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Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
Originator-Key-Asymmetric:
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 TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
 V4jdPUDXV5bzI/4C63ve5Pic5B/KR5KE5MDr/bl0HCtYvQ5sgtvEsEIYJ2nPpQjh
 I1KPGRbhBWtZzbW9VRBQJQ==

<SEC-DOCUMENT>0001181431-03-020324.txt : 20030825
<SEC-HEADER>0001181431-03-020324.hdr.sgml : 20030825
<ACCEPTANCE-DATETIME>20030825181538
ACCESSION NUMBER:		0001181431-03-020324
CONFORMED SUBMISSION TYPE:	4
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20030813
FILED AS OF DATE:		20030825

ISSUER:		

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			RAE SYSTEMS INC
		CENTRAL INDEX KEY:			0001084876
		STANDARD INDUSTRIAL CLASSIFICATION:	MEASURING & CONTROLLING DEVICES, NEC [3829]
		IRS NUMBER:				770588488
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	BUSINESS ADDRESS:	
		STREET 1:		1339 MOFFETT PARK DRIVE
		CITY:			SUNNYVALE
		STATE:			CA
		ZIP:			95112
		BUSINESS PHONE:		408-752-0723

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	NETTAXI INC
		DATE OF NAME CHANGE:	19990422

REPORTING-OWNER:	

	OWNER DATA:	
		COMPANY CONFORMED NAME:			HSI PETER H
		CENTRAL INDEX KEY:			0001171525

	FILING VALUES:
		FORM TYPE:		4
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-26109
		FILM NUMBER:		03865142

	BUSINESS ADDRESS:	
		STREET 1:		1339 MOFFETT PARK DRIVE
		CITY:			SUNNYVALE
		STATE:			CA
		ZIP:			95112
		BUSINESS PHONE:		4087520723

	MAIL ADDRESS:	
		STREET 1:		1339 MOFFETT PARK DR
		CITY:			SUNNYVALE
		STATE:			CA
		ZIP:			95112
</SEC-HEADER>
<DOCUMENT>
<TYPE>4
<SEQUENCE>1
<FILENAME>rrd16689.xml
<DESCRIPTION>STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP
<TEXT>
<XML>
<?xml version="1.0"?><ownershipDocument>
    <schemaVersion>X0201</schemaVersion>

    <documentType>4</documentType><periodOfReport>2003-08-13</periodOfReport><notSubjectToSection16>0</notSubjectToSection16>
    <issuer>
        <issuerCik>0001084876</issuerCik>
        <issuerName>RAE SYSTEMS INC</issuerName>
        <issuerTradingSymbol>RAEE.OB</issuerTradingSymbol></issuer><reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0001171525</rptOwnerCik>
            <rptOwnerName>HSI PETER H</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>C/O RAE SYSTEMS, INC.</rptOwnerStreet1>
            <rptOwnerStreet2>1339 MOFFETT PARK DRIVE</rptOwnerStreet2>
            <rptOwnerCity>SUNNYVALE</rptOwnerCity>
            <rptOwnerState>CA</rptOwnerState>
            <rptOwnerZipCode>94089</rptOwnerZipCode>
            <rptOwnerStateDescription></rptOwnerStateDescription>
        </reportingOwnerAddress>
            <reportingOwnerRelationship>
<isDirector>0</isDirector><isOfficer>1</isOfficer><isTenPercentOwner>0</isTenPercentOwner><isOther>0</isOther><officerTitle>CTO, VP Technology</officerTitle></reportingOwnerRelationship></reportingOwner><nonDerivativeTable><nonDerivativeTransaction><securityTitle><value>Common Stock</value></securityTitle><transactionDate><value>2003-08-13</value></transactionDate><deemedExecutionDate><value>2003-08-13</value></deemedExecutionDate><transactionCoding><transactionFormType>4</transactionFormType><transactionCode>G</transactionCode><equitySwapInvolved>0</equitySwapInvolved></transactionCoding><transactionAmounts><transactionShares><value>4336332</value></transactionShares><transactionPricePerShare><value>0</value></transactionPricePerShare><transactionAcquiredDisposedCode><value>D</value></transactionAcquiredDisposedCode></transactionAmounts><postTransactionAmounts><sharesOwnedFollowingTransaction><value>4336332</value></sharesOwnedFollowingTransaction></postTransactionAmounts><ownershipNature><directOrIndirectO
wnership><value>I</value></directOrIndirectOwnership><natureOfOwnership><value>See footnote</value><footnoteId id="F1"/></natureOfOwnership></ownershipNature></nonDerivativeTransaction></nonDerivativeTable><footnotes><footnote id="F1">4,336,332 shares are held by the Hsi Family Trust UA/DTD February 7, 2003.</footnote></footnotes><ownerSignature><signatureName>/s/ Lea Anne Matsuoka</signatureName><signatureDate>2003-08-13</signatureDate></ownerSignature></ownershipDocument>



</XML>
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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