SpaceDev Awarded Contract to Develop Innovative Small Sat Technology.

POWAY, Calif. -- SpaceDev (OTCBB: SPDV) has been awarded a $740,000 contract by the Air Force Research Laboratory (AFRL) to begin development of small satellite bus technologies with an emphasis on standards and responsiveness to on-demand needs. This project calls for SpaceDev to provide a significant departure from the classic space mission paradigm by designing a system that could be integrated and launched in hours or days instead of years.

"This is yet another exciting project for SpaceDev because it is in sync with our dynamic corporate culture of revolutionizing the space industry, and directly compliments innovative orbit work we are doing under another government contract," said Jim Benson, SpaceDev's founding chairman and chief executive officer. "We love opportunities like this, to accelerate changing the way space is done, thereby moving SpaceDev closer to profitably opening space for all of humanity."

SpaceDev's contract with AFRL calls for the development of a standardized small spacecraft bus that is modular and provides a scalable, networked architecture. SpaceDev will define standard payload and launch vehicle interfaces to enable plug and play of a variety of payloads to be rapidly launched on a variety of launch vehicles, on-demand. SpaceDev will extend its success in using TCP/IP in space, pioneered with SpaceDev's high performance CHIPSat microsatellite for NASA. CHIPSat was commissioned, or checked out, in ten manual steps. SpaceDev will incorporate autonomous satellite commissioning with the goal of the satellite being fully functional after only one orbit, or about 90 minutes in space.

The Company recently filed a Form 8-K with the Securities and Exchange Commission related to this contract award. (See www.sec.gov for more information.)

About SpaceDev

SpaceDev (OTCBB:SPDV) creates and sells affordable and innovative space products and solutions to government and commercial enterprises. SpaceDev's innovations include the design, manufacture, marketing and operation of sophisticated micro- and nano- satellites, hybrid rocket-based orbital Maneuvering and orbital Transfer Vehicles (MoTVs) as well as sub-orbital and orbital hybrid rocket-based propulsion systems for safe human space flight. For more information, visit www.spacedev.com.

This news release may contain forward-looking statements concerning the Company's business and future prospects and other similar statements that do not concern matters of historical fact. Forward-looking statements are based on the Company's current expectations. The Company's current expectations are subject to all of the uncertainties and risks customarily associated with developing business ventures. The Company's actual results may differ materially from current expectations. Readers are cautioned not to put undue reliance on forward-looking statements contained in this release and to read it in conjunction with the Company's annual report on Form 10-KSB, including the consolidated financial statements filed therewith. The Company disclaims any intent or obligation to update publicly these forward-looking statements, whether as a result of new information, future events or for any other reason.