SpaceDev Completes Third Milestone Under NASA Space Act Agreement for Development of Commercial Access to Space

Market Wire, October, 2008

SpaceDev, Inc. (OTCBB: SPDV) recently completed its third significant milestone under the Space Act Agreement signed with NASA in June 2007; the Internal Space Vehicle Propulsion Module Preliminary Design Review (PDR). Milestone completion was approved after submission of materials to the NASA COTS office.

SpaceDev entered into the Space Act Agreement with NASA to facilitate its development of reliable, safe and affordable transportation of passengers and cargo to and from Earth orbit. As part of the agreement, NASA is providing support regarding ISS visiting vehicle requirements and processes as well as ongoing quarterly milestone review meetings.

"We are pleased to have completed our third milestone on schedule," said Mark N. Sirangelo, SpaceDev's Chairman and Chief Executive Officer. "SpaceDev, in passing another significant technical step, continues to enhance the development of the Dream Chaser(TM). It also affirms the real value of NASA's Space Act Agreement program. We are very appreciative of the ongoing support provided by NASA to our program and plan to continue to forward our development schedule."

The SpaceDev Dream Chaser(TM) Space Vehicle is a derivative of the HL-20 Launch System developed by NASA Langley. The vehicle has on-board propulsion utilizing SpaceDev's patented and patent pending hybrid motor technology. This unique space transportation system is designed to effectively, reliably and safely carry crew/passengers and cargo on orbital flight regimes. The SpaceDev Dream Chaser(TM) Space Vehicle can be adapted to various mission configurations including carrying all passengers; pressurized or unpressurized cargo or, various combinations of crew and pressurized cargo. It is a piloted space solution which launches vertically and lands horizontally on conventional runways.

About SpaceDev

SpaceDev, Inc. is a space technology/aerospace company that creates and sells affordable and innovative space products and mission solutions. For more information, visit www.spacedev.com

This news release may contain "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve risks that are difficult to predict, are based on the Company's current expectations, and are not guarantees of performance. The Company's actual results could differ materially from its current expectations Factors that could contribute to such differences include risks and uncertainties associated with the Company's ability to effectively manage schedule changes or cancellation of customer orders, control costs and expenses, obtain additional financing, if needed, and competitive factors related to the Company's size. The Company also references other factors described in periodic reports filed with the SEC, including its current Annual Report on Form 10-KSB and subsequent Quarterly Reports on Form 10-Q. These forward-looking statements speak only as of the date of this release. SpaceDev does not intend to update these forward-looking statements.

SpaceDev Contacts Investor: Richard Slansky/Jessica Schwarz Media: Mark Sirangelo (858) 375-2026