IPT Iparty Corp.

iParty Corp. (NYSE Amex: IPT - news), a party goods retailer, has entered into a Second Amended and Restated Credit Agreement that continues its revolving line of credit with Wells Fargo at $12,500,000 and extends the term of the line for three years to July 2, 2012.

The amount of credit that is available from time to time under the Agreement is determined as a percentage of the value of eligible inventory and eligible credit card receivables, as reduced by certain reserve amounts. In addition, the new agreement includes an option whereby the company may increase its line of credit up to a maximum level of $15,000,000. Borrowings under the new agreement will generally accrue interest at a margin ranging from 3.00% to 3.50% over, at the Borrowers� election, either the London Interbank Offered Rate (�LIBOR�) or a base rate determined by Wells Fargo from time to time.�The facility also provides for letters of credit and includes an unused line fee on the unused portion of the credit line. Subject to conditions set forth in the new agreement which the company expects to meet, the new agreement continues to allow the revolving line of credit to be used to repay the $2.5 million loan from Highbridge International LLC when it becomes due on September 15, 2009. The obligations of the Borrowers under the Agreement and the other loan documents are secured by a lien on substantially all of the personal property of the Borrowers.

Sal Perisano, Chairman and Chief Executive Officer of iParty Corp., commented, �We are very pleased to continue our banking relationship with Wells Fargo for another three years. Wells Fargo has proven to be a solid and dependable business partner for us. Over the years we have used our facility with Wells Fargo to grow our business as well as to fund day to day operations. This renewal will allow us to continue to do so.�

About iParty Corp.

Headquartered in Dedham, Massachusetts, iParty Corp. is a party goods retailer that operates 50 iParty retail stores and licenses the operation of an Internet site for party goods and party planning at www.iparty.com. iParty�s aim is to make throwing a successful event both stress-free and fun. With over 20,000 party supplies and costumes and an online party magazine and party-related content, iParty offers consumers a sophisticated, yet fun and easy-to-use, resource with an extensive assortment of products to customize any party, including birthday bashes, Easter get-togethers, graduation parties, summer barbecues, and, of course, Halloween. iParty aims to offer reliable, time-tested knowledge of party-perfect trends, and superior customer service to ensure convenient and comprehensive merchandise selections for every occasion. Please visit our site at www.iparty.com.

Safe harbor statement under the Private Securities Litigation Reform Act of 1995

Certain statements in this Press Release constitute �forward-looking statements� within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words �anticipate�, �believe�, �estimate�, �expect�, �plan�, �intend� and other similar expressions are intended to identify these forward-looking statements, but are not the exclusive means of identifying them. Forward-looking statements included in this Press Release or hereafter included in other publicly available documents filed with the Securities and Exchange Commission (�SEC�), reports to our stockholders and other publicly available statements issued or released by us involve known and unknown risks, uncertainties, and other factors which could cause our actual results, performance (financial or operating) or achievements to differ from the future results, performance (financial or operating) or achievements expressed or implied by such forward looking statements. Such future results are based upon our best estimates based upon current conditions and the most recent results of operations. Various risks, uncertainties and contingencies could cause our actual results, performance or achievements to differ materially from those expressed in, or implied by, the forward-looking statements contained in this Press Release. These include, but are not limited to, those described under Item 1A, �Risk Factors� of our most recently filed Annual Report on Form 10-K for the year ended December 27, 2008 and our other periodic reports subsequently filed with the SEC. Our forward-looking statements speak only as of the date of this Press Release, and we do not intend to update these statements to reflect events or circumstances that occur after this date.

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