Applied Signal Technology, Inc. Announces First Quarter Operating Results

Sunnyvale , CA . May 1, 2008 – Applied Signal Technology, Inc. (NASDAQ - APSG) today announced that Gary L. Yancey has resigned as chairman and chief executive officer, and will be leaving the Company effective May 30, 2008. Mr. Yancey is also resigning from the Board of Directors. William Van Vleet III, Chief Operating Officer, will serve as Chief Executive Officer on an interim basis until a successor is appointed. John P. Devine, an Applied Signal director since 1995, has been named non-executive Chairman of the Board of Directors, effective May 1, 2008. The Board of Directors will be conducting a search for a successor CEO.

“ Gary was founder of Applied Signal Technology and has been integral to its growth and success over the past 25 years. His drive and broad experience have been key to the Company’s growth, and he has been instrumental in the Company’s success over its history. We look forward to continuing Gary’s commitment to meeting our customers’ high expectations for our products and services. We thank him for his dedication and the many contributions that he has made over the years, and we wish him well in his future endeavors,” said Mr. Devine, Chairman of the Board.

The Company will host a conference call on Monday May 5, 2008 to discuss the change in management. If you wish to participate in the conference call, please dial 1-877-407-8035 for domestic callers or 1-201-689-8035 for international callers on May 5, 2008 at 5:00pm eastern time/2:00pm pacific time. There is no pass code required. This call may be listened to simultaneously over the Internet through World Investor Links’ Vcall Website, located at www.InvestorCalendar.com.

About Applied Signal Technology, Inc.

Applied Signal Technology, Inc. provides advanced digital signal processing products, systems and services in support of intelligence, surveillance, and reconnaissance for global security. For further information about Applied Signal Technology visit our website at www.appsig.com.