TeraForce Technology Corporation Intensifies Sales Focus to Address Expansion of Market Opportunities.

RICHARDSON, Texas -- Strengthening of DNA Computing Solutions Sales Force Marks Transition to Direct Marketing in Preparation for Launch of New Products

TeraForce Technology Corporation (OTCBB:TERA) today announced that its wholly-owned subsidiary, DNA Computing Solutions, Inc., has expanded its sales organization with the recent addition of two new sales managers. The organizational expansion comes as the company positions itself to take maximum advantage of significant additional market opportunities presented with the availability of two new products scheduled for launch in the third quarter. This move is part of the company's strategy to migrate to a direct sales approach as its product line expands and business grows.

Jere Hofstetter joins DNA Computing Solutions as senior sales manager responsible for sales growth in the northeastern region of the country. Most recently a regional sales manager with Vista Controls, he brings more than twenty years experience to the company. Dee Campobasso joins the company as regional sales manager for the southeastern region. She has over fifteen years experience in sales management involving sophisticated electronic products. These new sales managers join James Falasco, who became regional sales manager for the central region at the beginning of the year. Along with Joe Dean, western regional sales manager, and Ted Van Allen, eastern regional sales manager, these new staff members report to Harold Messias, vice president of sales and marketing.

"These staff additions are a deliberate and integral step in executing our game plan to systematically expand our market reach," stated Dr. R. Eugene Helms, president and CEO of DNA Computing Solutions. "We have long planned to adopt a direct sales approach as we rounded out our portfolio of products to position ourselves to capture key accounts. With the new ruggedized products we are developing with Vista Controls and our new Nexus product line, we will have a much more potent product array with which to engage the market. Our new sales managers, along with our existing sales staff, will strengthen our ability to cover the ever-growing spectrum of opportunities in the defense electronics and homeland security markets."

Harold Messias, vice president of sales and marketing for DNA Computing Solutions commented, "I am very pleased to have Dee and Jere on the sales team. Their breadth of experience and industry contacts add significant resources to our sales effort. Armed with a rich product mix, we now are positioned to mount a formidable market thrust that I expect will yield greater market coverage and capture a growing share of our target market segments."

About TeraForce Technology Corporation

Based in Richardson, Texas, TeraForce Technology Corporation (OTCBB:TERA) designs, develops, produces and sells high-density embedded computing platforms and digital signal processing products, primarily for applications in the defense electronics industry. TeraForce's primary operating unit is DNA Computing Solutions, Inc.

Except for the historical information contained herein, the statements in this announcement are forward-looking statements which involve risks and uncertainties that could cause actual results to differ materially from those expressed in, or implied by, the forward looking statements. Factors that might cause such a difference include, but are not limited to, those relating to: general economic conditions in the markets in which the Company operates; success in the development and market acceptance of new and existing products; dependence on suppliers, third party manufacturers and channels of distribution; contingent liabilities; customer and product concentration; fluctuations in customer demand; maintaining access to external sources of capital; ability to attract and retain key management and technical personnel; issues regarding intellectual property rights; overall management of the Company's expansion; and other risk factors detailed from time to time in the Company's filings with the Securities and Exchange Commission.