EXHIBIT 99.1

AvTel Executes Stock Purchase Agreement To Sell Residential Long Distance
Business

Divested Unit To Be Treated As Discontinued Operations

     SANTA BARBARA, Calif.--(BUSINESS WIRE)--Sept. 2, 1999--AvTel
Communications Inc. (Nasdaq:AVCO - news), a single-source provider of
Enterprise Network Solutions, today announced that it has executed a Stock
Purchase Agreement to sell 100% of the stock of its wholly-owned subsidiary
Matrix Telecom, Inc. to Platinum Equity Holdings.

Matrix Telecom, based in Ft Worth, TX, is AvTel's residential long distance
telephone subsidiary. This unit sells and markets a bundled portfolio of
personal telephone services and dial-up Internet access through independent
distributors and agents to residential customers and small-office,
home-office customers. The closing of the transaction is subject to certain
contingencies, including regulatory consents and the approval of AvTel
shareholders. Shareholders representing over 50% of votes required to
approve the transaction have indicated that they will vote in favor of the
agreement.

The agreement reflects AvTel's recent decision to exit the residential long
distance business and focus on business customers. Matrix Telecom is
expected to be reflected as a discontinued operation in future financial
statement presentations. Consequently, the operating results and
comparative historical information of Matrix Telecom will be presented as a
single line "discontinued operations" in AvTel's statement of operations.

"This move marks the beginning of a strong initiative and a very clear
focus of servicing our business customers," stated Anthony E. Papa, AvTel's
Chairman and Chief Executive Officer. "We have worked diligently to
complete the divestiture of the residential long distance business prior to
the launch of NetLojix on September 15, 1999. We expect to record a gain on
the sale upon final closing of approximately $5.8 million, subject to any
purchase price adjustments and a future earn-out."

Mr. Papa continued, "We believe that the average business customer needs
more than the ubiquitous carrier access available from the multitude of
competitive telecom companies. Businesses today need solutions. They need
data-oriented technology partners capable of servicing their entire
enterprise versus providing connectivity to a point of demarcation. The
average small to medium size business customer requires the services of a
provider capable of integrating and supporting a total solution to the
desktop. These services include LAN/WAN design, integration, management and
support. AvTel is a comprehensive single-source solution provider for
mid-size businesses."

Platinum Equity Holdings, LLC, (www.peh.com) is one of the top-10 privately
held information technology companies in the United States specializes in
acquiring and operating mission-critical technology organizations and
technology-enabled service companies throughout the world.


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AvTel Communications Inc., soon to be NetLojix Communications Inc., is a
provider of integrated data communications services, network management and
IT support, creating enterprise-wide network solutions for business
customers. The Company provides carrier transport services including
dedicated private line, frame relay, ATM, ADSL, and dial-up Internet access
through more than 700 points-of-presence (POPs). The Company markets and
sells a broad range of advanced network services through direct sales
professionals. For further information, please visit the Company's Web site
at www.avtel.com.

All statements in this news release other than statements of historical
fact are forward-looking statements that involve substantial risks and
uncertainties. A Letter of Intent is not a binding agreement. There can be
no assurances that the Matrix sale referenced herein will be consummated,
nor that it will be consummated on the terms referenced herein, or on a
timely basis. Reference is made to the Company's Annual Report on Form 10K
and Form 10-K/A for the year ended Dec. 31, 1998, to the Quarterly Report
on Form 10-Q for the quarter ended June 30, 1999, and to the company's
other reports filed with the Securities and Exchange Commission for a
discussion of such risks and uncertainties and other factors that may have
material effect on the company's business.


Contact:

AvTel Communications Inc.
Todd Greene, VP Marketing, 805/884-6300
tgreene@avtel.com
OR
Mary McCarthy, Investor Relations 714/914-5495
mccarthy@avtel.com



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