SpaceDev’s hybrid propulsion technology helped propel Scaled
Composites/Paul Allen’s SpaceShipOne into space flight history as the
craft garnered the $10 Million Ansari X Prize, a contest created to
stimulate the development of the private sector human space flight
industry. SpaceDev, a provider of several critical components and
technology for the craft’s motor, including igniter, injector and main
operating valve, successfully performed as expected and powered
SpaceShipOne on today’s historic manned flight. SpaceShipOne exceeded
the altitude requirement on both scheduled flights as required by the
Ansari X Prize competition.

The hybrid propulsion system burned full duration. According to
Scaled Composites reports, pilot Brian Binnie steered SpaceShipOne
high above the Mojave, California desert to a high of 368,000 feet
altitude (62 miles). That exceeded the required 328,000 feet altitude
– a sky-high goal required by the X Prize Foundation of St. Louis,
Missouri. The altitude is generally considered to be the threshold of
space.

Jim Benson, SpaceDev’s founding chairman and chief executive
officer said, “This win signifies what we have been saying for some
time. Space flight will now undergo a microcomputer revolution, with
SpaceDev helping to revolutionize the $100 billion space industry with
hybrid-based propulsion systems for delivering cargo and people to
space, safely and affordably.”

The Ansari X Prize was designed to jumpstart the space tourism
industry through competition among the most talented entrepreneurs and
rocket experts in the world. SpaceShipOne was built and launched with
private funds. The craft was also able to carry equivalent weight of
three people to 100 kilometers (62.5 miles) and return safely to
earth. The competition follows in the footsteps of more than 100
aviation incentive prizes offered between 1905 and 1935 credited with
spawning today’s multibillion-dollar air transport industry.

“Today’s news moves the private space community infinitely closer
to realizing its vision of creating safe, affordable, commercial human
space flight. We are thrilled that we are an integral part of this
team and we remain very focused on powering passenger flights in the
very near future,” adds Mr. Benson.

About SpaceDev

SpaceDev (OTCBB: SPDV – News) 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. Upon founding SpaceDev
in 1997, Jim Benson started the trend of successful computer
entrepreneurs moving into the space development arena. 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 relating to product development, business
prospects and development of a commercial market for technological
advances are based on the Company’s current expectations. The
Company’s references to non-explosive motors directly relate to the
zero TNT equivalent rating of its hybrid rocket motors and that they
do not detonate notwithstanding the fact that any pressure vessel may
rupture but not “explode” like a solid or liquid rocket motor. The
Company’s current expectations are subject to all of the uncertainties
and risks customarily associated with developing business ventures
including, but not limited to, risks associated with new product
development and availability of raw resources and suppliers, risks to
marketed products and availability of financing and other sources of
income, as well as risks discussed in the Company’s periodic reports
filed with the U.S. Securities & Exchange Commission. 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.

Contact:
The Investor Relations Group
Investor Contact:
Kathryn McNeil / John Nesbett, 212-825-3210
or
Media Contact:
Stephanie Schroeder, 212-825-3210