SAN DIEGO, CA - September 28, 2000 - e.Digital Corporation (OTC: EDIG) today announced that it has added the following to its engineering staff: Brian Gray, Senior DSP Engineer; David Baggest, Electrical Design Engineer; Rudy Haluza, Firmware Engineer; Mark Holdgrafer, DSP Firmware Engineer; and William Conrad, Electrical Design Engineer. All are part of the company`s internal Internet Audio Group, formed last year to meet the growing demand for portable, Internet-compatible music and voice products.

Brian Gray holds a Master`s degree in Electrical Engineering (focus on signal processing) from Rensselaer Polytechnic Institute in Troy, New York. He has over 13 years of experience designing and implementing real-time embedded DSP systems. His most recent position was with L-3 Communications where he was developing a DSP based satellite demodulator. He has also worked in the digital television and sonar signal processing fields.

David Baggest holds a degree in Electrical Engineering from Washington State University. His technical specialty is over six years of analog instrumentation and embedded digital control as related to high power systems. Recent experience includes work with the DIII-D engineering team at General Atomics, San Diego, in support of the DIII-D Nuclear Fusion research program.

Rudy Haluza holds a degree in Physics from California State University, Fullerton. With over fifteen years` experience, he has held engineering and software design positions at several companies with a strong reputation for technological innovation, including GDE Systems, Inc., TRW Space and Technology Group, and Qualcomm, all in San Diego, California.

Mark Holdgrafer holds a degree in Electrical Engineering from San Diego State University. His most recent position was with Applied Magic in Carlsbad, California, where he was instrumental in developing and testing name-brand-DSP-based products for editing video and audio.

Bill Conrad holds a degree in Electrical and Computer Engineering from Worcester Polytechnic Institute in Worcester, Massachusetts. His professional experience includes various engineering and engineering management positions at Media Look and Pyxis Corporation, both in San Diego.

``In addition to our recent additions to the Board of Directors, our recent hires contribute to the successful execution of our business plan,`` said Fred Falk, President and CEO of e.Digital. ``While we work on a variety of projects for our OEM customers and licensees, it is important to have the best technical talent available. Based on our current workload and continuing growth, we expect to add additional senior management and engineering talent. This is one of the reasons we are requesting in our Proxy that four million of our authorized shares be added to our 1994 Employee Stock Option Plan. Stock options are a key incentive tool in the race to attract technical talent, key employees, and directors who contribute valuable experience to our efforts. We expect the additional options requested to be adequate for the next several years.``

About e.Digital

e.Digital Corporation offers an engineering partnership for the world`s leading electronics companies to link portable digital devices to PCs and the Internet. e.Digital develops and markets to consumer electronics manufacturers complete end-to-end solutions for delivery and management of open and secure digital media with a focus on music players/recorders and portable digital voice recorders. Engineering services range from the licensing of e.Digital`s patented MicroOSTM file management system to custom software and hardware development, industrial design and manufacturing services. For more information on the company, please visit http://wwww.edig.com/

# # #

Safe Harbor statement under the Private Securities Litigation Reform of 1995: This document contains forward-looking statements relating to future performance, technology and product development that may impact on future results and the future viability of the company. Actual results could be affected or differ materially from those projected in the forward-looking statements as a result of risk factors such as: future products and results; technological shifts; potential technical difficulties that could delay new products; competition; general economic conditions in the markets in which the company operates; the ability of the company, its customers, and suppliers to solve latent Year 2000 compliance issues; pricing pressures; and the uncertainty of market acceptance of new products by OEM`s and end-user customers.

Note: e.Digital and MicroOS are trademarks of e.Digital Corporation. All other company, product, and service names are the property of their respective owners.

CONTACTS:

e.Digital Corporation

Robert Putnam

(858) 679-1504

robert@edig.com

The MWW Group (for e.Digital)

Matt Messinger

Public Relations

(201) 964-2377

mmessing@mww.com