Digital Power Reports Financial Results for the Second Quarter Ended

June 30, 2010

FREMONT, Calif., August 16, 2010, Digital Power Corporation (NYSE Amex: WDP - News)  today announced its financial results for the second quarter ended June 30, 2010.
Revenues increased by 3.6 % to $2,171,000 for the quarter ended June 30, 2010, compared to $2,095,000 for the quarter ended June 30, 2009.
Gross margins increased to 40.0% for the quarter ended June 30, 2010, compared to 33.9% for the quarter ended June 30, 2009.

Net income was $103,000 for the quarter ended June 30, 2010, compared to a net loss of $118,000 for the quarter ended June 30, 2009.

Commenting on the results, Amos Kohn, President and CEO, stated, “We are very pleased to report respectable growth in demand from our primary market segment, resulting in this quarter’s improved revenues and net income. While our commercial, standard product lines remain an important part of our product mix, we achieved a significant milestone during the quarter by shipping our first production volumes of a new custom power solution. This challenging design requirement filled a need for a unique AC and DC input unit, operating across a broad temperature range with medical approvals. Designed into an advanced mobile, oxygen concentrator, this new equipment allows the user significantly enhanced mobility, including airborne operation.

In addition, we completed the development of three custom power solutions for a fiberoptic broadband system requiring operation over a harsh temperature, free convection, and a wide input voltage range featuring N+1 redundency operation. We welcome these stringent design demands and believe they will continue to serve as a platform for even more advanced power solutions”.

About Digital Power:
Digital Power Corporation is a solution-driven organization that designs, develops, manufactures and sells high-grade customized and flexible power system solutions for the most demanding applications in the medical, military, telecom and industrial markets.  We are highly focused on high-grade and custom product designs for both the commercial and military/defense markets, where customers demand high density, high efficiency and ruggedized products to meet the harshest and/or military mission critical operating conditions.  We are a California corporation originally formed in 1969, and our common stock trades on the NYSE Amex under the symbol “DPW”. Digital Power's headquarters are located at 41324 Christy Street, Fremont, California, 94538-3158

Contact: Assaf (Assi) Itshayek, CFO phone number; 510-657-2635

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