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AIWA Co. Ltd., one of the world's leading consumer electronics manufacturers, recently introduced the XR-H330MD mini-audio system in Japan. The XR-H330MD incorporates QSurround, a patented technology that reproduces full surround sound effects using just two speakers for playback. QSurround is optimized for use with Dolby encoded movies and music and AIWA plans to incorporate it into a minimum of 8 new mini-audio system models. This product line will be introduced to the North American market beginning in early 1999.

Today's announcement is a direct result of both QSound's and AIWA's success in the portable audio systems market. In 1997, AIWA began featuring QSound's QXpander technology in their portable audio products. To date this technology has been incorporated into over 24 of their models and AIWA has shipped over 4 million units worldwide.

``QSound has set our portable audio products apart from other brands by providing consumers with an easily understood and demonstrable benefit,'' said Akio Imanishi, Senior Vice President, Marketing for AIWA America, Inc. ``Based on that experience we've decided to also offer it in selected mini systems.''

David Gallagher, President and CEO of QSound Labs commented, ``We congratulate AIWA on this new product launch and we are very proud to be associated with such a market leader in the consumer electronics industry.''

About AIWA Co., Ltd and AIWA America, Inc.

AIWA Co., Ltd., based in Tokyo, is a $3 billion manufacturer and marketer of consumer and professional audio and video, computer, data storage, and communications products. Based in Mahwah, New Jersey, AIWA America, Inc., a wholly owned subsidiary of AIWA Co., Ltd. and celebrating its 20th anniversary this year, is one of the world's leading manufacturers and marketers of audio, video, car stereo and multimedia products.

About QSound Labs, Inc.

Founded in 1988, QSound Labs, Inc. (Nasdaq:QSNDF - news), is an advanced audio technology company specializing in 3D sound placement and audio image enhancement. Based in Calgary, Alberta, the company uses patented 3D audio technologies to serve the home entertainment, PC/Multimedia, consumer electronics and professional audio industries. The technologies provide immersive, realistic sound environments that include positional audio, stereo enhancement and virtual surround sound.

All product and brand names are trademarks and/or registered trademarks of their respective owners. Additional news releases may be obtained via the Internet at www.qsound.com/press0.htm or by calling the company directly at 403-291-2492.

This release contains forward-looking statements within the meaning of the Private Securities Litigation Act of 1995 concerning, among other things, the anticipated introduction of new products and projected shipment dates of products and future financial results. Investors are cautioned that such forward-looking statements involve risk and uncertainties, which could cause actual results, performance or achievements of the Company, or industry results to differ materially from those reflected in the forward-looking statements. Such risks and uncertainties include, but are not limited to, risks associated with the commercialization of the Company's technologies, dependence on the performance of third parties who have licensed the Company's technologies, dependence on intellectual property, uncertainties relating to product development and commercial introduction, rapid technological change and competition, manufacturing uncertainties and other risks detailed from time to time in the Company's periodic reports filed with the Securities and Exchange Commission. Forward-looking statements are based on the current expectations, projections and opinions of the Company's management, and the Company undertakes no obligation to publicly release the results of any revisions to such forward-looking statements which may be made, for example to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

Contact:

     QSound Labs, Inc.

     Cathy Cochrane, 403/291-2492

     403/250-1521  (FAX)

     cathy.cochrane@qsound.com

     http://www.qsound.com

              or

     QSound Labs, Inc.

     Paula Murray, 954/796-8798

     954/796-9312  (FAX)

     paula.murray@qsound.com