Exhibit 99.1


                        Ultralife Batteries Awarded $10.9
       Million Contract for Rechargeable Batteries and Chargers to Power
                 System to Counter Improvised Explosive Devices

     Ultralife Expands Presence in Growing Military Prime Contractor Market


    NEWARK, N.Y.--(BUSINESS WIRE)--Oct. 9, 2006--Ultralife Batteries,
Inc. (NASDAQ: ULBI) has been awarded a contract valued at
approximately $10.9 million from a supplier to a major defense
contractor for the production and delivery of Ultralife's UBI-2590
lithium ion rechargeable batteries, and CH0003 six-bay battery
chargers produced by its McDowell Research unit. The batteries and
chargers will be used to power a system to counter improvised
explosive devices. Deliveries are expected to begin immediately and be
completed in the 1st quarter of 2007.

    "With products produced by both Ultralife and our McDowell
Research operating unit, this award clearly illustrates the strength
and value of our complementary, world-class power system offerings.
Ultralife was chosen as the exclusive supplier because of the
industry-leading performance and high-quality reputation of our
batteries and chargers," said John D. Kavazanjian, Ultralife's
president and chief executive officer. "Building on awards we have
received from other prime contractors, this award serves to expand our
presence in the highly attractive military prime contractor market,
where our engineering expertise creates an unmatched competitive
advantage."

    Ultralife's UBI-2590 lithium ion rechargeable battery has two
independent 15-volt sections, each with protection electronics and
state-of-charge displays, enabling users to operate the battery in
either 15-volt or 30-volt modes. The UBI-2590 is the most advanced
battery of its type and is designed to power demanding military as
well as commercial devices. In addition to military applications, its
usage has been spread over many markets including law enforcement,
homeland security, scientific research, medical, surveillance and
mining. Applications include military communications devices,
robotics, power grid surveillance sensors, remote data collection
devices, video detection systems and scientific monitoring equipment.

    The CH0003 battery charger, manufactured by Ultralife's McDowell
Research operating unit, is a self-contained charger, which provides a
reliable and consistent recharge of up to six batteries
simultaneously. The charger auto-senses the battery type to assure the
proper charging profile is used. The CH0003 can be both powered in the
field from vehicles and generators, and in base locations. A wide
range of AC and DC input voltages allows for operation from nearly any
power source likely to be encountered worldwide.

    About Ultralife Batteries, Inc.

    Ultralife is a global provider of high-energy power solutions and
communications accessories for diverse applications. The company
develops, manufactures and markets a wide range of non-rechargeable
and rechargeable batteries, charging systems and accessories including
power supplies, amplifiers, amplified speakers, equipment mounts, case
equipment and integrated communication systems for markets including
military, industrial and consumer portable electronics. Through its
portfolio of standard products and engineered solutions, Ultralife is
at the forefront of providing the next generation of power systems and
accessories. Industrial, retail and government customers include
General Dynamics, Philips Medical Systems, General Motors, Energizer,
Kidde Safety, Lowe's, Radio Shack and the national defense agencies of
the United States, United Kingdom, Germany, Australia and New Zealand,
among others.

    Ultralife's headquarters, principal manufacturing and research
facilities are in Newark, New York, near Rochester. Ultralife's three
other operating units are: Ultralife Batteries (UK) Ltd., in Abingdon,
England; McDowell Research in Waco, Texas; and ABLE New Energy in
Shenzhen, China. Detailed information on Ultralife is available at:
www.ultralifebatteries.com.

    This press release may contain forward-looking statements based on
current expectations that involve a number of risks and uncertainties.
The potential risks and uncertainties that could cause actual results
to differ materially include: worsening global economic conditions,
increased competitive environment and pricing pressures, disruptions
related to restructuring actions and delays. Further information on
these factors and other factors that could affect Ultralife's
financial results is included in Ultralife's Securities and Exchange
Commission (SEC) filings, including the latest Annual Report on Form
10-K.



Note to editors: Photographs of the UBI-2590 battery and CH0003
charger are available at the following links:
www.ultralifebatteries.com/images/lineart/hires/UBI2590_hires.jpg
www.ultralifebatteries.com/images/lineart/hires/WB-hires_CH0003.jpg


    Ultralife(R) and McDowell Research(TM) are trademarks of Ultralife
Batteries, Inc.



    CONTACT: Ultralife Batteries, Inc.
             Pete Comerford, 315-332-7100
             pcomerford@ulbi.com
             or
             Investor Relations:
             Lippert/Heilshorn & Associates, Inc.
             Jody Burfening, 212-838-3777
             jburfening@lhai.com