Two Additional Contract Proposals Currently Under Review by NASA

SPACEHAB, Incorporated, a leading provider of commercial space services, today
announced that the Company made the competitive range as a finalist on NASA’s
International Space Station (ISS) Mission Integration Contract (MIC).

Based on the Company’s combined expertise in ISS Program support, as well
as its space research and logistics services, SPACEHAB believes it is
positioned to continue, and expand, support to the ISS Program as it
transitions from its current assembly phase to operations and space
utilization. The MIC, estimated by NASA at more than $100 million over five
years with two additional one-year options, further leverages this capability,
utilizing critical skills that include mission integration, ISS stowage
integration, and Russian language and logistics services.

SPACEHAB has aggressively pursued this opportunity, establishing a highly
credible team, comprised of United Space Alliance, MRE Consulting, and ARES
Corporation. In preparation for a potential contract award, this experienced
team has begun development of detailed work processes, initiated a hiring
program, and implemented key steps that support an effective transition
process for contract start.

NASA is consolidating 26 current contracts into seven in an effort to
optimize synergies within the ISS Program, encourage competitive sourcing, and
improve program accountability. Of the seven procurement opportunities
outlined by NASA, SPACEHAB is competing on three of these initiatives
including the MIC effort.

NASA is currently reviewing proposals previously submitted for the two
other procurements, both of which SPACEHAB is bidding on as a subcontractor.
The ISS Program Integration and Control contract, a five-year initiative
valued at approximately $18 million for the Company, utilizes SPACEHAB’s core
competency in configuration management. The Cargo Mission contract, also a
five-year effort, employs the Company’s unique stowage integration,
International Partner integration, sustaining engineering of stowage hardware,
and program integration capabilities.

“We are optimistic about these contract opportunities and look forward to
continuing our support to NASA and the International Space Station Program,”
said SPACEHAB President and Chief Operating Officer, Michael E. Kearney. “In
the meantime, we are focused on supporting NASA’s return-to-flight activities,
providing the Agency with high-value flight hardware and payload integration
expertise on three upcoming ISS missions.”

Although there is no assurance that SPACEHAB will be awarded these
contracts, NASA tentatively expects to announce awards in October 2003 with
contract transition beginning as early as November 2003.

About SPACEHAB, Incorporated

With approximately $100 million in annual revenue, SPACEHAB, Incorporated
(www.spacehab.com) is a leading provider of commercial space services. The
Company develops, owns, and operates habitat and laboratory modules and cargo
carriers aboard NASA’s Space Shuttles for space station resupply and research
purposes. Its Government Services business unit provides Space Station and
Space Shuttle support services including orbiter crew compartment integration,
stowage, and configuration management to NASA’s Johnson Space Center in
Houston. SPACEHAB’s Astrotech subsidiary provides commercial satellite
processing services at facilities in California and Florida. Additionally,
through The Space Store, Space Media provides space merchandise to the public
and space enthusiasts worldwide (www.thespacestore.com).

This release contains forward-looking statements that are subject to
certain risks and uncertainties that could cause actual results to differ
materially from those projected in such statements. Such risks and
uncertainties include, but are not limited to, whether the Company will fully
realize the economic benefits under its NASA and other customer contracts, the
timing and mix of Space Shuttle missions, the impact of the recent Columbia
tragedy on the Company’s existing and future business operations, the amount
of any indemnification payments the Company may receive for its RDM, which was
lost as part of the Columbia tragedy, the successful development and
commercialization of new space assets, technological difficulties, product
demand, timing of new contracts, launches and business, market acceptance
risks, the effect of economic conditions, the impact of war, uncertainty in
government funding, the impact of competition, and other risks detailed in the
Company’s Securities and Exchange Commission filings. The Company assumes no
obligation to update these forward-looking statements.

For more information, contact:

Kimberly Campbell
Director of Marketing
SPACEHAB, Inc.
Phone 713.558.5049
Fax 713.558.5957
campbell@spacehab.com

Haris Tajyar
Managing Partner
Investor Relations International
Phone 818.981.5300
Fax 818.981.5303
htajyar@irintl.com