EXHIBIT 99.1

FOR IMMEDIATE RELEASE
CONTACT:
George Morgenstern, CEO
DATA SYSTEMS & SOFTWARE INC.
(201) 529-2026
e-mail: ir@dssiinc.com


DSSI TO TRANSFER TO NASDAQ SMALLCAP MARKET

MAHWAH,  NJ - February  27, 2003 Data  Systems & Software  Inc.  (NASDAQ:  DSSI)
announced  today that, as a result of a decision by a Nasdaq Listing Panel,  the
listing for its Common Stock will be transferred to the Nasdaq SmallCap Market.
The Company has requested a review of the Listing Panel's decision by the Nasdaq
Listing Council.  The review request does not delay effectiveness of the Listing
Panel's decision. The Listing Council has the authority to reverse or modify the
Panel's decision or refer it back to the Listing Panel for reconsideration.  The
Company's  Common  Stock will  continue to trade on the Nasdaq  National  Market
until the close of trading on Friday,  February 28, 2003 and will begin  trading
on the Nasdaq SmallCap Market at the commencement of trading on Monday, March 3,
2003.
                                       ***
ABOUT DATA SYSTEMS & SOFTWARE INC.
Data  Systems  &  Software  Inc.  is  a  provider  of  software  consulting  and
development  services,  and is an  authorized  direct  seller  and  value  added
reseller of computer hardware. Through its Comverge Technologies subsidiary, the
Company provides energy intelligence solutions to utilities.
FOR MORE INFORMATION, CONTACT:
At the Company,  George  Morgenstern,  CEO, (201) 529-2026,  ir@dssiinc.com.  At
                                                             ---------------
National Financial Network,  Gary Geraci,  Investor  Relations,  (781) 444-6100,
extension  629 or (800)  343-4874,  extension  629,  garyg@otcfn.com
                                                     ----------------
THIS PRESS RELEASE  INCLUDES  FORWARD-LOOKING  STATEMENTS,  WHICH ARE SUBJECT TO
RISKS  AND   UNCERTAINTIES,   INCLUDING  RISKS  ASSOCIATED  WITH  (I)  CONTINUED
ELIGIBILITY  FOR LISTING FOR THE COMPANY'S  STOCK ON THE NASDAQ SMALL  CAPMARKET
AND (II) THE  REQUESTED  REVIEW BY THE LISTING  COUNCIL OF THE  LISTING  PANEL'S
DECISION.  ACTUAL  RESULTS  MAY VARY FROM  THOSE  PROJECTED  OR  IMPLIED  BY THE
FORWARD-LOOKING  STATEMENTS IN THIS RELEASE.  ALTHOUGH THE COMPANY COMPLIES WITH
ALL CRITERIA FOR LISTING ON THE NASDAQ SMALLCAP MARKET AND BELIEVES THAT IT WILL
BE  ELIGIBLE TO MAINTAIN  SUCH  LISTING,  RESULTS OF  OPERATIONS  AND/OR  MARKET
CONDITIONS  MAY  ADVERSELY  AFFECT THE  COMPANY'S  ELIGIBILITY  TO MAINTAIN SUCH
LISTING  OVER  THE  LONG  TERM.  A  MORE   COMPLETE   DISCUSSION  OF  RISKS  AND
UNCERTAINTIES  WHICH MAY AFFECT THE COMPANY'S  BUSINESS GENERALLY IS INCLUDED IN
"BUSINESS--FACTORS WHICH MAY AFFECT FUTURE RESULTS" IN THE COMPANY'S MOST RECENT
ANNUAL  REPORT  ON FORM 10-K AS FILED BY THE  COMPANY  WITH THE  SECURITIES  AND
EXCHANGE COMMISSION.

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