As filed with the Securities and Exchange Commission on June 10, 2004
                           Registration No. 333-88314

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                       ===================================

                         POST-EFFECTIVE AMENDMENT NO. 3
                                       TO
                                    FORM SB-2
                                   ON FORM S-3
                             REGISTRATION STATEMENT
                                      UNDER
                           THE SECURITIES ACT OF 1933
                       ===================================

                        NATURAL GAS SERVICES GROUP, INC.
                -------------------------------------------------
                 (Name of small business issuer in its charter)

            Colorado                       3533                    75-2811855
------------------------------ ----------------------------  -------------------
(State or jurisdiction of      (Primary Standard Industrial  (I.R.S. Employer
incorporation or organization) Classification Code Number)   Identification No.)


                           2911 South County Road 1260
                              Midland, Texas 79706
                                 (432) 563-3974
              (Address and telephone number of principal executive
                    offices and principal place of business)

                               Wallace C. Sparkman
                           2911 South County Road 1260
                              Midland, Texas 79706
                                 (432) 563-3974
            (Name, address and telephone number of agent for service)

                                   COPIES TO:
                              David A. Thayer, Esq.
                              Jones & Keller, P.C.
                            1625 Broadway, Suite 1600
                             Denver, Colorado 80202
                            Telephone: (303) 573-1600
                         -------------------------------

  Approximate date of proposed sale to the public: As soon as practicable after
           the effective date of this Post-Effective Amendment No. 3
                         to the Registration Statement.

         If the only securities  being registered on this Form are being offered
pursuant to dividend or interest  reinvestment plans, please check the following
box. [_]

         If any of the  securities  being  registered  on  this  Form  are to be
offered  on a  delayed  or  continuous  basis  pursuant  to Rule 415  under  the
Securities Act of 1933,  other than  securities  offered only in connection with
dividend or interest reinvestment plans, check the following box. [X]

         If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the  Securities  Act,  check the following box and
list the Securities Act registration  statement number of the earlier  effective
registration statement for the same offering. [_]

         If this  Form is a  post-effective  amendment  filed  pursuant  to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act  registration   statement  number  of  the  earlier  effective  registration
statement for the same offering. [_]

         If delivery of the  prospectus  is expected to be made pursuant to Rule
434, check the following box. [_]



PROSPECTUS        SUBJECT TO COMPLETION, DATED JUNE __, 2004


                        NATURAL GAS SERVICES GROUP, INC.


         We are  offering  1,500,000  shares  of our  common  stock  to  holders
electing to exercise  warrants  issued as part of our initial public offering in
October  2002.  The  1,500,000  warrants  sold to the public in our offering are
exercisable at $6.25 per share.  If all of the warrants are  exercised,  we will
receive gross proceeds of $9,375,000.

         We  also  issued  options  to the  underwriter  of our  initial  public
offering to purchase  150,000 shares of our common stock for $6.25 per share and
to purchase  warrants to purchase  150,000 shares of our common stock at $0.3125
per warrant. The underwriter subsequently transferred the options to the selling
securityholders.  Each warrant entitles the holders to purchase one share of our
common stock for $7.8125 per share.  If the options and warrants are  exercised,
we will receive gross proceeds of $2,156,250.  The selling security holders will
receive all of the  proceeds  from the sale of the options and  warrants if they
are sold rather than exercised by it. See "Selling Securityholders"

         Our  common  stock and  public  warrants  trade on the  American  Stock
Exchange under the symbols NGS and NGS.WS.

                            -------------------------

         You should  carefully  consider  the risk  factors  beginning on page 4
before purchasing any of the securities.

         Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus  is truthful or  complete.  Any  representation  to the contrary is a
criminal offense.

                            -------------------------






                  The date of this prospectus is June __, 2004






                    WHERE YOU CAN FIND ADDITIONAL INFORMATION

         We are subject to the reporting requirements of the Securities Exchange
Act of 1934, and we file annual, quarterly and special reports, proxy statements
and other information with the Securities and Exchange Commission.  You may read
and copy any document that we file at the Securities  and Exchange  Commission's
public reference room at 450 Fifth Street,  N.W.,  Washington,  D.C. Please call
the Securities  Exchange Commission at 1-800-SEC-0330 for further information on
the public  reference  room.  Our SEC filings are also  available to you free of
charge at the Securities Exchange Commission's web site at http://www.sec.gov.


                     INCORPORATION OF DOCUMENTS BY REFERENCE

         The SEC allows us to  incorporate by reference some of the documents we
file with it, which means that we can disclose  important  information to you by
referring you to those documents.  The information  incorporated by reference is
considered to be part of this  prospectus,  and  information  that we file later
with the SEC will  automatically  update  and  supersede  this  information.  We
incorporate  by reference the documents  listed below and any future  filings we
will  make  with  the SEC  under  Sections  13(a),  13(c),  14 or  15(d)  of the
Securities  Exchange  Act of 1934.  This  prospectus  is part of a  registration
statement we filed with the SEC (Registration No.  333-47051).  The documents we
incorporate by reference are:

         o        Our Annual  Report on Form 10-KSB for the year ended  December
                  31, 2003.

         o        Our  Quarterly  Report on Form  10-QSB for the  quarter  ended
                  March 31, 2004.

         o        Our Current  Report on Form 8-K  announcing  our first quarter
                  2004 financial results filed April 6, 2004.

         o        The  description  of our common  stock,  which is contained in
                  Items 1 and 2 of our Registration  Statement on Form 8-A filed
                  pursuant to Section 12 of the Exchange Act on July 17, 2002.

         o        All documents we file pursuant to Sections 13(a), 13(c), 14 or
                  15(d) of the  Exchange  Act after the date of this  prospectus
                  and prior to the  termination  of the  offering  of the shares
                  offered hereby.

                           HOW TO REQUEST INFORMATION

         We will provide at no cost to each  person,  including  any  beneficial
owner, to whom this  prospectus is delivered,  on the written or oral request of
such person,  a copy of any or all of the documents we incorporate by reference,
other than exhibits to such  documents.  Requests  should be directed to Natural
Gas Services  Group,  Inc., 2911 South County Road 1260,  Midland,  Texas 79706,
(432) 563-3974, Attention: Investor Relations.



                                       2



                     ABOUT NATURAL GAS SERVICES GROUP, INC.

         We provide  equipment and services to the natural gas and oil industry.
We manufacture,  fabricate,  sell and lease natural gas compressors that enhance
the  production  of oil and gas wells and we provide  maintenance  services  for
those  compressors.  We define a natural gas  compressor as a mechanical  device
with one basic goal - to deliver gas at a pressure  higher than that  originally
existing. It may be powered by a natural gas burning engine or an electric motor
to  accommodate  different  applications.   Gas  compression  is  undertaken  to
transport and distribute  natural gas to pipelines.  Pipeline pressures vary and
with the  addition  of new  wells  to the  pipeline,  the  need for  compression
increases.  We also manufacture and sell flare tips and ignition systems for oil
and gas plant and  production  facilities.  We define a flare tip as a burner on
the upper end of a flare stack that is designed to combust waste gases to assure
a clean  environment.  An ignition  system is a pilot light or a spark generator
that assures continuous  ignition of the waste gases going through the burner in
the flare tip.

         We primarily  lease natural gas  compressors.  As of March 31, 2004, we
had 416 natural gas compressors under lease to third parties.

         We also fabricate natural gas compressors for our customers,  designing
compressors to meet unique specifications dictated by well pressures, production
characteristics and particular applications for which compression is sought.

         We have  established an exchange and rebuild program to attempt to help
minimize  costs and maximize  revenue for our customers.  Under the program,  we
work  with  maintenance  and  operating  personnel  of a  customer  to  identify
equipment for exchange.  When we receive a compressor for exchange  because of a
maintenance problem, we deliver to our customer a replacement compressor at full
price. We then rebuild the exchange compressor and credit our customer an amount
based on the  value of the  rebuilt  compressor.  We also  offer a  retrofitting
service by repackaging a customer's  compressor with a compressor that meets our
customer's changed conditions.

         We design,  manufacture,  install and service  flare stacks and related
ignition and control  devices for onshore and offshore  burning of gas compounds
such as hydrogen sulfide,  carbon dioxide,  natural gas and liquefied  petroleum
gases.

         We have  manufacturing and fabrication  facilities located in Lewiston,
Michigan,  and Midland,  Texas,  where we manufacture and fabricate  natural gas
compressors. We design and manufacture natural gas flare systems, components and
ignition  systems  in our  facility  in  Midland,  Texas,  for use in  oilfield,
refinery and petrochemical plant applications.

         We currently  provide our  products and services to a customer  base of
oil  and  gas  exploration  and  production  companies  operating  primarily  in
Colorado, Kansas, Louisiana, Michigan, New Mexico, Oklahoma, Texas and Wyoming.

         We  maintain  our  principal  office at 2911  South  County  Road 1260,
Midland, Texas 79706 and our telephone number is (432) 563-3974.



                                       3


                                  RISK FACTORS

         To inform investors of our future plans and objectives, this prospectus
(and other  reports and  statements  issued by us and our officers  from time to
time) contain certain statements concerning our future performance,  intentions,
objectives,   plans  and   expectations   that  are  or  may  be  deemed  to  be
"forward-looking  statements."  Our ability to do this has been  fostered by the
Private Securities Litigation Reform Act of 1995, which provides a "safe harbor"
for  forward-looking  statements to encourage  companies to provide  prospective
information so long as those statements are accompanied by meaningful cautionary
statements  identifying  important  factors that could cause  actual  results to
differ materially from those discussed in the statement.

         You  should  carefully  consider  the  following  risks.  The risks and
uncertainties  described below are not the only ones facing us. Additional risks
and  uncertainties  that are not presently known to us or that we currently deem
immaterial may also impair our business.

         If any of the events  described in the following  risks actually occur,
our business,  financial condition and results of operations could be materially
adversely  affected.  In such case,  the trading  prices of our common  stock or
warrants could decline and you could lose all or part of your investment.

         Our  current  debt is large and may  negatively  impact our current and
future financial stability.

         As of March 31, 2004, we had an aggregate of approximately  $12,089,000
of  outstanding  indebtedness,  not  including  accounts  payable,  and  accrued
expenses  of   approximately   $2,285,000.   As  a  result  of  our  significant
indebtedness,  we might not have the ability to incur any substantial additional
indebtedness. The level of our indebtedness could have several important effects
on our future operations, including:

         o        our  ability  to  obtain  additional   financing  for  working
                  capital, acquisitions, capital expenditures and other purposes
                  may be limited;

         o        a significant  portion of our cash flow from operations may be
                  dedicated  to the  payment of  principal  and  interest on our
                  debt, thereby reducing funds available for other purposes; and

         o        our  significant  leverage  could make us more  vulnerable  to
                  economic downturns.

         If we are unable to service our debt,  we will likely be forced to take
remedial steps that are contrary to our business plan.

         As of December 31, 2003,  our debt service  requirements  on a monthly,
quarterly and annual basis were $223,000, $670,000 and $2,681,000, respectively.
It is possible  that our business  will not generate  sufficient  cash flow from
operations  to meet our debt service  requirements  and the payment of principal
when due. If this were to occur, we may be forced to:

         o        sell assets at disadvantageous prices;



                                       4



         o        obtain additional financing; or

         o        refinance all or a portion of our  indebtedness  on terms that
                  may be very unfavorable to us.

         Our current bank loan contains  covenants  that limit our operating and
financial  flexibility  and, if  breached,  could  expose us to severe  remedial
provisions.

         Under the terms of the bank loan, we must:

         o        comply with a debt to asset ratio;

         o        maintain minimum levels of tangible net worth;

         o        not exceed specified levels of debt;

         o        comply with a cash flow to fixed charges ratio;

         o        comply with a debt to net worth ratio; and

         o        not incur additional debt over a specified amount.

         Our ability to meet the financial  ratios and tests under our bank loan
can be affected by events beyond our control,  and we may not be able to satisfy
those  ratios  and  tests.  A  breach  under  either  could  permit  the bank to
accelerate  the  debt so that it is  immediately  due and  payable.  No  further
borrowings  would be available under the credit  facility.  If we were unable to
repay the debt, the bank could proceed against our assets.

Approximately 70% of our compressor leases are leased for terms of six months or
less and, if terminated,  would adversely  impact our revenue and our ability to
recover our initial equipment costs.

         Approximately  70% of our compressor  leases are for terms of up to six
months.  There is a possibility that these leases could be terminated by lessees
within short  periods of time and that we may not be able to recover the cost of
a compressor for which a lease is terminated.

The  anticipated  revenue  from the  affiliate  of Dominion  Michigan  cannot be
guaranteed.

         In connection with our acquisition of the compression-related assets of
Dominion Michigan,  an affiliate of Dominion Michigan committed until March 2006
to purchase  compressors  from us or enter into five year leases of  compressors
with us totaling  five-thousand  horsepower.  If, for any reason,  the affiliate
does not fulfill this obligation to any material  extent,  our cash flow will be
significantly reduced and we may not be able to pay the principal or interest on
our debt as it becomes due.



                                       5


We rely on one customer for a significant amount of our business and the loss of
this customer could adversely  affect our operating  results and lower the price
of our common stock.

         Our business is dependent  not only on securing new  customers but also
on maintaining current customers.  During the three months ended March 31, 2004,
Dominion  Exploration & Production,  Inc. accounted for approximately 26% of our
consolidated  revenue.  During the years ended December 2003 and 2002,  Dominion
Exploration accounted for approximately 28% and 30% of our consolidated revenue,
respectively.  The loss of Dominion  Exploration  as a customer  could cause our
operating  results to fall below  market  analysts'  expectations  and lower the
price of our common stock.

We are dependent on a few suppliers for some of our  compressor  components  and
the loss of one of these suppliers could cause a delay in the  manufacturing  of
our compressors and reduce our revenue.

         We currently obtain approximately 23% of our compressor components from
two suppliers.  We order from these suppliers as needed and we have no long-term
contracts with either supplier.  If either of these suppliers should curtail its
operations  or be  unable  to meet our  needs,  we  would  encounter  delays  in
supplying our customers with compressors until an alternative  supplier, if any,
could be found.  Such  delays in our  manufacturing  process  could  reduce  our
revenue and negatively impact our relationships with customers.

Decreased oil and gas industry  expenditure  levels would  adversely  affect our
revenue.

         Our revenue is derived  from  expenditures  in the oil and gas industry
which, in turn, are based on budgets to explore for, develop and produce oil and
natural  gas. If these  expenditures  decline,  our  revenue  will  suffer.  The
industry's willingness to explore,  develop and produce depends largely upon the
prevailing view of future oil and gas prices. Many factors affect the supply and
demand for oil and gas and, therefore, influence product prices including:

         o        the level of oil and gas production;

         o        the levels of oil and gas inventories;

         o        the expected cost of developing new reserves;

         o        the cost of producing oil and gas;

         o        the level of drilling activity;

         o        inclement weather;

         o        worldwide economic activity;

         o        regulatory  and other  federal and state  requirements  in the
                  United States;



                                       6



         o        the  ability  of  the  Organization  of  Petroleum   Exporting
                  Countries to set and maintain production levels and prices for
                  oil;

         o        terrorist activities in the United States and elsewhere;

         o        the cost of developing alternate energy sources;

         o        environmental regulation; and

         o        tax policies.

         If  the  demand  for  oil  and  gas  decreases,  then  demand  for  our
compressors likely will decrease.

The intense  competition in our industry  could result in reduced  profitability
and loss of market share for us.

         We sell or lease our  products  and sell our  services  in  competitive
markets.  In most of our  business  segments,  we  compete  with the oil and gas
industry's  largest  equipment  and  service  providers  who have  greater  name
recognition  than  we  do.  These  companies  also  have  substantially  greater
financial  resources,  larger  operations  and greater  budgets  for  marketing,
research  and  development  than we do.  They may be better  able to  compete in
making  equipment  available  quickly  and more  efficiently,  meeting  delivery
schedules or reducing  prices.  As a result,  we could lose customers and market
share to those  competitors.  These companies may also be better positioned than
us successfully to endure downturns in the oil and gas industry.

         Our operations may be adversely affected if our current  competitors or
new market  entrants  introduce  new  products or services  with better  prices,
features, performance or other competitive characteristics than our products and
services.  Competitive pressures or other factors also may result in significant
price competition that could harm our revenue and our business.

We might be unable to employ adequate technical personnel which could hamper our
plans for expansion or increase our costs.

         Many of the compressors  that we sell or lease are technically  complex
and often must perform in harsh conditions.  We believe that our success depends
upon our ability to employ and retain a sufficient number of technical personnel
who have the ability to design, utilize, enhance and maintain these compressors.
Our ability to expand our operations  depends in part on our ability to increase
our skilled  labor force.  The demand for skilled  workers is high and supply is
limited. A significant  increase in the wages paid by competing  employers could
result in a reduction of our skilled  labor  force,  or cause an increase in the
wage rates that we must pay, or both.  If either of these  events were to occur,
our cost structure could increase and our operations and growth  potential could
be impaired.



                                       7


If we do not develop, produce and commercialize new competitive technologies and
products, our revenue may decline.

         The markets for natural gas  compressor  products  and services and for
flare  systems,  ignition  systems  and  components  for  plant  and  production
facilities  are  characterized  by continual  technological  developments.  As a
result,  substantial  improvements in the scope and quality of product  function
and  performance  can occur over a short  period of time.  If we are not able to
develop  commercially  competitive  products  in a timely  manner in response to
changes in technology, our business and revenue may be adversely affected.

         We  may  encounter   financial   constraints   or  technical  or  other
difficulties  that could delay  introduction of new products and services in the
future.  Our  competitors  may introduce new products before we do and achieve a
competitive advantage.

         Additionally,  the time and expense invested in product development may
not result in commercial applications that provide revenue. We could be required
to write  off our  entire  investment  in a new  product  that  does  not  reach
commercial  viability.  Moreover,  we may experience  operating losses after new
products are  introduced  and  commercialized  because of high  start-up  costs,
unexpected manufacturing costs or problems, or lack of demand.

We are  subject  to  extensive  environmental  laws and  regulations  that could
require us to take  costly  compliance  actions  that  could harm our  financial
condition.

         Our manufacturing and maintenance operations are significantly affected
by stringent and complex federal, state and local laws and regulations governing
the  discharge of  substances  into the  environment  or  otherwise  relating to
environmental  protection. In these operations, we generate and manage hazardous
wastes such as solvents,  thinner,  waste paint, waste oil, washdown wastes, and
sandblast material.  We attempt to use generally accepted operating and disposal
practices and, with respect to acquisitions, will attempt to identify and assess
whether there is any environmental risk before completing an acquisition.  Based
on the nature of the industry,  however,  hydrocarbons  or other wastes may have
been disposed of or released on or under properties  owned,  leased, or operated
by us or on or under  other  locations  where  such  wastes  have been taken for
disposal.  The  wastes on these  properties  may be  subject to federal or state
environmental laws that could require us to remove the wastes or remediate sites
where they have been  released.  We could be exposed to  liability  for  cleanup
costs,  natural  resource  and other  damages as a result of our  conduct or the
conduct of, or  conditions  caused by, prior  operators or other third  parties.
Environmental laws and regulations have changed in the past, and they are likely
to change in the future.  If existing  regulatory  requirements  or  enforcement
policies change,  we may be required to make significant  unanticipated  capital
and operating expenditures.

Any failure by us to comply with applicable  environmental  laws and regulations
may result in governmental  authorities taking actions against our business that
could harm our operations and financial condition, including the:

         o        issuance of administrative, civil and criminal penalties;



                                       8


         o        denial or revocation of permits or other authorizations;

         o        reduction or cessation in operations; and

         o        performance   of  site   investigatory,   remedial   or  other
                  corrective actions.

         We could be subject to substantial liability claims that could harm our
financial condition.

         Our products are used in hazardous drilling and production applications
where an accident or a failure of a product can cause personal  injury,  loss of
life,  damage to  property,  equipment  or the  environment,  or  suspension  of
operations.

         While we maintain insurance coverage, we face the following risks under
our insurance coverage:

         o        we may  not  be  able  to  continue  to  obtain  insurance  on
                  commercially reasonable terms;

         o        we may be faced  with  types of  liabilities  that will not be
                  covered by our  insurance,  such as damages  from  significant
                  product liabilities and from environmental contamination;

         o        the  dollar  amount of any  liabilities  may exceed our policy
                  limits; and

         o        we do not maintain  coverage  against the risk of interruption
                  of our business.

         Any claims  made under our policy  will  likely  cause our  premiums to
increase.  Any future  damages  caused by our products or services  that are not
covered  by  insurance,  are in  excess  of  policy  limits  or are  subject  to
substantial  deductibles,  would reduce our earnings and our cash  available for
operations.

Liability to customers under  warranties may materially and adversely affect our
earnings.

         We provide  warranties as to the proper  operation and  conformance  to
specifications  of the  equipment we  manufacture.  Our equipment is complex and
often  deployed  in harsh  environments.  Failure of this  equipment  to operate
properly  or  to  meet  specifications  may  increase  our  costs  by  requiring
additional  engineering  resources  and  services,   replacement  of  parts  and
equipment or monetary  reimbursement to a customer. We have in the past received
warranty claims and we expect to continue to receive them in the future.  To the
extent that we incur substantial  warranty claims in any period, our reputation,
our ability to obtain future  business and our earnings  could be materially and
adversely affected.

Loss of key members of our management  could adversely affect our business while
we attempt to find their replacements.

         We depend on the continued  employment  and  performance  of Wallace C.
Sparkman, our interim President, Earl R. Wait, our Treasurer and Chief Financial
Officer,  and other key members of our  management.  If any of our key  managers
resigns or becomes  unable to continue in his present role and is not adequately
replaced,  our business operations could be materially adversely affected. We do
not maintain any "key man" life insurance for any of our officers.


                                       9


Provisions  contained in our  governing  documents  could hinder a change in our
control.

         Our articles of  incorporation  and bylaws contain  provisions that may
discourage acquisition bids and may limit the price investors are willing to pay
for our common  stock and  warrants.  Our articles of  incorporation  and bylaws
provide that:

         o        directors   will  be  elected  for  three-year   terms,   with
                  approximately one-third of the board of directors standing for
                  election each year;

         o        cumulative voting is not allowed,  which limits the ability of
                  minority shareholders to elect any directors;

         o        the   unanimous   vote  of  the  board  of  directors  or  the
                  affirmative  vote of the  holders  of not less than 80% of the
                  votes  entitled  to be  cast  by the  holders  of  all  shares
                  entitled to vote in the  election of  directors is required to
                  change the size of the board of directors; and

         o        directors may only be removed for cause by holders of not less
                  than 80% of the votes entitled to be cast on the matter.

         Our board of  directors  has the  authority to issue up to five million
shares  of  preferred  stock.  The board of  directors  can fix the terms of the
preferred stock without any action on the part of our shareholders. The issuance
of  shares  of  preferred  stock  may  delay  or  prevent  a change  in  control
transaction.  In addition,  preferred stock could be used in connection with the
board of  director's  adoption of a  shareholders'  rights plan (also known as a
poison  pill),  which  would make it much more  difficult  to effect a change in
control of us through acquiring or controlling  blocks of our stock. Also, after
completion of this offering, our directors and officers as a group will continue
to  beneficially  own stock.  Although  this is not a majority of our stock,  it
confers  substantial voting power in the election of directors and management of
us. This would make it difficult  for other  minority  shareholders  to effect a
change  in  control  or  otherwise  extend  any  significant  control  over  our
management.  This may adversely  affect the market price and interfere  with the
voting and other rights of our common stock.

We have a comparatively  low number of shares of common stock  outstanding  and,
therefore,  our common  stock may suffer from limited  liquidity  and its prices
will likely be volatile and its value may be adversely affected.

         Because of our relatively  low number of  outstanding  shares of common
stock,  the  trading  price of our  common  stock  will  likely  be  subject  to
significant price fluctuations and limited liquidity.  This may adversely affect
the value of your  investment.  In  addition,  our common  stock  price could be
subject to  fluctuations  in  response  to  variations  in  quarterly  operating
results,  changes in  management,  future  announcements  concerning us, general
trends in the industry  and other  events or factors as well as those  described
above.


                                       10


We must evaluate our intangible assets annually for impairment.

         Our   intangible   assets  are   recorded  at  cost  less   accumulated
amortization  and consist of goodwill  and patent  costs.  Through  December 31,
2001,  goodwill was amortized using the  straight-line  method over 15 years and
patent costs were amortized over 13 to 15 years.

         In June 2001, the Financial Accounting Standards Board issued Statement
of  Financial  Accounting  Standards  No. 142,  "Goodwill  and Other  Intangible
Assets."  FAS  142  provides  that:  1)  goodwill  and  intangible  assets  with
indefinite lives will no longer be amortized;  2) goodwill and intangible assets
with indefinite  lives must be tested for impairment at least  annually;  and 3)
the amortization  period for intangible  assets with finite lives will no longer
be limited to forty years. In the event that we determine our intangible  assets
with indefinite  lives have been impaired,  we must record a write-down of those
assets on our  statement  of  operations  during the period of  impairment.  Our
determination of impairment will be based on various  factors,  including any of
the following factors, if they materialize:

         o        significant under performance  relative to expected historical
                  or projected future operating results;

         o        significant  changes in the manner of our use of the  acquired
                  assets or the strategy for our overall business;

         o        significant negative industry or economic trends;

         o        significant decline in our stock price for a sustained period;
                  and

         o        our market capitalization relative to net book value.

         We  adopted  FAS  142 as of  January  1,  2002.  Based  on  independent
valuations in June 2003 and 2002 of our reporting units with goodwill,  adoption
of FAS 142 has not had a material adverse effect on us through at least 2003. In
the future it could result in impairments of our intangible  assets or goodwill.
We expect to continue to amortize our  intangible  assets with finite lives over
the same time periods as previously used, and we will test our intangible assets
with  indefinite  lives for impairment at least once each year. In addition,  we
are required to assess the  consumptive  life, or longevity,  of our  intangible
assets with finite lives and adjust their amortization periods accordingly.  Our
net  intangible  assets  were  recorded on our  balance  sheet at  approximately
$2,697,000  as of March  31,  2004,  and we  expect  the  carrying  value of net
intangible  assets  will  increase   significantly  if  we  acquire   additional
businesses. Any impairments in future periods of those assets, or a reduction in
their consumptive  lives, could materially and adversely affect our statement of
operations and financial position.




                                       11


                                 USE OF PROCEEDS

         If all warrants  and options were  exercised,  we would  receive  about
$11.4 million net of legal, accounting, printing and other offering costs.

         We  intend  to use any  proceeds  received  from  the  exercise  of our
warrants  and options for  repayment  of debt,  general  corporate  purposes and
working capital.

         Pending  the uses  described  above,  we will  invest the  proceeds  in
short-term, government, government guaranteed or investment grade securities.

                             SELLING SECURITYHOLDERS

         The following  table sets forth  information  regarding the  beneficial
ownership of our  securities  by the selling  securityholders.  All  information
contained  in the table below is based upon  beneficial  ownership as of May 31,
2004.

         The  selling   securityholders   received  their  securities  from  the
underwriter of our initial public offering completed in October 2002. As part of
its  compensation  in the  offering,  the  underwriter  received  an  option  to
purchase:

         o        150,000 shares of our common stock at $6.25 per share; and
         o        warrants to  purchase  150,000  shares of our common  stock at
                  $7.8125 per share.

         We agreed to register the shares of common stock in order to permit the
selling  securityholders  to sell these  shares  from time to time in the public
market or in privately-negotiated  transactions.  We have also agreed to pay for
all expenses of this offering other than underwriting  discounts and commissions
and brokerage commissions and fees.

         This table assumes that all shares owned by the selling securityholders
as being  sold.  The  selling  securityholders  may offer and sell less than the
number of shares  indicated.  The  selling  securityholders  are not  making any
representation that any shares will or will not be offered for sale.





















                                       12




-------------------------------- -------------------------------------------- ---------------- ----------------
Name and Address                           Shares Beneficially Owned               Shares           Shares
of Selling Securityholder                    Prior to the Offering             Offered Hereby    Beneficially
-------------------------                    ---------------------             --------------    Owned After
                                                                                                 the Offering

-------------------------------- -------------------------------------------- --------------- -----------------
                                      Underlying            Underlying
                                        Options              Warrants
-------------------------------- --------------------- ---------------------- --------------- -----------------
                                  Number     Percent    Number      Percent
-------------------------------- ---------- ---------- ----------- ---------- --------------- -----------------
                                                                            
Charles C. Bruner                   30,000     20%         30,000     20%          All              -0-
1675 Larimer Street, Suite 300
Denver, Colorado 80203

-------------------------------- ---------- ---------- ----------- ---------- --------------- -----------------
Zenas N. Gurley                     15,000     10%         15,000     10%          All              -0-
102 South Tejon Street,
Suite 1100
Colorado Springs, CO 80903

-------------------------------- ---------- ---------- ----------- ---------- --------------- -----------------
Eugene Neidiger                     30,000     20%         30,000     20%          All              -0-
1675 Larimer Street, Suite 300
Denver, Colorado 80203

-------------------------------- ---------- ---------- ----------- ---------- --------------- -----------------
Robert L. Parish                    11,000    7.3%         11,000    7.3%          All              -0-
1675 Larimer Street, Suite 300
Denver, Colorado  80203

-------------------------------- ---------- ---------- ----------- ---------- --------------- -----------------
Anthony B. Petrelli                 40,000    26.7%        40,000    26.7%         All              -0-
1675 Larimer Street, Suite 300
Denver, Colorado  80203

-------------------------------- ---------- ---------- ----------- ---------- --------------- -----------------
Regina L. Roesner                   15,000     10%         15,000     10%          All              -0-
1675 Larimer Street, Suite 300
Denver, Colorado  80203

-------------------------------- ---------- ---------- ----------- ---------- --------------- -----------------
John R. Turk                         9,000     6%           9,000     6%           All              -0-
1675 Larimer Street, Suite 300       -----                  -----
Denver, Colorado  80203


    Total                          150,000                150,000
                                   =======                =======

-------------------------------- ---------- ---------- ----------- ---------- --------------- -----------------















                                       13


                              PLAN OF DISTRIBUTION

         The selling  shareholders  may sell the common  stock or warrants  from
time to time in one or more transactions  through the American Stock Exchange or
any other exchanges or automated  quotation system on which our common stock and
warrants  may be  admitted  for  trading or  listing.  Such sales may be made at
market  prices  prevailing  at the  time  of  sale,  at  prices  related  to the
prevailing  market prices,  or at negotiated  prices.  In addition,  the selling
shareholders may sell some or all of their common stock or warrants through:

         o        privately negotiated transactions;

         o        a block trade in which a broker-dealer may resell a portion of
                  the  block,   as  principal,   in  order  to  facilitate   the
                  transaction;

         o        purchases by a broker-dealer,  as principal, and resale by the
                  broker-dealer for its account; or

         o        ordinary  brokerage  transactions  and transactions in which a
                  broker solicits purchasers.

         The selling  shareholders may also sell or transfer the common stock in
connection with hedging  transactions,  covering short sales or loans or pledges
to broker-dealers. The selling shareholders may negotiate and pay broker-dealers
commissions, discounts or concessions for their services. Broker-dealers engaged
by the selling  shareholders  may allow other  broker-dealers  to participate in
resales.  However, the selling  shareholders and any broker-dealers  involved in
the sale or resale of the common stock may qualify as "underwriters"  within the
meaning of Section  2(a)(11) of the Securities Act of 1933 (the "1933 Act").  In
addition, the broker-dealers'  commissions,  discounts or concession may qualify
as underwriters'  compensation  under the 1933 Act. If the selling  shareholders
qualify  as  "underwriters,"  they will be subject  to the  prospectus  delivery
requirements of Section 5(b)(2) of the 1933 Act.

         In  addition  to selling  their  common  stock or  warrants  under this
prospectus, the selling shareholders may:

         o        agree to indemnify any  broker-dealer or agent against certain
                  liabilities  related to the  selling  of the common  stock and
                  warrants, including liabilities arising under the 1933 Act;

         o        transfer  their  common  stock and  warrants in other ways not
                  involving  market  makers  or  established   trading  markets,
                  including directly by gift,  distribution,  or other transfer;
                  or

         o        sell their  common  stock and  warrants  under Rule 144 of the
                  1933 Act rather than under this prospectus, if the transaction
                  meets the requirements of Rule 144.

                                  LEGAL MATTERS

         The validity  under  Colorado law of the shares will be passed upon for
us by Jones & Keller, P.C., Denver, Colorado.



                                       14


                                     EXPERTS

         HEIN & ASSOCIATES LLP, independent  certified public accountants,  have
audited  our   consolidated   balance  sheet  at  December  31,  2003,  and  the
consolidated statements of income,  shareholders' equity and cash flows for each
of the two years ended December 31, 2003 and 2002, as set forth in their report,
which  is  incorporated  in  this  prospectus  by  reference.  Our  consolidated
financial  statements are incorporated by reference in reliance on their report,
given on their authority as experts in accounting and auditing.

                  INDEMNIFICATION FOR SECURITES ACT LIABILITIES

         Section  7-109-102 of the Colorado  Business  Corporation Act permits a
Colorado  corporation to indemnify any director against liability if such person
acted in good faith and, in the case of conduct in an official capacity with the
corporation, that the director's conduct was in the corporation's best interests
and, in all other cases, that the director's conduct was at least not opposed to
the best interests of the corporation  or, with regard to criminal  proceedings,
the  director  had no  reasonable  cause to believe the  director's  conduct was
unlawful.

         Section  7-109-103 of the Colorado  Business  Corporation  Act provides
that,  unless limited by its articles of incorporation,  a Colorado  corporation
shall indemnify a person who was wholly successful,  on the merits or otherwise,
in the  defense of any  proceeding  to which the person was a party  because the
person is or was a director,  against reasonable expenses incurred by him or her
in connection with the proceeding.

         Section 3 of Article IX of our articles of incorporation  provides that
we shall  indemnify,  to the maximum extent permitted by law in effect from time
to time,  any person who is or was a  director,  officer,  agent,  fiduciary  or
employee of ours  against any claim,  liability  or expense  arising  against or
incurred by such person made party to a proceeding because such person is or was
a director, officer, agent, fiduciary or employee of ours or because such person
is or was serving  another  entity as a  director,  officer,  partner,  trustee,
employee,  fiduciary or agent at our request.  We further have the  authority to
the maximum extent permitted by law to purchase and maintain insurance providing
such indemnification.

         Article VI of our bylaws  provides for the  indemnification  of certain
persons.

         Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to our directors,  officers and controlling persons
pursuant to the foregoing provisions, or otherwise, we have been advised that in
the opinion of the Securities and Exchange  Commission such  indemnification  is
against  public  policy  as  expressed  in the  Securities  Act of 1933  and is,
therefore, unenforceable.




                                       15



============================================
         We have not  authorized any dealer,
salesperson  or  other  person  to give  any
information  or to make  any  representation
not  contained  in  this  prospectus.   This
prospectus  does not  constitute an offer to
sell, or a solicitation  of an offer to buy,
any offer or  solicitation  by anyone in any
jurisdiction not authorized, or in which the
person making such an offer or  solicitation
is not  qualified  to do so or to any person
to whom it is unlawful to make such an offer
or   solicitation.   By   delivery  of  this
prospectus  we do not imply  that  there has
been no  change in our  affairs  or that the
information in this prospectus is correct as
of any time subsequent to its date.

            ---------------
                                                            NATURAL GAS SERVICES
           TABLE OF CONTENTS                                     GROUP, INC.
                                               Page

Where You Can Find Additional Information..2
Incorporation of Documents by Reference....2
How to Request Information..................    2
About Natural Gas Services Group, Inc.......    3             ________________
Risk Factors................................    4
Use of Proceeds.............................   12                PROSPECTUS
Selling SecurityHolders.....................   12             ________________
Plan of Distribution .......................   14
Legal Matters...............................   14
Experts.....................................   15
Indemnification for Securities Act
Liabilities.................................   15





                                                                   June __, 2004







                                     PART II

                     INFORMATION NOT REQUIRED IN PROSPECTUS

Item 14. Other Expenses of Issuance and Distribution.

         Expenses payable by us in connection with the issuance and distribution
of the securities being registered hereby are as follows:

         Accounting Fees and Expenses                              2,000*
         Legal Fees and Expenses                                   5,000*
         Printing and Filing Expenses                              2,000*
         Transfer Agent Fee                                        2,000
         Miscellaneous                                             1,000
                                                                --------
         Total                                                  $ 12,000
                                                                ========
         *  Estimated.


         Item 15.  Indemnification of Directors and Officers.

         Section  7-109-102 of the Colorado  Business  Corporation Act permits a
Colorado  corporation to indemnify any director against liability if such person
acted in good faith and, in the case of conduct in an official capacity with the
corporation, that the director's conduct was in the corporation's best interests
and, in all other cases, that the director's conduct was at least not opposed to
the best interests of the corporation  or, with regard to criminal  proceedings,
the  director  had no  reasonable  cause to believe the  director's  conduct was
unlawful.

         Section  7-109-103 of the Colorado  Business  Corporation  Act provides
that,  unless limited by its articles of incorporation,  a Colorado  corporation
shall indemnify a person who was wholly successful,  on the merits or otherwise,
in the  defense of any  proceeding  to which the person was a party  because the
person is or was a director,  against reasonable expenses incurred by him or her
in connection with the proceeding.

         Section 3 of Article IX of our articles of incorporation  provides that
we shall  indemnify,  to the maximum extent permitted by law in effect from time
to time,  any person who is or was a  director,  officer,  agent,  fiduciary  or
employee of ours  against any claim,  liability  or expense  arising  against or
incurred by such person made party to a proceeding because such person is or was
a director, officer, agent, fiduciary or employee of ours or because such person
is or was serving  another  entity as a  director,  officer,  partner,  trustee,
employee,  fiduciary or agent at our request.  We further have the  authority to
the maximum extent permitted by law to purchase and maintain insurance providing
such indemnification.




Article VI of our bylaws provides for the indemnification of certain persons.

         Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to our directors,  officers and controlling persons
pursuant to the foregoing provisions, or otherwise, we have been advised that in
the opinion of the Securities and Exchange  Commission such  indemnification  is
against  public  policy  as  expressed  in the  Securities  Act of 1933  and is,
therefore, unenforceable.

         Item 16.  Exhibits.

         The  following  is a  list  of all  exhibits  filed  as  part  of  this
Registration Statement:

Exhibit
No.               Description and Method of Filing
-------           --------------------------------

2.1               Purchase and Sale Agreement by and between Hy-Bon  Engineering
                  Company, Inc. and NGE Leasing, Inc. (1)

5                 Legal Opinion of Jones & Keller, P.C. (2)

23.1              Consent of HEIN & ASSOCIATES LLP (2)

24                Power of Attorney (See Signature Page)

(1) Filed as exhibit 2.1 to the Registrant's Current Report on Form 8-K filed on
March 6, 2003 and incorporated herein by reference.

(2) Filed herewith.

Item 17.    Undertakings.

The undersigned Registrant hereby undertakes:

         (1) to file, during any period in which offers or sales are being made,
         a post-effective amendment to this Registration Statement.

         (i)      To include any prospectus  required by Section 10(a)(3) of the
                  Securities Act of 1933, as amended;

         (ii)     To reflect in the prospectus any facts or events arising after
                  the effective date of this Registration statement (or the most
                  recent post-effective amendment hereof) which, individually or
                  in  the  aggregate,  represent  a  fundamental  change  in the
                  information set forth in this Registration Statement; and

         (iii)    To include any material  information  with respect to the plan
                  of distribution not previously  disclosed in this Registration
                  Statement or any material  change to such  information in this
                  Registration Statement




         Provided,  however,  that paragraphs (1)(i) and (1)(ii) do not apply if
the information  required to be included in a post-effective  amendment by those
paragraphs is contained in periodic reports filed by the Registrant  pursuant to
Section 13 or Section 15(d) of the Securities  Exchange Act of 1934, as amended,
that are incorporated by reference in this Registration Statement.

         (2) That,  for the  purpose  of  determining  any  liability  under the
         Securities Act, each such  post-effective  amendment shall be deemed to
         be a new  registration  statement  relating to the  securities  offered
         herein,  and the  offering  of such  securities  at that time  shall be
         deemed to be the initial bona fide offering thereof.

         (3) To remove from registration by means of a post-effective  amendment
         any of the  securities  being  registered  which  remain  unsold at the
         termination of the offering.

         The  undersigned  Registrant  hereby  undertakes  that, for purposes of
determining  any  liability  under  the  Securities  Act,  each  filing  of  the
Registrant's  Annual  Report  pursuant to Section  13(a) or Section 15(d) of the
Exchange Act that is incorporated by reference into this Registration  Statement
shall be deemed to be a new  registration  statement  relating to the securities
offered herein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.

         Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors,  officer and  controlling  persons of
the  Registrant  pursuant  to  the  foregoing  provisions,   or  otherwise,  the
Registrant  has been advised that in the opinion of the  Securities and Exchange
Commission  such  indemnification  is against  public policy as expressed in the
Securities Act and is, therefore,  unenforceable.  In the event that a claim for
indemnification  against  such  liabilities  (other  than  the  payment  by  the
Registrant of expenses  incurred or paid by a director,  officer or  controlling
person of the  registrant  in the  successful  defense of any action,  suit,  or
proceeding)  is  asserted by such  director,  officer or  controlling  person in
connection with the securities being registered,  the Registrant will, unless in
the  opinion  of its  counsel  the  question  has been  settled  by  controlling
precedent,  submit to a court of appropriate  jurisdiction  the question whether
such  indemnification  by it is  against  public  policy  as  expressed  in  the
Securities Act and will be governed by the final adjudication of such issue.




                                   SIGNATURES

         In accordance with the  requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements of filing on Form S-3 and has duly caused this  registration
statement  to be  signed  on its  behalf  by  the  undersigned,  thereunto  duly
authorized, in the City of Midland, State of Texas on June 10, 2004.

                                    NATURAL GAS SERVICES GROUP, INC.


                                    /s/ Wallace C. Sparkman
                                    --------------------------------------------
                                    Wallace C. Sparkman, President and Principal
                                    Executive Officer


                                    /s/ Earl R. Wait
                                    --------------------------------------------
                                    Earl R. Wait, Principal Financial and
                                    Accounting Officer

         Each person whose  signature  appears  below  constitutes  and appoints
Wallace C. Sparkman and Earl R. Wait,  or either of them, as  attorneys-in-fact,
each with the power of substitution  for him in any and all capacities,  to sign
any amendment to this Registration Statement and to file the same, with exhibits
thereto and other  documents in connection  therewith,  with the  Securities and
Exchange Commission, granting to said attorneys-in-fact,  and each of them, full
power and authority to do and perform each and every act and thing requisite and
necessary  to be done in  connection  therewith,  as  fully to all  intents  and
purposes as he might or could do in person hereby  ratifying and  confirming all
that said  attorneys-in-fact or any of them, or their or his or her substitutes,
may lawfully do or cause to be done by virtue hereto.

         Pursuant  to the  requirements  of the  Securities  Act of  1933,  this
registration statement was signed by the following persons in the capacities and
on the dates indicated:


Signature                                Title                       Date
---------                                -----                       ----

/s/ Wallace O. Sellers                  Director                 June 10, 2004
------------------------------
Wallace O. Sellers

/s/ Wallace C. Sparkman                 Director                 June 10, 2004
------------------------------
Wallace C. Sparkman

                                        Director                 June 10, 2004
------------------------------
Charles G. Curtis

/s/ William F. Hughes                   Director                 June 10, 2004
------------------------------
William F. Hughes

/s/ Gene A. Strasheim                   Director                 June 10, 2004
------------------------------
Gene A. Strasheim

/s/ Richard L. Yadon                    Director                 June 10, 2004
------------------------------
Richard L. Yadon





                                  EXHIBIT INDEX

Exhibit
No.               Description and Method of Filing
-------           --------------------------------

2.1               Purchase and Sale Agreement by and between Hy-Bon  Engineering
                  Company, Inc. and NGE Leasing, Inc. (1)

5                 Legal Opinion of Jones & Keller, P.C. (2)

23.1              Consent of HEIN & ASSOCIATES LLP (2)

24                Power of Attorney (See Signature Page)