Item 4.02. Non-Reliance on Previously Issued Financial Statements or a Related Audit Report of Completed Interim Review.

     Management of Crosstex Energy, L.P. (the “Partnership”) has determined that a purchase of natural gas from a supplier on newly acquired assets was not accrued in the first quarter of 2006 due to a clerical accounting error. This error occurred shortly after the acquisition of the south Louisiana processing assets from El Paso Corporation and during a period of upgrading and transitioning to new accounting systems for the acquired assets. Since the first quarter of 2006, the Partnership has implemented system improvements and conducted additional training of new personnel. Also, the Partnership will implement additional controls beginning in the third quarter of 2006 to specifically address the error.

     The net effect of the required adjustment due to the error reduces the Partnership’s net income for the three months ended March 31, 2006 and the six months ended June 30, 2006 by approximately $0.9 million. Partners’ equity is reduced by and current liabilities are increased by this same amount. Accordingly, on September 15, 2006, the management of the Partnership and the Audit Committee of the board of directors of the general partner of the general partner of the Partnership concluded that the Partnership should restate previously issued interim (unaudited) financial statements for the quarters ended March 31, 2006 and June 30, 2006 to reflect this adjustment. Accordingly, the Partnership will file amendments to its Quarterly Reports on Form 10-Q’s for the quarters ended March 31, 2006 and June 30, 2006.

     In light of the restatement of interim financial information, the consolidated statements of operations and consolidated balance sheets previously issued by the Partnership as of and for the three months ended March 31, 2006 and as of and for the three and six months ended June 30, 2006 should no longer be relied upon.

     The Audit Committee and Partnership management have discussed the foregoing matters with the Partnership’s independent registered public accounting firm, KPMG LLP.

Item 7.01. Regulation FD Disclosure.

     On September 20, 2006, the Partnership issued a press release announcing that management and the Audit Committee of the Board of Directors of Crosstex Energy GP, LLC, the general partner of the general partner of the Partnership, have concluded that the Partnership should restate certain previously issued interim (unaudited) financial statements for the quarters ended March 31, 2006 and June 30, 2006 due to a clerical accounting error. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K. In accordance with General Instruction B.2 of Form 8-K, the information set forth in this Item 7.01 and in the attached Exhibit 99.1 is deemed to be furnished and shall not be deemed to be “filed” for purposes of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).