SPACEHAB Celebrates Launch and Activation of Commercial Payload; Company Shows that Access to Space is Available Today.

HOUSTON -- SPACEHAB, Incorporated (Nasdaq/NMS:SPAB), a leading provider of commercial space services, today announced that it has successfully delivered a thermal incubator to the International Space Station (ISS) for one of its international customers.

SPACEHAB is providing the Japan Aerospace Exploration Agency (JAXA) with launch and on-orbit use of a protein crystal growth incubation system under a contract with Mitsubishi Corporation , SPACEHAB's marketing representative in Japan. In an unprecedented schedule of less than nine months, SPACEHAB and its subcontractors were able to finalize contracts and then design, build, test, certify, ship, and launch the experiment facility onboard a Russian Progress vehicle which lifted off last Wednesday, August 11, 2004 from the Baikonur cosmodrome.

"Even with the temporary grounding of the space shuttle, SPACEHAB is pleased that we are able to offer timely and affordable commercial access to space via our international alliance with RSC Energia, Russia's largest space company," said Michael E. Kearney, SPACEHAB President and Chief Executive Officer.

The cargo ship, an unmanned vehicle loaded with supplies and equipment, docked to the orbiting space station on Saturday where cosmonauts then successfully transferred and installed the experiment hardware in the Russian segment of the ISS. Three sets of protein experiments will be conducted through October 2005 at which time JAXA has an option to acquire extended use of the hardware from SPACEHAB.

Kearney added, "We believe that this significant accomplishment, and others like it performed by SPACEHAB in the past, clearly demonstrate private industry's ability to find commercial solutions for space access, and that we are equipped with the resources, expertise, and most importantly, the flexibility to achieve customer needs."

About SPACEHAB, Incorporated

SPACEHAB, Incorporated (www.spacehab.com) is a leading provider of commercial and government space services with three primary business units. The Flight Services business unit develops, owns, and operates habitat and laboratory modules and cargo carriers aboard NASA's Space Shuttles for Space Station resupply and research purposes. SPACEHAB's Astrotech subsidiary provides payload processing support services for both commercial and government customers at company-owned facilities in Florida and California. The Company's Government Services business unit supports NASA's Johnson Space Center providing configuration management, product engineering, and support services for both the Space Station and Space Shuttle programs. Additionally, through The Space Store, Space Media provides space merchandise to the public and space enthusiasts worldwide (www.thespacestore.com).

The statements in this document may contain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in the statements. In addition to those risks and uncertainties discussed herein, such risks and uncertainties include, but are not limited to, whether the Company will fully realize the economic benefits under its U.S. National Aeronautics and Space Administration ("NASA") and other customer contracts, whether NASA and other customers will continue to utilize the Company's habitat modules and related commercial space assets, whether plans to complete the International Space Station ("ISS") are fulfilled, continued availability and use of the U.S. Space Shuttle system, technological difficulties, product demand and market acceptance risks, the effect of economic conditions, uncertainty in government funding, the impact of competition, delays and uncertainties in future space shuttle and ISS programs, resolution of the Company's indemnification claim with NASA arising from the loss of the Columbia orbiter and its crew during the STS-107 mission, and other risks described in reports filed by the Company with the Securities and Exchange Commission. The Company assumes no obligation to update these forward-looking statements.