SecProbe.io

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Room 4561
							September 6, 2005

Dr. Meir D. Burstin
Chairman of the Board of Directors
LanOptics Ltd.
1 Hatamar Street
P.O. Box 527
Yokneam 20692 Israel

	Re:	LanOptics Ltd.
      Form 20-F for Fiscal Year Ended December 31, 2004
	File No. 0-20860

Dear Dr. Burstin:

      We have reviewed the above referenced filing and have the
following comments.  Please note that we have limited our review
to
the matters addressed in the comments below.  We may ask you to
provide us with supplemental information so we may better
understand
your disclosure.  Please be as detailed as necessary in your
explanation.  After reviewing this information, we may raise
additional comments.

      Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects.  We welcome
any questions you may have about our comments or any other aspect
of
our review.  Feel free to call us at the telephone numbers listed
at
the end of this letter.

Form 20-F for the Fiscal Year Ended December 31, 2004

Controls and Procedures, Page 71

1. We note your statements in the third paragraph regarding the
inherent limitations of internal control systems.  You should
state
clearly, if true, that your disclosure controls and procedures are
designed to provide reasonable assurance of achieving their
objectives.  In the alternative, remove the reference to the level
of
assurance of your disclosure controls and procedures.  Please
refer
to Section II.F.4 of Management`s Reports on Internal Control Over
Financial Reporting and Certification of Disclosure in Exchange
Act
Periodic Reports, SEC Release No. 33-8238.

Notes to the Consolidated Financial Statements

Note 2 - Significant Accounting Policies

Note 2j - Redeemable Preferred shares in a subsidiary and
Preferred
shares in a subsidiary, page F-12

2. With regard to the redeemable preferred shares in EZchip,

a. Tell us how you are accounting for the accretion to the
redemption
value, including the amounts recorded in each period presented.

b. Provide a roll-forward of the related balances and a
description
of how the amounts recorded were computed, including the initial
valuation of the shares in March of 2003.

c. Tell us the fair value of the shares as of December 31, 2004
and
how this value was determined.

d. Provide us any additional information necessary surrounding
your
subsidiary to support your accounting for its preferred shares and
refer to the relevant literature that supports your accounting.
Address in your response the option you gave to the Major
Shareholders to exchange their shares in EZchip for Ordinary
shares
of LanOptics.

Note 3 - Investment in EZchip, page F-21

3. Tell us more about the Swap Options you granted to the Major
Shareholders in May 2003, which allows them to exchange their
shares
in EZchip for Ordinary shares of LanOptics.  Include in your
response
the business reasons for granting the Swap Options and the
underlying
formula that will determine the exchange ratio. Explain your
accounting for the Swap Option at issuance (May 2003) and the
subsequent interim periods, including upon exercise.  Refer to the
authoritative literature that supports your accounting, including
your consideration of EITF 00-19.  Tell us whether the exchange
transaction completed in June 2005 was completed under the
provisions
of the Swap Option and if so, discuss the exchange ratio and the
respective accounting.

Note 13 c. - Shareholders` Equity, Stock Options of Subsidiary,
page
F-34

4. We note that your privately-held subsidiary, EZchip, grants
options to its employees and others for the purchase of its
ordinary
shares.  We further note your disclosure that the exercise price
for
these options is equal to the market price of the shares at the
date
of grant.  Since EZchip is a privately-held subsidiary, tell us
how
you determined the exercise price is equal to the market price of
the
shares for the periods presented.  Provide us any objective
evidence
and analysis to support your fair value determination, including
issuances of preferred stock of the subsidiary, and conversion
rates
associated with the Swap Option.   Similarly address the valuation
of
EZchip`s options using the Black-Scholes model, and how you
determined the fair value of the underlying EZchip stock.
******

      As appropriate, please amend your filing and respond to
these
comments within 10 business days or tell us when you will provide
us
with a response.  Please submit all correspondence and
supplemental
materials on EDGAR as required by Rule 101 of Regulation S-T.  You
may wish to provide us with marked copies of any amendment to
expedite our review.  Please furnish a cover letter with any
amendment that keys your responses to our comments and provides
any
requested information.  Detailed cover letters greatly facilitate
our
review.  Please understand that we may have additional comments
after
reviewing any amendment and your responses to our comments.

	We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filing to be certain that the
filing includes all information required under the Securities
Exchange Act of 1934 and that they have provided all information
investors require for an informed investment decision.  Since the
company and its management are in possession of all facts relating
to
a company`s disclosure, they are responsible for the accuracy and
adequacy of the disclosures they have made.

	In connection with responding to our comments, please
provide,
in writing, a statement from the company acknowledging that:

* the company is responsible for the adequacy and accuracy of the
disclosure in the filing;

* staff comments or changes to disclosure in response to staff
comments do not foreclose the Commission from taking any action
with
respect to the filing; and

* the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.

      In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in our review of your filing or in
response to our comments on your filing.

You may contact Tamara Tangen at (202) 551-3443 at or Lisa
Mitrovich,
Assistant Chief Accountant, at (202) 551-3453 if you have
questions
regarding comments on the financial statements and related
matters.
If you need further assistance, you may contact me at (202) 551-
3488.

      Sincerely,

      Stephen G. Krikorian
      Branch Chief - Accounting

Meir D. Burstin
LanOptics Ltd.
September 6, 2005
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