Exhibit 99.1

                          Digital Recorders, Inc. Notes
         Federal Transit Funding Gains in U.S. House of Representatives

                     Cites APTA's Recent "Legislative Alert"



    DALLAS--(BUSINESS WIRE)--Feb. 7, 2007--Digital Recorders, Inc.
(DRI) (NASDAQ: TBUS), a technology leader in transportation, law
enforcement, and security digital communications systems, noted today
that the American Public Transportation Association (APTA) recently
announced in a "Legislative Alert" the U.S. House of Representatives
had passed a year-long joint resolution (H.J. Res. 20) to provide
federal transit programs with $8.975 billion for the current fiscal
year, a record-high level authorized by the Safe, Accountable,
Flexible, Efficient Transportation Equity Act: A Legacy for Users
(SAFETEA-LU, P.L. 109-59).

    "As APTA recently reported, funding for U.S. federal transit
programs is currently operating under a continuing resolution. While
most domestic federal programs will not receive an increase in funding
this year under the new continuing resolution, APTA said that transit
and highway programs may be spared from the freeze levels that are
being applied to most federal programs," David L. Turney, the
Company's Chairman, President, and Chief Executive Officer, said.

    Mr. Turney said he has been asked from time to time about the
present continuing resolution for transit funding. Those inquiring
want to know how it compares to the previous continuing resolutions
passed during the three years following (1) the expiration of the
Intermodal Surface Transportation Efficiency Act in 2003, and (2) the
failure of Congress to pass reauthorization legislation.

    "The nearly three-year delay in reauthorization legislation
greatly contributed to a market slump that was very troubling to the
industry and to DRI. The market slump finally ended with the passage
of reauthorization legislation, called SAFETEA-LU. That legislation
eliminated the uncertainty over continuation of the overall program
for another six-year period. In effect, SAFETEA-LU ushered in an air
of certainty and what was, in my opinion, a general favorable upturn
in the overall U.S. transit market," Mr. Turney said.

    Mr. Turney said the present continuing resolution is related to
the actual monetary funding of SAFETEA-LU programs for the present
fiscal year. "It is the relatively short-term, immediate program
funding that is now being addressed by the U.S. House of
Representatives in a positive manner. The six-year reauthorized
program is in place and record funding is now being advocated in
Congress for the current federal fiscal year. Of course, we still must
see this work its way through the entire legislative and
administrative process. Changes, both good and bad, can always enter
the picture during that process. However, having said that, I am
encouraged about the developing market trends under SAFETEA-LU."

    According to Mr. Turney, the proposed continuing resolution
funding increase may eventually impact DRI. "As I've said before, U.S.
federal transit funding increases may mean more domestic transit
market spending and additional demand for DRI's transit communications
equipment. Such a demand may help us to achieve additional growth."

    According to APTA, the U.S. Senate is expected to consider the
proposed continuing resolution this week.

    For APTA's complete "Legislative Alert," visit www.apta.com.

    APTA is a nonprofit international association of 1,600 member
organizations including public transportation systems; planning,
design, construction and finance firms; product and service providers;
academic institutions; and state associations and departments of
transportation. APTA members serve the public interest by providing
safe, efficient and economical public transportation services and
products. APTA members serve more than 90 percent of persons using
public transportation in the U.S. and Canada.

    ABOUT THE COMPANY

    Digital Recorders, Inc. is a digital communications technology
leader in the transportation, law enforcement, and security
industries. Using proprietary hardware and software applications, our
products improve the flow and mobility of people through
transportation infrastructure, improve energy efficiency, mitigate
security threats, and enhance law enforcement agencies' surveillance
capabilities. Our transportation communications products -
TwinVision(R) and Mobitec(R) electronic destination sign systems,
Talking Bus(R) voice announcement systems, Digital Recorders(R)
Internet-based passenger information and automatic vehicle
location/monitoring systems, and VacTell(TM) video actionable
intelligence systems - enhance public transportation and mitigate
security threats worldwide. By assisting transit vehicle operators'
quest to increase ridership, our products also help reduce dependence
on fuel. Our DAC(R) electronic surveillance tools, including
microphone amplifiers and processors, countermeasures devices, speech
activity detectors, and noise cancellation equipment, help
law-enforcement agencies around the globe arrest and prosecute
criminals. For more information about DRI and its operations
worldwide, go to www.digrec.com.

    FORWARD-LOOKING STATEMENTS

    This press release contains "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995.
In particular, any statement, express or implied, concerning future
events or expectations, including any conclusions surmised from APTA's
statements concerning recently approved increases in federal funding
for U.S. mass transportation, perceived market trends in the U.S.
transit industry, and the potential effects on our business or future
growth, is a forward-looking statement. Use of words such as "expect,"
"fully expect," "expected," "appears," "believe," "plan,"
"anticipate," "would," "goal," "potential," "potentially," "range,"
"pursuit," "run rate," "stronger," "preliminarily," etc., is intended
to identify forward-looking statements that are subject to risks and
uncertainties, including the risks and uncertainties related to
conclusions surmised from APTA's statements concerning recently
approved increases in federal funding for U.S. mass transportation,
risks that perceived funding or market tends in the U.S. transit
industry may not materialize as well as other risks and uncertainties
set forth in our Annual Report on Form 10-K filed April 17, 2006,
particularly those identified in Risk Factors Affecting Our Business.
There can be no assurance that any expectation, express or implied, in
a forward-looking statement will prove correct or that the
contemplated event or result will occur as anticipated.



    CONTACT: Veronica B. Marks
             Manager, Corporate Communications
             Digital Recorders, Inc.
             Phone: (214) 378-4776
             Fax: (214) 378-8437
             E-Mail: veronicam@digrec.com