Digital Ally Announces Record-Breaking Year as 2008 Revenues Rise Over 65% to Approximately...

Digital Ally Announces Record-Breaking Year as 2008 Revenues Rise Over 65% to
Approximately $32.5 Million, and Company Anticipates Over $50.0 Million in
2009 Revenues

NEW PRODUCTS AND CONTINUED STRONG DEMAND FOR DVM-500 IN-CAR VIDEO SYSTEMS TO
PLAY KEY ROLES IN COMPANY'S GROWTH DURING CURRENT YEAR

OVERLAND PARK, Kan., Jan. 12 /PRNewswire-FirstCall/ -- Digital Ally, Inc.
(Nasdaq: DGLY), which develops, manufactures and markets advanced video
surveillance products for law enforcement, homeland security and commercial
security applications, today announced that, on a preliminary unaudited basis,
its revenues for the year ended December 31, 2008 increased over 65% to
approximately $32.5 million, compared with revenues of $19.4 million in 2007.
The Company expects to report record earnings in 2008, exclusive of
non-recurring income tax benefits recorded in 2007, although fourth quarter
profitability will be significantly impacted by research and development
expenses related to a number of new products to be introduced in coming
months. The Company also provided guidance that management expects 2009
revenues to exceed $50.0 million, for an increase of more than 50% from last
year's levels.

"During our internal budgeting process, we carefully analyzed the current
global economic environment, including the possible budget cuts confronting
many federal, state and local government agencies," observed Stanton E. Ross,
Chief Executive Officer of Digital Ally, Inc. "Based upon information
currently available, we believe the continued success of our DVM-500 In-Car
Digital Video System Integrated into a Rear View Mirror, combined with the
anticipated impact of new products on our sales volumes, should allow Digital
Ally to increase its 2009 revenues to at least $50.0 million, when compared
with record 2008 revenues of approximately $32.5 million. To illustrate our
confidence in this projection, all officers and directors at Digital Ally have
agreed to defer 25% of their 2009 monetary compensation until year-to-date
sales reach the $50 million threshold."

"While the current economic recession has definitely slowed equipment
procurement timelines at many government agencies, the growing popularity of
our DVM-500 In-Car Digital Video system among domestic and international law
enforcement agencies, combined with the marketing strength of our World Wide
Sales Organization, have positioned Digital Ally to build upon its success
through the planned introduction of at least five new products in 2009,"
continued Ross. "We expect that international orders will account for
approximately 30% of the Company's revenues this year. Digital Ally continues
to take market share from competitors, some of which have been weakened
significantly by the current market environment, illustrating the critical
importance of product performance, innovative engineering and the ability to
deliver outstanding value to customers during challenging times such as these.
The recent addition of new Sales, Marketing and Support personnel with
extensive experience in law enforcement, school bus and mass transit video
equipment sales should serve Digital Ally well as it expands into new markets
during the current year."

"As for the year just ended, while we did not achieve our original sales
targets due to the slowing economy and some slippage in new product
introductions, we consider our performance outstanding relative to our
industry peers. Initial shipments of our new DVM-750 In-Car Video System,
which we expected to contribute to fourth quarter sales, were delayed until
later this month. We believe this delay cost us at least three major
contracts that would have bolstered 2008 sales by several million dollars. In
addition, the anticipated receipt of a sizeable international order in
December 2008 was postponed until February 2009. We have received orders for
over $1 million of the DVM-750 systems, which have been met with strong
acceptance in the marketplace. As other new products are rolled out in coming
months, we are confident that 2009 will establish Digital Ally as a leading
innovator of advanced digital surveillance products in a growing number of
markets," concluded Ross.

Regarding the "strategic alternatives" process that has been underway since
November 2008, the Company reiterated that it expects a resolution to the
process during the first quarter of 2009. As previously announced, Digital
Ally has retained Banc of America Securities as its financial advisor in
connection of the Company's consideration of a range of strategic alternatives
designed to enhance shareholder value.

About Digital Ally, Inc.

Digital Ally, Inc. develops, manufactures and markets advanced technology
products for law enforcement, homeland security and commercial security
applications. The Company's primary focus is Digital Video Imaging and
Storage. For additional information, visit www.digitalallyinc.com

The Company is headquartered in Overland Park, Kansas, and its shares are
traded on The Nasdaq Capital Market under the symbol "DGLY".

This press release contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Act of 1934. These forward-looking statements are based largely on the
expectations or forecasts of future events, can be affected by inaccurate
assumptions, and are subject to various business risks and known and unknown
uncertainties, a number of which are beyond the control of management.
Therefore, actual results could differ materially from the forward-looking
statements contained in this press release. A wide variety of factors that may
cause actual results to differ from the forward-looking statements include,
but are not limited to, the following: whether the Company's consideration of
strategic alternatives will result in a transaction; the Company's ability to
report record pretax earnings for 2008; the Company's ability to generate at
least $50.0 million in revenues in 2009; the Company's ability to deliver its
new product offerings as scheduled and have them perform as planned or
advertised; its ability to continue to increase revenue and profits as
forecast; its ability to continue to expand its share of the in-car video
market in the domestic and international law enforcement communities; whether
there will be a commercial market, domestically and internationally, for one
or more of its new products; its ability to commercialize its products and
production processes, including increasing its production capabilities to
satisfy orders in a cost-effective manner; whether the Company will be able to
adapt its technology to new and different uses, including being able to
introduce new products; competition from larger, more established companies
with far greater economic and human resources; its ability to attract and
retain customers and quality employees; its ability to obtain patent
protection on any of its products and, if obtained, to defend such
intellectual property rights; the effect of changing economic conditions; and
changes in government regulations, tax rates and similar matters. These
cautionary statements should not be construed as exhaustive or as any
admission as to the adequacy of the Company's disclosures. The Company cannot
predict or determine after the fact what factors would cause actual results to
differ materially from those indicated by the forward-looking statements or
other statements. The reader should consider statements that include the words
"believes", "expects", "anticipates", "intends", "estimates", "plans",
"projects", "should", or other expressions that are predictions of or indicate
future events or trends, to be uncertain and forward-looking. The Company does
not undertake to publicly update or revise forward-looking statements, whether
as a result of new information, future events or otherwise. Additional
information respecting factors that could materially affect the Company and
its operations are contained in its annual report on Form 10-KSB for the year
ended December 31, 2007 and Form 10-Q for the nine months ended September 30,
2008 as filed with the Securities and Exchange Commission.

For Additional Information, Please Contact:

Stanton E. Ross, CEO at (913) 814-7774
or
RJ Falkner & Company, Inc., Investor Relations Counsel at (800) 377-9893
or via email at info@rjfalkner.com

SOURCE Digital Ally, Inc.

Stanton E. Ross, CEO, Digital Ally, Inc., +1-913-814-7774, or RJ Falkner &
Company, Inc., Investor Relations Counsel, 1-800-377-9893, info@rjfalkner.com