Exhibit 99.1

Cascade Microtech Reports Third Quarter 2009 Results

Revenue of $14.0 million, Up 11% sequentially with improving margins

PORTLAND, Ore.—(MARKET WIRE)—October 27, 2009—Cascade Microtech (NasdaqGM:CSCD-News), today reported financial results for the third quarter ended September 30, 2009.

Third quarter results include:

• Revenue of $14.0 million, up 11% from Q209

• Engineering systems revenue increased 17% from Q209

• Probes and sockets revenue increased 5% from Q209

• Net loss of $1.4 million or $0.11 per share for Q309, compared to a net loss of $1.6 million or $0.12 per share in Q209

• Cash and investment balances increased by $1.4 million from Q209 to $35.1 million

“During the third quarter, we continued to see a recovery in the market place with increased revenue and improving gross and operating margins. Our focus is on achieving revenue growth while controlling operating costs in order to leverage our earnings model”, said Geoff Wild, CEO of Cascade Microtech.

Financial Outlook

Based on the current backlog and anticipated bookings, Cascade anticipates that fourth quarter 2009 revenues will be in the range of $14 million to $16 million.

The company will host a conference call beginning at 5 p.m. EST (2 p.m. PST) on October 27, 2009 to discuss its results for the third quarter of 2009.

A simultaneous audio cast of the conference call may be accessed online from the investor relations page of www.cascademicrotech.com. A replay will be available after 8 p.m. EST at this same internet address. (For a telephone replay, dial (888) 286-8010 passcode: 60250700; International: 617-801-6888.)

Forward-Looking Statements

The statements in this release, particularly the comments above made by Mr. Wild and the paragraph above captioned “Financial Outlook”, are “forward-looking” statements within the meaning of the Securities Litigation Reform act of 1995. Such statements are based on current expectations, estimates and projections about the Company’s business based in part on assumptions made by management. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including changes in demand for the Company’s products, product mix, the timing of shipments and customer orders, constraints on supplies of components, excess or shortage of production capacity and other risks discussed from time to time in the Company’s Securities and Exchange Commission filings and reports, including the Company’s Annual Report on Form 10-K. In addition such statements could be affected by general industry and market conditions and growth rates and general domestic and international economic conditions. Such forward-looking statements speak only as of the date on which they are made and the company does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release.

About Cascade Microtech

Cascade Microtech, Inc. (NASDAQ: CSCD) is a worldwide leader in the precise electrical measurement and test of integrated circuits (ICs) and other small structures. For technology businesses and scientific institutions that need to evaluate small structures, Cascade Microtech delivers access to electrical data from wafers, integrated circuits (ICs), IC packages, circuit boards and modules, MEMs, biological structures, electro-optic devices and more. Cascade Microtech’s leading-edge semiconductor production test consumables include unique probe cards and test sockets that reduce manufacturing costs of high-speed and high-density semiconductor chips. Information about Cascade Microtech can be found on the Web at www.cascademicrotech.com.

CASCADE MICROTECH, INC.

AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

(in thousands, except per share data)

(unaudited)

	Three Months Ended
	September 30, 2009			June 30, 2009			September 30, 2008			Year to Date Ended September 30,
										2009			2008
Sales	$	13,971		$	12,616		$	21,128		$	38,056		$	61,174
Cost of sales		8,478			7,835			12,068			23,927			33,933
Gross profit		5,493			4,781			9,060			14,129			27,241
Operating expenses:
Research and development		2,095			1,818			2,308			5,906			8,040
Selling, general and administrative		4,971			5,186			7,739			15,552			21,953
Amortization of purchased intangibles		144			145			582			435			1,879
Total operating expenses		7,210			7,149			10,629			21,893			31,872
Loss from operations		(1,717	)		(2,368	)		(1,569	)		(7,764	)		(4,631	)
Other income (expense):
Interest income, net		68			103			221			269			711
Other, net		226			440			(369	)		111			(113	)
Total other income (expense)		294			543			(148	)		380			598
Loss before income taxes		(1,423	)		(1,825	)		(1,717	)		(7,384	)		(4,033	)
Income tax benefit		(4	)		(249	)		(426	)		(224	)		(868	)
Net loss	$	(1,419	)	$	(1,576	)	$	(1,291	)	$	(7,160	)	$	(3,165	)
Basic and diluted net loss per share	$	(0.11	)	$	(0.12	)	$	(0.10	)	$	(0.54	)	$	(0.24	)
Shares used in basic and diluted per share calculations		13,325			13,306			13,108			13,291			13,047

CASCADE MICROTECH, INC.

AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(in thousands)

(unaudited)

	September 30, 2009			December 31, 2008
Assets
Current assets:
Cash and cash equivalents	$	21,030		$	3,750
Marketable securities		8,813			28,795
Accounts receivable, net		9,970			12,801
Inventories		17,588			19,079
Prepaid expenses and other		810			1,367
Income taxes receivable		—			1,003
Deferred income taxes		100			99
Assets held for sale		—			400
Total current assets		58,311			67,294
Long-term investments		5,267			2,465
Fixed assets, net		12,799			13,580
Purchased intangible assets, net		1,990			2,425
Deferred income taxes		276			237
Other assets		2,441			2,455
	$	81,084		$	88,456
Liabilities and Stockholders’ Equity
Current liabilities:
Current portion of long-term debt and capital leases	$	11		$	19
Accounts payable		3,697			4,110
Deferred revenue		913			1,120
Accrued liabilities		2,769			3,776
Total current liabilities		7,390			9,025
Capital leases, net of current portion		33			62
Deferred revenue		87			313
Other long-term liabilities		2,277			2,356
Total liabilities		9,787			11,756
Stockholders’ equity:
Common stock		85,136			83,345
Unrealized holding gain on investments		35			69
Accumulated deficit		(13,874	)		(6,714	)
Total stockholders’ equity		71,297			76,700
	$	81,084		$	88,456

Contact: Cascade Microtech, Inc.

  Steven Sipowicz, Chief Financial Officer, 503 601-1000