Silicom Achieves Design Win from a Tier-1 Communications Equipment Provider; Prestigious Manufacturer To Use Customized Silicom

Silicom Ltd. (Nasdaq: SILCF) today announced that it has
achieved a strategic Design Win for its BYPASS Gigabit Ethernet
Adapters from a Tier-1 communications equipment manufacturer. This
prestigious manufacturer will use a specific-form-factor version of
Silicom's advanced adapters to guarantee mission-critical data
availability in a new line of security appliances.
   So far, the customer has placed a $70,000 order for prototypes,
and has guided Silicom to expect orders in 2006 for both additional
prototypes and serial-production units.
   This Design Win adds to the momentum that has been building for
the Company over the past two years. Over this period, the Company has
accumulated over 30 Design Wins for its BYPASS and multi-port
adapters, enabling it to post seven consecutive quarters of growth and
to achieve its highest quarterly revenues in eight years.
   Commenting on the news, Shaike Orbach, Silicom's President and
CEO, said, "We are proud to receive this important Design Win from
another prestigious communications industry player, a testament to the
cost-performance of our BYPASS adapters and to the quality of our
rapid customization capabilities. As with the majority of our Design
Wins, we believe this Win has the potential to lead to a flow of
orders, representing a fertile new source of revenues that will build
over time. With a strong sales pipeline and growing needs in our
target markets, we are working to achieve additional Design Wins and
pleased by the pace of our growth."

   Silicom Ltd. is an industry-leading provider of high-performance
network connectivity solutions. The Company's flagship products
include a variety of multi-port Gigabit Ethernet server adapters and
innovative BYPASS adapters designed to increase throughput and
availability of security appliances and other mission-critical gateway
applications. Silicom also offers a broad range of customizable PC
Cards, PCI cards and USB products. For more information, please visit:
www.silicom.co.il.

   Statements in this press release which are not historical data are
forward-looking statements which involve known and unknown risks,
uncertainties, or other factors not under the Company's control, which
may cause actual results, performance, or achievements of the Company
to be materially different from the results, performance, or other
expectations implied by these forward-looking statements. These
factors include, but are not limited to, those detailed in the
Company's periodic filings with the Securities and Exchange
Commission. The Company disclaims any duty to update such statements.