Exhibit 99.1

    NEOMAGIC(R) CORPORATION ANNOUNCES PATENT LICENSING AGREEMENT WITH SONY
                                   CORPORATION

     SANTA CLARA, Calif., Sept. 7 /PRNewswire-FirstCall/ -- NeoMagic Corporation
(Nasdaq: NMGC), a pioneer in developing processors for multimedia- rich mobile
phones and other wireless handheld systems, today announced that it has granted
Sony Corporation of Tokyo, Japan a worldwide, non-exclusive license to all of
its patents. In accordance with the agreement, NeoMagic expects to receive gross
proceeds of $8.5 million. After deducting fees and commissions, NeoMagic expects
to receive net proceeds of approximately $5.6 million. Among the patents that
are being licensed to Sony Corporation are those that relate to the use of
embedded dynamic random-access-memory (DRAM) technology and on-chip memories in
semiconductor integrated circuits.

     "We are pleased to conclude this patent agreement with Sony Corporation. We
believe that our patent portfolio is a key strategic asset of NeoMagic, and we
intend to continue our efforts to license our patents," stated Mr. Doug Young,
NeoMagic Corporation's President and Chief Executive Officer.

     As a result of its groundbreaking use of embedded DRAM technology in the
personal computer graphics controller area during the 1990's, NeoMagic was one
of the first companies to adopt large amounts of on-chip memory for commercial
applications. Many industry sources consider NeoMagic's graphics controllers to
be the semiconductor industry's first commercially-successful embedded DRAM
products.

     During the negotiations that led to the conclusion of the recently signed
agreement, NeoMagic was represented by The Consortium for Technology Licensing,
Ltd., of Nissequogue, New York. NeoMagic and The Consortium continue to explore
other opportunities to generate additional revenue from NeoMagic's patents.

     About NeoMagic

     NeoMagic Corporation, based in Santa Clara, California, enables new
generations of handheld systems with its Multimedia Processors that are designed
to offer the lowest power, smallest form-factor and best multimedia features and
performance. The company is a pioneer in the integration of complex logic,
memory and analog circuits into single-chip solutions. Information on the
company may be found on the World Wide Web at www.neomagic.com.

     This press release contains forward-looking statements within the meaning
of the Securities Act of 1933 and the Securities Exchange Act of 1934, including
statements regarding the Company's on-going patent licensing efforts. Our patent
licensing activities involve various risks and uncertainties, including, without
limitation, uncertainties as to the willingness of other companies to pay
material fees to license our intellectual property, the length and uncertain
outcome of licensing negotiations, the possibility that litigation may be
required to enforce patents, and the risks and costs inherent in any patent
litigation. Additional risks that could affect the Company's future operating
results are more fully described in the Company's most recent annual report, its
most recent quarterly report and other filings with the United States Securities
and Exchange Commission (SEC), and are available online at http://www.sec.gov.
NeoMagic may, from time to time, make additional written or oral forward-
looking statements, including statements contained in filings with the SEC and
reports to shareholders. NeoMagic does not undertake the obligation to update
any forward-looking statements that may be made by or on behalf of the company.

     NeoMagic, and the NeoMagic circle logo are registered trademarks, and
MiMagic is a trademark, of NeoMagic Corporation. All other trademarks are the
property of their respective owners. NeoMagic disclaims any proprietary interest
in the marks and names of others.

     (Logo: http://www.newscom.com/cgi-bin/prnh/20020802/NMGCLOGO )