Applied Signal Technology, Inc. Subcontracts with Prime Contractor on
NASIC’s Advanced Technology Exploitation Program

SUNNYVALE, California, July 23, 2009 – Applied Signal Technology, Inc. (NASDAQ: APSG) (AST), a market leader in advanced intelligence, surveillance, and reconnaissance (ISR) solutions, today announced that it is part of a subcontractor team for one of the three prime contractors that has been awarded a five-year, indefinite delivery, indefinite quantity (IDIQ) contract by the National Air and Space Intelligence Center (NASIC). The Advanced Technology Exploitation Program (ATEP) contract has a total ceiling value of $600 million. Task orders will be competed for by the three major prime contractors and their subcontractor teams.

With this award, AST will help provide advanced remote sensing data analysis and sensor exploitation research and development of space-based and airborne sensor data. AST’s products and technologies will directly support NASIC and its mission of providing advanced geospatial intelligence (AGI) products, services, capabilities, and technical support to the operational, arms control and treaty monitoring, acquisition policy, scientific and technical intelligence communities, and national defense policy makers.

“Applied Signal Technology is pleased to be part of the Advanced Technology Exploitation Program subcontractor team,” said William Van Vleet, Chief Executive Officer. “Our broad range of advanced signal processing and geospatial intelligence exploitation capabilities will directly support national priorities by providing accurate, timely intelligence to both armed forces and national decision makers. This subcontract win also helps to solidify AST’s commitment to the Greater Dayton Area by bringing a new supply of employment opportunities and economic vitality across the region.”

About National Air and Space Intelligence Center
The National Air and Space Intelligence Center serves as the national and U.S. Department of Defense (DOD) executive agent for the processing, exploitation, analysis, integration and dissemination of measurement and signature intelligence (MASINT) data collected from radar, electro-optical and infrared technical sensors. It prepares signatures of threat targets, develops analytical tools for technical analysis and provides these techniques for the fusion of MASINT data in direct support of operational missions of the DOD and mission partners throughout the intelligence community.

About Applied Signal Technology, Inc.
Applied Signal Technology, Inc. is a leading provider of advanced intelligence, surveillance and reconnaissance (ISR) products, systems, and services that enhance global security. For further information about Applied Signal Technology, visit our website at www.appsig.com.

Except for historical information contained herein, matters discussed in this news release may contain forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially. Statements as to our ability to provide products, services, and support needed by the Advanced Technology Exploitation Program; and our ability to bring a new supply of employment opportunities and economic vitality across the Greater Dayton Area are forward-looking statements. The risks and uncertainties associated with these statements include our ability to capture task orders; whether task orders will be issued by procurers; whether any contracts obtained by us will be performed well and be profitable; and whether we will be able to hire qualified staff as needed in the Greater Dayton Area.  The Company assumes no obligation to update the information provided in this news release.