SecProbe.io

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Room 4561
September 22, 2005

Mr. Eberhard Schoeneburg
Chief Executive Officer
Artificial Life, Inc.
4601 China Online Centre
333 Lockhart Road
Wanchai, Hong Kong

      Re:	Artificial Life, Inc.
      Form 10-KSB for the Year Ended December 31, 2004
		Filed March 31, 2005
		Form 10-QSB for the Quarter Ended June 30, 2005
		Filed August 15, 2005
		File No. 0-25075

Dear Mr. Schoeneburg,

      We have reviewed the above referenced filing and have the
following comments.  Please note that we have limited our review
to
only your financial statements and related disclosures and do not
intend to expand our review to other portions of your document. 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 comment 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-KSB for the Year Ended December 31, 2004

Item 7. Financial Statements

Report of Independent Registered Public Accounting Firm, page F-1

1. We note that your principal office is located in Hong Kong and
your auditors are located in Denver, Colorado.  We generally
believe
that there should be a logical relationship between the location
from
which the audit report is rendered and the location of the
registrant`s corporate offices or place where the registrant
conducts
its principal operations.  Please explain to us why you have
engaged
auditors located in Colorado and indicate whether they are
licensed
to practice in Hong Kong.  In addition, please explain why the
audit
opinion on your financial statements for fiscal 2004 is dated
March
4, 2004.

Notes to Consolidated Financial Statements

Note 2. Summary of Significant Accounting Policies

Revenue Recognition, Concentration and Credit Risk, page F-7

2. It is unclear from your disclosures whether you recognize
revenue
related to entertainment products, games and technologies which
are
downloaded by users from telecommunications carriers on a gross or
net basis.  Please clarify for us whether you recognize this
revenue
on a gross or net basis and support your policy by explaining how
it
complies with EITF 99-19.

3. Please describe to us the nature of your application services
and
the terms of the related arrangements.  Identify the authoritative
literature that you rely on in recognizing this revenue and
explain
to us how each revenue recognition model for these services (i.e.,
as
services are performed, upon completion, by phase, and on
acceptance)
complies with that literature.  For each model, explain how and
when
the relevant criteria are met in order to recognize revenue in the
manner described.

4. It appears that you enter into multiple-element arrangements
that
include both products and services.  Please identify the elements
included within these arrangements and describe the material
contractual terms.  Describe to us your revenue recognition
policies
for each element offered as part of your multiple-element
arrangements and explain how these policies comply with the
relevant
authoritative literature.  For elements that you have concluded
may
be accounted for separately, specifically support those
conclusions.

Note 3. Accounts Payable Restatement, page F-9

5. Please explain to us whether you have entered into any revenue
and
purchase transactions with the same party similar to those with
your
German customer.  If so, please describe to us those transactions
and
quantify any amounts that were recognized within your financial
statements.  Refer to the authoritative literature that supports
your
accounting treatment for any such transactions and explain how you
complied with that literature.

Note 4. Related party transactions, page F-10

6. Please tell us how you considered the guidance in EITF 98-5 and
EITF 00-27 in calculating and recording any beneficial conversion
feature related to your convertible note payable.

Note 6. Commitments and Contingencies

Contingencies, page F-12

7. We note that you have accrued only $100,000 of the $585,000
summary judgment against you in the Copley Place Associates
matter.
In addition, we note that you have not accrued the full amount of
the
default judgment against you in the matter related to your former
employees.  Please explain to us the basis for concluding that
your
accruals related to these matters are appropriate and in
compliance
with the guidance in SFAS 5 and FIN 14.

Item 8A. Controls and Procedures, page 26

8. We note that you concluded your evaluation on February 1, 2004
and
disclose the conclusion regarding the effectiveness of your
disclosure controls and procedures as of that date.  Please
explain
to us how you complied with Item 307 of Regulation S-B that
requires
you to provide this conclusion as of December 31, 2004 based on an
evaluation performed as of the same date. In addition, please
explain
to us why your disclosures made under Item 308(c) of Regulation S-
B
do not appear to conform to the guidance provided within that
item.

9. Please explain to us the effect that your restatement had on
your
evaluation of disclosure controls and procedures.  In this regard,
we
note that a restatement is generally considered strong evidence of
the existence of a material weakness.

Form 10-QSB for the Quarter Ended June 30, 2005

Item 1. Basis of Presentation, page 6

10. We note that you have entered into an agreement with an Asian
mobile telecommunications provider.  Please describe to us the
terms
of, and explain how you are accounting for, this agreement.
Explain
to us the basis for your accounting conclusions regarding the
advertising benefits and the amount and timing of any revenue that
will be recognized throughout the term of the agreement.  Refer to
the authoritative literature that supports your accounting
treatment
and explain how you complied with that literature.

      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 Stathis Kouninis, Staff Accountant, at (202)
551-3476, Mark Kronforst, Senior Staff Accountant at (202) 551-
3451
or me at (202) 551-3489 if you have any questions regarding these
comments.

							Very truly yours,

							Brad Skinner
						Accounting Branch Chief
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Eberhard Schoeneburg
Artificial Life, Inc.
September 22, 2005
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