Medis Technologies Ltd. (NASDAQ:MDTL - "Medis") announced today that it has received an order from General Dynamics C4 Systems, a business unit of General Dynamics (NYSE:GD), to deliver five prototype fuel cell power packs and associated cartridges as power sources for 10 prototype tablet computers in support of the United States Air Force (USAF) Wearable Computer Power Program. The order provides for payment to Medis' subsidiary More Energy Ltd. of a total of $425,000 for the development, in milestone payments. The order is issued pursuant to a contract awarded to General Dynamics by the USAF and announced on August 20th. The order states that "it is fully expected that the successful completion of this initial project which is intended to demonstrate extended field operation and the potential to reduce reliance on battery operation, will lead to a follow-on spiral development program with an objective of replacing the current ground air traffic control computers."

The defense services continue to demonstrate their advocacy in applying fuel cell products to improve mission stamina," said Chris Marzilli, a Senior Vice President and Deputy General Manager for General Dynamics C4 Systems. "This Science & Technology initiative will equip USAF special operations forces with an enhanced Battlefield Air Operations kit, including an advanced computing platform with increased endurance for dismounted missions in an overall lighter, more deployable package. The prototype also could have implications for multiple Department of Defense instruments and applications, including among other candidate products, powering the Joint Tactical Radio System (JTRS) Cluster 5 family of handheld and embedded software-defined radios."

General Dynamics C4 Systems plans eventually to be the prime producer, systems integrator and supplier of Medis Technologies fuel cell power packs and fuel cartridges to U.S. Military markets and will be supporting Medis in a product engineering capacity to tailor their commercial offering to address requirements unique to the soldier systems market.

"We, at Medis, are excited about the implications of extending our fuel cell technology to new horizons," said Robert K. Lifton, Chairman and CEO of Medis Technologies. "The military market for our fuel cell technology represents a highly important business program for Medis. Many of the products being developed for military use, like this fuel cell power source for the tablet computer, lend themselves to the commercial markets, as well. This opportunity is another step in the development of a significant military presence for our technology. Successful conclusion of this development will expand our fuel cell power capabilities from the present level of cell phones, digital cameras and PDAs, to encompass tablet computers and products falling into similar categories of power requirements.

General Dynamics C4 Systems, headquartered in Scottsdale, Ariz., is a leading integrator of secure communication and information systems and technology. With more than 7,000 employees world wide, the company specializes in command and control, communications networking, computing and information assurance for defense, government and select commercial customers in the U.S. and abroad.

Medis Presenting at Roth Capital Partners New York Conference

In a separate development, Medis Technologies announced that Mr. Lifton, accompanied by Michelle Rush, Vice President, Marketing, will make a corporate presentation at the Roth Capital Partners New York Conference, September 13, 2004 at 4:30 PM Eastern Time, in New York City. The presentation will be webcast and can be accessed through Medis website at www.medistechnologies.com.

Medis Technologies is involved in the development of highly advanced proprietary technology products primarily related to sources of clean energy for the 21st Century. Medis' primary focus is on direct liquid fuel cell technology. Its business strategy is to license or sell its technologies to, or enter into joint ventures with, large international corporations or sell its products to end users through retail outlets and service providers. In addition to its fuel cell technology, Medis' product pipeline, in varying stages of development, includes inherently conductive polymers, the toroidal engine and compressor and stirling cycle system. Medis has also developed the CellScan with many potential applications relating to disease diagnostics and chemo sensitivity.

This press release may contain forward-looking statements, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve risk and uncertainties, including, but not limited to, the successful completion of product development, the success of product tests, commercialization risks, availability of financing and results of financing efforts. Further information regarding these and other risks is described from time to time in the Company's filings with the SEC.

This press release is available on Medis' web site at www.medistechnologies.com.