EXHIBIT 99.1


FOR IMMEDIATE RELEASE                               CONTACT:        LES VAN DYKE
                                                    DIRECTOR, INVESTOR RELATIONS
                                                                  (281) 492-5370

        DIAMOND OFFSHORE DRILLING, INC. ANNOUNCES PRICING OF $250 MILLION
                              SENIOR NOTE OFFERING

Houston, Texas, August 25, 2004 -- Diamond Offshore Drilling, Inc. (NYSE:DO)
today reported the pricing of $250 million of the Company's 5.15% senior
unsecured notes due September 1, 2014. The notes were offered at 99.759% of the
principal amount. Closing of the transaction is scheduled for August 27, 2004,
subject to customary closing conditions.

The Company intends to use the net proceeds from the sale of the notes to
partially fund a refinancing of the Company's zero coupon convertible debentures
due 2020. The holders of those debentures can require the Company to repurchase
their debentures on June 6, 2005 at the issue price plus accrued original issue
discount of 3.5% per year, or the accreted value. The Company has the option to
repurchase all or part of the debentures on or after June 6, 2005 at the
accreted value. As of June 30, 2004, the aggregate accreted value of the
debentures was $463 million. On June 6, 2005, the accreted value of the
debentures currently outstanding will be approximately $478 million.

This notice does not constitute an offer to sell or the solicitation of an offer
to buy securities. Any offers of the securities will be made only by means of a
private offering memorandum. The notes have not been registered under the
Securities Act of 1933 or the securities laws of any other jurisdiction and will
not be offered or sold in the United States absent registration or an applicable
exemption from the registration requirements.

Diamond Offshore is a leader in deep water drilling. The Company's fleet of 45
offshore drilling rigs consists of 30 semisubmersibles, 14 jack-ups and one
drillship. The fleet operates in the waters of six of the world's seven
continents.

Statements in this press release may contain "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended, and are
inherently subject to a variety of risks and uncertainties that could cause
actual results to differ materially from those anticipated or projected. A
discussion of the risk factors that could impact these areas and the Company's
overall business and financial performance can be found in the Company's reports
and other filings with the Securities and Exchange Commission. These factors
include, among others, general economic and business conditions, casualty
losses, industry fleet capacity, changes in foreign and domestic oil and gas
exploration and production activity, competition, changes in foreign, political,
social and economic conditions, regulatory initiatives and compliance with
governmental regulations, customer preferences and various other matters, many
of which are beyond the Company's control. Given these concerns, investors and
analysts should not place undue reliance on forward-looking statements. Each
forward-looking statement speaks only as of the date of this press release. The
Company expressly disclaims any obligation or undertaking to release publicly
any updates or revisions to any forward-looking statement to reflect any change
in the Company's expectations with regard thereto or any change in events,
conditions or circumstances on which any forward-looking statement is based.