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LORUS THERAPEUTICS INC.

2 MERIDIAN ROAD

TORONTO, ONTARIO

M9W 4Z7

June 13, 2007

VIA EDGAR

Securities and Exchange Commission

100 F Street, NE

Washington, DC 20549

Attention: Frank Wyman

            Re:

            Comment Letter, dated March 30, 2007 related to

Form 20-F for fiscal year ended May 31, 2006

File No. 001-32001

Dear Sirs/Mesdames:

Pursuant to the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder, we enclose our proposed responses  to the Staff’s letter of comments, dated March 30, 2007 (the “Comment Letter”), with respect to Lorus Therapeutics Inc.’s Form 20-F for the fiscal year ended May 31, 2006 originally filed on November 18, 2006 (“Form 20-F”). Responses are keyed to the headings and comment numbers contained in the Comment Letter.   .Where a comment would require an amendment to the Form 20-F, the proposed amendments are provided in Appendix A and are indicated by bold and underlined text..

.

Comment 1:

Form 20-F for fiscal year ended May 31, 2006

Item 5. Operating and Financial Review and Prospects

Management’s Discussion and Analysis of Financial Condition and Results of Operations

A. Operating Results

Critical Accounting Policies, page 32

You have identified drug development costs, stock based compensation, valuation allowance for future tax assets and valuation of long lived assets as critical accounting policies but appear to have omitted any further discussion of the associated uncertainties in applying these critical accounting policies and the likelihood that materially different amounts would be reported under different conditions or using different assumptions.  Please disclose the expected uncertainties in applying your critical accounting policies, the effect that changes in such estimates have had on your operating results and financial position for each period presented and the effect that reasonably likely changes in the key assumptions underlying these estimates as of the latest balance sheet may have on your financial position.  Refer to Section V of Financial Reporting Release No. 72 issued on December 29, 2003.
Please include a discussion of any differences between Canadian and U.S. GAAP regarding your critical accounting policies or estimates that are necessary for an understanding of the financial statements as a whole.  Please refer to SAE Topic 1:D.1.

The Corporation confirms its understanding of the Staff’s position and its disclosure obligations. The requested revisions to the Form 20-F are provided in Comment 1 of the Appendix A.

Comment 2:

Operating Results

Research and Development page 34

Please refer to the Division of Corporation Finance “Current Issues and Rulemaking Projects Quarterly Update” under section VIII – Industry Specific Issues – Accounting and Disclosure by Companies Engaged in Research and Development Activities.  You can find it at the following website address: http://www.scc.gov/divisions/corpfin/cfcrg032001.;htm#secviii.

Provide the following information for each of your major research and development projects:

            a.

            The costs incurred during each period presented and to date on the project;

            b.

            The nature timing and estimated costs of the efforts necessary to complete the project;

            c.

            The anticipated completion date for the project;

            d.

            The risks and uncertainties associated with completing development on schedule, and the consequences to operations, financial position and liquidity if the project is not completed timely; and,

            e.

            The period in which material net cash inflows from the project are expected to commence.

Regarding a., if you do not maintain any research and development costs by project disclose that fact and explain why management does not maintain and evaluate research and development costs by project.  Provide other quantitative or qualitative disclosure that indicates the amount of the company’s resources being used on the project.

Regarding b. and c. disclose the amount or range of estimated costs and timing to complete the phase in process and each future phase.  To the extent that information is not estimable, disclose those facts and circumstances indicating the uncertainties that preclude you from making a reasonable estimate.

The Corporation confirms its understanding of the Staff’s position and its disclosure obligations. The requested revisions to the Form 20-F are provided in Comment 2 of the Appendix A.

Comment 3:

You refer to NuChem Analog milestone obligations to be paid to Ion Pharmaceuticals and Cyclacel and royalties to be paid to the University of Manitoba and the University of Toronto.  Please disclose the following information related to these arrangements:

            a.

            Describe how your patents are used in the clinical development and commercialization activities for your lead product candidates.  In particular, describe how NuChem Analogs impact the clinical development of Virulizin and GTI-2040.

            b.

            Describe and quantify the “certain milestones” expected to be achieved in 2007 and 2008.

            c.

            Describe and quantify the terms governing royalty payments to these parties.

The Corporation confirms its understanding of the Staff’s position and its disclosure obligations. The requested revisions to the Form 20-F are provided in Comment 3 of the Appendix A.

Comment 4:

Please disclose the process for developing intellectual property under your collaborations with NCI, University of Toronto and Sumitomo and Koken, the specific rights to the resulting intellectual property to be held by you and the terms expected to govern each related license.  Quantify the amount and timing of royalties expected to be received under these agreements.

The Corporation confirms its understanding of the Staff’s position and its disclosure obligations. The requested revisions to the Form 20-F are provided in Comment 4 of the Appendix A.

Comment 5:

F. Tabular disclosure of contractual obligations, page 41

Your table of contractual obligations omits estimated funding obligations related to your license agreements and collaborations.  Please revise the table to include these obligations or explain to us why it is unnecessary.

The Corporation confirms its understanding of the Staff’s position and its disclosure obligations. The requested revisions to the Form 20-F are provided in Comment 5 of the Appendix A.

Comment 6:

Item 11. Qualitative and quantitative Disclosures about Market Risk

Your disclosures in Notes 13 and 15 to the consolidated financial statements do not appear to provide the disclosures about market risk required by Item 11 to Form 20-F.  Pleas disclose the information required by Item 11 in this section of the filing.

The Corporation confirms its understanding of the Staff’s position and its disclosure obligations. The requested revisions to the Form 20-F are provided in Comment 6 of the Appendix A.

Comment 7:

Item 17. Financial Statements

Report of Independent Registered Public Accounting Firm, page F-2

KPMG LLP states in their report that “we did not audit the consolidated financial statements of loss and deficit and cash flows for the period from inception on September 6, 1986 to May 31, 2006 in accordance with the standards of the Public Company Accounting Oversight Board (United States).”  Please note that an auditor’s association with the cumulative data is required on an annual basis as long as the registrant is in the development stage.  Please amend your filing to include a report from KPMG that states they have audited the consolidated financial statements of loss and deficit and cash flows for the period from inception on September 6, 1986 to May 31, 2006 in accordance with the standards of the Public Company Accounting Oversight Board.

The Corporation’s Auditors, KPMG LLP have advised that it, respectfully, can not comply with the above comments for the following reasons:

Prior to the filing of its fiscal 2006 annual report, Lorus was eligible to file its annual report on Form 40-F under the Multi-jurisdictional Disclosure System (“MJDS”) with the SEC.  As permitted under the MJDS, KPMG's

audits for the periods prior to May 31, 2006 were conducted only in accordance with Canadian generally accepted auditing standards (“Canadian GAAS).

In July 2006, the Company determined that it no longer met the criteria to file as a MJDS foreign private issuer on Form 40-F and therefore would prepare its 2006 annual report on Form 20-F.  Form 20-F requires that audits of registrants be conducted in accordance with the standards of the Public Company Accounting Oversight Board (“PCAOB”) effective with the release of PCAOB Standard No. 1 in May 2004 and prior to that, generally accepted auditing standards of the United States (“US GAAS”) (effective in 2000).

For Canadian regulatory purposes, KPMG LLP issued its auditors’ report prepared in accordance with Canadian GAAS, dated August 9, 2006, on the consolidated financial statements as at May 31, 2006 and 2005 and for each of the years in the three-year period ended May 31, 2006 and for the cumulative period from September 5, 1986 to May 31, 2006.   The period from inception on September 5, 1986 to May 31, 1994 was audited and reported on by other auditors.

For SEC reporting purposes, KPMG LLP has issued its report of independent registered public accounting firm prepared in accordance with the standards of the PCAOB, dated November 17, 2006, for each of the years in the three-year period ended May 31, 2006.  For the cumulative period from June 1, 1994 to May 31, 2006, KPMG did not conduct its audit in accordance with US GAAS and/or the standards of the PCAOB and therefore KPMG’s audit opinion could not assert compliance with US GAAS and the standards of the PCAOB for the cumulative period from June 1, 1994 to May 31, 2006.   The period from inception on September 5, 1986 to May 31, 1994 was audited and reported on by other auditors.

KPMG LLP is unable to report on the consolidated financial statements of loss and deficit and cash flows for the period from inception on September 5, 1986 to May 31, 2006 in accordance with the standards of the Public Company Accounting Oversight Board (United States) for the following reasons:

            1.

            KPMG LLP was appointed auditors for the year ended May 31, 1995.  At this time, KPMG does not have access to the predecessor auditors’ work papers for the period prior to the date they were appointed auditors in order to determine whether the audits conducted by the predecessor auditor included sufficient and appropriate audit procedures to assert compliance with the standards of the PCAOB.

            2.

            KPMG considered the differences between Canadian and United States auditing standards for the period from inception to May 31, 2004 as set out in an internal firm publication (prepared in 2000) and concluded that they could not be assured that all of the additional procedures as required by US GAAS and/or the standards of the PCAOB had been considered and evaluated as part of the Canadian GAAS audit of that time period.

Prior to June 1, 2004, additional procedures and documentation were required to be performed regarding fraud considerations (AU 316, Consideration of Fraud in a Financial Statement Audit), compliance with laws and regulations (AU 317, Illegal Acts by Clients) and communication with the Audit Committee, among other things as compared with Canadian GAAS at the time.  The auditor was required to make specific inquiries of management at the time regarding their policies relative to the prevention of illegal acts and compliance with laws and regulations.

For example, for the period prior to June 1, 2004, additional procedures and documentation were required to be performed regarding fraud considerations (AU 316, Consideration of Fraud in a Financial Statement Audit – SAS 82) for an audit conducted in accordance with US GAAS. In particular, SAS 82 required that the auditor inquire of management in order to determine:

            a)

            management's understanding regarding the risk of fraud in the entity

            b)

            whether management has knowledge of fraud that has been perpetrated on or within the entity.

            c)

            whether there are particular subsidiary locations, business segments, types of transactions, account balances, or financial statement categories where fraud risk factors exist or may be more likely to exist

            d)

            how management may be addressing such risks.

            e)

            whether the Company’s programs to prevent, deter, and detect fraud has identified any fraud risk factor.

In addition, for the period prior to June 1, 2004, additional procedures and documentation was required to be performed regarding compliance with laws and regulations (AU 317, Illegal Acts by Clients).  In particular, AU 317 required that the auditor inquire of management in order to determine:

            a)

            the Company’s policies relative to the prevention of illegal acts.

            b)

            the use of directives issued by the Company and periodic representations obtained by the Company from appropriate levels of authority within the organization concerning compliance with laws and regulations.

Lastly, for the period prior to June 1, 2004, additional procedures and documentation was required to be performed regarding communication with the Audit Committee (AU 380, Communication with Audit Committees).  In particular, AU 380 required that the auditor:

            a)

            document communication with the Audit Committee by appropriate memoranda or notations in the working papers

            b)

            inform the Audit Committee about adjustments arising from the audit that could, in the auditor’s judgment, either individually or in the aggregate, have a significant effect on the Company’s financial reporting process, whether or not recorded by the Company.

            3.

            Statement on Auditing Standards No. 96, Audit Documentation and PCAOB Standard No. 3, Audit Documentation both require that the auditor document procedures performed, audit evidence obtained, and conclusions reached with respect to financial statement assertions.  KPMG could not be assured that the documentation of audit work performed by all personnel who participated in the engagement (including the work of specialists) related to the cumulative results of operations would be sufficient to meet the US GAAS standards and specifically those of PCAOB Standard No. 3, paragraph 6.  KPMG could not be certain that an experienced auditor with a reasonable understanding of the industry and having no previous connection with the engagement would be able to conclude that the work performed was completed and identify the
person who reviewed the work and the date of the review.

In 2000, annual reports filed on Form 20-F with respect to fiscal years ended on or after September 30, 2000 were required to include an auditors’ report that stated that the audit has been conducted in accordance with US GAAS.  Previously, the SEC staff had accepted auditors’ reports that referred to the audit as having been conducted in accordance with local generally accepted auditing standards provided that an assertion is made that those auditing standards are substantially consistent with US GAAS.

It is KPMG’s understanding that at the November 1, 2000 meeting of the AICPA International Practices Task Force, the Task Force agreed (and KPMG understands that the SEC staff did not object) that, except in two limited transitional situations, described below, the auditor’s report should refer to the audit having been conducted in accordan