Exhibit 99.1

                Ibis Technology Announces Agreement in Principle
                        to Settle Securities Litigation

     DANVERS, Mass.--(BUSINESS WIRE)--Oct. 2, 2006--Ibis Technology Corporation
(Nasdaq NM: IBIS), a leading provider of SIMOX-SOI implantation equipment to the
worldwide semiconductor industry, today announced that it has reached an
agreement in principle to settle the consolidated securities class action
litigation pending in the United States District Court of Massachusetts against
the Company and its President and CEO. The settlement is subject to negotiation
and execution of a formal settlement agreement and to final Court approval. The
proposed settlement provides for a payment to the plaintiffs of $1.9 million,
which amount will be funded entirely by the Company's insurance carrier.

     About Ibis Technology

     Ibis Technology Corporation is a leading provider of oxygen implanters for
the production of SIMOX-SOI (Separation-by-Implantation-of-Oxygen
Silicon-On-Insulator) wafers for the worldwide semiconductor industry.
Headquartered in Danvers, Massachusetts, the company maintains an additional
office in Aptos, California. Ibis Technology is traded on the Nasdaq Global
Market under the symbol IBIS. Information about Ibis Technology Corporation and
SIMOX-SOI is available on Ibis' web site at www.ibis.com.

     "Safe Harbor" Statement under the Private Securities Litigation Reform Act
of 1995

     This release contains express or implied forward-looking statements
regarding, among other things, expected Court approval of the class action
litigation settlement described above and payment of the settlement amount by
the Company's insurance carrier. Such statements are neither promises nor
guarantees, but rather are subject to risks and uncertainties which could cause
actual results to differ materially from those described in the forward-looking
statements. Such risks and uncertainties include, but are not limited to,
cessation as a going concern due to the depletion of the Company's cash reserves
at an unanticipated rate combined with an inability to obtain customer orders or
to secure financing, future continued migration to SOI technology and market
acceptance of SIMOX, the level of demand for the Company's products, the
Company's ability to pursue and maintain further strategic relationships,
partnerships and alliances with third parties, the Company's ability to protect
its proprietary technology, the potential trends in the semiconductor industry
generally, the ease with which an i2000 can be installed and qualified in
fabrication facilities, the likelihood that implanters, if ordered, will be
qualified and accepted by customers without substantial delay, modification, or
cancellation, in whole or in part, the likelihood and timing of revenue
recognition on such transactions, the impact of competitive products,
technologies and pricing, the impact of rapidly changing technology, the
possibility of further asset impairment and resulting charges, equipment
capacity and supply constraints or difficulties, the Company's limited history
in selling implanters, general economic conditions, and other risks and
uncertainties described in the Company's Securities and Exchange Commission
filings from time to time, including but not limited to, the Company's Annual
Report on Form 10-K for the year ended December 31, 2005. All information set
forth in this press release is as of October 2, 2006, and Ibis undertakes no
duty to update this information unless required by law.


     CONTACT: Company Contact:
              Ibis Technology Corporation
              William J. Schmidt, 978-777-4247
              Chief Financial Officer
              or
              IR Agency Contact:
              Bill Monigle Associates
              Bill Monigle, 941-497-1622
              President