AMERICAN SHARED HOSPITAL SERVICES REPORTS HIGHER REVENUE AND PRE-TAX INCOME FOR THE FOURTH QUARTER AND 2006 VERSUS PRIOR YEAR Fourth Quarter Operating Income Increased Over Prior Year For The 24 th Consecutive Quarter Sa

AMERICAN SHARED HOSPITAL SERVICES REPORTS

HIGHER REVENUE AND PRE-TAX INCOME FOR THE

FOURTH QUARTER AND 2006 VERSUS PRIOR YEAR

Fourth Quarter Operating Income Increased Over Prior Year

For The 24th Consecutive Quarter

San Francisco, CA, March 6, 2007 AMERICAN SHARED HOSPITAL SERVICES (AMEX:AMS), a leading

provider of turnkey technology solutions for advanced radiosurgical and radiation therapy services,

today announced higher revenue, operating income and pre-tax income for the fourth quarter and 2006

compared to the same periods of 2005.

By delivering continued modest growth from our existing portfolio of radiosurgical assets, and

setting the foundation for more rapid growth in the future, we achieved our most important goals

for 2006, said Chairman and Chief Executive Officer Ernest A. Bates, M.D.

The increase in revenue, operating income and pre-tax income for the fourth quarter and 2006

reflected the maturation of the two Gamma Knife centers that began treating patients in mid-2005,

higher patient volumes at several of our older centers, and effective cost control. We also made

great strides in our plan to use AMS creative financing solutions to dramatically expand our

growth potential by offering our clinical partners the latest technology solutions for radiation

We expect our innovative agreement with Tufts-New England Medical Center to provide

state-of-the-art equipment as part of a complete radiation therapy department upgrade to contribute

to our operating results beginning in mid-2007. Under this agreement, which is a model for

additional agreements we hope to complete in the future, AMS will provide Tufts-NEMC an

image-guided radiation therapy (IGRT) system, a CT Simulator, and related service, support and

maintenance services.

Last month the Commonwealth of Massachusetts issued a Determination of Need for the Clinatron-250

proton beam radiation therapy (PBRT) system that AMS separately agreed to provide Tufts-NEMC. We

also recently announced an agreement to provide a Clinatron-250 to M. D. Anderson Cancer Center

Orlando, part of Orlando Regional Healthcare, one of Florida s most comprehensive private,

not-for-profit healthcare networks. Subject to the receipt of FDA approval for the Clinatron-250,

we anticipate commencing our lease agreements with Tufts-NEMC and M. D. Anderson Cancer Center

Orlando for the PBRT system in 2009. Interest is high among potential clinical partners in this

exciting new technology, and we are actively evaluating additional PBRT opportunities, Dr. Bates

Currently under development by Still River Systems, the Clinatron-250 is a single-treatment-room

PBRT system incorporating proprietary technology that Still River believes may dramatically reduce

the cost of implementing proton beam radiation therapy. In April 2006, AMS invested $2 million for

an equity interest in Still River Systems and acquired an option to purchase two PBRT systems. AMS

exercised this purchase option in February 2007.

We also continue to pursue opportunities for current-generation radiation therapy devices. The

success of this effort was underscored by our recently announced order for four Leksell Gamma Knife

Perfexion systems from Elekta AB for planned upgrades of clinical partner sites in the United

States beginning this spring.

With our many accomplishments this past year, we are increasingly optimistic about AMS future as

we expand our reach in radiation oncology, Dr. Bates concluded.

For the three months ended December 31, 2006, revenue increased to $4,793,000 from $4,650,000 for

the fourth quarter of 2005. Operating income increased to $922,000 from $914,000 a year earlier,

the 24th consecutive year-over-year gain in this important financial measure, and

pre-tax income increased to $696,000 for the fourth quarter of 2006 from $685,000 for the fourth

quarter of 2005. Net income for the fourth quarter of 2006 decreased to $347,000, or $0.07 per

diluted share, compared to $479,000, or $0.09 per diluted share, for the fourth quarter of 2005,

the result of an increase in the effective income tax rate to 50% from 30% a year earlier.

For the twelve months ended December 31, 2006, revenue increased 12% to $20,385,000 from

$18,231,000 for 2005. Operating income increased 11% to $3,864,000 from $3,471,000, and pre-tax

income increased 12% to $2,858,000 from $2,547,000 for the prior year. Net income for 2006

decreased to $1,656,000, or $0.33 per diluted share, reflecting a 42% effective income tax rate.

This compares to net income for 2005 of $1,767,000, or $0.35 per diluted share, reflecting a 31%

effective income tax rate.

At December 31, 2006, AMS reported cash, cash equivalents and short-term securities of $5,526,000

and long-term securities of $3,380,000. At December 31, 2005, cash, cash equivalents and

short-term securities were $5,835,000 and long-term securities were $2,797,000. Shareholders

equity at December 31, 2006 increased to $19,009,000 compared to $18,320,000 at December 31, 2005.

Earnings Conference Call

American Shared has scheduled a conference call at 12:00 p.m. PST (3:00 p.m. EST) today. To

participate in the live call, dial (800) 446-2782 at least 5 minutes prior to the scheduled start

time. A simultaneous WebCast of the call may be accessed through the Company s website,

www.ashs.com, or through CCBN, www.earnings.com (individual investors) or

www.streetevents.com (institutional investors). A replay will be available for 30 days at

these same internet addresses, or by calling (888) 843-8996, pass code 17226313.

American Shared Hospital Services provides turnkey technology solutions for advanced radiosurgical

and radiation therapy services. AMS is the world leader in providing Gamma Knife radiosurgery

services, a non-invasive treatment for malignant and benign brain tumors, vascular malformations

and trigeminal neuralgia (facial pain). The Company also offers the latest IGRT and IMRT systems,

as well as its proprietary Operating Room for the 21st Century concept. Through its equity investment in Still River Systems, AMS also plans to complement these

services with the Clinatron-250 proton beam radiation therapy (PBRT) system, which has not yet

been approved by the FDA.

Safe Harbor Statement

This press release may be deemed to contain certain forward-looking statements with respect to the

financial condition, results of operations and future plans of American Shared Hospital Services,

which involve risks and uncertainties including, but not limited to, the risks of the Gamma Knife

business, the risks of developing its IMRT and The Operating Room for the 21st Century

programs, and the risks of investing in a development-stage company, Still River Systems, Inc.,

without a proven product. Further information on potential factors that could affect the financial

condition, results of operations and future plans of American Shared Hospital Services is included

in the filings of the Company with the Securities and Exchange Commission, including the Company s

Annual Report on Form 10-K for the year ended December 31, 2005, the Form 10-Q for the three months

ended March 31, 2006, June 30, 2006 and September 30, 2006 and the definitive Proxy Statement for

the Annual Meeting of Shareholders on June 28, 2006.

AMERICAN SHARED HOSPITAL SERVICES

Selected Financial Data