Exhibit 99.1

Digital Recorders, Inc. Shareholders Approve Proposals During the 2005 Annual
Meeting

    DALLAS--(BUSINESS WIRE)--June 3, 2005--Digital Recorders, Inc. (DRI)
(Nasdaq:TBUS), a market leader in transportation, law enforcement, and
security digital communications systems, announced today that its
shareholders approved the four proposals put forth for vote at its
Annual Meeting of Shareholders, which was held today at the Radisson
Hotel Research Triangle Park in Research Triangle Park, N.C.
    David L. Turney, DRI's Chairman, Chief Executive Officer, and
President, reviewed and discussed the Company's fiscal year 2004
results with shareholders immediately following the event.

    Election Results

    Shareholders cast their votes in favor to:

    --  approve a proposal to the Amended and Restated Articles of
        Incorporation of Digital Recorders, Inc. to remove the
        requirement that members of the Board of Directors serve
        staggered three-year terms so that, beginning with the
        directors elected at the Annual Meeting of Shareholders in
        2005, each director will instead serve an annual term;

    --  re-elect Class One directors to serve until the Annual Meeting
        of Shareholders in 2006;

    --  ratify the Audit Committee's selection of
        PricewaterhouseCoopers LLP as independent auditors for fiscal
        year 2005; and

    --  approve and ratify the amendment of the 2003 stock option plan
        to increase by 300,000 the number of shares that may be issued
        pursuant to awards granted under that plan.

    No other business was transacted during the Annual Meeting of
Shareholders.

    2005-2006 Board of Directors

    Class One directors whose terms will expire in 2006 include:

    --  Stephanie L. Pinson, age 68, Watchung, N.J.;

    --  Lawrence A. Taylor, age 58, Dallas, and

    --  Juliann Tenney, J.D., age 52, Chapel Hill, N.C.

    Class Two directors whose terms will expire in 2006 include:

    --  C. James Meese Jr., age 63, Raleigh, N.C.;

    --  John K. Pirotte, age 55, Raleigh, N.C.; and

    --  David L. Turney, age 61, Dallas.

    Class Three directors whose terms will expire in 2007 include:

    --  Russell C. Cleveland, age 66, Dallas;

    --  Nuria I. Fernandez, age 45, Alexandria, Va.; and

    --  John D. Higgins, age 71, Glen Head, N.Y.

    For each director's full biography, please refer to the 2005 Proxy
Statement available on the Company's Web site, www.digrec.com,
Investor Relations, Shareholder Communications, Proxy Statements.

    About the Company

    Digital Recorders, Inc. is a market leader in transportation, law
enforcement, and security digital communications systems using
proprietary hardware and software applications. Our products improve
the flow and mobility of people through transportation infrastructure,
mitigate security threats, and enhance law enforcement agencies'
surveillance capabilities. Our transportation communications products
-- TwinVision(R) and Mobitec(R) electronic destination sign systems,
Talking Bus(R) voice announcement systems, Internet-based passenger
information systems, and computer-aided dispatch/ automatic vehicle
locating and monitoring systems -- enhance public transportation and
mitigate security threats worldwide. Our electronic surveillance
tools, including microphone amplifiers and processors, countermeasures
devices, speech activity detectors, and noise cancellation equipment,
help law-enforcement agencies around the globe arrest and prosecute
criminals. For more information about DRI and its operations
worldwide, go to www.digrec.com.

    CONTACT: Digital Recorders, Inc., Dallas
             Veronica B. Marks, 214-378-4776
             Fax: 214-378-8437
             E-Mail: veronicam@digrec.com