Mail Stop 6010

      October 31, 2005

Tower Semiconductor USA
4300 Stevens Creek Blvd., Suite 175
San Jose, CA 95129
As Agent for Service of Tower Semiconductor Ltd.

      Re:	Amendment No. 2 to Tower Semiconductor Ltd.
	Registration Statement on Form F-2
      Filed October 11, 2005
	File No. 333-126909

Dear Sir/Madam:

      We have limited our review of your filing to those issues we
have addressed in our comments.  Where indicated, we think you
should
revise your document in response to these comments.  If you
disagree,
we will consider your explanation as to why our comment is
inapplicable or a revision is unnecessary.  Please be as detailed
as
necessary in your explanation.  In some of our comments, we may
ask
you to provide us with information so we may better understand
your
disclosure.  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 F-2

General
1. With a view to disclosure, please describe a) any recent
developments in negotiations related to the credit facility and b)
the status of your efforts to comply with the conditions of the
Israeli government grants.





Questions and Answers About the Rights Offering, page 2

Are the debentures subordinated to our current indebtedness? page
3
2. Please update the amount of your obligations to a more recent
period than August 31, 2005, and also update the narrative
discussion
generally throughout the prospectus, as appropriate.

What are the federal income tax and Israeli income tax
consequences
of exercising your rights? page 6
3. Revise the second sentence to clarify that you received an
opinion
of counsel regarding the material federal income tax consequences.

Material Income Tax Considerations, page 49

United States Tax Considerations, page 51
4. We note your response to comment 21 and reissue the comment.
Please specifically comply with the third and fourth sentences.
Also, if counsel is unable to opine with certainty, revise the
disclosure on page 52 to explain and describe the tax consequences
in
the event that the debentures are determined to be characterized
as
equity, rather than using vague language stating that the
consequences "generally should not be materially less favorable."

Closing Comments

      As appropriate, please amend your registration statement in
response to these comments.  You may wish to provide us with
marked
copies of the amendment to expedite our review.  Please furnish a
cover letter with your amendment that keys your responses to our
comments and provides any requested information.  Detailed cover
letters greatly facilitate our review.  Please understand that we
may
have additional comments after reviewing your amendment and
responses
to our comments.









      You may contact Thomas Dyer at (202) 551-3641 or Kaitlin
Tillan
at (202) 551-3604 if you have questions regarding comments on the
financial statements and related matters.  Please contact Adelaja
Heyliger at (202) 551-3636 or me at (202) 551-3800 with any other
questions.

      Sincerely,



								Peggy A. Fisher
								Assistant Director

cc (via fax):  	Sheldon Krause, Esq.
	Eilenberg & Krause LLP
	212.986.2399

Tower Semiconductor USA
As Agent for Service of Tower Semiconductor Ltd.
October 31, 2005
Page 1