<?xml version="1.0"?>
<ownershipDocument>

    <schemaVersion>X0202</schemaVersion>

    <documentType>4</documentType>

    <periodOfReport>2006-07-27</periodOfReport>

    <notSubjectToSection16>1</notSubjectToSection16>

    <issuer>
        <issuerCik>0000702259</issuerCik>
        <issuerName>DIAGNOSTIC PRODUCTS CORP</issuerName>
        <issuerTradingSymbol>DP</issuerTradingSymbol>
    </issuer>

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0001292478</rptOwnerCik>
            <rptOwnerName>Schultz Gary A</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>C/O DIAGNOSTIC PRODUCTS CORPORATION</rptOwnerStreet1>
            <rptOwnerStreet2>5210 PACIFIC CONCOURSE DRIVE</rptOwnerStreet2>
            <rptOwnerCity>LOS ANGELES</rptOwnerCity>
            <rptOwnerState>CA</rptOwnerState>
            <rptOwnerZipCode>90045</rptOwnerZipCode>
            <rptOwnerStateDescription></rptOwnerStateDescription>
        </reportingOwnerAddress>
        <reportingOwnerRelationship>
            <isDirector>0</isDirector>
            <isOfficer>0</isOfficer>
            <isTenPercentOwner>0</isTenPercentOwner>
            <isOther>1</isOther>
            <otherText>Controller</otherText>
        </reportingOwnerRelationship>
    </reportingOwner>

    <derivativeTable>
        <derivativeTransaction>
            <securityTitle>
                <value>Common Stock Option - Right to Buy</value>
            </securityTitle>
            <conversionOrExercisePrice>
                <value>42.12</value>
            </conversionOrExercisePrice>
            <transactionDate>
                <value>2006-07-27</value>
            </transactionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>D</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
            </transactionCoding>
            <transactionAmounts>
                <transactionShares>
                    <value>5000</value>
                </transactionShares>
                <transactionPricePerShare>
                    <footnoteId id="F2"/>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>D</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <exerciseDate>
                <footnoteId id="F1"/>
            </exerciseDate>
            <expirationDate>
                <value>2014-05-27</value>
            </expirationDate>
            <underlyingSecurity>
                <underlyingSecurityTitle>
                    <value>Common Stock</value>
                </underlyingSecurityTitle>
                <underlyingSecurityShares>
                    <value>5000</value>
                </underlyingSecurityShares>
            </underlyingSecurity>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>0</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </derivativeTransaction>
    </derivativeTable>

    <footnotes>
        <footnote id="F1">1,000 vested annually on January 27, 2005 through January 27, 2006. 1,000 will vest annually on January 27, 2007 through
 January 27, 2009.</footnote>
        <footnote id="F2">Cancelled pursuant to the Agreement and Plan of Merger, dated as of April 26, 2006, by and among the issuer, Siemens Medical
 Solutions USA, Inc., and Dresden Acquisition Corporation (the &quot;Merger Agreement&quot;) in exchange for an amount equal to $58.50
 for each share of common stock of the issuer subject to the cancelled option, less the applicable exercise price and any
 applicable withholding taxes, the aggregate amount of which is payable in the form of cash.</footnote>
    </footnotes>

    <ownerSignature>
        <signatureName>James L. Brill, Authorized Signer</signatureName>
        <signatureDate>2006-07-27</signatureDate>
    </ownerSignature>
</ownershipDocument>
