<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS IN THE QUARTERLY REPORT ON FORM 10-Q OF DSP GROUP, INC. FOR
THE QUARTER ENDED SEPTEMBER 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
       
                             
<PERIOD-TYPE>                   9-MOS
<FISCAL-YEAR-END>                          DEC-31-1997
<PERIOD-START>                             JAN-01-1997
<PERIOD-END>                               SEP-30-1997
<CASH>                                          14,911
<SECURITIES>                                    46,281
<RECEIVABLES>                                    3,393
<ALLOWANCES>                                       811
<INVENTORY>                                      3,987
<CURRENT-ASSETS>                                70,610
<PP&E>                                           8,745
<DEPRECIATION>                                 (4,976)
<TOTAL-ASSETS>                                  76,889
<CURRENT-LIABILITIES>                           10,707
<BONDS>                                              0
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<COMMON>                                            10
<OTHER-SE>                                      66,172
<TOTAL-LIABILITY-AND-EQUITY>                    76,889
<SALES>                                         37,626
<TOTAL-REVENUES>                                45,378
<CGS>                                           23,306
<TOTAL-COSTS>                                   24,428
<OTHER-EXPENSES>                                 6,043
<LOSS-PROVISION>                                     0
<INTEREST-EXPENSE>                                   0
<INCOME-PRETAX>                                  9,255
<INCOME-TAX>                                     1,666
<INCOME-CONTINUING>                                  0
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                     7,589
<EPS-PRIMARY>                                      .76
<EPS-DILUTED>                                      .73