NEWS RELEASE
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COMPANY CONTACT:
Olga Tikhonski
SI Diamond Technology, Inc.
512.339.5020 ext. 117

FOR IMMEDIATE RELEASE

                   SI DIAMOND ISSUES NON-EXCLUSIVE LICENSE FOR
                        AMOUNT EXCEEDING $5.0 MILLION
                 -SI DIAMOND WILL SHOW FIRST PROFITABLE QUARTER-
                       -ACHIEVES POSITIVE NET WORTH-

AUSTIN, Texas, March 31, 1999 - SI Diamond Technology, Inc. (OTC BB: SIDT) 
announced today that it has licensed its patents in the field of electron 
field emission display applications to one of the world's largest 
manufacturers of information and office equipment. The license is a 
non-exclusive worldwide license that requires a lump sum payment in excess of 
$5 million to SI Diamond. The license excludes certain electron field 
emission display technology that will be used exclusively by SI Diamond for 
the development of the next generation billboard and video wall products.

"Although this is just the beginning, this signifies a tremendous 
breakthrough for the company both financially and technically. The 
tremendous effort that Dr. Yaniv and his team have put forth to build value 
in our patent portfolio has been validated in a big way," said Marc Eller, 
chairman and chief executive officer of SI Diamond.

"From a financial standpoint, it's the first time SIDT will be profitable 
from operations in any given quarter," continued Eller. "Also, this 
transaction gives the company a net worth that is positive. I am very proud 
of what our team has accomplished over the last two years and I look forward 
to better things to come."

SI Diamond will hold a conference call today, March 31, 1999 at 10:00 a.m. 
CST to discuss this and other business developments. Interested participants 
should dial (706) 634-2266 at that time to listen to the conference call.

This press release contains forward looking information within the meaning of 
Section 27A of the Securities Act of 1993, as amended, and Section 21E of 
the Securities Act of 1934, as amended, and is subject to the safe harbor 
created by those sections. The Company's results may be impacted by risk 
factors listed from time-to-time in SIDT's SEC reports.

SI Diamond Technology is a holding company consisting of two wholly owned 
subsidiaries. The Field Emission Picture Element Technology (FEPET) 
subsidiary is developing products for applications utilizing SIDT's 
proprietary Field emission technology. The Electronic Billboard Technology 
(EBT) subsidiary is geared toward the commercialization of electronic digitized 
sign technology.