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Aksys, Ltd.

Two Marriott Drive

Lincolnshire, IL 60069

December 9, 2005

  Securities and Exchange Commission

  100 F Street, NE

  Washington, D.C. 20549 -6010

  Attention:

  Brian Cascio

  Kristin Lochhead

  Kate Tillan

  Re:

  Aksys, Ltd.

  File No. 000-28290

  Response to Staff Comments
  on Form 10-K for the year ended December 31, 2004 Filed March 16,
  2005

Ladies and Gentlemen:

This letter responds to your letter dated November 25,
2005 to Aksys, Ltd. (“Aksys” or the “Company”) relating to the
Company’s filing on Form 10-K for the year ended December 31, 2004
filed March 16, 2005  (the “Filing”).

The Company’s responses to the staff’s comments are
numbered to relate to the corresponding comments in your letter.  References to page numbers in our responses
are to page numbers of the Filing.
Capitalized terms used in this letter but not otherwise defined have the
meanings assigned to them in the Filing.

Form 10-K for the year ended December 31,
2004

Item 7.
Management’s Discussion and Analysis of Financial Condition and Results
of Operations

Results of Operations

Revenue, page 31

1.                                       We
note your response to comment one and six in our letter dated October 17,
2005 and the revised response included in your Form 10-Q for the nine
months ended September 30, 2005.
It does not appear as though your disclosure describes the circumstances
that occurred during the period under discussion that resulted in material
changes to your revenue from sales of machines.
For example, your revenue from product sales decreased 60% from the nine
months ended September 30, 2004 to the nine months ended September 30,
2005, yet your discussion does not explain why this decrease has occurred.  Please revise in future filings.

Response: Our disclosure will be
revised in future filings along the following lines:

Revenue for the nine-month period ended September 30,
2005 was $1,842,000, an increase of $80,000 or 5% from $1,762,000 in the
comparable period of 2004. Revenue generated from sales of the PHD System was $331,000 for the
nine months ended September 30, 2005, a decrease of $498,000 or 60% from
$829,000 for the nine months ended September 30, 2004.  The number of units sold varies greatly from
quarter to quarter as we are still in the early commercialization stages of the
PHD System. While we have continued to increase our customer base, increased
competition in the home hemodialysis market contributed to the increase in
rentals and decrease in sales of our machine.
In an effort to gain market acceptance of our relatively new product, we
allow customers to rent the PHD System. The expectation is that over time some
of these rentals may convert to sales. Rental revenue for the nine months ended
September 30, 2005 was $478,000, an increase of by $210,000 or 78% from $268,000
for the nine months ended September 30, 2004.  Service and supplies revenue for the
nine-month period ended September 30, 2005 was $1,033,000, an increase of
$368,000 or 55% from $665,000 for the nine months ended September 30,
2004.

Product revenue from units sold is
recorded when the PHD System has been installed and a patient has started
training whereas rental revenue from operating leases is recognized over the
duration of the lease, starting when the machine is installed and the patient
starts training. Changes in the number of units sold will have a more
significant impact on revenue than changes in the number of rental units. We
will continue to extend renting as an option to our customers as we continue to
work to increase market acceptance of our product.

While there have been no material
changes to our monthly rental price over the past two years, rental revenue and
service and supplies revenue has increased as our patient base has continued to
grow. Service and supply revenue is generated from patient utilization of each
machine we have sold or rented.   The
following table shows patient growth by quarter.

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  Date

  Number of Patients

  December 31,
  2003

  67

  September 30,
  2004

  106

  December 31,
  2004

  121

  September 30,
  2005

  163

The
number of patients using the PHD System reflected in the table above includes
patients using the PHD System as a result of either a sale or a rental
transaction.

2.                                       In
addition, in future filings please clarify whether the number of patients
includes those who are being treated through sales and rentals or only through
rentals.  You should also clearly
disclose how patient growth impacts your rental and service and supplies revenue.

Response:  We acknowledge the staff’s comment. Please
see our response incorporated into item 1.

Consolidated Financial Statements

Note 1.  Summary
of Significant Accounting Policies, page 46

(f) Long-Lived Assets, page 47

3.                                       Refer
to your response to prior comment two in our letter dated October 17,
2005.  You explain that you record
transfers of machines from inventory to equipment and leased assets as an
outflow of operating cash flows for inventory until the machine is placed in
service as demonstration equipment or rental units, which is shown as an
outflow of cash as an investing activity.
It appears as though you should only show cash used for the purchase of
the machines as cash used at the time the cash is disbursed and then disclose
the non-cash event of transferring the machines to service as demonstration
equipment or rental units as a footnote disclosure.  Please tell us in detail why you believe that
your current presentation complies with SFAS 95.

Response: We acknowledge the staff’s
comment. Beginning with our Form 10-K filing for the year ended December 31,
2005 we will present all cash used to purchase machines as operating cash flows
and subsequent transfers to fixed or leased assets will be disclosed as a
non-cash event in the footnotes. We will reclassify the Statement of Cash Flows
for all periods presented in future filings, beginning with our Form 10-K
filing for the year ended December 31, 2005, to conform to this updated
presentation.

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In connection with responding to these comments the
Company acknowledges that:

•                  the Company is responsible for the
adequacy and accuracy of the disclosure in the Filings;

•                  staff comments or changes to
disclosure in response to staff comments do not foreclose the Commission from
taking any action with the Filings; 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.

*      *      *      *      *

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We hope that the foregoing has been responsive to the
staff’s comments.  If you or others have
any questions or would like additional information, please do not hesitate to
contact me at (847) 229-2161.

  Very truly yours,

  /s/ Laurence P. Birch

  Laurence P. Birch

  Chief Financial Officer

  Aksys, Ltd.

  cc:

  William C. Dow

  Chief Executive Officer

  Aksys, Ltd.

  Keith S. Crow, P.C.

  Kirkland & Ellis LLP

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