FOR IMMEDIATE RELEASE

SPACEHAB'S ASTROTECH UNIT COMPLETES SUCCESSFUL FIRST LAUNCH
OF NEW ORIOLE SOUNDING ROCKET

Washington, D.C., July 12, 2000 -- Astrotech Space Operations, a wholly owned subsidiary of SPACEHAB, Inc. (NASDAQ/NMS: SPAB), has successfully completed the inaugural launch of its new Oriole suborbital launch vehicle. The Oriole sounding rocket lifted off at 6:25 a.m. EDT on July 7 from the National Aeronautics and Space Administration's (NASA) Wallops Flight Facility in Virginia. The demonstration flight lasted approximately 10 minutes, achieving a maximum altitude of 229 miles (368.5 kilometers) and a maximum range of 330 miles (531 km). The Oriole flew a ballistic flight path before impact in the Atlantic Ocean as planned (see http://www.spacehab.com/astrotech/oriole/ to view a video of the launch).

Astrotech developed the Oriole as a next-generation sounding rocket for launching scientific and commercial payloads and as a target vehicle for Theater Missile Defense system testing. The company is marketing the vehicle to government and commercial users. The Oriole is the first privately developed sounding rocket in U.S. history and the first new suborbital launch system developed in the last 25 years.

"All systems on the vehicle performed flawlessly," Astrotech Vice President for Suborbital Programs Wayne Montag reported after the launch. "The Oriole's performance and flight environment exceeded expectations."

"The Oriole is evidence of SPACEHAB's intent to expand its line of space services to meet the needs of customers who require access to space," said SPACEHAB Chairman and Chief Executive Officer Dr. Shelley A. Harrison. "It also embodies the technical excellence that enables us to maintain a leadership position in space commerce."

Sounding rockets fly a ballistic flight profile, providing several minutes of useful microgravity environment for payloads at low cost without entering Earth orbit. (The Oriole can provide six to nine minutes of microgravity.) The Oriole's flight demonstration payload was a set of instruments intended to validate vehicle performance and verify the predicted flight environment. The flight also successfully demonstrated operation of the rocket's mechanical despin and payload separation systems. The Oriole did not carry a commercial payload on this demonstration launch. Astrotech is now conducting a detailed evaluation of flight instrumentation and radar data.

The Oriole rocket system includes a propulsion system, tail assembly, vehicle service module, and booster interstage structure. The rocket is designed for launch in a single-stage or two-stage configuration. The Oriole demonstration flight vehicle was a two-stage configuration consisting of a Terrier Mark-12 surplus military booster, provided by NASA, and the Oriole stage built by Astrotech. The Oriole stage is powered by a solid rocket motor developed by Alliant Missile Products Company of Rocket Center, West Virginia, under contract to Astrotech. A successful static firing of this propulsion system took place April 20 at Alliant's West Virginia test range.

Astrotech provides commercial space services through its Sounding Rocket and Payload Processing divisions. Astrotech's Payload Processing division provides commercial satellite processing services for Boeing's Delta and Lockheed Martin's Atlas launch vehicles in North America. Since its establishment in 1981, Astrotech has been at the forefront of the commercial space industry.

Founded in 1984 and with more than $100 million in annual revenue, Astrotech's parent company SPACEHAB, Inc., is a leading provider of commercial space services. SPACEHAB is the first company to commercially develop, own and operate habitable modules that provide laboratory facilities and logistics resupply aboard NASA's Space Shuttles. The company also supports NASA astronaut training at the Johnson Space Center in Houston, Texas.

This release contains forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected in such statements. Such risks and uncertainties include, but are not limited to, whether the company will fully realize the economic benefits under its NASA and other customer contracts, the timing and mix of Space Shuttle missions, the successful development and commercialization of new space assets, technological difficulties, product demand, timing of new contracts, launches and business, market acceptance risks, the effect of economic conditions, uncertainty in government funding, the impact of competition, and other risks detailed in the Company's Securities and Exchange Commission filings.

FOR MORE INFORMATION:

Linda Billings
Director of Communications
SPACEHAB, Inc.
(202) 488-3500 x. 201
billings@hqspacehab.com

The Oriole's GEM 22 graphite-epoxy-motor propulsion system is a solid rocket motor developed by Alliant Missile Products Company of Rocket Center, West Virginia, under contract to Astrotech. The GEM 22 is an outgrowth of the highly successful GEM 40, 50 and 60 Delta strap-on solid rocket motor series and the Extended Range Patriot missile system. A successful static firing of the GEM 22 took place April 20, 2000, at Alliant's Rocket Center test range.

The Oriole demonstration flight vehicle was a spin-stabilized two-stage configuration consisting of a Terrier Mark-12 boost stage, provided by NASA's Goddard Space Flight Center through the agency's sounding rocket operations contractor Litton PRC, and the Oriole stage developed by Astrotech. The demonstration flight payload was a set of instruments that gathered vehicle performance and launch environment data during the powered phase of the flight.

• Length: 155 inches (3.94 meters)

• Diameter: 18 in. (0.457 m)

• Propellant: cartridge-loaded double-base nitrocellulose

• Propellant weight: 1200 pounds mass (536 kilograms)

• Average sea-level thrust: 55,000 pounds force (244.6 kilonewtons)

Payload gross mass: 696.4 lbm (316 kg)
Vehicle liftoff weight: 5,321 lbm (2,359 kg)
Vehicle burnout weight: 1,200 lbm (544 kg)

Apogee altitude: 229 mi. (368.5 km) (actual)
Apogee time: 315.2 sec (5.25 min.) (actual)

Astrotech's Payload Processing Division offers customers a commercial alternative to using government payload processing facilities. Astrotech's facilities support launches from Kennedy Space Center/Cape Canaveral Air Force Station in Florida and Vandenberg Air Force Base in California. Astrotech provides services on a firm fixed-price basis. Astrotech has supported the processing of over 150 major payloads to date.