August 2, 2005 - Auburn, Alabama - Arotech Corporation (NasdaqNM: ARTX) announced today that its Simulation and Security Division, through its FAAC subsidiary, has received a contract award from the Marine Corps System Command Program Manager for Training System for two MTVR driving simulators. Both systems will be operated by the Marine Forces Reserve. The contract, valued at $700,000, includes a mobile system to be based in Red Bank New Jersey and a fixed site installation in Las Vegas, Nevada.

"We are proud of the contribution of our simulation training solutions in improving the safety of military transportation," said Robert S. Ehrlich, Arotech Chairman and CEO. "It is gratifying to see the Marine Corps' continuing confidence in FAAC's driving simulators."

About Arotech's Simulation and Security Division
Arotech's Simulation and Security Division develops manufactures and markets advanced high-tech multimedia and interactive digital solutions for training of emergency response, military, law enforcement, security and private industry personnel. The division's fully interactive training systems feature state-of-the-art simulator technology enabling training in situation awareness, risk analysis and decision making, emergency reaction and avoidance procedures, and conscientious equipment operation. In the driver training market, over 100,000 drivers have been trained on its installed base of 220 driving simulators. The division also provides pilot decision-making support software for the F-15, F-18, and JSF aircraft as well as simulation models for the ACMI/TACTS air combat training ranges. In addition, the division's use-of-force training products and services allow organizations to train their personnel in safe, productive and realistic environments.

Arotech's Simulation and Security Division consists of FAAC Incorporated and IES Interactive Training Inc.

About Arotech Corporation
Arotech Corporation is a leading provider of quality defense and security products for the military, law enforcement and homeland security markets, including interactive simulators/trainers; lightweight armoring; advanced zinc-air and lithium batteries and chargers. Arotech operates through three major business divisions: Armor, Simulation and Security and Battery and Power Systems. Arotech is incorporated in Delaware, with corporate offices in Auburn, Alabama, and research, development and production subsidiaries in Alabama, Colorado, Michigan, California and Israel.

COMPANY CONTACT: Kim Kelly
VP Corporate Communications
1-866-317-4677
kim@arotech.com

Except for the historical information herein, the matters discussed in this news release include forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. Readers are cautioned not to place undue reliance on these forward-looking statements, as they are subject to various risks and uncertainties that may cause actual results to vary significantly. These risks and uncertainties include, but are not limited to, risks relating to: product and technology development; the uncertainty of the market for Arotech's products; changing economic conditions; delay, cancellation or non-renewal, in whole or in part, of contracts or of purchase orders; and other risk factors detailed in Arotech's most recent Annual Report on Form 10-K for the fiscal year ended December 31, 2004, as amended, and other filings with the Securities and Exchange Commission. Arotech assumes no obligation to update the information in this release. Reference to the Company's website above does not constitute incorporation of any of the information thereon into this press release.