OTI Reaches New Milestone in Contactless Payments Market: Solutions for 130,000 Readers and 20 Million Cards Shipped to Date

On Track Innovations Ltd., (OTI) (Nasdaq: OTIV) a global leader in contactless microprocessor-based smart card solutions for homeland security, payments, petroleum payments and other applications, today announced that its payments solutions has reached more than 130,000 reader solutions and more than 20 million payment card solutions, including inlays, key fobs and operating system royalties, for the ongoing contactless payments market.

In 2006, OTI penetrated additional new market segments including readers for mass transit and readers for vending machines market. OTI's readers are certified by MasterCard's PayPass(TM), Visa contactless program, Discover contactless program and ExpressPay from American Express and by the major processors in the U.S.

OTI's solutions for card products include operating systems, inlays, key fobs and other unique form factors, providing a robust solution that meets the stringent security requirements of the payments industry, while also providing the speed and convenience that is essential in contactless transactions. These solutions have been successfully integrated with major card manufactures.

Oded Bashan, President & CEO, OTI, stated, "We are seeing acceleration in the demand for contactless readers in 2006 over 2005, an indicator of the potential for growth in both cards and readers shipments. We believe that we are well positioned to support growth through our in house manufacturing capabilities for both cards and readers solutions."

About OTI

Established in 1990, OTI (Nasdaq: OTIV) designs, develops and markets secure contactless microprocessor-based smart card technology to address the needs of a wide variety of markets. Applications developed by OTI include product solutions for petroleum payment systems, homeland security solutions, electronic passports and IDs, payments, mass transit ticketing, parking, loyalty programs and secure campuses. OTI has a global network of regional offices to market and support its products. The company was awarded the Frost & Sullivan 2005 and 2006 Company of the Year Award in the field of smart cards. For more information on OTI, visit http://www.otiglobal.com.

Safe Harbor for Forward-Looking Statements:

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other Federal securities laws. Whenever we use words such as "believe," "expect," "anticipate," "intend," "plan," "estimate" or similar expressions, we are making forward-looking statements. Because such statements deal with future events and are based on OTI's current expectations, they are subject to various risks and uncertainties and actual results, performance or achievements of OTI could differ materially from those described in or implied by the statements in this press release. For example, forward-looking statements include statements regarding our goals, beliefs, future growth strategies, objectives, plans or current expectations. Forward-looking statements could be impacted by market acceptance of new and existing products and our ability to execute production on orders, as well as the other risk factors discussed in OTI's Annual Report on Form 20-F for the year ended December 31, 2005, which is on file with the Securities and Exchange Commission. Although OTI believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be achieved. OTI disclaims any intention or obligation to update or revise any forward-looking statements, which speak only as of the date hereof, whether as a result of new information, future events or circumstances or otherwise.

OTI Contact: Media Relations

Galit Mendelson Adam Handelsman

Director of Corporate Communications 5W Public Relations

201 944 5200 ext. 111 212 999 5585

galit@otiglobal.com ahandelsman@5wpr.com

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