The amendment allows MTI Micro to produce fuel cartridges with additional third party OEMs in support of its first Mobion® consumer products. Also included is the expansion of the scope of work and the extension of a new milestone 4A to accommodate market penetration relating to emerging opportunities, including new alliances. Simultaneously, MTI Micro will continue to work together with its fuel distribution partner in the development and mass market commercialization of fuel cells and cartridges.

"I am delighted that this amendment provides MTI Micro the flexibility of working with our consumer OEMs at this early stage in support of our Mobion® consumer products," said Peng Lim, CEO of MTI Micro. "We see this amendment as an opportunity for MTI Micro to more fully participate in the revenue stream that these cartridges will generate."

The Company intends to file the amendment as an Exhibit to its Quarterly Report on Form 10-Q for the period ending September 30, 2006.

About MTI MicroFuel Cells

MTI MicroFuel Cells Inc., a subsidiary of Mechanical Technology Incorporated (MTI) (Nasdaq: MKTY), is the developer of the award-winning Mobion® direct methanol micro fuel cell technology. MTI Micro has a world-class team of entrepreneurial business executives, researchers and scientists; a number of system prototypes demonstrating size reductions and performance improvements; significant related intellectual property; and has received government awards and developed strategic partnerships to facilitate efforts to achieve commercialization. More information is available at http://www.mtimicrofuelcells.com.