8-K

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 8-K

                     Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934



Date of Report (Date of earliest event reported) May 31, 2006




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


           Delaware                  0-11380                11-2650500
- -------------------------------   -------------   ------------------------------
(State or other jurisdiction of    (Commission           (I.R.S. Employer
 incorporation or organization)    file number)          Identification No.)


 1983 Marcus Avenue, Lake Success, New York                   11042
- --------------------------------------------                  -----
  (Address of principal executive offices)                  (Zip Code)


                                 (516) 750-1600
                                 --------------
              (Registrant's telephone number, including area code)







Form 8-K, Current Report
ATC Healthcare, Inc.
Commission File No.  0-11380


Item 3.02  Unregistered Sale of Equity Securities.

     On May 31, 2006, ATC Healthcare, Inc. (the "Company") sold to one
accredited investor 500 shares of its 6% Convertible Series C Preferred Stock
(the "Series C Preferred Stock") for $1.0 million. The Series C Preferred shares
are convertible into the Company's Class A Common Stock at $0.45 per common
share. As part of the sale the purchaser also received 741,000 warrants to
purchase shares of the Company's Class A Common Stock at $0.60 per share over a
five-year period. The Company paid a finder a seven percent commission of
$70,000 and granted the finder 155,000 warrants to purchase shares of the
Company's Class A Common Stock for $0.60 per share.

     The Company has relied upon the exemptions from registration in Sections
4(2) and 4(6) of the Securities Act of 1933, as amended, and under Rule 506 of
Regulation D of the Securities and Exchange Commission.

     The Company plans to use the net proceeds from the sale of the Series C
Preferred Shares to finance the acquisition discussed under Item 8.01 of this
Report.

     On June 1, 2006, the Company issued a press release announcing these
transactions. A copy of that press release is attached to this Report as Exhibit
99.1.


Item 8.01  Other Events.


On June 1, 2006 ATC Healthcare, Inc. (the "Company"), a leader in medical
staffing, announced that it has entered into an agreement to acquire a leading
provider of per-diem and travel-nursing services in the Arizona market. The
company, with three locations in Arizona, had revenues of approximately $7
million last year. The closing of the acquisition is expected to occur by June
20, 2006, and is subject to certain conditions, including the obtaining of
consents. To finance the acquisition, the Company sold $1.0 million of its new
Series C Preferred stock which is convertible into Class A Common Stock at $0.45
per share, which is discussed under Item 3.02 of this report.

     A copy of the Company's June 1, 2006 press release announcing these
transactions is attached to this Report as Exhibit 99.1.



SIGNATURES


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


Dated: June 1, 2006                            ATC Healthcare, Inc.

                                         By:   /s/ Andrew Reiben
                                               ---------------------------------
                                               Name:  Andrew Reiben
                                               Title: Senior Vice President
                                                      Chief Financial Officer

EX-99.1

                                                                    Exhibit 99.1

                ATC to Acquire Medical Staffing Firm in Arizona

    LAKE SUCCESS, N.Y.--(BUSINESS WIRE)--June 1, 2006--ATC Healthcare,
Inc., (AMEX:AHN) a leader in medical staffing, announced today that it
has entered into an agreement to acquire a leading provider of
per-diem and travel-nursing services in the Arizona market. The
company, with three locations in Arizona, had revenues of
approximately $7 million last year and should be accretive to ATC's
earnings. The closing of the acquisition is expected to occur by June
20, 2006, and is subject to certain conditions, including the
obtaining of consents. To finance the acquisition, ATC sold $1.0
million of its new Series C Preferred stock which is convertible into
Class A Common Stock at $0.45 per share.

    About ATC Healthcare, Inc.

    ATC is a national leader in medical staffing personnel to
hospitals, nursing homes, clinics and other health care facilities
with 54 locations in 31 states. ATC provides supplemental staffing,
outsourcing and human resources solutions to hospitals, nursing homes,
medical and research facilities and industry. Drawing from a pool of
over 15,000 health care professionals spanning more than 50
specialties, the company supplies both clinical and non-clinical
personnel for short-term, long-term, and "traveling" contract
assignments. To learn more about the company's services, visit their
web site at www.atchealthcare.com.

    This press release contains forward-looking statements. Actual
results could differ materially from those projected in the
forward-looking statements. Additional information concerning factors
that could cause actual results to differ materially from those in the
forward-looking statements is contained in ATC Healthcare, Inc. Annual
Report on Form 10-K for the year ended February 28, 2006 as filed
with the Securities and Exchange Commission on May 30, 2006.

    CONTACT: ATC Healthcare, Inc.
             David Savitsky, 516-750-1681
             dsavitsky@atchealthcare.com
             or
             Andrew Reiben, 516-750-1663
             areiben@atchealthcare.com
             or
             Investors:
             BPC Financial Marketing
             John Baldissera, 800-368-1217