SCI Engineered Materials, Inc. (Form: 424B3)

Filed Pursuant to Rule 424(b)(3)

Registration No. 333-131605

PROSPECTUS SUPPLEMENT

Number 7

Prospectus dated April 4, 2006, Prospectus Supplement dated May 15, 2006, Prospectus Supplement dated August 3, 2006, Prospectus Supplement dated November 3, 2006, Prospectus Supplement dated March 15, 2007, Post-effective Amendment dated May 1, 2007, Prospectus Supplement dated May 9, 2007, Post-effective Amendment dated July 18, 2007, Post-effective Amendment dated July 20, 2007, Post-effective Amendment dated August 3, 2007, Post-effective Amendment dated August 29, 2007, Prospectus Supplement dated November 13, 2007, and Post effective Amendment dated April 24, 2008

SCI ENGINEERED MATERIALS, INC.

2,281,253 Shares of Common Stock

This Prospectus Supplement relates to the sale of up to 2,281,253 shares of SCI Engineered Materials, Inc. common stock (the “Shares”). The Shares are being registered to permit public secondary trading of the shares that are being offered by the selling shareholders named in the prospectus. We are not selling any of the Shares in this offering and therefore will not receive any proceeds from this offering.

This Prospectus Supplement No. 7 includes the attached Quarterly Report on Form 10-Q (the “Form 10-Q”) of SCI Engineered Materials, Inc. (the “Company”), for the three months ended March 31, 2008, filed by the Company with the Securities and Exchange Commission on May 5, 2008. The exhibits to the Form 10-Q are not included with this Prospectus Supplement No. 7 and are not incorporated by reference herein. This Prospectus Supplement No. 7 should be read in conjunction with the prospectus supplement No. 1 dated May 15, 2006, the prospectus supplement No. 2 dated August 3, 2006, the prospectus supplement No. 3 dated November 3, 2006, the prospectus supplement No. 4 dated March 15, 2007, the post-effective amendment dated May 1, 2007, the prospectus supplement No. 5 dated May 9, 2007, the post-effective amendment No. 2 dated July 18, 2007, the post-effective amendment No. 3 dated July 20, 2007, the post-effective amendment No. 4 dated August 3, 2007, the post-effective amendment No. 5 dated August 29, 2007, the prospectus supplement No. 6 dated November 13, 2007, and the post-effective amendment No. 6 dated April 24, 2008.

Our common stock is traded on the Over-the-Counter Bulletin Board under the symbol “SCCI.”

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

The date of this Prospectus Supplement No. 7 is May 8, 2008.

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2008

o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______________ to ______________

Commission file number: 0-31641

SCI ENGINEERED MATERIALS, INC.

(Exact name of small business issuer as specified in its charter)

Ohio	31-1210318
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

2839 Charter Street, Columbus, Ohio 43228

(Address of principal executive offices) (Zip Code)

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer o Accelerated filer o Non-accelerated filer o Smaller reporting company x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

3,502,050 shares of Common Stock, without par value, were outstanding at April 30, 2008.

SCI ENGINEERED MATERIALS, INC.

Table of Contents

			Page No.

PART I. FINANCIAL INFORMATION

	Item 1.	Financial Statements.

		Balance Sheets as of March 31, 2008 (unaudited) and December 31, 2007	3

		Statements of Operations for the Three Months Ended March 31, 2008 and 2007 (unaudited)	5

		Statements of Cash Flows for the Three Months Ended March 31, 2008 and 2007 (unaudited)	6

		Notes to Financial Statements (unaudited)	8

	Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations.	13

	Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	N/A

	Item 4.	Controls and Procedures.	18

PART II. OTHER INFORMATION

	Item 1.	Legal Proceedings.	N/A

	Item 1A.	Risk Factors	N/A

	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	N/A

	Item 3.	Defaults Upon Senior Securities.	N/A

	Item 4.	Submission of Matters to a Vote of Security Holders.	N/A

	Item 5.	Other Information.	N/A

	Item 6.	Exhibits.	19

	Signatures.		20

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

SCI ENGINEERED MATERIALS, INC.

BALANCE SHEETS

ASSETS

	March 31,			December 31,
	2008			2007
	(UNAUDITED)

CURRENT ASSETS
Cash	$	853,500		$	1,182,086
Accounts receivable
Trade, less allowance for doubtful accounts of $24,700		501,313			219,222
Contract		52,760			65,954
Other		60			550
Inventories		869,549			756,999
Prepaid expenses		78,041			21,148
Total current assets		2,355,223			2,245,959

PROPERTY AND EQUIPMENT,
AT COST
Machinery and equipment		4,178,480			3,386,778
Furniture and fixtures		81,155			74,222
Leasehold improvements		301,551			301,551
Construction in progress		8,735			599,753
		4,569,921			4,362,304
Less accumulated depreciation		(2,276,751	)		(2,185,277	)
		2,293,170			2,177,027

OTHER ASSETS
Deposits		18,260			18,639
Intangibles		31,647			29,202
Total other assets		49,907			47,841

TOTAL ASSETS	$	4,698,300		$	4,470,827

The accompanying notes are an integral part of these financial statements.

SCI ENGINEERED MATERIALS, INC.

BALANCE SHEETS

LIABILITIES AND SHAREHOLDERS' EQUITY

	March 31,			December 31,
	2008			2007
	(UNAUDITED)

CURRENT LIABILITIES
Capital lease obligation, current portion	$	301,420		$	259,714
Accounts payable		319,457			160,468
Accrued contract expenses		49,910			47,702
Accrued personal property taxes		13,216			10,216
Customer Deposits		61,269			19,483
Accrued Compensation		56,140			138,190
Accrued expenses and other		95,570			89,968
Total current liabilities		896,982			725,741

CAPITAL LEASE OBLIGATION, NET OF CURRENT PORTION		894,914			846,433

COMMITMENTS AND CONTINGENCIES		-			-

SHAREHOLDERS' EQUITY
Convertible preferred stock, Series B, 10% cumulative, nonvoting, no par value, $10 stated value, optional redemption at 103%; 24,566 issued and outstanding		382,002			375,861
Common stock, no par value, authorized 15,000,000 shares; 3,501,966 and 3,474,338 shares issued and outstanding respectively		9,137,047			9,061,378
Additional paid-in capital		986,007			987,840
Accumulated deficit		(7,598,652	)		(7,526,426	)
		2,906,404			2,898,653

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$	4,698,300		$	4,470,827

The accompanying notes are an integral part of these financial statements.

SCI ENGINEERED MATERIALS, INC.

STATEMENTS OF OPERATIONS

THREE MONTHS ENDED MARCH 31, 2008 AND 2007

(UNAUDITED)

	2008		2007

SALES REVENUE	$	1,713,940	$	2,454,009

COST OF SALES REVENUE		1,284,915		1,995,429

GROSS PROFIT