EMRISE CORPORATION's XCEL Power Systems Ltd. Receives Unmanned Air Vehicle Development and Manufacturing Contracts from Thales and Ultra Electronics Ltd.

RANCHO CUCAMONGA, Calif. -- EMRISE CORPORATION (NYSE ARCA:ERI), a multi-national manufacturer of defense and aerospace electronic components and communications equipment, today announced that its subsidiary, XCEL Power Systems Ltd., based in Ashford, Kent, has been awarded two contracts in connection with the UK's Watchkeeper Unmanned Air Vehicle (UAV) program.

Watchkeeper will provide the UK armed forces with an essential Intelligence, Surveillance, Target Acquisition and Reconnaissance (ISTAR) capability based on a tactical unmanned air vehicle system and will be a key component of the UK's drive for Network Enabled Capability (NEC).

Thales UK has awarded XCEL a contract for the design and manufacture of power supplies for the I-Master Radar, the all-weather surveillance payload to be installed on the Watchkeeper UAV. Working closely with the project team at Crawley, XCEL is designing the power supply for the radar's Microwave Power Module.

Another key Watchkeeper subcontractor, Ultra Electronics Limited at Greenford, has selected XCEL for the design and manufacture of power supplies for the High Integrity Data Link, which plays a vital role in communications between the UAVs and Ground Station Controllers.

These applications require robust solutions, capable of operating under extreme temperature while maintaining EMC compliance and high reliability, within a very small size constraint. Both projects are well underway, with our early validation product expected to be delivered at the end of Q4 2006 and production deliverables to begin in 2007.

Richard Weller, XCEL's Managing Director, said, "XCEL is already an established supplier on many other Thales programs, with power supplies installed in aircraft equipment, ground systems, and on board Navy vessels. Inclusion on the UK's Watchkeeper program has been an objective for us for some time, and we are very pleased to have secured these key contracts."

Graham Jefferies, Executive Vice President and Chief Operating Officer of EMRISE Corporation, commented, "EMRISE Corporation's custom electronic components are found on most manned military aircraft, but the importance and growth of UAVs, we believe, will grow to be a significant part of the Western defense arsenal. We are targeting this market in the U.S., Europe and Japan and these two programs add to an already growing list of contract awards."

About EMRISE CORPORATION

EMRISE Corporation is a multi-national manufacturer of defense and aerospace electronic components and communications equipment. EMRISE's electronic components group, which consists of EMRISE Electronics Corporation and its international subsidiaries, provides custom power conversion, RF components and subsystems as well as digital and rotary switches to the North American, European and Asian electronic components market. These products are primarily used for defense, aerospace and industrial applications. EMRISE's communications equipment group, consisting of CXR Larus Corporation and its subsidiary CXR Anderson Jacobson, provides network access, satellite timing and synchronization and transmission products as well as communications test equipment to the North American, European and Asian communications industry. Founded in 1983, EMRISE operates out of facilities in the United States, England, France and Japan. As of October 31, 2006, EMRISE had a total of 298 employees in its various subsidiaries and divisions. Website: www.emrise.com. Listed on NYSE Arca under the ticker symbol: ERI.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995

With the exception of historical information, the matters discussed in this press release are forward-looking statements that involve a number of risks and uncertainties. The actual future results of EMRISE Corporation could differ from those statements. Factors that could cause or contribute to such differences include, but are not limited to, XCEL Power Systems' ability to manufacture and deliver products on a timely basis; general market and economic conditions; changes in technology and governmental regulations and policies, competitive products and services; unforeseen technical issues and those factors contained in the "Risk Factors" Section of EMRISE Corporation's Form 10-K for the year ended December 31, 2005.