LOG ON AMERICA TAKES LEGAL ACTION AGAINST
FOUR PREFERRED SHAREHOLDERS

PROVIDENCE,  R.I., August 21, 2000 -- Log On America, Inc. (NASDAQ:  LOAX) today
commenced  legal  proceedings  in the United  States  District  Court,  Southern
District of New York,  against the four  institutional  investors and certain of
their affiliates  which hold the Company's Series A Convertible  Preferred Stock
and Warrants. The action alleges that the holders of the Preferred Stock engaged
in a scheme to manipulate and intentionally  drive down the trading price of the
Company's Common Stock and have violated Federal securities laws.

The Company  also said that it will not honor  requests  for  conversion  of the
Preferred Stock and will not register the Common Stock  underlying the Preferred
Stock.  The Company has  requested  declaratory  relief from the Court,  seeking
termination of the conversion  rights of the preferred  holders based upon their
market manipulation, fraudulent conduct and 10b-5 violations.

In addition to today's  action,  several  other public  companies  have recently
brought public actions against certain institutional investors, including two of
the  defendants  named  in  the  Company's  complaint,  alleging  breach  of the
securities laws and market  manipulation in connection with similar  convertible
issues.

Recent  articles in the business media have drawn more scrutiny to these abuses.
A May 17, 1998 New York Times article  observed,  "Such short selling is illegal
if used to  manipulate  the market  for  profit.  And big  profits  are  clearly
possible:  Once the price is down, an investor can convert  preferred shares for
large amounts of the  company's  stock,  use some to repay the borrowed  shares,
bank  profits  from the short sale and own as many shares in the company as when
he started, or more."

Log On America issued the convertible  preferred shares and warrants on February
22, 2000. The complaint  alleges that as a result of the defendants'  fraudulent
conduct,  and abusive  shorting of the  Company's  common  stock,  the Company's
common stock declined from $ 17 at the preferred  issue date to less than $ 3.00
per share at Friday's close.

Earlier  this month,  Log On America  reported a 28% revenue  gain in the second
quarter ended June 30th and an EBITDA loss of $4.8 million.  Capital spending in
the first half  totaled  approximately  $10  million,  primarily  related to the
initial build out of its network.  Capital  availability  totaled $44 million at
June 30th,  consisting  of $20  million in cash and liquid  investments  and $24
million in various credit facilities.


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"From an operational  viewpoint,  we are ahead of plan and believe that our plan
will build  shareholder  value. We are bringing this action,  which we intend to
pursue  vigorously,  to defend that  value,"  David  Paolo,  Chairman  and Chief
Executive Officer, said.

Log On America,  Inc. is a rapidly  growing  switched  facilities-based  D-CLEC+
providing broadband communications and data services to the commercial and small
office/home  office  (SOHO)  markets.  With a focus  on the  Northeast  Regional
Market, the company provides local dial tone, in-state toll, long distance,  and
high-speed  Internet  access  and  high-speed  Internet  access  solutions  over
traditional  copper wire using DSL  technology  to  residential  and  commercial
clients throughout the Northeast. For more information on Log On America, please
see the Company's Web site at http://www.loa.com.

Forward-Looking Statements

Statements  made in this news  release,  including  those  relating to our legal
proceedings,  may contain forward-looking statements concerning our business and
products. Our actual results may differ materially depending on a number of risk
factors  including,  but not limited to, the  following:  general  economic  and
business  conditions,   development,  shipment,  market  acceptance,  additional
competition  from  existing  and new  competitors,  changes in  technology,  and
various other factors  beyond our control.  Other risks inherent in our business
are described in our Securities and Exchange Commission  filings,  including our
most recently filed Forms 10KSB and 10QSB.  We undertake no obligation to revise
or update any  forward-looking  statements  to reflect  events or  circumstances
after the date of this release.