August 15, 2005


Fax (972) 9-765-1977
Room 4561


Ilan Erez
Chief Financial Officer
Silicom Ltd.
8 Hanagar Street
Kfar Sava 44000, Israel

      RE: 	Silicom Ltd.
 		Form 20-F for Fiscal Year Ended December 31, 2004
		File No. 000-23288

Dear Mr. Erez:

      We have reviewed the above referenced filing and have the
following comments.  We have limited our review to these issues we
have addressed in our comments. We may ask you to provide us with
supplemental information so we may better understand your
disclosure.
Please be as detailed as necessary in your explanation.  After
reviewing this information, we may raise additional comments.

	Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects.  We welcome
any questions you may have about our comments or any other aspect
of
our review.  Feel free to call us at the telephone numbers listed
at
the end of this letter.

Form 20-F for the Year Ended December 31, 2004

Item 15. Controls & Procedures, page 62

1. We note that your evaluation was completed "within 90 days of
the
filing date of this annual report."  Tell us how you considered
Section F of Release No. 33-8238, which requires that the
evaluation
be done  "as of the end of the period" covered by the annual or
quarterly reports.

Report of Independent Registered Public Accounting Firm, page F-1

2. We note that for the year ended December 31, 2002, the
Company`s
independent public accounting firm did not audit the financial
statements of the Company`s consolidated subsidiary.    Tell us
how
you considered Article 2-05 of Regulation S-X, which requires that
the report of the other auditors be included in the filing when
your
principal auditors rely on such work and make reference to such
report. Further guidance may be found in Section 5.J of
"International Reporting and Disclosure Issues in the Division of
Corporation Finance" on the Commission`s website at:
http://www.sec.gov/divisions/corpfin/
internatl/cfirdissues1104.htm#P442_69217.  Also, tell us whether
or
not your principal auditors relied on the work of other auditors
for
the years ended December 31, 2003 and 2004.

Note 2 - Significant Accounting Policies

K. Revenue Recognition, page F-9

3. We note from disclosure on page 13 that products are shipped to
prospective customers for evaluation and qualification purposes.
Describe your accounting for these arrangements and tell us when
revenue is recognized.   We further note that this evaluation
process
may entail customization of your Server Networking Cards.  Tell us
how you account for these customization services.  If you
recognize
revenues for such services, then please provide your revenue
recognition policy.

4. We also note from disclosure on page 18 that OEMs may attempt
to
return unsold products. Tell us whether you offer any
contingencies
such as rights of return, price protection, price concessions,
warranties, etc., and tell us  the nature of these contingencies
and
your accounting treatment for each.  Describe significant
assumptions, material changes and reasonably likely uncertainties.

* * * * *

       Please respond to these comments within 10 business days or
tell us when you will provide us with a response.  Please
understand
that we may have additional comments after reviewing your
responses
to our comments.

	 We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filing to be certain that the
filing includes all information under the Exchange Act and that
they
have provided all information investors require for an informed
decision.  Since the company and its management are in possession
of
all facts relating to a company`s disclosure, they are responsible
for the accuracy and adequacy of the disclosures they have made.

	In connection with responding to our comments, please
provide,
in writing, a statement from the company acknowledging that:

* the company is responsible for the adequacy and accuracy of the
disclosure in the filing;

* staff comments or changes to disclosure in response to staff
comments do not foreclose the Commission from taking any action
with
respect to the filing; and

* the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.

	You may contact David Edgar, Staff Accountant, at (202)-551-
3459
or the undersigned at (202) 551-3499 if you have any questions
regarding comments on the financial statements and related
matters.

						Sincerely,


						Kathleen Collins
						Accounting Branch Chief
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Ilan Erez
Silicom Ltd.
August 15, 2005
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