Commtouch Regains Nasdaq Compliance.

Company Meets Minimum Bid Price Rule

MOUNTAIN VIEW, Calif. -- Commtouch[R] (NASDAQ:CTCH), the leading OEM provider of real time anti-spam, Zero-Hour(TM) virus protection and IP Reputation technology, today announced that it received a Nasdaq Staff letter advising that the company has regained compliance with the minimum bid price requirement for continued listing (Marketplace Rule 4320(e)(2)(E)(i)). To regain compliance, the company's ordinary shares recently achieved a minimum closing bid price of $1.00 or higher for at least 10 consecutive business days during the 180 day period allotted under the rule; this, in addition to meeting all other requirements for continued listing on The Nasdaq Capital Market.

"We are very pleased that our business achievements and continued progress are reflected in the recent rise of our stock. We look forward to continuing to build on this growing trust with our investor community," stated Gideon Mantel, CEO of Commtouch.

About Commtouch

Commtouch Software Ltd. (NASDAQ:CTCH) is dedicated to protecting and preserving the integrity of the world's most important communications tool -- e-mail. Commtouch has over 15 years of experience developing messaging software and is a global developer and provider of proprietary anti-spam, Zero-Hour virus protection and IP Reputation solutions. Using core technologies including RPD (Recurrent Pattern Detection(TM)), the Commtouch Detection Center analyzes billions of email messages per month to identify new spam and malware outbreaks within minutes of their introduction into the Internet. Integrated by more than 50 OEM partners, Commtouch technology protects thousands of organizations, with over 50 million users in over 100 countries. Commtouch is headquartered in Netanya, Israel, and has a subsidiary in Mountain View, Calif. For more information, see: www.commtouch.com. The site includes the Commtouch online lab detailing spam statistics and charts.

This press release contains forward-looking statements, including projections about our business, within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. For example, statements in the future tense, and statements including words such as "expect," "plan," "estimate," "anticipate," or "believe" are forward-looking statements. These statements are based on information available to us at the time of the release; we assume no obligation to update any of them. The statements in this release are not guarantees of future performance and actual results could differ materially from our current expectations as a result of numerous factors, including business conditions and growth or deterioration in the Internet market, commerce and the general economy, both domestic as well as international; fewer than expected new-partner relationships; competitive factors, including pricing pressures; technological developments, and products offered by competitors; the ability of our OEM partners to successfully penetrate markets with products integrated with Commtouch technology; a slower than expected acceptance rate for our newer product offerings; availability of qualified staff for expansion; and technological difficulties and resource constraints encountered in developing new products, as well as those risks described in the text of this press release and the company's Annual Reports on Form 20-F and reports on Form 6-K, which are available through www.sec.gov.

Recurrent Pattern Detection, RPD and Zero-Hour are trademarks, and Commtouch is a registered trademark, of Commtouch Software Ltd. U.S. Patent No. 6,330,590 is owned by Commtouch.