SecProbe.io

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Mail Stop 4-06

April 21, 2005

Jim Miller - Chief Executive Officer
Imageware Systems, Inc.
10883 Thornmint Road
San Diego, CA  92127

	RE:	Imageware Systems, Inc. (File No. 001-15757)
		Form 10-K: For the Fiscal Year Ended December 31, 2004

Dear Mr. Miller;

      We have reviewed the above mentioned filing and have the
following comments.  Where indicated, we think you should revise
your
future filings in response to these comments.  If you disagree, we
will consider your explanation as to why our comments are
inapplicable or a revision is unnecessary.  Please be as detailed
as
necessary in your explanation.  In some of our comments, we may
ask
you to provide us with supplemental information so we may better
understand your disclosure.  After reviewing this information, we
may
or may not 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 on any other
aspect
of our review.  Feel free to call us at the telephone numbers
listed
at the end of this letter.

Form 10-K:  For the Fiscal Year Ended December 31, 2004

Audited Financial Statements

Note 2.  Summary of Significant Accounting Policies - Revenue
Recognition
1. We note that a number of the Company`s contracts are with
government agencies.  Supplementally tell us how you considered
paragraphs 32 - 33 of SOP 97-2 in accounting for fiscal funding
clauses included in your software arrangements.  Also tell us how
fiscal funding clauses or other government contract contingencies
impact your revenue recognition for other services and product you
provide.
2. Supplementally explain  each revenue stream and the related
revenue recognition policy for each revenue source (i.e., long-
term
contracts involving customization, license fees, maintenance
agreements, multi-element arrangements and other software sales).
Cite the accounting literature that supports each policy and at a
minimum, address the applicability of SOP 97-2, SOP 81-1, SAB 104,
EITF 00-21 and EITF 03-05 in your response.  We may have further
comments based on your response.
3. Explain how you identify the elements included in a software
arrangement (i.e., software license, support, training,
consulting,
etc) and how you establish VSOE for each of the elements in a
multiple element arrangements.  Clarify whether or not you apply
the
residual method of accounting to your arrangements and the basis
for
that accounting.  In this regard, address the extent to which you
have established VSOE for each of the undelivered elements.

Note 17.  Subsequent Events
4. We note that the Company sold your wholly-owned, Singapore
subsidiary on March 3, 2005.  Supplementally tell us how you
considered paragraphs 30 and 42-43 of SFAS 144 in determining that
classification of the operations of Digital Imaging Asia Pacific
as
discontinued operations was not warranted at December 31, 2004.

      As appropriate, please respond to these comments via EDGAR
within 10 business days of the date of this letter.  You may
request
additional time to respond, as necessary. Please furnish a cover
letter that keys your responses to our comments and provides any
requested supplemental information.  Detailed cover letters
greatly
facilitate our review.  Please understand that we may have
additional
comments after reviewing your responses to our comments.

	We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filing reviewed by the staff to
be
certain that they have provided all information investors require
for
an informed 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 Megan Akst, Staff Accountant, at (202) 942-
1793
or Kathleen Collins, the Branch Chief who supervised this review,
at
(202) 942-2814 if you have questions regarding comments on the
financial statements and related matters, or me at (202) 942-1800
with any other questions.

							Very truly yours,

							Craig Wilson
							Senior Assistant Chief
Accountant
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Imageware Systems, Inc.
April 21, 2005
Page 3 of 3

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