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Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
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MIC-Info: RSA-MD5,RSA,
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<SEC-DOCUMENT>0001001277-04-000055.txt : 20040127
<SEC-HEADER>0001001277-04-000055.hdr.sgml : 20040127
<ACCEPTANCE-DATETIME>20040127174241
ACCESSION NUMBER:		0001001277-04-000055
CONFORMED SUBMISSION TYPE:	4
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20040116
FILED AS OF DATE:		20040127

ISSUER:		

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			DIGITAL POWER CORP
		CENTRAL INDEX KEY:			0000896493
		STANDARD INDUSTRIAL CLASSIFICATION:	ELECTRONIC COMPONENTS, NEC [3679]
		IRS NUMBER:				941721931
		STATE OF INCORPORATION:			CA
		FISCAL YEAR END:			1231

	BUSINESS ADDRESS:	
		STREET 1:		41920 CHRISTY ST
		CITY:			FREMONT
		STATE:			CA
		ZIP:			94538
		BUSINESS PHONE:		5106572635

	MAIL ADDRESS:	
		STREET 1:		41920 CHRISTY STREET
		CITY:			FREMONT
		STATE:			CA
		ZIP:			94538

REPORTING-OWNER:	

	OWNER DATA:	
		COMPANY CONFORMED NAME:			SMITH ROBERT O
		CENTRAL INDEX KEY:			0000091335

	FILING VALUES:
		FORM TYPE:		4
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-12711
		FILM NUMBER:		04547354

	BUSINESS ADDRESS:	
		STREET 1:		41920 CHRISTY STREET
		CITY:			FREMONT
		STATE:			CA
		ZIP:			94538
		BUSINESS PHONE:		5106572635

	MAIL ADDRESS:	
		STREET 1:		41920 CHRISTY STREET
		CITY:			FREMONT
		STATE:			CA
		ZIP:			94538
</SEC-HEADER>
<DOCUMENT>
<TYPE>4
<SEQUENCE>1
<FILENAME>for011604_ex.xml
<TEXT>
<XML>
<?xml version="1.0"?>
<ownershipDocument>

    <schemaVersion>X0201</schemaVersion>

    <documentType>4</documentType>

    <periodOfReport>2004-01-16</periodOfReport>

    <notSubjectToSection16>0</notSubjectToSection16>

    <issuer>
        <issuerCik>0000896493</issuerCik>
        <issuerName>DIGITAL POWER CORP</issuerName>
        <issuerTradingSymbol>DPW</issuerTradingSymbol>
    </issuer>

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0000091335</rptOwnerCik>
            <rptOwnerName>SMITH ROBERT O</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>41920 CHRISTY STREET</rptOwnerStreet1>
            <rptOwnerStreet2></rptOwnerStreet2>
            <rptOwnerCity>FREMONT</rptOwnerCity>
            <rptOwnerState>CA</rptOwnerState>
            <rptOwnerZipCode>94538</rptOwnerZipCode>
            <rptOwnerStateDescription></rptOwnerStateDescription>
        </reportingOwnerAddress>
        <reportingOwnerRelationship>
            <isDirector>0</isDirector>
            <isOfficer>0</isOfficer>
            <isTenPercentOwner>1</isTenPercentOwner>
            <isOther>0</isOther>
        </reportingOwnerRelationship>
    </reportingOwner>

    <derivativeTable>
        <derivativeTransaction>
            <securityTitle>
                <value>Options to Purchase Common Stock</value>
            </securityTitle>
            <conversionOrExercisePrice>
                <value>3.00</value>
            </conversionOrExercisePrice>
            <transactionDate>
                <value>2004-01-16</value>
            </transactionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>D</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
                <footnoteId id="F1"/>
            </transactionCoding>
            <transactionAmounts>
                <transactionShares>
                    <value>100000</value>
                </transactionShares>
                <transactionPricePerShare>
                    <value>0</value>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>D</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <exerciseDate>
                <value>2002-01-01</value>
            </exerciseDate>
            <expirationDate>
                <value>2012-01-01</value>
            </expirationDate>
            <underlyingSecurity>
                <underlyingSecurityTitle>
                    <value>Common Stock</value>
                </underlyingSecurityTitle>
                <underlyingSecurityShares>
                    <value>100000</value>
                </underlyingSecurityShares>
            </underlyingSecurity>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>435500</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </derivativeTransaction>
        <derivativeTransaction>
            <securityTitle>
                <value>Options to Purchase Common Stock</value>
            </securityTitle>
            <conversionOrExercisePrice>
                <value>1.16</value>
            </conversionOrExercisePrice>
            <transactionDate>
                <value>2004-01-16</value>
            </transactionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>A</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
            </transactionCoding>
            <transactionAmounts>
                <transactionShares>
                    <value>100000</value>
                </transactionShares>
                <transactionPricePerShare>
                    <value>0</value>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>A</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <exerciseDate>
                <value>2004-01-16</value>
            </exerciseDate>
            <expirationDate>
                <value>2014-01-16</value>
            </expirationDate>
            <underlyingSecurity>
                <underlyingSecurityTitle>
                    <value>Common Stock</value>
                </underlyingSecurityTitle>
                <underlyingSecurityShares>
                    <value>100000</value>
                </underlyingSecurityShares>
            </underlyingSecurity>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>535500</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </derivativeTransaction>
    </derivativeTable>

    <footnotes>
        <footnote id="F1">Cancellation of option in connection with grant of replacement option.</footnote>
    </footnotes>

    <ownerSignature>
        <signatureName>/s/ Robert O. Smith</signatureName>
        <signatureDate>2004-01-27</signatureDate>
    </ownerSignature>
</ownershipDocument>

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