Exhibit 99-1

                             Court Rules for Diomed
       Diomed Wins Motion on Validity and Enforceability of EVLT(R) Patent
                         Trial on Infringement Expected

ANDOVER, MA, August 31, 2006, --- Diomed Holdings, Inc. (AMEX: DIO - News), a
leading developer and marketer of minimally invasive medical technologies,
including its patented EndoVenous Laser Treatment (EVLT(R)) for varicose veins,
today announced that U.S. District Judge Nathaniel M. Gorton has ruled that
Diomed's U.S. Patent No. 6,398,777 is valid and enforceable. In granting
Diomed's motion for summary judgment; the court rejected defenses advanced by
defendants AngioDynamics and Vascular Solutions that Diomed's patent was invalid
and unenforceable.

The court denied separate motions by each of the parties for summary judgment on
the issue of infringement by the defendants, in effect ruling that Diomed is
entitled to proceed to trial on its claims for an injunction and damages against
the defendants.

In January 2004, Diomed commenced legal action in the United States Federal
District Court for the District of Massachusetts against AngioDynamics, seeking
injunctive relief and damages for infringement of Diomed's pioneering United
States Patent Number 6,398,777 which covers the endovascular laser treatment of
varicose veins. Diomed acquired exclusive rights to the patent from the five
inventors of the procedure in September 2003. Diomed initiated similar actions
against Vascular Solutions and two other competitors later in 2004.

"We are extremely pleased with Judge Gorton's decision to grant Diomed's motions
on enforceability and validity and look forward to proceeding to trial on
infringement," stated James A. Wylie, Jr., President and Chief Executive Officer
of Diomed Holdings, Inc. "We now expect that the time until we begin trial has
been accelerated, and that the only issues at trial will be limited to those
relating to infringement and damages." Further details regarding the decision
will be made available upon its release by the court for publication.

About Diomed
Diomed develops and commercializes minimal and micro-invasive medical procedures
that use its proprietary laser technologies and disposable products. Diomed's
EVLT(R) laser vein ablation procedure is used in varicose vein treatments.
Diomed also provides photodynamic therapy (PDT) for use in cancer treatments,
and dental and general surgical applications. The EVLT(R) procedure and the
Company's related products were cleared by the United States FDA in January of
2002. Along with lasers and single-use procedure kits for its EVLT(R) laser vein
treatment, the Company provides its customers with state of the art physician
training and practice development support. Additional information is available
on the Company's website: www.evlt.com.



EVLT(R) is a registered trademark of Diomed Inc., Andover, MA.

Safe Harbor
Safe Harbor statements under the Private Securities Litigation Reform Act of
1995: Statements in this news release looking forward in time involve risks and
uncertainties, including the risks associated with trends in the products
markets, reliance on third party distributors in various countries outside the
United States, reoccurring orders under OEM contracts, market acceptance risks,
technical development risks and other risk factors. These statements relate to
our future plans, objectives, expectations and intentions. These statements may
be identified by the use of words such as "may," "will," "should," "potential,"
"expects," "anticipates," "intends," "plans," "believes" and similar
expressions. These statements are based on our current beliefs, expectations and
assumptions and are subject to a number of risks and uncertainties. Our actual
results could differ materially from those discussed in these statements. Our
Annual Report on Form SEC 10-KSB/A (the "Annual Report") contains a discussion
of certain of the risks and uncertainties that affect our business. We refer you
to the "Risk Factors" on pages 23 through 38 of the Annual Report for a
discussion of certain risks, including those relating to our business as a
medical device company without a significant operating record and with operating
losses, our risks relating to our commercialization of our current and future
products and applications and risks relating to our common stock and its market
value. Diomed disclaims any obligation or duty to update or correct any of its
forward-looking statements.

For more information contact:
Christopher J. Geberth, VP Finance          Carney Duntsch
Diomed Holdings, Inc.                       Burns McClellan, Investor Relations
Phone: 866-4DIOMED                          Phone:  212-213-0006
email: cgeberth@diomedinc.com               email :  cduntsch@burnsmc.com