<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS IN THE ANNUAL REPORT ON FORM 10-K OF DSP GROUP, INC. FOR
THE YEAR ENDED DECEMBER 31, 1996 AND IS QUALIFIED IN ITS ENTIRETY TO SUCH
FINANCIAL STATEMENTS
</LEGEND>
<MULTIPLIER> 1,000
       
                             
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          DEC-31-1996
<PERIOD-START>                             JAN-01-1996
<PERIOD-END>                               DEC-31-1996
<CASH>                                          12,172
<SECURITIES>                                    30,762
<RECEIVABLES>                                    5,469
<ALLOWANCES>                                       636
<INVENTORY>                                      2,957
<CURRENT-ASSETS>                                52,609
<PP&E>                                           7,324
<DEPRECIATION>                                   4,033
<TOTAL-ASSETS>                                  59,207
<CURRENT-LIABILITIES>                            4,758
<BONDS>                                              0
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<COMMON>                                            10
<OTHER-SE>                                      54,439
<TOTAL-LIABILITY-AND-EQUITY>                    59,207
<SALES>                                         41,290
<TOTAL-REVENUES>                                52,910
<CGS>                                           29,432
<TOTAL-COSTS>                                   30,528
<OTHER-EXPENSES>                                 8,481
<LOSS-PROVISION>                                     0
<INTEREST-EXPENSE>                                 158
<INCOME-PRETAX>                                  7,036
<INCOME-TAX>                                     1,057
<INCOME-CONTINUING>                              5,979
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                     5,979
<EPS-PRIMARY>                                     0.62
<EPS-DILUTED>                                     0.62