SO. ST. PAUL, MN (September 14, 2006) … Digital Angel Corporation (Amex: DOC), an advanced technology company in the field of rapid and accurate identification, location tracking, and condition monitoring of high-value assets, announced today that sales of its electronic RFID (radio frequency identification) livestock tags in Canada and the U.S. are expected to surpass 1.9 million tags by the end of September which, after only nine months, is nearly 12 percent higher than the total of 1.7 million sold in all of 2005.

The increased sales are generally due to a greater awareness of the value that electronic tags (e-tags) provide for livestock traceability, which is fueled in part by the federal government-sponsored National Animal Identification System, said President and CEO Kevin N. McGrath. McGrath noted that while the national system is not due to be fully implemented until 2009, cattle ranchers are beginning to make the move toward electronic tagging which allows beef purchasers the ability to know where the cattle have been throughout their lives.

“We are seeing an evolution in the cattle ranching industry, particularly among the sophisticated, large cattle buyers, toward electronic tagging,” McGrath said. “The full adoption of the NAIS program is still in the future, but beef producers and the general public are much more aware today of the importance of traceability, particularly given the issues surrounding Mad Cow Disease and other potential animal health issues such as Hoof and Mouth Disease. We believe this general awareness is a trend that is here to stay.”

The sales increases are generally coming from Digital Angel’s larger U.S. and Canadian distributors who have traditionally been leaders in driving the adoption of advances in cattle tagging in the industry, McGrath added. Canada is also working toward implementing a national livestock identification system and is further along in the process than the U.S.

McGrath also noted that sales of visual tags, another key element in Digital Angel’s livestock tagging business, remain strong along with the increase in electronic tag sales. Many ranchers have both tags on their cattle, he said.

Digital Angel also recently announced that it had begun selling electronic livestock tags in Brazil, the largest beef exporting country in the world and home to nearly 200 million cattle. Digital Angel currently has a livestock tag sales presence in six Latin American countries including Argentina, Brazil, Chile, Ecuador, Mexico and Uruguay.

About Digital Angel Corporation

Digital Angel Corporation develops and deploys sensor and communications technologies that enable rapid and accurate identification, location tracking, and condition monitoring of high-value assets. Applications for the Company’s products include identification and monitoring of humans, pets, fish, poultry and livestock through its patented implantable microchips; location tracking and message monitoring of vehicles and aircraft in remote locations through systems that integrate GPS and geosynchronous satellite communications; and monitoring of asset conditions such as temperature and movement, through advanced miniature sensors.

Digital Angel Corporation is majority-owned by Applied Digital Inc. (Nasdaq:ADSX). For more information about Digital Angel, please visit http://www.digitalangelcorp.com/.

The statements in this press release that are not strictly historical, are "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and are intended to be covered by the safe harbors created by these sections. The forward-looking statements are subject to risks and uncertainties and the actual results that the Company achieves may differ materially from these forward-looking statements due to such risks and uncertainties, including, but not limited to, that Applied Digital Inc. owns 55.4% of the Company’s common stock, that new accounting pronouncements regarding expensing of share based compensation may impact the Company’s future results of operations, the Company may continue to incur net losses, infringement by third parties on the Company’s intellectual property or development of substantially equivalent proprietary technology by the Company’s competitors could negatively impact the Company’s business, domestic and foreign government regulation and other factors could impair the Company’s ability to develop and sell its products in certain markets, the Company relies on sales to government contractors for its animal identification and search and rescue beacon products, and any decline in the demand by these customers for such products could negatively affect the Company’s business, the Company depends on a single production arrangement for its patented syringe-injectable microchips, and the loss of or any significant reduction in the production could have an adverse effect on the Company’s business, technological change could cause the Company’s products to become obsolete, the loss of one of the Company’s principal customers could negatively impact the Company’s net revenue, the Company’s earnings will decline if the Company writes off goodwill and other intangible assets, options and warrants outstanding and available for issuance may adversely affect the market price of the Company’s common stock, currency exchange rate fluctuations could have an adverse effect on the Company’s sales and financial results, the Company depends on a small team of senior management. A detailed statement of risks and uncertainties is contained in the Company’s reports to the Securities and Exchange Commission, including in particular the Company’s Form 10-K for the fiscal year ended December 31, 2005. Investors and stockholders are urged to read this document carefully. The Company can offer no assurances that any projections, assumptions or forecasts made or discussed in this release will be met, and investors should understand the risks of investing solely due to such projections. The Company undertakes no obligation to revise any forward-looking statements in order to reflect events or circumstances that may arise after the date of this press release.