e.Digital Corporation

FOR IMMEDIATE RELEASE

November 9, 2007

e.DIGITAL ANNOUNCES RECORD REVENUES AND IMPROVED FINANCIAL RESULTS: Revenues for Q2 Grow 86% Over Preceding Q1, Additional Enforcement Actions of Flash-R™ Patent Portfolio Being Prepared

(SAN DIEGO, CA, – November 9, 2007) – e.Digital Corporation (OTC: EDIG), a leading innovator of dedicated portable inflight entertainment (IFE) systems and patented flash memory-related technology, reported record revenues and a reduced net loss for its fiscal 2008 second quarter and six months ended September 30, 2007.

For the second quarter, e.Digital reported revenues of $2.42 million, a substantial increase from revenues of $13,000 for the second quarter of the year prior and an 86% increase over revenues of the immediately preceding quarter ended June 30, 2007. The Company reported revenues of $3.72 million for the first six months of fiscal 2008 compared to $34,000 for the same six-month period the prior year. Revenues for the first six months of fiscal 2008 included quantity shipments of the Company’s proprietary eVU™ mobile entertainment system to multiple in-flight entertainment (IFE) customers including major European and Asian airlines.

Gross profit for the second quarter of fiscal 2008 was $597,000 or 25% of revenues. Gross profit for the first six months of fiscal 2008 was $844,000 or 22% of revenues. Operating costs in fiscal Q2 2008 were $688,000, compared to $879,000 in fiscal Q2 2007. For the six months ended September 30, 2007, operating costs were $1.44 million compared to $1.57 million for the first six months of fiscal 2007. The Company incurred increases in sales and marketing expenses, more than offset by reduced research and development costs.

Net loss for the second quarter decreased significantly to $158,000 from $1.60 million for the second quarter of the year prior. For the first six months of fiscal 2008, the Company’s net loss was $751,000, a substantial decrease from $2.73 million for the same six months in fiscal 2007. The improved financial performance is the result of current year eVU product and service revenues resulting in positive product margins as well as containing costs and reducing operating expenses. Net loss available to common stockholders for the second fiscal quarter and for the first six months of fiscal 2008 were $(0.00) per basic and diluted share, compared to $(0.01) per basic and diluted share for the same periods last year.

“In the last twelve months, we have sold over $5 million in products and services to airlines around the world,” said Will Blakeley, president of e.Digital. “With the recent successful launch of our proprietary eVU Extended Range™ (eVU-ER™) and its industry leading 20+ hours of continuous video playback from a single battery, we continue to expand our leadership in dedicated portable IFE systems. We expect new IFE business and follow-on orders this quarter and in calendar 2008.”

“Our IP team is preparing detailed documentation to support additional enforcement actions of our Flash-R™ patent portfolio against a broad range of companies,” added Blakeley. “The recent commencement of enforcement actions was an important milestone and we look forward to monetizing our investment in a robust intellectual property asset base which includes being the first company to employ and patent important aspects of the use of removable flash memory in portable recording devices.”

About e.Digital Corporation: e.Digital is a leading innovator of dedicated portable inflight entertainment systems. More than 30 airlines have made dedicated portable systems powered by e.Digital technology their inflight entertainment choice. e.Digital also owns and is pursuing the monetization of its Flash-R™ portfolio of flash memory-related patents. e.Digital was the first company to employ and patent important aspects of the use of removable flash memory in portable recording devices. For more information about e.Digital and eVU, please visit: www.edigital.com.

Safe Harbor statement under the Private Securities Litigation Reform of 1995: All statements made in this document, other than statements of historical fact, are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act. You should not place undue reliance on these statements. We base these statements on particular assumptions that we have made in light of our industry experience, the stage of product and market development, expected future developments and other factors that we believe are appropriate under the circumstances. These forward-looking statements are based on the then-current expectations, beliefs, assumptions, estimates and forecasts about the businesses of the Company and the industries and markets in which the Company operates. Actual outcomes and results may differ materially from what is expressed or implied by the forward-looking statements. More information about potential factors that could affect the Company can be found in its most recent Form 10-K, Form 10-Q and other reports and statements filed with the Securities and Exchange Commission (“SEC”). e.Digital Corporation disclaims any intent or obligation to update these or any forward-looking statements, except as otherwise specifically stated by it.

CONTACT: e.Digital Corporation: Robert Putnam, (858) 304-3016 ext. 205, rputnam@edigital.com

e.Digital Corporation and subsidiary
Condensed Balance Sheet
(000's omitted except per share amount)
(unaudited)
			September 30	March 31,
			2007	2007
			$	$
ASSETS
	Current
		Cash	430	695
		Accounts receivable	918	37
		Inventory	363	309
		Deposits and prepaid expenses	52	51
	Total current assets		1,763	1,092
		Property and equipment, net	29	36
		Prepaid transaction costs	-	629
	Total assets		1,792	1,757
LIABILITIES AND STOCKHOLDERS' DEFICIT
	Current
		Accounts payable	1,221	687
		Other accounts payable and accrued liabilities	236	131
		Accrued employee benefits	162	150
		Deposits and deferred revenue	128	119
		Dividends	519	464
		Current maturity of convertible note, net	240	139
		Secured promissory note, net	643	750
	Total current liabilities		3,149	2,440
	Long term		687	754
	Stockholders’ deficit		(2,044)	(1,437)
	Total liabilities and stockholders' deficit		1,792	1,757

e.Digital Corporation and subsidiary
Condensed Statement of Operations
(000's omitted except per share amount)
(unaudited)

		For the three months ended September 30		For the six months ended September 30
		2007	2006	2007	2006
		$	$	$	$
Total revenue		2,420	13	3,724	34
Cost of revenue		1,822	13	2,881	29
	Gross profit	597	0	844	5
Operating expenses:
	Selling and administrative	472	477	943	813
	Research and development	216	402	496	754
Total operating expenses		688	879	1,439	1,567
Operating profit (loss)		(91)	(879)	(596)	(1,562)
Other income (expenses):
	Interest income	26	3	26	10
	Interest expense	(63)	(499)	(132)	(946)
	Other	(30)	(231)	(50)	(231)
Total other income (expenses)		(67)	(727)	(155)	(1,167)
Loss and comprehensive loss		(158)	(1,605)	(751)	(2,729)
	Dividends on convertible preferred stock	(28)	(33)	(55)	(67)
Loss attributed to common stockholders		(185)	(1,638)	(806)	(2,796)
Loss per common share - basic and diluted		(0.00)	(0.01)	(0.00)	(0.01)
Weighted average common shares outstanding		246,361	205,997	245,391	203,379

CONTACT: e.Digital Corporation: Robert Putnam, (858) 304-3016 ext. 205, rputnam@edigital.com

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