Alanco's StarTrak Awarded Pilot Contract to Demonstrate New Remote Water Quality Monitoring System.

Solar Powered System Provides Continuous Wireless Monitoring and Eliminates Cost of Manual Sample Collection and Transport

SCOTTSDALE, Ariz. -- Alanco Technologies, Inc. (NASDAQ: ALAN), announced today that its StarTrak Systems subsidiary has been awarded a pilot contract to demonstrate its new REMTrak[TM] Remote Environmental Monitoring system at a high security government facility to monitor water contaminants including volatile organic chemicals (VOCs), trace inorganics and radioactive materials. REMTrak utilizes StarTrak's standard ReeferTrak[TM] communications modem and existing wireless telematics network with the addition of specialized sensors and analysis tools for this new market application. A solar power feature allows REMTrak units to be located virtually anywhere on earth. The new remote monitoring system is capable of continuously sampling a wide variety of environmental variables and wirelessly transmitting data to a central monitoring authority at reduced costs compared to current sampling and transport practices at these remote locations.

The potential market opportunity for remote environmental monitoring systems is multiple thousands of rural site installations at state and federal government facilities, military bases and in the oil and gas, mining and agricultural industries.

StarTrak President, Tim Slifkin, commented, "The new REMTrak application demonstrates the flexibility of StarTrak's existing technology and network infrastructure to respond to new market opportunities. Although our primary focus remains in the cold chain and transportation segments, we continue to seek opportunities to expand our technology to additional vertical markets."

Alanco Technologies, Inc. (NASDAQ: ALAN), headquartered in Scottsdale, Arizona, is a rapidly growing provider of wireless tracking and asset management solutions through its StarTrak Systems and Alanco/TSI PRISM subsidiaries. Corporate website: www.alanco.com

StarTrak Systems is a leading provider of GPS tracking and wireless asset management services to the transportation industry and the dominant provider of tracking, monitoring and control services to the refrigerated or "Reefer" segment of the transportation marketplace. StarTrak products increase efficiency and reduce costs of the refrigerated supply chain through the wireless monitoring and control of critical Reefer data, including GPS location, cargo temperatures and Reefer fuel levels. StarTrak offers complete integrated solutions for refrigerated trailers, trucks, railcars, and containers. Additional information is available at www.StarTrak.com.

Alanco/TSI PRISM is the leading provider of RFID real-time tracking technologies for the corrections industry. TSI PRISM systems track and record the location and movement of inmates and officers, resulting in enhanced facility safety and security and significant staff productivity improvements. Utilizing proprietary RFID (Radio Frequency Identification) tracking technology, TSI PRISM provides real-time inmate and officer identification, location and tracking both indoors and out, and is currently utilized in prisons in Michigan, California, Illinois, Ohio, Missouri, Virginia, and Indiana. Additional information is available at www.TSIPRISM.com.

The Company also participates in the data storage industry through its wholly owned subsidiary, Excel/Meridian Data, Inc., a manufacturer of Network Attached Storage (NAS) systems. Excel delivers uniquely scalable, manageable and cost-effective storage solutions for all network storage customers. For further information, visit www.emdstorage.com.

EXCEPT FOR HISTORICAL INFORMATION, THE STATEMENTS CONTAINED IN THIS PRESS RELEASE ARE FORWARD-LOOKING STATEMENTS MADE PURSUANT TO THE SAFE HARBOR PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. ALL SUCH FORWARD-LOOKING STATEMENTS ARE SUBJECT TO, AND ARE QUALIFIED BY, RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE EXPRESSED OR IMPLIED BY THOSE STATEMENTS. THESE RISKS AND UNCERTAINTIES INCLUDE, BUT ARE NOT LIMITED TO, REDUCED DEMAND FOR INFORMATION TECHNOLOGY EQUIPMENT; COMPETITIVE PRICING AND DIFFICULTY MANAGING PRODUCT COSTS; DEVELOPMENT OF NEW TECHNOLOGIES WHICH MAKE THE COMPANY'S PRODUCTS OBSOLETE; RAPID INDUSTRY CHANGES; FAILURE OF AN ACQUIRED BUSINESS TO FURTHER THE COMPANY'S STRATEGIES; THE ABILITY TO MAINTAIN SATISFACTORY RELATIONSHIPS WITH LENDERS AND TO REMAIN IN COMPLIANCE WITH FINANCIAL LOAN COVENANTS AND OTHER REQUIREMENTS UNDER CURRENT BANKING AGREEMENTS; AND THE ABILITY TO SECURE AND MAINTAIN KEY CONTRACTS AND RELATIONSHIPS.