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CORRESP
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June 13, 2005

U.S. Securities and Exchange Commission

Attn: Gary Todd, Reviewing Accountant

Mail Stop 0306

Washington, D.C. 20549

RE:          Advanced
Power Technology, Inc.

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

Filed March 8, 2005

Form 10-Q for the quarter ended March 31, 2005

File No. 001-16047

Dear Mr. Todd,

Thank you for your letter dated May 17, 2005 regarding various
disclosures made in the above referenced documents.  In the paragraphs that follow, we have
provided the requested supplemental information.  In addition, we will make the requested
changes in our future filings.

Regarding our responses to your comments, Advanced Power Technology, Inc.
recognizes and acknowledges the following:

•      We are
responsible for the adequacy and accuracy of the disclosures in the filings;

•      Staff comments
or changes to disclosures in response to staff comments in the filings reviewed
by the staff do not foreclose the Commission from taking any action with
respect to the filing; and

•      We 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.

If you have any further questions about the information provided,
please feel free to contact me.

Sincerely,

  By:

  /s/ GREG HAUGEN

  Greg Haugen

  Vice President, Finance and Administration,

  Chief Financial Officer and Secretary

  (Principal Financial Officer)

Please note, all numbers are in $000’s, unless otherwise indicated.

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

Item 7. Management’s Discussion and Analysis
of Financial Condition and Results of Operations – Page 13

Results of Operations – Page 16

SEC Comment

1.             We
see that MD&A presents a non-GAAP measure of gross profit margin excluding
non-cash purchase accounting charges and amortization of technology rights. We
agree that you should discuss and quantify unusual and infrequent items
included in operating results. However, Item 10(e)(1)(ii) of Regulation
S-K prohibits non-GAAP performance measures that eliminate or smooth items
identified as non-recurring, infrequent or unusual when the nature of the
charge is such that it is reasonably likely to recur within two years or where
there was a similar charge within the prior two years. We see that the measure
excludes amortization of technology rights which is a recurring charge.
Accordingly, you should delete the non-GAAP measure of gross margin from all
future filings.

Management Response

Beginning with our Form 10-Q for
the quarter ended June 30, 2005, we will no longer present the non-GAAP
measure of gross margin excluding non-cash purchase accounting charges and
amortization of technology rights. As deemed necessary, we might discuss the
amount and nature of these fixed, non-cash charges included in our costs of
goods sold in order to show the impact they will have on earnings and cash
flows.

Sample Revision

The following is an example of the revised
explanation we expect to include in the Gross Profit section of the
MD&A.

Gross Profit.  Our gross profit margin
was 36.0% in 2004 compared to 31.7% in 2003, or an increase of 4.3%. Included
in our costs of goods sold in both 2004 and 2003, was $1.1 million of
amortization of technology rights assets.

SEC Comment

2.             With
respect to restructuring and exit costs, MD&A in future filings should
present quantified disclosure about expected and actual costs savings. Refer to
SAB Topic 5-P and the disclosure guidance from the next to last paragraph
under “4. Disclosures.”

Management Response

Beginning with our Form 10-Q for
the quarter ended June 30, 2005, we will make disclosures about the expected
and estimated actual cost savings, periods to be affected, and P&L line
items affected by our restructuring activities, in accordance with guidance in
SAB Topic 5-P, item 4 “Disclosures.”

Sample Revision

The following is an example of the revised
explanation we expect to include in the Restructuring Charges section of
the MD&A.

The Company estimates that the annual savings
from these actions are approximately $1.4 million for cost of goods sold and $800
for selling, general and administrative costs. The cost savings were realized
gradually from the inception of the restructuring actions.  The savings in cost of goods sold reached the
estimated annual run rate of $350 per quarter in the fourth quarter of 2004,
and the savings in selling, general and administrative costs reached the full
annualized run rate of $200 per quarter in the third quarter of 2004.

Consolidated Financial Statements

Note 1. Summary of Significant Accounting
Policies – Page F-7

(c) Revenue Recognition, Sales Returns,
and Allowances

SEC Comment

3.             We
note from page 7 that you may provide price protection rights. Please
expand future filings to clarify the extent of these arrangements and your
underlying accounting.

Management Response

Beginning with our Form 10-Q for
the quarter ended June 30, 2005, we will expand our explanation regarding
the extent of price protection rights provided to distributors and associated
accounting policies in the accounting footnotes and in the critical accounting
policies section of the MD&A. In addition, in our 2005 10-K we
will expand the disclosure made in the business overview section.

Sample Revision

The following is an example of the revised
explanation we expect to include in the Sales, Marketing and Distribution section of
Item 1. Business.

In certain circumstances we may elect to give
product-specific price protection or other allowances to our distributors, as
more fully explained in the footnotes to our financial statements and critical
accounting policies contained herein.

The following is an example of the revised
explanation we expect to include in the Critical Accounting Policies section of
the MD&A and the Revenue Recognition, Sales Returns and Allowances footnote
to the financial statements.

Our distributors have certain stock rotation
rights which allow them to rotate, every six months, their products in
inventory for a value up to 5% of their purchases over the preceding six month
period in exchange for an order of an equal amount of new product. In addition
we may elect to give price protections or other allowances to our distributors.
Price protections may be offered for distributor inventory on hand when we
update our price list. Additional price allowances may be offered to our
distributors in certain competitive bidding situations in which we may further
discount the price.  These price
allowances are evaluated as requested by the distributor on a case by case
basis.  Upon shipment, we record an
allowance for the estimated cost that may be incurred for product warranty,
sales returns, price allowances and contractual requirements with our
distributors based on historical experience.

SEC Comment

4.             Additionally,
you disclose that revenue from “certain contractual product sales or 1icense
agreements” is deferred and recognized when earned. In future filings please
make more specific disclosure about the nature and extent of these arrangements
and your underlying accounting policy. Also further clarify the criteria you
apply and the factors you consider in concluding that revenue under these
arrangements has been earned. Respond supplementally, as well.

Management Response

Our revenue recognition footnote states that “Revenue
from certain contractual product sales or license arrangements is deferred and
recognized when earned in accordance with the arrangement.” There are two
reasons we included this statement in our accounting policies:

The first reason relates to technology licensing
revenue that was material from 1997 through 2000. We had entered into a
licensing and technology transfer agreement whereby we received certain cash
payments as defined technological transfer milestones were achieved. This
revenue arrangement terminated in 2000 with all revenue recognized being
collected. Since that time we have recognized only immaterial amounts of
license revenue from licensing our technology in certain foreign markets. The
amount of this revenue was $0, $15, $25 and $29 in the first quarter of 2005,
2004, 2003, and 2002, respectively.

The second reason relates to non-recurring
engineering charges passed on to our customers when a special lot size or other
customer requested adjustment requires adaptation to our production process and
equipment. The customer is sometimes billed up-front for the cost of the
modifications. The revenue is later recognized when the modifications are
completed and the cost of the

modifications has been incurred by the
Company. The amount of non-recurring engineering charges is immaterial to our
overall revenues and margins.

As both the licensing and non-recurring
engineering charges have been immaterial, we will eliminate this statement from
our accounting policies footnote in future filings, provided that it continues
to be immaterial.

(f) Inventories

SEC Comment

5.             We
see that the “cost of certain inventories has been reduced by $1,923 and $2,036
as of December 31, 2004 and 2003, respectively”. Future filings should
clarify the nature of and reasons for these reductions. Also respond
supplementally.

Management Response

The statement in footnote 1(f) relates
to the gross adjustment to our inventory cost for excess and obsolete parts
which totaled $1,923 and $2,036 as of December 31, 2004 and 2003, respectively.
We establish a new inventory cost basis for estimated unmarketable (excess) or
obsolete inventory to estimated net realizable value based upon assumptions
about future demand and market conditions. We evaluate historical usage of the
product, current customer demand, purchase commitments and forecasted usage of
the product in making this assessment. Much of the accumulated inventory cost
adjustment related to product for communications and semiconductor capital equipment
applications which experienced a sharp decline in demand following the 2000
peak, resulting in excess inventory.

During the years presented in our 2004 10-K,
the amount of inventory cost write downs charged to cost of goods sold were
$807, $454, and $893, in 2004, 2003, and 2002, respectively. The amount of
inventory cost adjustment is presented on the face of our statement of cash
flows. There were no material sales of any of these products during the years
presented, which would have impacted our overall gross margin.

In future filings, we will eliminate the
statement in footnote 1(f) regarding the accumulated adjustment to the
cost basis of our inventory, and we will include in the MD&A, as materially
applicable, the amount and nature of inventory cost adjustments for the
applicable periods.

SEC Comment

6.             As
a related matter, future filings should make disclosure about the circumstances
leading to significant inventory impairment charges. You should also clarify
the disposition of the affected inventory; and, if material, MD&A should
also address the impact on gross margin of any sales inventory carried at
reduced cost.

Management
Response

Beginning with our Form 10-Q for
the quarter ended June 30, 2005, we will make any necessary disclosures
about the circumstances and nature of any material inventory costs adjustments
recorded. In addition, in the event the Company’s disposition of the affected
inventory results in a material impact on our reported gross margin, we will
disclose the nature of the disposition and quantify the impact on our gross
margin.

Note 12. Segment Information – page F-21

SEC Comment

7.             Please
revise future filings to also present the long-lived asset disclosure specified
by paragraph 38b to SFAS 131. Please note that under that guidance, the
geographic disclosure of long-lived assets should present tangible assets only
and should not include intangibles or investments. See question 22 to the FASB
publication “Segment information: Guidance on Applying Statement 131.”

Management Response

Beginning with our Form 10-K for
the year ended December 31, 2005, we will present long-lived assets by
geographic area according to paragraph 38b of SFAS 131, excluding intangible
assets and investments. In addition we will provide the appropriate
reconciliation to consolidated total assets.

Form 8-K dated April 28, 2005

SEC Comment

8.             We
see disclosure of non-GAAP measures of “pro forma net income” and “pro forma
gross margin” in your earnings release. Disclosures of non-GAAP measures in
furnished earnings releases should comply with all of the requirements of
paragraph (e)(1)(i) of Item 10 of Regulation S-K and Question 8 of the FAQ
Regarding the Use of Non-GAAP Financial Measures dated June 13, 2003.
Either delete these measures or revise future releases to present each of the
following for each non-GAAP measure:

•      A
presentation, with equal or greater prominence, of the most directly comparable
financial measure calculated and presented in accordance with GAAP;

•      A
reconciliation of the differences between a non-GAAP financial measure and the
most directly comparable financial measure calculated and presented in
accordance with GAAP;

•      Statements
disclosing the reasons why you
believe that the presentation of a non-GAAP financial measure provides useful
information to investors

regarding financial condition and results of operations; and

•      To the extent
material, statements disclosing any additional purposes for which management
uses any non-GAAP financial measure.

Your disclosures should be substantive and
specific to each non-GAAP measure. Those disclosures should address the
economic substance underlying your use of any non-GAAP measure, including how
you use each non-GAAP measure in conducting and evaluating your business. Those
disclosures should also address any material limitations associated with any
non-GAAP measure, including how you compensate for those limitations. Please
note that the existing statements in support of the measures are too generic to
support their use. Show us how you plan to implement this comment.

Management Response

Beginning with our earnings release and
related Form 8-K for the quarter ended June 30, 2005 we will
revise our disclosures of non-GAAP financial measures to meet the requirements
of paragraph (e)(1)(i) of Item 10 of Regulation

S-K and Question 8 of the FAQ Regarding the Use of Non-GAAP Financial Measures
dated June 13, 2003, specifically meeting the four bullet points
summarized in your letter to us.

Sample Revision

In Attachment A to this letter, is a revised
disclosure and supplemental reconciliation of the non-GAAP financial measures
used in our earnings release for the first quarter ended March 31, 2005.
The attachment illustrates how we plan to implement the comment from your
letter, including addressing each of the four bullet points raised in your
letter.

SEC Comment

9.             In
addition, we note that you refer to your non-GAAP information as “pro forma.”
The pro forma terminology has very specific meaning in accounting literature,
as indicated by Article 11 of Regulation S-X. In future filings, please
revise or omit the pro forma terminology when referring to non-GAAP
information.

Management Response

We agree that the term “pro forma” has
specific meaning in current accounting literature as indicated in Article 11
of Regulation S-X, and we will refrain from using the term when referring to
any non-GAAP financial measures in future filings.

Sample Revision

Refer to Attachment A.

SEC Comment

10.           Under
“Business Outlook” we see disclosure of expected pro forma loss per share for
the second quarter. Future press releases should not include projected non-GAAP
measures unless all of the relevant disclosures required under

Item 10(e)(1)(i) are