<ARTICLE> 5
<LEGEND>
THIS RESTATED 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, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<RESTATED>
<MULTIPLIER> 1,000
       
                             
<PERIOD-TYPE>                   9-MOS
<FISCAL-YEAR-END>                          DEC-31-1996
<PERIOD-START>                             JAN-01-1996
<PERIOD-END>                               SEP-30-1996
<CASH>                                          24,152
<SECURITIES>                                     9,361
<RECEIVABLES>                                    5,051
<ALLOWANCES>                                         0
<INVENTORY>                                      5,389
<CURRENT-ASSETS>                                45,573
<PP&E>                                           7,389
<DEPRECIATION>                                 (3,637)
<TOTAL-ASSETS>                                  53,805
<CURRENT-LIABILITIES>                            4,879
<BONDS>                                              0
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<COMMON>                                             9
<OTHER-SE>                                      48,917
<TOTAL-LIABILITY-AND-EQUITY>                    53,805
<SALES>                                         29,136
<TOTAL-REVENUES>                                37,829
<CGS>                                           21,511
<TOTAL-COSTS>                                   22,107
<OTHER-EXPENSES>                                 6,584
<LOSS-PROVISION>                                     0
<INTEREST-EXPENSE>                                 121
<INCOME-PRETAX>                                    646
<INCOME-TAX>                                        68
<INCOME-CONTINUING>                                  0
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                       578
<EPS-PRIMARY>                                     0.06
<EPS-DILUTED>                                     0.06