Form S-8

Title of Securities to be registered¹	Amount to be registered	Proposed maximum offering price per share ²		Proposed maximum aggregate offering price²		Amount of registration fee

1997 Stock Option Plan

Common Stock Par Value $0.001	1,431,243	$	18.20	$	26,048,622.60	$	2,396.47

(a) The Company’s latest annual report on Form 10-K filed pursuant to Sections 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), containing audited financial statements for the Company’s latest fiscal year ended December 31, 2001, as filed with the Securities and Exchange Commission on March 22, 2002.

Arthur Andersen LLP has not consented to the incorporation by reference in this registration statement of their report on the financial statements of the Company that is included in our most recent annual report on Form 10-K, and we have dispensed with the requirement to file their consent in reliance upon Rule 437a under the Securities Act of 1933, as amended (the “Securities Act”). Because Arthur Andersen LLP has not consented to the incorporation by reference of their report in this registration statement, you will not be able to recover against Arthur Andersen LLP under Section 11(a) of the Securities Act.

Section 11(a) provides that if any part of a registration statement, at the time such registration statement becomes effective, contains any untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading, any person acquiring a security pursuant to such registration statement (unless such person knows of such untruth or omission) may sue, among others, every accountant who has consented to be named as having prepared or certified any part of the registration statement, or as having prepared or certified any report or valuation that is used in connection with the registration statement, with respect to the statement in such registration statement, report or valuation that purports to have been prepared or certified by the accountant. This Registration Statement on Form S-8 incorporates under Item 3 certain filings of the Company that include financial statements certified by Arthur Andersen.

Because we are unable to obtain Arthur Andersen’s written consent to the incorporation by reference of their report on such financial statements, Rule 437a permits us to file this Registration Statement without that written consent. Because it did not consent, Arthur Andersen does become subject to liability under Section 11(a), as discussed above. Consequently, stockholders would be unable to sue Arthur Andersen under Section 11(a) in connection with the purchase or sale of securities. However, other persons who are subject to liability under Section 11, including the Company’s officer and directors, may still rely on Arthur Andersen’s original audit reports as being made by an expert for purposes of establishing a due diligence defense under Section 11(b) of the Securities Act.

All documents subsequently filed by the Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a post-effective amendment to this registration statement which indicates that all securities offered hereby have been sold or which deregisters all securities remaining unsold, shall be deemed to be incorporated by reference in this registration statement and to be a part hereof from the date of filing of such documents.

Section 102(b) of the Delaware General Corporation Law authorizes a corporation to provide in its Certificate of Incorporation that a director of the corporation shall not be personally liable to a corporation or its stockholders for monetary damages for breach or alleged breach of the director’s “duty of care.” While this statute does not change the directors’ duty of care, it enables corporations to limit available relief to equitable remedies such as injunction or rescission. The statute has no effect on a director’s duty of loyalty or liability for acts or omissions not in good faith or involving intentional misconduct or knowing violations of law, illegal payment of dividends or stock redemptions or repurchases, or for any transaction from which the director derives an improper personal benefit. As permitted by the statute, the Company has adopted provisions in its Certificate of Incorporation which eliminate to the fullest extent permissible under Delaware law the personal liability of its directors to the Company and its stockholders for monetary damages for breach or alleged breach of their duty of care.

Section 145 of the General Corporation Law of the State of Delaware provides for the indemnification of officers, directors, employees and agents of a corporation. The Bylaws of the Company provide for indemnification of its directors, officers, employees and agents to the full extent permitted by Delaware law, including those circumstances in which indemnification would otherwise be discretionary under Delaware law. The Company’s Bylaws also empower it to enter into indemnification agreements with its directors and officers and to purchase insurance on behalf of any person whom it is required or permitted to indemnify. The Company has entered into agreements with its directors and certain of its executive officers that require the Company to indemnify such persons to the fullest extent permitted under Delaware law against expenses, judgments, fines, settlements and other amounts actually and reasonably incurred (including expenses of a derivative action) in connection with any proceeding, whether actual or threatened, to which any such person may be made a party by reason of the fact that such person is or was a director or an executive officer of the Company or any of its affiliated enterprises. The indemnification agreements also set forth certain procedures that will apply in the event of a claim for indemnification thereunder.

Section 145 of the General Corporation Law of the State of Delaware provides for indemnification in terms sufficiently broad to indemnify such individuals, under certain circumstances, for liabilities (including reimbursement of expenses incurred) arising under the Securities Act of 1933, as amended (the “Securities Act”).

(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement;

provided, however, that paragraphs (a)(1)(i) and (a)(l)(ii) do not apply if the registration statement is on Form S-3 or Form S-8, and the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed by the registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that are incorporated by reference in the registration statement.

(2) That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the registrant’s annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

Pursuant to the requirements of the Securities Act, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of San Jose, State of California, on January 23, 2003.

The officers and directors of Power Integrations, Inc. whose signatures appear below, hereby constitute and appoint Balu Balakrishnan and John M. Cobb, and each of them, their true and lawful attorneys and agents, with full power of substitution, each with power to act alone, to sign and execute on behalf of the undersigned any amendment or amendments to this registration statement on Form S-8, and each of the undersigned does hereby ratify and confirm all that each of said attorney and agent, or their or his substitutes, shall do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on January 17, 2003.

Signature				Title

/s/ BALU BALAKRISHNAN Balu Balakrishnan				President, Chief Executive Officer and Director (Principal Executive Officer)

/s/ JOHN M. COBB John M. Cobb				Vice President of Finance and Chief Financial Officer (Principal Financial and Accounting Officer)

/s/ HOWARD F. EARHART				Director
Howard F. Earhart

/s/ E. FLOYD KVAMME				Director
E. Floyd Kvamme

/s/ STEVEN J. SHARP				Director
Steven J. Sharp

/s/ R. SCOTT BROWN				Director
R. Scott Brown

/s/ NICHOLAS BRATHWAITE				Director
Nicholas Brathwaite

/s/ ALAN D. BICKELL				Director
Alan D. Bickell

4.1		Restated Certificate of Incorporation of the Company is incorporated by reference to Exhibit 3.1 to the Company’s Registration Statement on Form S-1 filed with the Securities and Exchange Commission on September 11, 1997 (File No. 333-35421)

4.2		Bylaws of the Company are incorporated by reference to Exhibit 3.2 to the Company’s Registration Statement on Form S-1 filed with the Securities and Exchange Commission on September 11, 1997 (File No. 333-35421)

4.3		Form of Rights Agreement between the Company and BankBoston, N.A., as Rights Agent, is incorporated by reference to Exhibit 1 to the Company’s report on Form 8-K filed with the Securities and Exchange Commission on March 12, 1999 (File No. 000-23441)

5		Opinion of Legality

23.1		Consent of Counsel (included in Exhibit 5)

23.2		Consent of Independent Accountants – Unavailable and omitted pursuant to Rule 437a of the Securities Act of 1933, as amended.

24		Power of Attorney (included in signature pages to this registration statement)

Delaware		94-3065014
(State or other jurisdiction of incorporation or other organization)		I.R.S. Employer Identification No.)

POWER INTEGRATIONS, INC.

By:		/s/ JOHN M. COBB
		John M. Cobb Vice President of Finance and Chief Financial Officer