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Letter Of Correspondence

 September 20, 2005

 Securities and Exchange Commission

 100 F
Street, NE

 Washington, D.C. 20549

Attention:

Brad Skinner

Sherri Bowen

Marc Thomas

Re:

Maxwell Technologies, Inc. (the “Company”)

Form 10-K for Fiscal Year Ended December 31, 2004 Filed March 23, 2005

Form 10-Q for Fiscal Quarter Ended March 31, 2005 Filed May 9, 2005

Form 10-Q for Fiscal Quarter Ended June 30, 2005 Filed August 8, 2005

File No. 1-15477

 Dear Staff:

 On behalf of Maxwell Technologies, Inc., this letter responds to the
comments of the staff (the “Staff”) of the Securities and Exchange Commission (the “Commission”) to the filing of the above-referenced annual and quarterly reports (the
“Filings”), which were included in your letter dated September 6, 2005 (the “Staff Letter”).

 In this letter, we have reproduced your comments and have followed each comment with our response. The numbered paragraphs of this letter set forth below
correspond to the numbered paragraphs of the Staff Letter. References in this letter to “we,” “our” or “us” mean Maxwell Technologies, Inc.

 Form 10-K for the Year Ended December 31, 2004

 Risk Factors

1.
You state in the filing that you are relatively inexperienced in managing the Company’s international operations. You have also experienced significant management
turnover in recent periods such that your auditors noted problems in internal controls in this regard. Tell us how you have addressed these concerns.

 Response: By way of background, the Company acquired the bulk of its international operations with the acquisition of
Montena Components Ltd., now known as Maxwell Technologies S.A., located in Rossens, Switzerland, in July 2002. In the past three years, we have gained considerable experience operating our Swiss-based operations and have

 Brad Skinner

 Sherri
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 Marc Thomas

 September 20, 2005

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established global reporting relationships for key functions, including finance and sales and marketing, to strengthen our management capabilities.

 To address concerns regarding controls as they relate to
finance staff depth, experience and professional credentials, we have created and filled the following positions since December 31, 2004:

•

Director of SEC Reporting and Sarbanes Oxley Compliance (CPA)

•

Assistant Controller (CPA)

•

Senior Accountant

•

Staff Accountant (Swiss subsidiary)

•

Cost Accountant (Swiss subsidiary)

 In addition to the hiring of more accounting staff, the CFO or Corporate Controller visits the Swiss site on a quarterly basis to review financial
records. Month-end, quarter-end, and year-end close checklists have been established and integrated into the accounting department’s processes and procedures at both the U.S. and Swiss sites.

 Management’s Discussion & Analysis

2.
We noted that during the first, third and fourth quarters of fiscal 2004 costs charged to the cost of sales exceeded the value of the specific sales under the long-term supply
agreement. Tell us with whom this long-term supply agreement is with. Address the reasons the costs have exceeded the sales under the agreement and whether this trend is expected to continue. Tell us the revenues and costs recorded under this
agreement during the periods presented. Further, tell us the nature and terms of the agreement.

 Response: Regarding the question of cost of sales with respect to certain products, Maxwell has entered a new and emerging business area where the
cost of start up production has exceeded the initial selling price of the product. The specific long-term supply agreements are with two different customers, neither of which are related parties of Maxwell. These supply agreements generated losses
due to selling prices negotiated being lower than the expected cost to produce the product during its early phase of production. The reserves taken regarding these agreements were disclosed on page 32 of the Company’s 2004 10-K.

 As planned, cost of the specific product covered by the first of these
agreements has already dropped below the selling price. We expect that cost reductions for the product covered by the second of these agreements will have dropped below the selling price by the end of our fiscal Q3 2005.

 Brad Skinner

 Sherri
Bowen

 Marc Thomas

 September 20, 2005

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 The first agreement had a three-year term that expired in November 2004, with multiple releases for
multiple delivery dates. The second agreement has a four-year term that expires in August 2008 with multiple releases for multiple delivery dates.

3.
In your discussion of and comparison of operating results for the fiscal 2002 to 2003 periods, it is unclear which components of your current and sold businesses are being
presented and compared and whether they are being reflected within current or discontinued operations. Please clarify how you have treated the disposition of Winding, I-Bus and TeknaSeal. Also explain to us how you applied SFAS 144 in distinguishing
each business’s sale as a divestiture as opposed to a discontinued operation.

 Response:

 WINDING EQUIPMENT BUSINESS:

 The winding machine business was a separate reporting segment, and therefore was treated as discontinued operations at the appropriate time. The details
of the transaction are as set forth below:

•

In December 2003, we consummated the sale of the winding equipment business segment of Maxwell Technologies SA (a subsidiary of Maxwell Technologies in Switzerland) to Metar SA, a
Swiss company not related to Maxwell Technologies, SA.

•

Pending orders from the winding business that were placed before the selling date (December 31, 2003) remained the property of Maxwell Technologies, and were completed by Metar, the
purchasing company, and shipped to Maxwell customers through the second quarter of 2004. Revenue and costs related to these shipments were recognized by Maxwell.

•

We had no business ownership in the winding business after the sale.

•

The winding business was an asset group as defined in paragraph 4 of FASB 144 and reported as a discontinued operation upon fulfillment of outstanding orders in the second quarter
of 2004.

 In accordance with FASB Statement 144,
Accounting for the Impairment or Disposal of Long-Lived Assets, paragraph 42, the results of operations of a component of an entity (Maxwell Technologies, SA, in Rossens, Switzerland) that have been disposed of, shall be reported in discontinued
operations because: (1) the operations and cash flows of the component (asset group-made up of winding equipment) have been (or will be) eliminated from the ongoing operations of the subsidiary or entity as a result of the

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disposal of the entire winding equipment business, and (2) the entity did not have any significant continued involvement in the operations of the winding
equipment business after the sale or disposal of the these assets. In accordance with Example 12, of Appendix A of FASB Statement 144, the winding business was segregated operationally and for financial reporting purposes.

 Therefore, the sale of the winding equipment business was reported as
discontinued operations during the second quarter of 2004, as reported in the Form 10-K for 2004. All periods were retroactively reclassified to present the winding business as discontinued operations.

 I-BUSINESS/PHOENIX SUBSIDIARY:

 I-BUS was a wholly owned subsidiary that was consolidated with Maxwell
Technologies, Inc.

 The Company decided to exit that business
completely and the sale of the I-Bus/Phoenix, Inc. business in September of 2002. The sale was reported as a divestiture since it involved a separate business subsidiary whose operations were consolidated with Maxwell Technologies, Inc.

 In accordance with FASB Statement No. 144, paragraph 30, the criteria for
a completed sale or disposition of long-lived assets have been met. Staff Accounting Bulletin No. 30 (T.5E) also supports the treatment of this sale as a divestiture. The principal consideration in this accounting determination is that the risks and
other incidents of ownership have been transferred to an unrelated buyer with sufficient certainty.

 TEKNASEAL SUBSIDARY:

 TEKNASEAL was a wholly owned subsidiary of Maxwell Technologies, Inc.

 The sale of TEKNASEAL was completed in December of 2002, when Maxwell sold all of the assets of this business to an
independent third party. No remaining assets or business overlap existed after the sale.

 Similarly to I-BUS, in accordance with FASB Statement No. 144, paragraph 30, the criteria for a completed sale or disposition of long-lived assets have been met. Staff Accounting Bulletin No. 30 (T.5E) also supports
the treatment of this sale as a divestiture. The principal consideration in this accounting determination is that the risks and other incidents of ownership have been transferred to an unrelated buyer with sufficient certainty.

 Brad Skinner

 Sherri
Bowen

 Marc Thomas

 September 20, 2005

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 Item 9. Controls and Procedures

4.
Your disclosures should describe in specific detail the nature of the material weaknesses identified. You should address when the material weaknesses were identified and by
whom, quantify the impact of the adjustments made in both the 2002 and 2004 financial statements as a result of the lack of adequate review of your financial close procedures and address the specific steps taken to remediate the weakness. Each
interim period filing should address and update the status of the remediation efforts which have occurred during the individual interim time period and whether the material weaknesses still exist.

 Response: The material weaknesses existing as of December 31, 2004
were related to two different issues. The first was related to a lack of adequate review of our financial close procedures surrounding accrued expenses in 2004 and the second was related to accounting for stock based compensation in the 2002
financial statements. The amount involved in the accrued expenses in 2004 was approximately $106,000. The amount involved in the stock based compensation in 2002 was approximately $1.9 million.

 The material weakness in accruals for payroll and other expenses identified
during the 2004 year-end audit has been remediated with the addition of more staff, which allows for a more systematic review to occur, and the implementation of an accounting close checklist process, which is designed to ensure that all necessary
accruals have been considered and processed. The material weakness for stock based compensation generated in 2002 was an isolated incident and does not require specific remediation.

 These material weaknesses were identified by the Company’s independent auditors during the preparation and review of
Form 10-K for 2004.

 Based on an Audit Plan for SOX 404, the
Company has taken the following control testing and remediation steps during 2005:

•

For each quarter in 2005 the Company has conducted a Control Test covering material weaknesses and the testing of other controls over financial reporting.

•

During Q1, Q2 and now during Q3 2005, the Company has re-tested those weaknesses and remediation to ensure that those controls are working properly.

•

The Company has hired five new accounting personnel (three in San Diego and two in Switzerland) during 2005. A new Director of SEC Reporting and Compliance was one of those hired to
remedy one of the material weaknesses cited by the independent auditors.

•

New accounting personnel are expected to be fully trained by the end of 2005.

 Brad Skinner

 Sherri
Bowen

 Marc Thomas

 September 20, 2005

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 We will revise our disclosure in future periods to address the Staff’s comment. Additionally, we
will include disclosure in all future interim period filings that will address and update the status of the remediation efforts, which have occurred during the interim time period and whether the material weaknesses still exist.

 Note 1—Description of Business and Summary of Significant Accounting Policies

 Revenue Recognition

5.
We note your disclosures within the revenue recognition policy that you derive revenues from the sale of manufactured products. Revenues are recognized from the sale of
licenses and from product development contracts, which appear to be both short and long term in nature. Your revenue recognition policy should clearly address what authoritative accounting literature you are following in accounting for your revenue
generating sources (i.e. SAB 104 or SOP 81-1).

 Response: Maxwell recognizes revenue primarily from the shipment of products. License revenue in 2003 and 2004 became significant and therefore was separately disclosed. Product and license revenue is recognized within the guidelines
of SAB 101 and SAB 104. Product development contracts have become significant in 2005 and the revenue derived from these contracts is recognized within the guidelines of SOP 81-1. We shall refer to authoritative accounting literature in our revenue
recognition policy in future SEC filings.

6.
Tell us and clarify your revenue recognition policy to address and define “net revenues.”

 Response: The term “net revenues” was used to describe
total revenues in two tables within the MD&A section. In future SEC filings the term “net revenues” will be changed to “total revenue” as shown on the Statement of Operations.

7.
Regarding the license agreement entered into with YEC in February of 2003, summarize for us the nature and terms of the license. Specifically state the period of the agreement
and describe how you recognize revenue and related costs under the agreement. Quantify for us the revenues and costs recognized under this agreement during the periods presented.

 Brad Skinner

 Sherri
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 Marc Thomas

 September 20, 2005

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 Response: Following is a summary of the Manufacture and Technology Transfer Agreement between
Yeong-Long Technologies, Co., Ltd. (YEC) and Maxwell Technologies, Inc. (Maxwell) (the “YEC Agreement”)

Period:

February 20, 2003 through December 20, 2017

Payments:

$5 million for a license to manufacture and sell ultracapacitors and royalties of 3% of YEC sales on an ongoing basis through Dec. 20, 2017.

 General Nature

 of the Agreement:

This is a license to manufacture and sell ultracapacitors in China. Maxwell grants YEC the exclusive right to manufacture and sell specific PC Ultracapacitors in China.

 YEC will not sell PC
Ultracapacitors outside of China.

 Maxwell will provide and
transfer to YEC the ability to produce and sell PC Ultracapacitors including manufacturing documentation, assistance in selection of factory equipment and training of YEC personnel.

 Maxwell will supply all of YEC’s requirements for electrode material to produce PC Ultracapacitors.

 YEC will pay a royalty of 3% of its sales of PC Ultracapacitors to Maxwell
through December 20, 2017.

 Revenue Recognition:

 Feb. 20, 2003 - $500,000 payment to Maxwell for “know how”
transferred from Maxwell to YEC. Revenue recognized in Q4 2003 when the transfer was completed.

 Feb. 25, 2003 - $2,500,000 payment to Maxwell for “know how” transferred from Maxwell to YEC. Revenue recognized in Q4 2003 when the transfer
was completed.

 Sep. 20, 2003 - $1,000,000 payment to Maxwell
for helping YEC qualify as a manufacturer of PC Ultracapacitors. Revenue recognized in Q4 2003 as the qualification was completed as of December 31, 2003.

 Dec. 20, 2003 - $1,000,000 payment to Maxwell for providing documentation, training and support to YEC and for confirmation of YEC as a manufacturer of PC
Ultracapacitors by Maxwell supported by Maxwell placing an order

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to purchase PC Ultracapacitors for 2004 deliveries. Revenue was recognized in Q1 2004 after Maxwell had fulfilled all condit