrued these amounts pursuant to SFAS
128.

Note 14 Shareholder Receivable, page F-27

4. Please advise us of your compliance with section 402 of the
Sarbanes-Oxley Act of 2002 regarding the note receivables with
your
officers

Note 20 - Subsequent Event, page F-34

5. We note that after year end you raised $597,423 from the
exercise
of warrants issued to Paulson Investment Company as compensation
for
services.  Further, we note that you recorded a preferred dividend
related to these warrants in the first quarter of 2005.  Clarify
the
timing in which the warrants were issued, how they were accounted
for
at the date of issuance and your basis in GAAP for your accounting
treatment.  Lastly, advise us why you recorded the change in fair
value for the warrants as a preferred dividend below net loss in
your
first quarter Form 10-Q and the accounting literature you relied
upon
in determining this treatment was appropriate.

      As appropriate, please amend your filing and respond to
these
comments within 10 business days or tell us when you will provide
us
with a response.  You may wish to provide us with marked copies of
the amendment to expedite our review.  Please furnish a cover
letter
with your amendment that keys your responses to our comments and
provides any requested information.  Detailed cover letters
greatly
facilitate our review.  Please understand that we may have
additional
comments after reviewing your amendment and responses to our
comments.

      We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filings to be certain that the
filings include 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 the 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 filings; 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 filings or
in
response to our comments on your filings.

      You may contact Thomas Flinn, Staff Accountant, at (202)
551-
3469 or the undersigned at (202) 551-3413 if you have questions.
      			Sincerely,


      Cicely D. Luckey
      Accounting Branch Chief






Mr. Anthony Fidaleo
Adstar, Inc.
July 15, 2005
Page 1