SANTA BARBARA, CA--(Marketwire - January 16, 2008) - The Walking Company, a subsidiary of Big Dog Holdings, Inc. (NASDAQ: BDOG), is pleased to announce that it has closed its acquisition of substantially all assets of Natural Comfort Footwear, Inc. effective January 15, 2008. Natural Comfort is one of the largest independent comfort shoe retailers in Florida, with eight stores operating under the names Natural Comfort and Martini's. The stores acquired will be converted to The Walking Company stores.

Big Dog Holdings, Inc. consists of The Walking Company and Big Dogs. The Walking Company is a leading independent specialty retailer of high quality, technically designed comfort shoes and accessories that features premium brands such as ECCO, Mephisto, and Dansko among many others. With the acquisition of Natural Comfort, The Walking Company now operates 185 stores in premium malls across the nation. Big Dogs develops, markets and retails a branded, lifestyle collection of unique, high-quality, popular-priced consumer products, including activewear, casual sportswear, accessories and gifts. Big Dogs currently operates 108 stores throughout the country.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995 -- With the exception of historical information, the matters discussed in this press release are forward looking statements that involve a number of risks and uncertainties. The actual future sales and other results of the Company could differ significantly from those statements. Further information on the Company's risk factors is contained in the Company's quarterly and annual reports as filed with the Securities and Exchange Commission.

Contact Information: Big Dog Holdings, Inc. 121 Gray Avenue Santa Barbara, California 93101 CONTACT: Alexis Dilg Investor Information (805) 963-8727, extension 1302