Arotech Subsidiary FAAC Inc Receives
$2.2 Million of Orders in May

New contracts and contract extensions for military and commercial applications

May 27, 2004 - Arotech Corporation (NasdaqNM: ARTX) announced today that its FAAC subsidiary has received contracts and contract extensions totaling $2.24M during the month of May. The contracts include the sale of driving simulator related products as well as several military operation programs.

One of the contract extensions for a transportable driving simulator came from the Center For Transportation Studies (CTS) in Denver Colorado. The simulator is the seventh simulator that CTS has ordered. CTS provides turnkey driver training services featuring FAAC simulators combined with classroom training and live driving.

“The on-going relationship between CTS and FAAC has been very positive for both sides,” noted Al Jordan, FAAC President. “CTS provides excellent curriculum based training, and some of their customers may later purchase their own simulator from FAAC.”

“Contract awards in May are tracking pretty closely with our projections for the year,” said Robert S. Ehrlich, Arotech Chairman and CEO. “We foresee continuing sales growth in all of our sectors – commercial driving simulators, military driving simulators and our niche military operations areas.”

About FAAC Inc.

FAAC Incorporated has been providing high fidelity training and simulation products to it's military and commercial customer base for over 30 years. FAAC supplies driving simulators for training operators of automobiles, trucks, police/fire/EMS vehicles, bus drivers, light rail operators, and airport ground vehicles. Over 80,000 drivers have been trained on FAAC's installed base of 173 driving simulators. FAAC also provides pilot decision-making support software for the F-15, F-18, and JSF aircraft as well as simulation models for the ACMI/TACTS air combat training ranges.

About Arotech Corporation

Arotech Corporation provides quality defense and security products for the military, law enforcement and homeland security markets, including advanced zinc-air and lithium batteries and chargers, multimedia interactive simulators/trainers and lightweight vehicle armoring.

The Battery and Power Systems Division includes Electric Fuel Battery Corporation and Epsilor Electronic Industries. The Simulation, Training and Consulting Division includes IES Interactive Training, FAAC Incorporated and Arocon Security Consulting. The Armored Vehicle Division includes MDT Armor Corp and MDT Protective Industries Ltd.

Arotech is incorporated in Delaware, with corporate offices in New York, and research, development and production subsidiaries in Alabama, Colorado, Michigan and Israel.

Except for the historical information herein, the matters discussed in this news release include forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. Readers are cautioned not to place undue reliance on these forward-looking statements, as they are subject to various risks and uncertainties that may cause actual results to vary significantly. These risks and uncertainties include, but are not limited to, risks relating to: product and technology development; the uncertainty of the market for Arotech’s products; changing economic conditions; delay, cancellation or non-renewal, in whole or in part, of contracts or of purchase orders; and other risk factors detailed in Arotech’s most recent Annual Report on Form 10-K for the fiscal year ended December 31, 2003 and other filings with the Securities and Exchange Commission. Arotech assumes no obligation to update the information in this release. Reference to the Company’s website above does not constitute incorporation of any of the information thereon into this press release.