Artificial Life (ALIF) to Retain New Auditors, Reports on Current Business Activities

Artificial Life, Inc. announced that it is in the final stages of retaining new auditors to complete the audit of the Company's financial statements for the year ended December 31, 2010. This effort follows the dismissal of KPMG, the Company's previous auditors.

As previously announced, the Company's (ALIF) Independent Audit Committee dismissed KPMG on March 18, 2011 with notice effective March 30, 2011 to allow KPMG to complete the current audit. However, KPMG did not manage to complete the audit on or prior to the effective date of the termination.

"The Company and its independent Audit Committee are currently working through the process of selecting a new audit firm, and we hopefully will have a final selection within the next week or so," said Frank Namyslik, the Company's Chief Financial Officer. Mr. Namyslik was pleased with the efforts made thus far, and said, "We are nearing the end of our selection process and are satisfied with the quality and responsiveness of the candidates having presented to us." The Company will file its 2010 Form 10-K as soon as a new audit firm is selected and completes the audit.

In addition to the process of selecting a new audit firm, the Company continues to operate its business as usual.

The Company is continuing to expand and to explore further opportunities for growth with new and existing business partners. The Company has won new clients for its flagship m-commerce product OPUS-M in the first quarter of 2011 and, together with its joint venture partner M-Health Middle East Ltd., is also expanding its sales and business activities in certain emerging markets, specifically the Middle East and South Africa.