Alpha Announces Temporary Closure of Ella Star.

Business Editors

NEW YORK--(BUSINESS WIRE)--Nov. 14, 2001

As has been widely reported, the September 11th terrorist attack on the World Trade Center has had a dramatic impact on the travel and hospitality industries throughout the country, South Florida included.

As a result of this condition, Alpha Hospitality Corporation (NASDAQ - ALHY; BSE - ALH; WARRANTS: OTCBB - ALHYW; BSE - ALHW) (the "Company") announced today that passenger levels on the Ella Star Casino have fallen dramatically from those enjoyed immediately prior to the September 11th attack. It is the opinion of the Company that this condition, which further exacerbated by the crash of American Airlines flight 587 out New York's John F. Kennedy airport on Monday, November 12, 2001, may extend into and possibly through the upcoming high tourism season. As a consequence of this assessment, the Company decided to suspend temporarily operations at the Ella Star Casino. The action will allow the Company time to review options concerning the future operation of the facility. These options may include the reopening of the facility if the hospitality industry begins an upswing or the possibility of divesting its interest in the operation. At this point, the Company is also reviewing all costs associated with this action.

In other recent events, on October 31, 2001, New York State recently adopted a gambling extension bill that could, but may not, affect the Company's prospects. Under such legislation, the Governor of the State of New York is authorized (without separate authorization or ratification by the State Senate or Assembly) to enter into compacts with one or more Native American tribes for up to three gaming facilities in the Counties of Sullivan and Ulster, provided that such compacts contain certain assurances and protections. The affect of this legislation could be to facilitate the approval of a gaming facility by Catskill Development, LLC ("Catskill"), in which the Company is a member and holds an interest, or a potential competitor for Catskill. No assurance can be given that the Governor of the State of New York will use the authority granted under this legislation to approve any compact for any casino to be developed by the Company or Catskill.

The new legislation also authorizes the New York State Division of Lottery to license the operation of video lottery gaming at several racetracks, including at the Monticello Raceway (the "Raceway"), which is owned by Catskill. Although it is anticipated that the operation of video lottery gaming at the Raceway would increase the revenues from such facility, there can be no assurance that the Division of Lottery will in fact grant the Raceway a license to operate video lottery gaming or, if such a license is granted, the number of video lottery gaming terminals with respect to such a license would be granted. Accordingly, no prediction can be made as to whether this new legislation will have any impact on the operations of the Raceway. Further, since at least $20 million in priority payments would have to be made by Catskill before any distribution could be made to the Company on account of any net revenues from the Raceway there can be no assurance that any revenues generated from the Raceway will be distributed to the Company.

The Company, along with its partners in Catskill, continue to explore opportunities with other tribes interested in participating in a Native American casino at the Raceway as well as aggressively pursue their $6.3 billion lawsuit against Park Place Entertainment Corporation (NYSE - PPE) alleging tortious interference with prospective business relations and tortious interference with contract involving the development of a proposed Native American casino with the St. Regis Mohawk Tribe at the Raceway.

To the extent the content of this press release includes forward-looking statements, they involve risks and uncertainties that are described from time to time in the Company's reports filed with the Securities and Exchange Commission. The Company wishes to caution readers not to place undue reliance on such forward-looking statements, which statements are made pursuant to the Private Securities Litigation Reform Act of 1994, and as such, speak only as of the date made.