SECURITIES AND EXCHANGE COMMISSION


                             WASHINGTON, D.C. 20549

                            ------------------------


                                   FORM 8 - K


                                 CURRENT REPORT


     Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934


       Date of Report (Date of earliest event reported): February 28, 2006


                              Data I/O Corporation
             (Exact name of registrant as specified in its charter)


                                   Washington
                 (State of other jurisdiction of incorporation)


         0-10394                                            91-0864123
     (Commission File Number)                 (IRS Employer Identification No.)


   10525 Willows Road N.E., Redmond, WA                              98073-9746
   (Address of principal executive offices)                           (Zip Code)


        Registrant's telephone number, including area code: (425) 881-6444


                                 Not Applicable
          (Former name or former address, if changed since last report)


                                Page 1 of 3 Pages





Item 2.03 Creation of a Direct  Financial  Obligation or an Obligation  under an
Off-Balance Sheet Arrangement of a Registrant.

The information disclosed under Item 2.04 is incorporated into this Item 2.03.

Item 2.04  Triggering  Events that  Accelerate  or  Increase a Direct  Financial
Obligation or an Obligation under an Off-Balance Sheet Arrangement.


On February 28,  2006,  Data I/O entered  into two  agreements  with its current
landlord,  one to early terminate the current headquarters  building lease and a
second agreement to lease a new facility.

The new facility lease agreement is for a term of 5 years for 39,901 square feet
of  building  space  commencing  June 1, 2006 or such later  completion  date as
provided for in the new construction provisions.  The lease includes 4 months of
free rent, $10 per square foot of tenant improvement  allowance,  and provisions
for an additional  five years  renewal  term.  Base rent for the lease starts at
$13.50 per square foot with annual 3% escalation in the base rent.  For the five
year  lease  this  rent  totals   $2,680,283.   In  addition  to  base  rent,  a
proportionate share of operating costs, taxes and allocable costs,  expenses and
liabilities shall be paid by Data I/O Corporation.

The  Lease  Termination  Agreement  provides  for the early  termination  of the
current Willows Road NE, Redmond, WA headquarters building lease. This lease had
an original scheduled termination date of December 31, 2006. The new termination
date shall be the later of 30 days after notice of  completion  of  construction
for the new building lease or July 7, 2006.  Data I/O  Corporation's  obligation
for operating expenses, taxes and additional rent shall be prorated according to
that  date.  Data I/O  shall  pay an early  termination  fee  equivalent  to the
prorated  current lease base rent from that termination date to August 15, 2006.
Based upon the earliest possible  termination date this payment could be as high
as $230,000.







SIGNATURES


Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned hereunto duly authorized.

                                    Data I/O Corporation

March 31, 2006                      By _/s/Joel S. Hatlen
                                    Joel S. Hatlen
                                    Vice President
                                    Chief Financial Officer
                                    Secretary and Treasurer