PALOMAR ESTABLISHES SUBSIDIARY IN AUSTRALIA

BURLINGTON, MASSACHUSETTS, UNITED STATES OF AMERICA (July 17, 2008) … Palomar Medical Technologies, Inc., a leading researcher and developer of light-based systems for cosmetic treatments, today announced the establishment of an international sales office in Australia to support Palomar’s efforts in gaining market share and assist with sales, service and marketing in Australia and New Zealand.

Joseph P. Caruso, Palomar Chief Executive Officer said, “To provide direct service support to our current customers, and offer an exciting benefit for new customers, we are pleased to announce the opening of this new office to assist in marketing and provide easy access to clinical information to all. The direct availability of Palomar products and service support in this region will further enhance Palomar’s brand recognition and provide access to a wide variety of superior aesthetic treatment modalities to better meet customer needs. To further support our customers, we will also be looking to focus on ongoing educational clinical symposiums, consensus meetings and collaborative marketing campaigns.”

Mr. Caruso continued, “Palomar remains committed to developing new technologies for products that provide superior results, and we look forward to the placement of our new Aspire(TM) aesthetic laser platform and SlimLipo(TM) laser-assisted lipolysis handpiece in the near future. The Aspire platform will allow Palomar to offer new high-demand body sculpting procedures and complement the broad range of aesthetic applications offered by Palomar's flagship StarLux(R) 500 laser and pulsed-light platform. With a focused approach to the market and a highly specialised sales and support team, we are confident of maintaining and enhancing our leadership position in this flourishing region.”

About Palomar Medical Technologies Inc: Palomar is a leading researcher and developer of light-based systems for cosmetic treatments. Palomar pioneered the optical hair removal field, when, in 1997, it introduced the first high-powered laser hair removal system. Since then, many of the major advances in light-based hair removal have been based on Palomar technology. In December 2006, Palomar became the first company to receive a 510(k) over-the-counter (OTC) clearance from the United States Food and Drug Administration (FDA) for a new, patented, home-use, light-based hair removal device. OTC clearance allows the product to be marketed and sold directly to consumers without a prescription. There are now millions of light-based cosmetic procedures performed around the world every year in physician offices, clinics, spas and salons. Palomar is testing many new and exciting applications to further advance the hair removal market and other cosmetic applications. Palomar is focused on developing proprietary light-based technology for introduction to the mass markets. Palomar has granted The Procter & Gamble Company a non-exclusive License Agreement to certain patents, technology and FDA documents related to the home-use, light-based hair removal field for women. In addition, Palomar has an exclusive development and license agreement with Johnson & Johnson Consumer Companies to develop and potentially commercialize home-use, light-based devices for reducing or reshaping body fat including cellulite, reducing the appearance of skin aging, and reducing or preventing acne.

For more information on Palomar and its products, visit Palomar’s website at www.palomarmedical.com. To continue receiving the most up-to-date information and latest news on Palomar as it happens, sign up to receive automatic e-mail alerts by going to the Investor Relations’ section of the website.