PHOENIX Oct. 7, 2003 ILX Resorts Incorporated (the Company) (AMEX:ILX) has retained the Phoenix law firm of Osborn Maledon, P.A. to defend it and its Sedona Vacation Club and Premiere Vacation Club businesses in a lawsuit filed two weeks ago by two individuals claiming damages for deceptive and abusive practices on behalf of a purported class of purchasers of vacation ownership interests.

ILX Resorts;
William J. Maledon, one of the name partners of the law firm and the head of its litigation section, will lead the defense effort. Maledon and his firm have extensive expertise in defending purported class action suits such as this.

The suit alleges various violations of the Arizona Consumer Fraud Act, the Arizona Real Estate Timeshare Act and related principles of state common law and equity. One of the key allegations of the complaint is that the Company has "oversold" timeshare units in its Los Abrigados property in Sedona, Arizona. However, data presented in the Company's annual filings, including in its 10-K Report and in reports on file with the Arizona State Department of Real Estate, show that allegation to be untrue. To the contrary, those public reports show that timeshare sales by the Company are well within the number of units it has available for sale. The Company also rejects as false the complaint's assertion that it has incorrectly applied maintenance assessments, and also rejects as entirely unfounded the complaint's allegations that the Company deceived prospective purchasers with respect to the size of room units available for use or in any other manner. Here again, the documents given to owners and prospective purchasers of the Company's timeshare units refute these allegations of the complaint.

As it said in an earlier report, the Company believes that the allegations in this action are without merit and intends to defend this action vigorously and seek its early dismissal together with recovery of the Company's litigation expense and attorney's fees.

ILX Resorts acquires, develops, and operates premier timeshare resorts primarily in the western United States that provide its owners with extraordinary vacation experiences. ILX's portfolio of world-class properties includes six resorts in Arizona, one in Indiana, one in Colorado, one in San Carlos, Mexico; land adjacent to an existing resort in northern Arizona and 44 acres of land one mile from the Las Vegas Strip, to both of which parcels the Company holds development rights. It also, through Premiere Vacation Club, has acquired, and continues to acquire, inventory at the Carriage House in Las Vegas.