<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, 1998 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS. 
</LEGEND>
<MULTIPLIER> 1,000
       
                             
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          DEC-31-1998
<PERIOD-START>                             JAN-01-1998
<PERIOD-END>                               DEC-31-1998
<CASH>                                           9,038
<SECURITIES>                                    57,951
<RECEIVABLES>                                    6,025
<ALLOWANCES>                                       304
<INVENTORY>                                      2,182
<CURRENT-ASSETS>                                77,874
<PP&E>                                          11,330
<DEPRECIATION>                                   7,094
<TOTAL-ASSETS>                                  85,791
<CURRENT-LIABILITIES>                            9,201
<BONDS>                                              0
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<COMMON>                                             9
<OTHER-SE>                                      75,686
<TOTAL-LIABILITY-AND-EQUITY>                    85,791
<SALES>                                         49,252
<TOTAL-REVENUES>                                63,850
<CGS>                                           29,002
<TOTAL-COSTS>                                   29,428
<OTHER-EXPENSES>                                10,181
<LOSS-PROVISION>                                     0
<INTEREST-EXPENSE>                                 189
<INCOME-PRETAX>                                 19,219
<INCOME-TAX>                                     4,804
<INCOME-CONTINUING>                             14,415
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                    14,415
<EPS-PRIMARY>                                     1.48
<EPS-DILUTED>                                     1.44