Exhibit 99.1

For additional information contact:        

Richard S. DeRose (703) 293-7901

For release: August 8, 2006 at 9:00 a.m.

Information Analysis Inc. Reports Second Quarter Results

FAIRFAX, VIRGINIA – Information Analysis Inc. (OTCBB: IAIC) reported results for the second quarter ended June 30, 2006. Revenues were $2,569,000 compared to $3,006,000 reported in 2005’s second quarter. The Company reported net income of $154,000, or $0.01 per share, compared to net income of $148,000, or $0.01 per share in 2005’s second quarter. IAI had revenue of $4,883,000, compared to $5,193,000 reported for six months ending June 30, 2005. Net income for the first six months of fiscal 2006 was $239,000, or $0.02 per share, versus net income of $220,000, or $0.02 per share, in the comparable 2005 period.

“Our second quarter profit continued to improve over last year’s results,” said Sandor Rosenberg, Chairman and Chief Executive Officer of IAI. “The Company is continuing the active pursuit of the conversion and system modernization business in addition to developing business opportunities in the area of Web applications. We now are working on a number of bid opportunities for new business and additional add-on business to existing contracts, which are expected to be awarded during the later part of the year.

“As our financial strength continues to grow, we expect more opportunities to expand our business through M&A activities.”

About Information Analysis Incorporated

Information Analysis Incorporated (www.infoa.com), headquartered in Fairfax, Virginia, is an information technology services company. The Company is a web solution provider and software conversion specialist, modernizing legacy systems and extending their reach to the Internet world.

Additional information for investors

This release may contain forward-looking statements regarding the Company’s business, customer prospects, or other factors that may affect future earnings or financial results. Such statements involve risks and uncertainties which could cause actual results to vary materially from those expressed in the forward-looking statements. These include the failure to obtain sufficient contracts, and to profitably complete those contracts. Investors should read and understand the risk factors detailed in the Company’s 10-KSB for the fiscal year ended December 31, 2005 and in other filings with the Securities and Exchange Commission.

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Information Analysis Reports Second Quarter Results

August 8, 2006

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Information Analysis Incorporated

Condensed Income Statements

	Three months ended June 30,
	2006		2005
(in thousands, except per share data; unaudited)
Sales:
Professional fees	$	2,299	$	2,372
Software sales		270		634
Total sales		2,569		3,006
Cost of goods sold and services provided:
Cost of professional fees		1,703		1,837
Cost of software sales		225		564
Total cost of sales		1,928		2,401
Gross margin		641		605
Operating expenses:
Selling, general and administrative		489		452
Operating income		152		153
Other income (expense)		2		(5	)
Income before income taxes		154		148
Provision for income taxes		—		—
Net income	$	154	$	148
Comprehensive Income	$	154	$	148
Net income per share:
Basic and diluted	$	0.01	$	0.01
Shares used in calculating earnings per share:
Basic		11,035,507		10,296,527
Diluted		11,504,714		11,292,107

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Information Analysis Reports Second Quarter Results

August 8, 2006

Page 3 of 4

Information Analysis Incorporated

Condensed Income Statements

	Six months ended June 30,
	2006		2005
(in thousands, except per share data; unaudited)
Sales:
Professional fees	$	4,495	$	4,486
Software sales		388		707
Total sales		4,883		5,193
Cost of goods sold and services provided:
Cost of professional fees		3,454		3,519
Cost of software sales		295		605
Total cost of sales		3,749		4,124
Gross margin		1,134		1,069
Operating expenses:
Selling, general and administrative		898		840
Operating income		236		229
Other income (expense)		3		(9	)
Income before income taxes		239		220
Provision for income taxes		—		—
Net income	$	239	$	220
Comprehensive Income	$	239	$	220
Net income per share:
Basic and diluted	$	0.02	$	0.02
Shares used in calculating earnings per share:
Basic		10,890,164		10,290,057
Diluted		11,399,119		11,151,036

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Information Analysis Reports Second Quarter Results

August 8, 2006

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Information Analysis Incorporated

Condensed Balance Sheets

	As of June 30, 2006			As of December 31, 2005
	(unaudited)			(audited)
ASSETS
Current assets:
Cash and cash equivalents	$	668		$	452
Accounts receivable, net		2,233			1,994
Prepaid expenses		324			183
Note receivable		105			85
Other assets		12			—
Other receivables		4			15
Total current assets		3,346			2,729
Fixed assets, net		58			57
Other assets		2			9
Total assets	$	3,406		$	2,795
LIABILITIES & STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	1,137		$	1,175
Deferred revenues		440			214
Accrued payroll and related liabilities		328			321
Other accrued liabilities		129			125
Income taxes payable		—			4
Total liabilities		2,034			1,839
Common stock, par value $0.01, 30,000,000 shares authorized; 12,779,987 shares issued, 11,137,371 outstanding at June 30, 2006, and 12,127,626 shares issued, 10,623,015 outstanding at December 31, 2005		128			121
Additional paid in capital		14,458			14,212
Accumulated deficit		(12,272	)		(12,511	)
Accumulated other comprehensive loss		(12	)		(12	)
Less treasury stock; 1,642,616 shares at cost at June 30, 2006, and 1,504,611 shares at cost At December 31, 2005		(930	)		(854	)
Total stockholders’ equity		1,372			956
Total liabilities and stockholders’ equity	$	3,406		$	2,795