Elbit Systems Enters Teaming Agreement with AeroAstro
to Develop Space Systems and Components

Ashburn, VA and Haifa, Israel – April 8, 2003

Elbit Systems Ltd. (NASDAQ: ESLT) today announced that through its subsidiary, Elop Electro-Optics Industries Ltd., (“El-Op”) the Company has entered into a teaming agreement with AeroAstro, Inc., a leading small satellite technology company, for the development of advanced micro and nano space systems and components, with a special focus on remote sensing and optical systems.

With the teaming agreement between the two companies now in place, an equity investment by Elbit Systems for a minority share of AeroAstro is anticipated to be concluded as soon as regulatory authority is obtained.

Since its inception in 1988, AeroAstro has been a leading developer and proponent of small, low-cost spacecraft. As component size, mass, power and cost continue to shrink, AeroAstro has pioneered new small satellite applications in astrophysics, communications and technology development and verification.

Over the last decade, Elbit Systems, through El-Op, has demonstrated its ability to create highly capable optical systems for space research, earth imagery and other remote sensing applications, which are compatible – in terms of mass, volume and power consumption, as well as budget – with highly efficient micro and nano spacecraft. As microspace grows and matures, its market continues to evolve, and the Elbit Systems/AeroAstro team is addressing the ever-changing needs of these customers.

Dr. David Stavitsky, Chief Scientist of Elbit Systems, noted, “By forging a close working relationship, Elbit Systems and AeroAstro can now provide end-to-end on-orbit solutions across a variety of space applications, particularly in remote sensing. Rather than force-fitting an existing payload design into a previously designed spacecraft bus, this team provides a completely integrated solution, yielding high performance in small, light, inexpensive, and reliable products.”

Dr. Rick Fleeter, CEO of AeroAstro, said, “The future of microspace will be, in part, built on providing cost-effective results to new users worldwide. The Elbit Systems/AeroAstro team has the reach and expertise to bring the benefits of space to the increasingly diverse user community. As these new participants bring their needs to space, they will spur development of new, advanced space systems capabilities and architectures. Elbit Systems and AeroAstro, the only team in microspace combining leaders in payload and space systems, is uniquely positioned to work with users to pioneer the next generation of single and multiple spacecraft solutions.”

About AeroAstro:
AeroAstro, a pioneer of micro and nano spacecraft applications in science, remote sensing, and communications, is a leader in innovative small satellite applications that open the space frontier to a larger and more varied constituency. AeroAstro manufactures low-cost satellite systems and components, used in its own spacecraft and for spacecraft development in the US and abroad.

About Elbit Systems:
Elbit Systems Ltd. is an international defense electronics company engaged in a wide range of defense-related programs throughout the world, in the areas of aerospace, ground and naval systems, command, control, communications, computers and information (C4I) Intelligence, Surveillance and Reconnaissance (ISR), Unmanned Airborne Vehicles (UAV), security systems and advanced electro-optic technologies.

For more information about Elbit, call Arie Tal at 972-4-831-6632; visit www.elbit.co.il; write Elbit Systems Ltd. at P.O.B. 539, Haifa, Israel 31053; or email elbit-systems@elbit.co.il.

Statements in this press release which are not historical data are forward-looking statements which involve known and unknown risks, uncertainties or other factors not under the company’s control, which may cause actual results, performance or achievements of the company to be materially different from the results, performance or other expectations implied by these forward-looking statements. These factors include, but are not limited to, those detailed in the company’s periodic filings with the Securities and Exchange Commission.