Ownership Submission
FORM 3
 UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

INITIAL STATEMENT OF BENEFICIAL OWNERSHIP OF SECURITIES

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940
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(Print or Type Responses)
1. Name and Address of Reporting Person *
  Wallace Scott Alan
 2. Date of Event Requiring Statement (Month/Day/Year)
01/03/2008		 3. Issuer Name and Ticker or Trading Symbol
PECO II INC [(PIII)]
(Last)
(First)
(Middle)
1376 ST RT 598		 4. Relationship of Reporting Person(s) to Issuer
(Check all applicable)
_____ Director _____ 10% Owner
__X__ Officer (give title below) _____ Other (specify below)
Principle Accounting Officer
 5. If Amendment, Date Original Filed(Month/Day/Year)
(Street)

GALION, OH 44833		 6. Individual or Joint/Group Filing(Check Applicable Line)
_X_ Form filed by One Reporting Person
___ Form filed by More than One Reporting Person
(City)
(State)
(Zip)
Table I - Non-Derivative Securities Beneficially Owned
1.Title of Security
(Instr. 4)		 2. Amount of Securities Beneficially Owned
(Instr. 4)		 3. Ownership Form: Direct (D) or Indirect (I)
(Instr. 5)		 4. Nature of Indirect Beneficial Ownership
(Instr. 5)
Common Stock 12,928
D
 

Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly. SEC 1473 (7-02)
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Table II - Derivative Securities Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security
(Instr. 4)		 2. Date Exercisable and Expiration Date
(Month/Day/Year)		 3. Title and Amount of Securities Underlying Derivative Security
(Instr. 4)		 4. Conversion or Exercise Price of Derivative Security 5. Ownership Form of Derivative Security: Direct (D) or Indirect (I)
(Instr. 5)		 6. Nature of Indirect Beneficial Ownership
(Instr. 5)
Date Exercisable Expiration Date Title Amount or Number of Shares
Non-qualified Stock Option (right to buy) 03/15/2007(1) 03/15/2009 Common shares without par valud 10,000 $ 1.18 D  

Reporting Owners

Reporting Owner Name / Address Relationships
Director 10% Owner Officer Other
Wallace Scott Alan
1376 ST RT 598
GALION, OH 44833		       Principle Accounting Officer  

Signatures

Kimberly J. Lauer for Scott A. Wallace 01/07/2008
**Signature of Reporting Person Date

Explanation of Responses:

* If the form is filed by more than one reporting person, see Instruction 5(b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations. See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
(1) Above non-qualified stock options were granted on 03/15/2004 and vested as follows: 4,000 shares became exercisable on 03/15/2005, 3,000 became exercisable on 03/15/2006 and 3,000 shares became exercisable on 03/15/2007.

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