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                                  EXHIBIT 99.1

                                  PRESS RELEASE

               ATMEL IMPLEMENTS AGGRESSIVE EXPENSE REDUCTION PLAN

COMPANY TO CONSOLIDATE MANUFACTURING OPERATIONS IN U.S. AND EUROPE

3Q'01 PRE-TAX CHARGE OF $450 TO $500 MILLION

     SAN  JOSE, Calif.--(BUSINESS WIRE)--Sept. 28, 2001--Atmel Corporation
(Nasdaq:ATML - news) today provided an update to its recently announced
restructuring plan. As stated in the Company's most recent quarterly earnings
conference call, Atmel is undertaking aggressive actions to reduce expenses in
the face of a challenging market environment for semiconductors. The objective
of the expense reduction program is to reduce manufacturing and operating
expenses by approximately $150 million per quarter, or $600 million annually,
compared to Q1 2001 run rates.

     The  Company has now finalized the decision to consolidate manufacturing
operations in both the U.S. and in Europe by ceasing volume manufacturing in two
of its 6-inch factories. In addition, plans to launch manufacturing in the
Company's new 8-inch facility in the United Kingdom have been suspended for the
time being. Furthermore, all the Company's support functions in Europe and the
U.S. will be rationalized and reduced to support the current level of business.

     The  implementation of this restructuring plan is anticipated to result in
an asset impairment charge of approximately $400 to $450 million pre-tax in the
current quarter, mainly associated with the write-down of certain manufacturing
equipment to its fair market value. The Company projects that its cost reduction
program will reduce its headcount in Europe and the U.S. by approximately 2500,
or 26 percent, from the Q1 2001 headcount. A separate pre-tax accrual of
approximately $50 million associated with headcount reduction is also expected
to be recognized this quarter.

     George Perlegos, Atmel's Chairman and CEO stated, "This is the most
difficult business climate our industry has ever faced. We do not expect a rapid
improvement in market conditions, and accordingly we have decided to reduce our
expense run rate to a level that should ensure positive operating profits by the
first half of 2002. In addition these expense reduction efforts should allow
Atmel to maintain a positive EBITDA going forward.

     "We  continue our efforts to develop new leading edge products and plan to
begin transition from .18 micron technology to .13 micron technology by the
middle of 2002. The combination of lower costs, high performance products and
leading edge technology is the best antidote to the current environment."
Perlegos concluded, "Future product development and company growth will come
from our microcontrollers, SLI (System Level Integration and ASICs), RF SiGe and
communications chips, and memories, mainly high-density flash."

About Atmel

     Founded in 1984, Atmel Corp. is headquartered in San Jose with
manufacturing facilities in North America and Europe. Atmel designs,
manufactures and markets worldwide, advanced logic, mixed-signal, nonvolatile
memory and RF semiconductors. Atmel is also a leading provider of system-level
integration semiconductor solutions using CMOS, BiCMOS, bipolar SiGe, and
high-voltage BCDMOS process technologies.

     Requests may be sent via e-mail to literature@atmel.com or by visiting
Atmel's website at www.atmel.com.

     Except for historical information contained herein, the matters set forth
in this press release are forward looking statements that are subject to risks
and uncertainties that could cause actual results to differ materially,
including the impact of competitive products and pricing, timely design
acceptance by our customers, timely introduction of new technologies, ability to
ramp new products into volume, industry wide shifts in supply and demand for
semiconductor products, industry overcapacity, effective and cost efficient
utilization of manufacturing capacity, financial stability in foreign markets,
ability to integrate and manage acquisitions, and other risks detailed from time
to time in the Atmel's SEC reports and filings.

     Contact:
            Atmel Corporation
            Donald Colvin, 408/436-4360