Exhibit 99.1

For Immediate Release

WSI Industries Reports Strong Increase in First Quarter Sales

January 5, 2011—Minneapolis, MN—WSI Industries, Inc. (Nasdaq: WSCI) today reported sales for its fiscal 2011 first quarter ending November 28, 2010 of $5,528,000, a 29.9% increase versus the prior year amount of $4,254,000. Net income for the fiscal 2011 first quarter was $69,000 or $.02 per diluted share versus $163,000 or $.04 per diluted share in the prior year first quarter.

Michael J. Pudil, chief executive officer, commented: “In its fiscal 2011 first quarter, WSI experienced a strong sales increase of almost 30% led in large measure by our ATV and motorcycle markets.” Pudil continued: “While we were profitable during the quarter with earnings at $.02 per diluted share, our results were negatively impacted by start-up costs with new customers.” Pudil concluded: “While our outlook for fiscal 2011 is somewhat tempered by the results in our fiscal 2011 first quarter, we remain optimistic about the balance of the fiscal year.”

Benjamin Rashleger, president and chief operating officer, added: “In prior communications we announced new programs in the energy sector as well as with a major defense contractor. While the roll-out of these programs is slower than we had anticipated, we are optimistic of their long-term positive impact on WSI. We consider the start-up costs with these customers to be investments that will provide future returns.” Rashleger concluded: “We are also pleased to report additional investments in capital equipment were made during the quarter that not only increased our capacities but further expanded our machining capabilities.”

The Company also announced today that its Board of Directors has declared a quarterly dividend of $.04 per share. As mentioned last quarter, the Company believes that a consistent dividend program is a further sign of WSI’s financial strength and improved business outlook. The dividend will be payable February 2, 2011 to holders of record on January 19, 2011.

WSI Industries, Inc. is a leading contract manufacturer that specializes in the machining of complex, high-precision parts for a wide range of industries, including avionics and aerospace, energy, recreational vehicles, small engines, marine, bioscience and the defense markets.

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For additional information:
Michael J. Pudil (CEO), Benjamin Rashleger (President) or Paul D. Sheely (CFO)
763-295-9202

The statements included herein which are not historical or current facts are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Reform Act of 1995. There are certain important factors which could cause actual results to differ materially from those anticipated by some of the statements made herein, including the Company’s ability to retain current programs and obtain additional manufacturing programs, and other factors detailed in the Company’s filings with the Securities and Exchange Commission.