[SPATIALIZER AUDIO LABORATORIES, INC. LOGO]



                                                     CONTACT: INVESTOR RELATIONS
                                                           Henry R. Mandell, CEO
                                            Spatializer Audio Laboratories, Inc.
                                                             408-453-4180 Ext. 4
                                               E-mail:  investor@spatializer.com

                 Spatializer Audio Laboratories Concludes Major
         Multi-Technology Licensing Agreement with Samsung Electronics

            New License Agreement for Spatializer UltraMobile HD(TM)
                     Projected to Expand its Customer Base

SAN JOSE, CALIF., AUGUST 26, 2004 - Marking a significant step in expanding its
customer base, Spatializer Audio Laboratories, Inc. (OTCBB: SPAZ) announced
today that on August 22, 2004, through its wholly-owned subsidiary, Desper
Products, Inc., it entered into a license agreement with Samsung Electronics,
Co. Ltd., a leader in advanced semiconductor technology. Under this license
agreement, Samsung will have a nonexclusive license to use the Spatializer
UltraMobile HD technology in certain products, including DVDs and portable
digital audio players. Samsung intends to make this technology a standard
feature in its product offerings. Spatializer expects to generate meaningful
revenue by expanding its customer base in the near future.

This transaction marks the beginning of a new Spatializer initiative to license
its technologies directly to semiconductor companies. Spatializer UltraMobile HD
delivers higher definition digital audio to mobile audio systems through the
multiple and complementary use of Spatializer Natural Headphone(TM), Spatializer
Vi.B.E.(TM) and Spatializer PCE(TM). Spatializer UltraMobile HD improves the
performance of low cost headphones or ear buds, as well as from compressed audio
by opening up the sound field while improving bass performance.

In addition to Spatializer UltraMobile HD, Spatializer N-2-2 Ultra(TM) and
Spatializer VirtualSurround VBX(TM) are included in the licensed technology
portfolio.

Spatializer Chairman and CEO Henry R. Mandell stated, "We are very pleased to
enter into this agreement with Samsung. First, widespread distribution of
Spatializer's proven IP makes it feasible to deliver a rich suite of
technologies as a standard feature. Second, this transaction allows us to
streamline the licensing process by directly serving a single major customer and
leveraging their powerful distribution, rather than sourcing and servicing
multiple smaller customers. Third, it strengthens the Spatializer brand on a
truly global basis. Lastly, this transaction places us solidly in the rapidly
growing mobile audio market and allows us to grow with the market."




"This agreement with Spatializer enables Samsung Electronics to provide
differentiated 3D Virtual Surround technologies on silicon chip supporting
sound/music functions for the applications such as DVD Player and MP3 Player."
said K.H. Shin, senior manager of Samsung Electronics' System LSI division.
"These advanced technologies and special features will fully satisfy the high
demands of customers and enforce Samsung's presence in the multimedia
system-on-chip semiconductor market."

About Spatializer

Spatializer Audio Laboratories Inc. is a leading developer, licensor and
marketer of next-generation technologies for the consumer electronics, computing
and entertainment industries. The company's advanced audio technology is
incorporated into consumer electronics audio and video products from global
brand leaders including Toshiba, Sanyo and Sharp, among others. Spatializer
stock is traded on the OTC Bulletin Board under the symbol: SPAZ. The company is
headquartered in San Jose, CA, with executive offices in Westlake Village, CA
and representative offices throughout Japan and in Korea. Further information
may be obtained from the company's web site, www.spatializer.com, Spatializer
SEC filings, and by contacting the company's Investor Relations Department at
408-453-4180 or by writing to investor@spatializer.com.

Safe Harbor Act Statement Under the Private Securities Litigation Reform Act of
1995: Certain information in this news release, including the comments by Mr.
Mandell in this press release are forward looking statements that are based on
management's belief, as well as assumptions made by, and information currently
available to management. While the company believes that its expectations are
based upon reasonable assumptions, there can be no assurances that the company's
financial goals will be realized. Numerous uncertainties and risk factors may
affect the company's actual results and may cause results to differ materially
from those expressed in forward-looking statements made by or on behalf of the
company. These uncertainties and risk factors include, but are not limited to
the continued need for additional capital, dependence on new technology and
intellectual property, dependence on the PC and consumer electronics industries,
dependence on product shipments of third-party licensees, dependence on
third-party technology integrators or chip suppliers, competition and pricing
pressures, and other risks detailed from time to time in the company's periodic
reports filed with the Securities and Exchange Commission. The company assumes
no obligation to update the information in this press release.

NOTE: Desper Products Inc. is a wholly owned subsidiary of Spatializer Audio
Laboratories Inc. Spatializer(r) is a registered trademark and Spatializer
UltraMobile HD(tm), Spatializer N-2-2 Ultra(tm), Spatializer VirtualSurround
VBX.(tm), Spatializer Natural Headphone(TM), Spatializer PCE(TM) and Spatializer
Vi.B.E.(tm) are trademarks of Desper Products Inc. All other trademarks are the
property of their respective owners. Copyright (c) 2004 Spatializer Audio
Laboratories, Inc.