As filed with the Securities and Exchange Commission on July 24, 2003

                                                     Registration No. 333-106215
  ______________________________________________________________________________


                       SECURITIES AND EXCHANGE COMMISSION
                                WASHINGTON, D.C.

                            -------------------------

                                 AMENDMENT NO. 1
                                       to
                                    FORM S-3

                             Registration Statement
                                    Under The
                             Securities Act of 1933

                            -------------------------

                           INTERNATIONAL ISOTOPES INC.
                 ----------------------------------------------
                 (Name of Small Business Issuer in its Charter)

               Texas                          2835                 74-276837
 -------------------------------  ----------------------------  ----------------
 (State or other Jurisdiction of  (Primary Standard Industrial  (I.R.S. Employer
  Incorporation or Organization)   Classification Code Number)   Identification
                                                                    Number)

                  4137 Commerce Circle Idaho Falls, Idaho 83401
          ------------------------------------------------------------
          (Address and Telephone Number of Principal Executive Offices
                        and Principal Place of Business)

                                 Steve T. Laflin
                              4137 Commerce Circle
                            Idaho Falls, Idaho 83401
                                 (208) 524-5300

            ---------------------------------------------------------
            (Name, Address and Telephone Number of Agent for Service)
                                    Copy to:
                                Curtis R. Ashmos
                            Locke Liddell & Sapp LLP
                             100 Congress, Suite 300
                               Austin, Texas 78701
                                 (512) 305-4716

                Approximate Date of Proposed Sale to the Public:
     From time to time after this Registration Statement becomes effective.

         If the only securities  being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, check the following box. ||

         If any of the  securities  being  registered  on  this  form  are to be
offered  on a  delayed  or  continuous  basis  pursuant  to Rule 415  under  the
Securities Act of 1933, check the following box. |X|

         If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list  the  Securities  Act  registration  statement  number  of the  earlier
effective registration statement for the same offering. ||

         If this  form is a  post-effective  amendment  filed  pursuant  to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act  registration   statement  number  of  the  earlier  effective  registration
statement for the same offering. ||

         If delivery of the  prospectus  is expected to be made pursuant to Rule
434, please check the following box. ||
<TABLE>
<CAPTION>

                                                 Proposed Maximum     Proposed Maximum
     Title of Each Class of       Amount to be    Offering Price     Aggregate Offering       Amount of
  Securities to be Registered      Registered        Per Unit              Price           Registration Fee
 ------------------------------   ------------   ----------------    ------------------    ----------------
<S>                               <C>            <C>                 <C>                   <C>
 Common Stock,  $.01 par value,    38,229,157         $ .03              $1,146,875            $ 92.78
 included in the Units (1)
 ------------------------------   ------------   ----------------    ------------------    ----------------
 Warrants (2)                      76,458,314          ----                 ----                    (2)
 ------------------------------   ------------   ----------------    ------------------    ----------------
 Common Stock,  $.01 par value,    76,458,314         $.045              $3,440,625            $278.35
 issuable  upon exercise of the
 warrants (3)
 ------------------------------   ------------   ----------------    ------------------    ----------------
 Common  Stock;  $.01 par value    14,500,000         $ .03              $  435,000            $ 35.19
 (4)
 ------------------------------   ------------   ----------------    ------------------    ----------------
 Warrants (2) (5)                  29,000,000                                                       (2)
 ------------------------------   ------------   ----------------    ------------------    ----------------
 Common Stock;  $.01 par value,    29,000,000         $.045              $1,305,000            $105.58
 issuable  upon exercise of the
 oversubscription warrants
 ------------------------------   ------------   ----------------    ------------------    ----------------
 Subscription Rights (7)           38,229,157          ----                 ----                 ----
 ------------------------------   ------------   ----------------    ------------------    ----------------
</TABLE>

<PAGE>


         (1) The Company is offering  Units;  each Unit consists of one share of
         Common  Stock and two  warrants to purchase  two  additional  shares of
         Common Stock at $.04 and $.05, respectively.
         (2)  The  registration  fee  is  being  paid  in  connection  with  the
         registration of the underlying Common Stock.
         (3) Includes  38,229,157  shares  issuable upon exercise of warrants at
         $.04 per share,  and an  additional  38,229,157  shares  issuable  upon
         exercise of warrants at $.05 per share.
         (4) Issuable to fill excess over-subscriptions.
         (5) Includes the warrants  issuable in connection  with the  14,500,000
         Unit over subscription option.
         (6) Includes  14,500,000  shares  issuable upon exercise of warrants at
         $.04 per share,  and an  additional  14,500,000  shares  issuable  upon
         exercise of warrants at $.05 per share.
         (7) Evidencing the Rights to subscribe for Units.

         The Registrant hereby amends this  Registration  Statement on such date
or dates as may be necessary to delay its  effective  date until the  Registrant
shall file a further amendment which specifically  states that this Registration
Statement shall  thereafter  become effective in accordance with Section 8(a) of
the  Securities  Act of 1933 or until the  Registration  Statement  shall become
effective on such date as the Commission,  acting pursuant to said Section 8(a),
may determine.



                                       2
<PAGE>


PROSPECTUS
                           INTERNATIONAL ISOTOPES INC.
                                38,229,157 Units
                Issuable Upon the Exercise of Subscription Rights

         International  Isotopes Inc.  ("I3" or the "Company") is issuing to its
shareholders  of  record  as of the  close  of  business  on July 15,  2003  new
securities called "Rights".  Holders of Rights will be entitled to subscribe for
an aggregate of 38,229,157  Units of I3's securities at the rate of one Unit for
each 2.5 Rights held. The terms of the Rights offering are as follows:

         o      You will receive one Right for each share of I3 common stock you
                owned on July 15, 2003.

         o      You may purchase  one Unit for every 2.5 Rights you receive,  at
                the Subscription Price of $.03 per Unit.

         o      Each Unit  consists of (i) one share of common  stock,  (ii) one
                warrant to purchase an additional share of common stock for $.04
                per  share  ("Series  A  Warrant"),  and (iii)  one  warrant  to
                purchase  another  share of  common  stock  for  $.05 per  share
                ("Series B Warrant").  The warrants are exercisable through July
                31, 2007.

         o      If you  fully  exercise  your  rights,  you  may  subscribe  for
                additional Units through an over-subscription  privilege. If the
                over-subscriptions  exceed  the number of Units  available,  the
                Units   will   be   allocated   to   those    shareholders   who
                over-subscribe,  based  upon their  shareholdings  on the record
                date as more fully described in this Prospectus.

         o      The Rights are not  transferable  and may be  exercised  only by
                record date shareholders.

         o      The offer  expires on September  12,  2003.  There is no minimum
                number of Units required to be sold as a condition to completing
                the Offering.

The Company's Common Stock is quoted in the over the counter market in the "pink
sheets" under the symbol  "INIS." On July 21, 2003,  the last reported bid price
for shares of the  Company's  Common  Stock as  reported  in the pink sheets was
$.03.

Shareholders  of I3 who do not  exercise  all of their Rights will own a smaller
relative  equity  ownership and voting  interest in I3 after  completion of this
Offering than if they were to exercise all of their Rights.


                       -----------------------------------

          The securities offered hereby involve a high degree of risk.
                    See "Risk Factors" commencing on page 9.

                       -----------------------------------

                       Neither the Securities and Exchange
           Commission nor any state securities commission has approved
              or disapproved these securities or determined if this
          Prospectus is truthful or complete. Any representation to the
                         contrary is a criminal offense.

                       -----------------------------------

The  Company  has not  authorized  any  person,  agent  or  entity  to give  any
information  or make any  representation  other  than  those  contained  in this
Prospectus (including material incorporated by reference herein). You should not
rely on any such information or  representation as having been authorized by the
Company.  This  Prospectus is not an offer to sell the  securities and it is not
soliciting an offer to buy the securities in any state where offers or sales are
not permitted.


 Price to Public                        Proceeds to the Company
 -------------------------------------- ----------------------------------------
 Per Unit $.03                          $.03
 -------------------------------------- ----------------------------------------
 Total    $1,146,875                    $1,146,875
 -------------------------------------- ----------------------------------------

Expenses  of the Rights  Offer are  estimated  to be  $55,000.  No  underwriting
discounts or discounts will be paid.


                  The date of this Prospectus is July 24, 2003





                                       3
<PAGE>


                                TABLE OF CONTENTS
                                                                          Page

Prospectus Summary..........................................................5
Risk Factors................................................................8
The Company................................................................11
The Rights Offer...........................................................13
Use of Proceeds............................................................19
Description of Securities..................................................20
Legal Matters..............................................................22
Experts....................................................................22
Incorporation of Certain Information by Reference..........................22
Additional Information.....................................................22

Exhibit A  Form of Subscription Certificate ..............................A-1
Exhibit B  Form of Notice of Guaranteed Delivery..........................B-1
Exhibit C  Form of Nominee Holder Over Subscription Exercise Form.........C-1
Exhibit D  Form of Warrant Agreement......................................D-1
Exhibit E  Form of Warrant Certificate....................................E-1





                                       4
<PAGE>


                               PROSPECTUS SUMMARY

         The following  summary  explains only some of the  information  in this
prospectus.  More detailed  information about International  Isotopes Inc.("I3,"
the "Company," or "we") and the Rights offer,  and financial  statements  appear
elsewhere in this prospectus or in the documents  incorporated by reference into
this prospectus.

         This prospectus is part of a registration statement on Form S-3 that we
have filed with the  Securities  and Exchange  Commission.  The SEC allows us to
"incorporate by reference"  information  that we file with them. This means that
we can disclose important information to you by referring you to other documents
that we have  filed  with the  SEC.  The  information  that is  incorporated  by
reference is considered part of this  prospectus,  and information  that we file
later will automatically update and may supersede this information.  For further
information  about I3 and the securities being offered,  you should refer to the
registration statement and the documents that are incorporated by reference. See
"Incorporation   of  Certain   Information  by  Reference"   elsewhere  in  this
prospectus.

         Statements  contained in this prospectus that are not historical  facts
may  constitute  forward-looking  statements  that  are  subject  to  risks  and
uncertainties  that could cause actual results to differ  materially  from those
discussed.  Words such as "expects,"  "may," `will,"  "anticipates,"  "intends,"
"plans,"  "believes,"  "seeks,"  "estimates," and similar  expressions  identify
forward-looking statements. See "Risk Factors."


                                   The Company

         International  Isotopes Inc. was established as a Texas  corporation in
1995.  The Company was initially  formed to produce,  market,  and  distribute a
broad range of products used in diagnostic  and  therapeutic  nuclear  medicine,
research and industry.  In 1998 the Company acquired a subsidiary,  subsequently
named International  Isotopes Idaho Inc., which specialized in sales of isotopes
and providing hot cell services through a contract with the Department of Energy
(DOE) Idaho  Operations  and using the Advanced Test Reactor  (ATR).  Because of
difficulties  encountered with start up of the Company's Radioisotope Production
Facility  and Linear  Accelerator,  and the high cost of  conducting  commercial
operations in the midst of a DOE laboratory, the Company underwent a substantial
change in mission and strategy during 2000 and 2001. This change resulted in the
sales of the Radioisotope  Production  Facility and Linear  Accelerator in Texas
and  termination of the commercial  isotope  production  contract with the DOE's
prime-operating  contractor in Idaho. In June of 2001, the Company relocated its
corporate  headquarters to Idaho to continue the subsidiary's  operations as the
new, primary focus and mission of the Company.

         In  support  of our new  mission  and  strategy,  in 2001 new  contract
manufacturing  and  processing  agreements  were put in place,  a new  operating
facility was obtained and licensed  through the Nuclear  Regulatory  Commission,
and new contracts  put in place with the DOE's  prime-operating  contractor  for
continued  reactor  production  of high  specific  activity  cobalt.  These  new
agreements now fully support the Company's business products and services, which
include  manufacturing  nuclear  medicine  reference and calibration  standards,
processing  gemstones that have undergone  treatment for color enhancement,  and
large volume  production of high specific  activity  (HSA) cobalt.  We have been
able to continue  steady growth in the amount of revenues  generated  from these
business activities. We expect continued growth and the addition of new products
in  2003,  which  management  feels  will  produce  sufficient  cash to meet our
operational needs.  However,  prospective  investors are cautioned regarding the
speculative nature of any forward-looking projections. For a discussion of these
and other risk factors relating to the Company when considering an investment in
our securities, see "Risk Factors."


                              Purpose of the Offer

         The Board of  Directors  of I3 has  determined  that it is desirable to
raise capital in order to finance an expansion of our business operations.  This
expansion will include  construction  of a building  addition and acquisition of
hot cells and related  equipment  for  processing a wide range of new  products.
Although  intended to provide a variety of  processing  capability,  most of the
planned  operations  expansion  will  be  directed  towards  implementation  and
advancement of the Company's new Therapy Products business area.

         This  offering  will  allow  us to  raise  additional  capital  without
diluting the ownership  interests of existing  shareholders  who exercise  their
Rights and  without  paying the higher  underwriting  commissions  that would be
required to raise capital from third parties who are not already shareholders.


                                       5
<PAGE>


                               Terms of the Offer


Description of the Rights               We are  issuing  Rights  to  each of our
Offering                                shareholders  who  owned  shares  of our
                                        common stock at the close of business on
                                        July  15,  2003.  You will  receive  one
                                        Right  for every  share of common  stock
                                        you  own.   You  will  be   entitled  to
                                        purchase one Unit of our securities (one
                                        share of common  stock and two  warrants
                                        to purchase two  additional  shares) for
                                        every 2.5  Rights  you own.  Holders  of
                                        Rights will be entitled to subscribe for
                                        and  purchase  up  to  an  aggregate  of
                                        38,229,157 Units.

Subscription Price                      If you wish to  exercise  your Rights to
                                        purchase Units, the  Subscription  Price
                                        will be $.03 per Unit. The  Subscription
                                        Price  is  payable  in  cash  (including
                                        check,  money order and wire  transfer),
                                        except    with    respect   to   certain
                                        shareholders of I3 who have loaned funds
                                        to the  Company and may choose to cancel
                                        I3 debt in exchange for Units.

Description of Units                    Each Unit will  consist of (i) one share
                                        of our common  stock,  (ii) one Series A
                                        Warrant to purchase an additional  share
                                        of our  common  stock at a price of $.04
                                        per  share,   and  (iii)  one  Series  B
                                        Warrant to purchase another share of our
                                        common  stock  at a price  of  $.05  per
                                        share.  The warrants are  exercisable at
                                        any time on or  prior to July 31,  2007.
                                        The warrants are  redeemable  and may be
                                        repurchased by the Company for $.001 per
                                        warrant if the average  closing price of
                                        I3's common stock equals or exceeds $.12
                                        per  share  with  respect  to  Series  A
                                        Warrants and $.15 per share with respect
                                        to   Series  B   Warrants   during   any
                                        consecutive 20 business day period.  The
                                        Warrants  will be  evidenced  by Warrant
                                        Certificates  and will be subject to the
                                        terms of a Warrant Agreement between the
                                        Company  and  American   Stock  Transfer
                                        Company,   as  Warrant  Agent.  See  the
                                        Warrant  Agreement  attached  hereto  as
                                        Exhibit  D  and  the  form  of   Warrant
                                        Certificate  attached  hereto as Exhibit
                                        E.

Over-Subscription Privilege             Shareholders  who fully  exercise  their
                                        Rights   will   be   entitled   to   the
                                        additional  privilege of subscribing for
                                        and   purchasing,   subject  to  certain
                                        limitations  and subject to  allocation,
                                        any Units not acquired by other  holders
                                        of Rights in the  primary  subscription.
                                        If  subscriptions  for Units through the
                                        over-subscription  privilege  exceed the
                                        number of Units available for sale after
                                        the primary  subscription,  we may issue
                                        up to  14,500,000  additional  Units  to
                                        fill  all or a  portion  of  the  excess
                                        over-subscriptions.


                                       6
<PAGE>


How to Exercise Rights                  The   Rights   will  be   evidenced   by
                                        Subscription Certificates, which will be
                                        distributed to record date shareholders.
                                        See Exhibit A hereto.  You may  exercise
                                        your    Rights   by    completing    the
                                        Subscription  Certificate and delivering
                                        it,   together   with   payment  of  the
                                        Subscription  Price, to the Subscription
                                        Agent,  American  Stock Transfer & Trust
                                        Company, 59 Maiden Lane, Plaza Entrance,
                                        New York, New York 10038. Payment may be
                                        made  either by check  drawn on a United
                                        States bank,  wire transfer or by notice
                                        of  guaranteed  delivery  (as  explained
                                        under  "The  Rights  Offer--Payment  for
                                        Shares").  Certain shareholders who have
                                        loaned  funds  to the  Company  have the
                                        additional  option of electing to cancel
                                        all or a portion  of the I3 debt owed to
                                        them in  exchange  for  Units.  You must
                                        exercise   your  Rights  no  later  than
                                        September 12, 2003.  You may not rescind
                                        your  purchase  after   exercising  your
                                        Rights.

Non-Transferability of Rights           The Rights are  non-transferable and may
                                        be  exercised  only  by  a  record  date
                                        shareholder.

When You Can Exercise Your Rights       You can exercise your Rights only during
                                        the period  beginning on August 12, 2003
                                        and ending on September 12, 2003 at 5:00
                                        p.m., New York City time.

Common Stock Outstanding Prior          95,572,893 shares of common stock.
to this Offering

Common Stock to be                      After this  Offering,  assuming the sale
Outstanding After the                   of  the   38,229,157   Units   initially
Offering                                offered   plus   the   14,500,000   unit
                                        over-subscription  option,   148,302,050
                                        shares   of   common   stock   will   be
                                        outstanding.    There   will   also   be
                                        outstanding   warrants  to  purchase  an
                                        additional 105,458,314 shares.

Important Dates to Remember             Record Date:  July 15, 2003
                                        Expiration Date:  September 12, 2003
                                        Last date of Guaranteed
                                        Delivery:  September 17, 2003

Amendment, Extension or                 The Company may in its sole  discretion:
Termination of the Offer                (a)   terminate   the  Offer   prior  to
                                        delivery  of the Units for which  Rights
                                        holders have subscribed  pursuant to the
                                        exercise   of  Rights  in  the   primary
                                        subscription  or  the  over-subscription
                                        privilege;  (b)  extend  the  expiration
                                        date to a later  date;  (c)  change  the
                                        record date prior to the distribution of
                                        the Rights to shareholders; or (d) amend
                                        or modify the terms of the Rights offer.

Closing bid price of the Company's      $.03 per share
common stock as reported in the
over the counter market pink sheets
on June 13, 2003 (the trading day
prior to announcement of the Rights
offering)

Closing bid price of the Company's      $.03 per share
common stock as reported in the
over the counter market pink sheets
on July 21, 2003


                                       7
<PAGE>


Risk Factors                            An  investment  in the Units  involves a
                                        high degree of risk. The Units should be
                                        purchased  only  by  investors  who  can
                                        afford   the   loss  of   their   entire
                                        investment. See "Risk Factors."

Use of Proceeds                         New  facilities   and  equipment,   debt
                                        reduction and working capital.  See "Use
                                        of Proceeds."

Trading Symbol                          Our common shares are traded in the over
                                        the  counter  market and reported in the
                                        pink  sheets  under  the  symbol "INIS."

Participation of Certain                Certain   of  I3's   shareholders   have
Shareholders                            recently    loaned   the   Company   the
                                        aggregate  principal amount of $823,500.
                                        Although  there can be no assurance,  we
                                        expect  each of  these  shareholders  to
                                        participate   in  the  Rights  offer  by
                                        canceling all or a portion of the amount
                                        of I3 debt owed to them in exchange  for
                                        Units offered hereby.


                                  RISK FACTORS

International  Isotopes has incurred and may continue to incur losses.  With the
exception of 2002, we have incurred net losses for most fiscal periods since our
inception.  From inception (November 1995) through December 31, 2002 the Company
generated  $17,246,225  in revenues and had an  accumulated  deficit  (including
preferred stock  dividends and returns) in the amount of  $87,390,165.  However,
although we cannot  provide any  assurance  we believe the  Company's  continued
growth in our new  business  areas will produce  sufficient  revenue to meet our
2003 cash flow and operational needs.

We may need additional financing to continue operations. As of December 31, 2002
we have an  outstanding  debt of $1,046,520 on a $1.1 million  revolving line of
credit account with Texas State Bank. That note matures on December 31, 2003 and
is secured  with 80% of our  accounts  receivable  and 50% of our fixed  assets.
Seventy-five  percent (75%) of the cash resulting from the sale of any remaining
Linac  equipment  must be applied to the principal of this note.  Sales of about
$460,000 of this  equipment  are expected in 2003.  We will have to negotiate an
extension  of terms  on this  note at the end of 2003.  The  Company  also has a
ten-year  note for $909,738 at 7% interest to our former  Chairman of the Board.
Principal and interest  payments on this note are to be paid annually based upon
net profits of the Company (annual principal payment to equal 30% of net pre-tax
profits).  At December 31, 2002,  the note holder agreed to defer the April 2003
principal  payment.  The Company also has notes  totaling  $823,500 in principal
amount with several of our principal shareholders,  which mature in May 2004. We
expect the holders of these notes to convert all or a portion of the outstanding
amount of these notes to equity through the exercise of Rights in this offering.

Remaining  Company  Obligations  on the Texas State Bank Loan for the Waxahachie
Property.  The  Company  and Texas  State  Bank have  agreed to have the loan of
$345,295 assumed by an individual in consideration of our sale of our Waxahachie
property.  Liability for this loan would, however,  revert to the Company should
this individual default on the assumed note.


                                       8
<PAGE>

We will continue to be dependent upon our remaining  facilities and equipment to
function properly in order to provide  consistent,  timely shipments of products
that meet our customers' specifications.  If we experience equipment failures or
breakdowns we may be unable to satisfy our customers,  which could result in the
cancellation of contracts and the loss of revenues.

There is no long-term  contract in place with the DOE  Contractor  for continued
HSA  Cobalt  production.  The  Company  has put short  term  specific  "work for
non-government  sponsor agreements" in place with the DOE contractor to continue
sales of HSA cobalt  irradiated  at the Idaho reactor  facility.  We expect that
these agreements will continue,  however,  there is no assurance these contracts
will be equitable or continuing.

Operational hazards (i.e.,  spills,  faults,  ventilation  failure,  etc.) could
result in the spread of contamination within our facility and require additional
funding to correct. An irrevocable, automatic renewable letter of credit against
a $147,000  Certificate  of Deposit at Texas State Bank has been used to provide
the financial  assurance required by the Nuclear  Regulatory  Commission for our
Idaho facility license.  If a contamination  event resulted in greater liability
to us we  would  have to  borrow  money or fund the  liability  from our  future
revenue.

Government regulation could adversely affect our business. Operations within our
Idaho facility are subject to the U.S.  Nuclear  Regulatory  Commission and Food
and Drug Administration regulations.  Nuclear medicine calibration and reference
standards are licensed and  regulated.  To the extent these  regulations  are or
become burdensome, our business development could be adversely affected.

We are dependent  upon key  personnel.  Our ongoing  operations are dependent on
Steve T. Laflin,  President and Chief Executive  Officer.  The Company is highly
dependent upon this person and the loss of this individual could have a material
adverse effect on us. We have a $2 million dollar key man life insurance  policy
on Mr.  Laflin and a 5-year  employment  agreement  with him  extending  through
February 2007. The Company has revised our employee stock options to assist with
offering  incentives  and  retaining  key  personnel.  In addition,  there is no
assurance  the Company will be able to retain our existing  personnel or attract
additional qualified employees.  Loss of any of these relationships would result
in a significant decline in revenue.

We are  dependent  on various  third  parties in  connection  with our  business
operations.  The  production of HSA Cobalt is dependent  upon the  Department of
Energy, and its prime-operating  contractor,  who controls the Idaho reactor and
laboratory operations. Our gemstone production is tied to an exclusive agreement
with  Quali  Tech Inc.  Nuclear  medicine  calibration  and  reference  standard
manufacturing is conducted under an exclusive contract with RadQual,  LLC who in
turn has agreements in place with several companies for marketing and sales.

We are subject to competition from other  companies.  Each of the business areas
of the  Company  has direct  competition  from other  businesses.  HSA cobalt is
supplied  by  other  reactor  facilities  around  the  world.  Nuclear  medicine
calibration  and  reference  standards  are  being  produced  by  several  other
manufacturers in the U.S. and overseas, and there is at least one other gemstone
processor in Europe. Each of our competitors has significantly greater financial
resources  than us and that could create a  competitive  advantage for them over
us.

Regulation of Radioisotope  Production and Radioactive Waste. The manufacture of
radioisotopes,   nuclear  medicine  calibration  and  reference  standards,  and
processing  gemstones  are subject to  extensive  federal  regulation.  Prior to
commencing  operations in our newly leased Idaho facility,  the Company obtained
approval  from  the  Nuclear   Regulatory   Commission.   The  nuclear  medicine
calibration  and reference  standards are licensed as Sealed Sources through the
State of Texas Department of Health. The Company's  production facility does not
handle  "special  nuclear  materials"  (i.e.  nuclear  fuels and  weapons  grade
uranium, thorium and plutonium) and, therefore, is not designated as a "nuclear"
facility.


                                       9
<PAGE>

Pursuant  to the Low Level  Radioactive  Waste  Policy  Act of 1980,  states are
required  to assure  the safe  disposal  of mildly  radioactive  materials.  The
Nuclear Regulatory Commission,  Region IV, regulates the disposal of radioactive
waste for facilities  operating in Idaho. The radioactive waste we produce falls
into the category of low-level radioactive waste.

Other  Regulations.  In the event we enter into  agreements  with  suppliers  to
acquire  neutron-produced  research and  therapeutic  radioisotopes  we could be
subject to additional  regulations of the Nuclear  Regulatory  Commission or the
Food and Drug Administration.

Our  shares  are not  currently  listed on a  securities  exchange  or traded on
Nasdaq. As a result,  our shares are thinly traded and there can be no assurance
that an active trading market will develop for our stock. Accordingly, owners of
our shares may have a difficult  time  selling  large blocks of shares at market
prices.

No Trading market is expected to develop for the Warrants. Although the Series A
Warrants and Series B Warrants are being registered and will be freely tradeable
(including through the Depository Trust Company), the Company does not expect an
active trading market to develop for the Warrants.

Shareholders  of I3 who do not  exercise  all of their Rights will own a smaller
relative  percentage of I3 after the Offering and could  experience  dilution in
the value of their stock.  The Rights Offer is being made to all I3 shareholders
and if all shareholders  exercise all of their rights,  each  shareholder's  pro
rata ownership interest will remain the same. However, if a shareholder does not
exercise  his  Rights or  exercises  less than all his  Rights,  his  percentage
ownership  interest  could  be  reduced   significantly.   A   non-participating
shareholder's   interest   will  be  reduced  even  more  to  the  extent  other
shareholders  exercise  their  oversubscription  privilege.  To the  extent  the
offered  Unit  price  is  less  than  the  then  market  price  of  I3's  stock,
non-participating  shareholders  could also experience  dilution in the value of
their  shares.   The  same  is  true  for   non-participating   shareholders  if
participating  shareholders  later  exercise  their  Warrants  when the  Warrant
Exercise Price is less than the then market price of I3's stock.


                                       10
<PAGE>


                                   THE COMPANY

General

I3 was  established  as a Texas  corporation  in 1995. The Company was initially
formed to produce,  market,  and  distribute  a broad range of products  used in
diagnostic and therapeutic nuclear medicine,  research and industry. In 1998 the
Company acquired a subsidiary,  subsequently named International  Isotopes Idaho
Inc.,  which  specialized  in sales of isotopes and  providing hot cell services
through a contract  with the  Department  Of Energy (DOE) Idaho  Operations  and
using the Advanced Test Reactor (ATR). Because of difficulties  encountered with
start  up  of  the  Company's   Radioisotope   Production  Facility  and  Linear
Accelerator,  and the high cost of conducting commercial operations in the midst
of a DOE laboratory,  the Company underwent a substantial  change in mission and
strategy  during  2000  and  2001.  This  change  resulted  in the  sales of the
Radioisotope Production Facility and Linear Accelerator in Texas and termination
of the commercial  isotope  production  contract with the DOE's  prime-operating
contractor  in Idaho.  In June of 2001,  the  Company  relocated  its  corporate
headquarters  to Idaho  to  continue  the  subsidiary's  operations  as the new,
primary focus and mission of the Company.

In support of our new mission and strategy,  in 2001 new contract  manufacturing
and  processing  agreements  were put in place,  a new  operating  facility  was
obtained  and  licensed  through  the  Nuclear  Regulatory  Commission,  and new
contracts put in place with the DOE's  prime-operating  contractor for continued
reactor  production of high specific  activity cobalt.  These new agreements now
fully  support the  Company's  business  products and  services,  which  include
manufacturing nuclear medicine reference and calibration  standards,  processing
gemstones that have undergone treatment for color enhancement,  and large volume
production of high specific activity (HSA) cobalt. We have been able to continue
steady  growth  in  the  amount  of  revenues   generated  from  these  business
activities. We expect continued growth and the addition of new products in 2003,
which  management  feels will produce  sufficient  cash to meet our  operational
needs.  However,  prospective  investors are cautioned regarding the speculative
nature of any forward-looking  projections.  For a discussion of these and other
risk  factors  relating to the Company when  considering  an  investment  in our
securities, see "Risk Factors."

Company Licensing, Capabilities, and Qualifications

We  have  a  fully  implemented   Quality  Assurance  program  which  meets  the
requirements  of  ANSI/ASME  NQA-1 and 10 CFR  830.120.  In order to support the
production of Nuclear Medicine  calibration and reference  standards the Company
is also a  participating  member of the  National  Institute  of  Standards  and
Technology/ Nuclear Energy Institute's  (NIST/NEI) Measurement Assurance Program
(MAP) for the  radiopharmaceutical  industry. This program participation ensures
that we can provide  analytical  methods and  standards  necessary  for accurate
radioactivity  measurement.  The  Company  is also a  registered  Food  and Drug
Administration  (FDA) medical device  manufacturer  for Class I medical devices,
including Nuclear Sealed Calibration Sources (892.1400) and Nuclear Flood Source
Phantoms (892.1380).

Industry Overview and Target Markets

The  industries  and  markets  that  require or involve  the use of  radioactive
material are diverse. Our current operations involve products that are used in a
wide variety of applications  and in various  markets.  First, our HSA cobalt is
supplied as bulk material,  which is subsequently assembled into medical devices
by our  customer.  Second,  we are a contract  manufacturer  of several  nuclear
medicine  reference and  calibrations  standards used for operational  checks of
various  imaging and  measurement  systems for nuclear  medicine.  And third, we
support the special  packaging and  measurement of gemstones that have undergone
irradiation for color enhancement.

We conduct our operations in Idaho Falls,  Idaho.  Although the cobalt,  nuclear
medicine  calibration  and reference  standards,  and gemstone  products  appear
diverse,  they share the common links of being radioactive  materials  requiring
extensive process quality control. Therefore, the Company is required to have an
operating license from the Nuclear  Regulatory  Commission and specially trained
staff with rigorously  employed  quality  standards to produce and process these
materials.


                                       11
<PAGE>

Products

HSA  Cobalt  - The  Company  is one of a  very  few  sources  of  this  material
worldwide.  High Specific  Activity  (HSA) cobalt is used  primarily in external
beam radiation medical devices such as Elekta's Leksell Gamma Knife. This device
is used  for  non-surgical  radiation  treatment  of  vascular  deformities  and
non-malignant  tumors in the brain.  The HSA cobalt requires three to five years
of  irradiation  to reach  the  necessary  level of  activity  for this  medical
application.  We manage an inventory  of  approximately  800,000  curies of this
material in various  stages of  production,  thus ensuring a long and continuous
supply of  material.  After  irradiation  the material is shipped by us directly
from the DOE reactor laboratory to the customer's  facilities,  thus eliminating
the need for any on site processing of the material following irradiation.

Other Reactor  Produced  Radioisotopes - The Company's  facility and NRC license
permits  processing  of a wide  variety  of  radioisotopes.  We  are  evaluating
establishing  additional radioisotope transport and processing capabilities that
would  permit  production  and sale of various new  radioisotopes  using the DOE
laboratory  test  reactor  for  production  and our  Idaho  Falls  facility  for
processing.

Nuclear medicine calibration and reference standards manufacturing - The Company
is an exclusive contract  manufacturer to RadQual LLC for several of these types
of standards.  There are approximately 6,000 nuclear medicine centers around the
U.S.  and the number of these  centers is  expected to grow at an annual rate of
about 5%. Each of these centers has a variety of measurement and imaging systems
that require frequent use of calibration and reference standards to ensure their
proper  operation.   Because  of  the  relatively  short  lived  nature  of  the
radioactivity  used in these  standards,  the  customers are required to replace
them approximately once every 12 to 18 months.

Gemstone Processing - The Company has an exclusive contract with Quali-Tech Inc.
for processing  gemstones.  The  processing  involves  special  packaging of the
gemstones  in  containers,  which  allow them to undergo  irradiation  for color
enhancement. The processing we perform entails initial receipt of the gemstones,
packaging the gemstones for irradiation, managing the transport of the stones to
and from the reactor facility,  and then completing post irradiation  processing
of the stones before return  shipment to the  customer.  In 2001 the  production
volume  of  the  gemstones  was  limited  by  the  availability  of  irradiation
containers due to the difficulty  involved with repairing and constructing these
containers.  However,  in  January  2002 we had  solved  container  construction
problems and implemented a new technology to repair  containers.  As a result we
have been able to double the number of containers  available for  irradiation of
the  gemstones.  During  2002,  however,  the  general  slowdown  of the economy
impacted  the  market  demand  for  gemstones  and  thus the  Company's  revenue
resulting from processing did not meet expectations.

Competition

HSA cobalt is produced in some other reactors,  but we do not believe any in the
U.S. are capable of producing  the high activity  level and volume  required for
meaningful  commercial  production.  The two  domestic  reactor  sources are the
University  of  Missouri  Research  Reactor  and the High Flux  Isotope  Reactor
located in Oak Ridge Tennessee.  There are,  however,  numerous foreign reactors
actively producing high and low specific activity cobalt. While the logistics of
international  transport  of cobalt  presents  some  competitive  barriers,  the
Company must always consider the potential  threat these other suppliers pose to
our HSA cobalt business.

Nuclear  medicine  calibration  and  reference  standards  - The  Company is the
smallest of three major producers of these sources within the U.S. The Company's
customer (RadQual,  LLC) has increased the number of authorized distributors and
plans to make further expansion into the market in 2003.  However,  there can be
no assurance of increased sales.

Gemstone  processing  - there is no other  commercial  company or reactor in the
U.S.  processing  irradiated  gemstones.  We believe  there are one or two other
reactors in the world that support this business with other companies overseas.

Government Regulation

The  Company has  obtained a license  from the  Nuclear  Regulatory  Commission,
Region IV that permits use and possession of by-product  material.  The scope of
this license  includes  calibration  and reference  standard  manufacturing  and
distribution,  radioactive gemstone  processing,  environmental sample analysis,
and  various  research  and  development  activities.  The scope and  activities
permitted  by this  license are broad enough that it is not expected to restrict
any  anticipated  business  activities  in the coming year.  The Company is also
registered  as a medical  device  manufacturer  through  the U.S.  Food and Drug
Administration (FDA).


                                       12
<PAGE>


                                THE RIGHTS OFFER

Issuance of Rights

         We  are  issuing  Rights  to  subscribe  for  Units  of  the  Company's
securities. Each Unit consists of (i) one share of common stock, (ii) one Series
A Warrant to purchase an additional  share of common stock at an exercise  price
of $.04,  and (iii) one Series B Warrant  to  purchase  another  share of common
stock at $.05 per share.  The  warrants  are  exercisable  anytime  prior to and
including  July 31, 2007.  Each shareholder as of the record date will be issued
one  nontransferable  Right for each share of common stock owned.  No fractional
Rights  will be  issued.  The  Rights  entitle  the  holder  to  acquire  at the
Subscription  Price  one Unit  for each 2.5  Rights  held.  The  Rights  will be
evidenced by Subscription  Certificates (see Appendix A) which will be mailed to
shareholders.

         The Rights are not  transferable  and will not be quoted for trading in
the over the counter market nor on any stock exchange.  Shareholders  who, after
exercising their Rights, are left with fewer than 2.5 Rights,  will be unable to
exercise  those  remaining  Rights and will not be  entitled to receive any cash
from the Company in lieu of those remaining Rights.

Purpose of Offer

         The Board of  Directors  of I3 has  determined  that it is desirable to
raise capital in order to finance an expansion of our business operations.  This
expansion will include  construction  of a building  addition and acquisition of
hot cells and related  equipment  for  processing a wide range of new  products.
Although  intended to provide a variety of  processing  capability,  most of the
planned  operations  expansion  will  be  directed  towards  implementation  and
advancement of the Company's new Therapy Products business area.

         This  Offering  will  allow  us to  raise  additional  capital  without
diluting the ownership  interests of existing  shareholders  who exercise  their
Rights and  without  paying the higher  underwriting  commissions  that would be
required to raise capital from third parties who are not already shareholders.

The Subscription Price

         The  Subscription  Price  for the Units to be  issued  pursuant  to the
Rights is $.03 per Unit.  We  announced  the  offer on June 13,  2003.  The last
reported  bid prices of the common  stock in the over the  counter  market  pink
sheets on June 13, 2003,  and July 21, 2003,  were $.03 and $.03,  respectively.
The  Subscription  Price is  payable  in cash  (by  check,  money  order or wire
transfer),  except with  respect to certain  shareholders  of I3 who have loaned
funds to the Company and may elect to cancel I3 debt in exchange for Units.

Expiration of the Offer

         The Offer will expire at 5:00 p.m. New York City time on September  12,
2003 (the "Expiration Date").  Rights will expire on the Expiration Date and may
not be exercised after that date.

Exercise of Rights

         In order to exercise your Rights you must do all of the following:

         o    Fill in and sign the reverse side of the Subscription  Certificate
              which accompanies this prospectus;
         o    Deliver the completed and signed  Subscription  Certificate to the
              Subscription  Agent  with your  payment  in full for the Units you
              wish to purchase.  You may use the  enclosed  envelope to mail the
              Subscription Certificate and payment to the Subscription Agent, or
              you may  arrange  for one of the  alternative  methods of delivery
              described below.  Shareholders  choosing to cancel I3 debt owed to
              them  in   exchange   for  Units   should  so  indicate  on  their
              Subscription Certificate.



                                       13
<PAGE>


         o    The method of making  payment  for your Units is  described  below
              under "Payment for Shares."
         o    Properly completed and executed Subscription  Certificates must be
              received  by  the  Subscription   Agent  at  the  offices  of  the
              Subscription  Agent at the  address  set forth below prior to 5:00
              pm, New York City time, on the Expiration Date,  unless payment is
              effected by means of a notice of guaranteed  delivery as described
              below under "Payment for Shares."
         o    Rights may also be exercised through a broker,  who may charge you
              a servicing fee.

         Signed  Subscription  Certificates,   accompanied  by  payment  of  the
Subscription  Price,  should be sent to American Stock Transfer & Trust Company,
the Subscription Agent, by one of the methods described below:

         1.     By mail or by hand:
                     American Stock Transfer & Trust Company
                     59 Maiden Lane, Plaza Entrance
                     New York, NY  10038

         2.     By express mail or overnight courier:
                     American Stock Transfer & Trust Company
                     59 Maiden Lane, Plaza Entrance
                     New York, NY 10038

         3.     By facsimile (telecopier):
                     718/234-5001

with a copy of the original  Subscription  Certificate  to be sent by one of the
methods described above. Confirm facsimile by telephone to 800/937-5449.

 Do Not Send Subscription Certificates to the Company.
 ----------------------------------------------------

         A subscription  will be deemed accepted by the Subscription  Agent when
payment  (which may take the form of an  election  to cancel I3 debt owed to the
shareholder),  together  with a properly  completed  and  executed  Subscription
Certificate, and is received by the Subscription Agent.

         If you are issued fewer than 2.5 Rights, you may subscribe for one full
Unit.  Fractional Units will not be issued,  and if after exercising your Rights
you are left with fewer than 2.5 Rights,  you will not be able to exercise  your
remaining Rights.

         If you do not indicate the number of Rights you are  exercising,  or if
you do not  deliver  full  payment of the  Subscription  Price for the number of
Units that you indicate you are subscribing for (which payment may take the form
of an election  to cancel I3 debt owed to you),  then you will be deemed to have
exercised  Rights to purchase the maximum number of Units determined by dividing
the total Subscription Price you paid by the Subscription Price per Unit.

         If you submit payment for more Units than may be purchased  through the
regular  exercise of your  Rights,  your excess  payment  will be deemed to be a
Subscription   Payment  for  additional  Units  through  the   Over-Subscription
Privilege.  The  number  of  additional  Units  that you will be  deemed to have
subscribed for in the Over-Subscription Privilege will be determined by dividing
the amount of the excess payment by the Subscription Price per Unit.


                                       14
<PAGE>

         All  questions   concerning  the  time  limits,   validity,   form  and
eligibility  of  any  exercise  of  Rights  for  subscriptions  pursuant  to the
Over-Subscription  Privilege will be determined by I3, whose  determination will
be final  and  binding.  I3 in its sole  discretion  may  waive  any  defect  or
irregularity,  or may permit any defect or irregularity to be corrected,  within
such time as the Company may determine,  or I3 may reject,  in whole or in part,
the  purported  exercise  of  any  Right  in  the  primary  subscription  or any
subscription  pursuant to the  Over-Subscription  Privilege.  Neither I3 nor the
Subscription Agent will be under any duty or obligation to give any notification
or  permit  the  cure of any  defect  or  irregularity  in  connection  with the
submission of any Subscription Certificate,  the exercise or attempt to exercise
any Right or the Over-Subscription Privilege, or the payment of the Subscription
Price.  Subscriptions  through the  exercise of Rights or the  Over-Subscription
Privilege  will not be deemed to have been  received or accepted by I3 until all
irregularities  or defects  have been waived by I3 or cured to the  satisfaction
of, and within the time allocated by, I3 in its sole discretion.

Over-Subscription Privilege

         The  Over-Subscription  Privilege  may allow you to acquire  more Units
than the number  issuable  upon the exercise of the Rights  initially  issued to
you. By exercising the Over-Subscription  Privilege,  you may purchase any Units
that are left over by shareholders who fail to exercise their Rights.

         The Over-Subscription Privilege may only be exercised by Rights holders
who were shareholders on the record date and who exercise all of the rights they
received  from  I3.  Shareholders  such  as  broker-dealers,  banks,  and  other
professional  intermediaries  who hold I3 securities  on behalf of clients,  may
participate  in the  Over-Subscription  Privilege  for the  client if the client
fully exercises all Rights attributable to him.

         If you are eligible to exercise the Over-Subscription Privilege and you
wish to do so, you should  indicate on your  Subscription  Certificate  how many
Units you are willing to acquire  through the  Over-Subscription  Privilege.  If
sufficient common shares remain unsold, all  over-subscriptions  will be honored
in full.

         If you were a  shareholder  on the record date and you wish to exercise
the  Over-Subscription  Privilege through The Depository Trust Corporation,  you
must properly  execute and deliver to the  Subscription  Agent a DTC Participant
Over-Subscription  Form, together with payment of the Subscription Price for the
number  of  Units  that  you  wish to  purchase  through  the  Over-Subscription
Privilege. Copies of the DTC Participant Over-Subscription Form and payment must
be received  by the  Subscription  Agent at or prior to 5:00 p.m.  New York City
time on the Expiration Date.

         If you are eligible to exercise the Over-Subscription  Privilege but do
not deliver full payment of the Subscription  Price for the number of Units that
you indicate you are  subscribing for through the  Over-Subscription  Privilege,
then you will be deemed to have  exercised  the  Over-Subscription  Privilege to
purchase  the  maximum  number  of  Units   determined  by  dividing  the  total
Subscription  Price paid (in excess of the Subscription  Price for the number of
Units  you  purchased   through  the  full  exercise  of  your  Rights)  by  the
Subscription Price per Unit.

         If  subscriptions  for Units  through the  Over-Subscription  Privilege
exceed the initial  38,229,157 Units being offered by I3 through the exercise of
the  Rights,  I3 may issue up to  14,500,000  additional  Units to fill all or a
portion of the  over-subscriptions.  The  issuance of  additional  Units to fill
over-subscriptions  may  dilute  the  percentage  ownership  interests  of other
shareholders.

         I3 will not be obligated to issue any Units to fill over-subscriptions,
but we may do so in our sole and  absolute  discretion.  We reserve the right to
limit the number of Units  issued to fill an  over-subscription  from any single
shareholder  or from  shareholders  that are known or believed by us to be under
common control or acting as a group for the purpose of acquiring Units.


                                       15
<PAGE>

         Subject to the right of I3 to limit the number of Units issuable to any
shareholder,  if the Rights offer is over-subscribed so that  over-subscriptions
cannot be filled in full, the available  Units will be allocated among those who
over-subscribe  based on the number of Rights originally issued to them, so that
the  number of Units  issued  to  shareholders  who  subscribe  pursuant  to the
Over-Subscription  Privilege  will  generally be in  proportion to the number of
shares of common  stock  owned by them on the record  date.  The  percentage  of
available Units each over-subscribing  shareholder may acquire may be rounded up
or down to result in delivery of whole Units. The allocation process may involve
a series  of  allocations  in order to  assure  that the  total  number of Units
available for  over-subscriptions  is distributed on a prorata basis. If you are
not  allocated  the full amount of Units that you  subscribe for pursuant to the
Over-Subscription Privilege, you will receive a refund of the Subscription Price
you paid for Units that are not  allocated  to and  purchased by you. The refund
will be made by a check mailed by the Subscription Agent.

Payment for Units

         If you wish to exercise your Rights or to acquire Units pursuant to the
Over-Subscription  Privilege,  you may choose  between the following  methods of
payment:

         1.     You may send the Subscription  Certificate together with payment
(which may take the form of a written election on the  Subscription  Certificate
indicating  your  desire  to  cancel  I3 debt  owed to you in  exchange  for the
issuance  of Units)  for the Units  acquired  on  primary  subscription  and any
additional  Units that the you desire to acquire  through the Over  Subscription
Privilege to the Subscription Agent. A subscription will be deemed accepted when
payment,   together  with  a  properly   completed  and  executed   Subscription
Certificate,  is received by the Subscription  Agent.  Such payment and properly
executed Subscription  Certificate must be received by the Subscription Agent no
later  than  5:00  p.m.,  New  York  City  time  on  the  Expiration  Date.  The
Subscription  Agent will  deposit all checks  received by it for the purchase of
Units into a segregated  interest  bearing  account of I3 (the interest of which
will  belong to I3)  pending  pro ration and  distribution  of the Units.  To be
accepted,  a payment  pursuant to this  method must be in U.S.  dollars by money
order or check drawn on a bank located in the United States,  must be payable to
International  Isotopes  Inc.,  and must  accompany  a  properly  completed  and
executed Subscription Certificate.

         2.     Alternatively,   a   subscription   will  be   accepted  by  the
Subscription Agent if, prior to 5:00 p.m., New York City time, on the Expiration
Date,  the  Subscription  Agent has received a Notice of Guaranteed  Delivery by
facsimile  (telecopy) or otherwise  from a bank,  trust  company,  or a New York
Stock  Exchange  member  guaranteeing  delivery  of  (i)  payment  of  the  full
Subscription Price for the Units subscribed for in the primary  subscription and
any additional Units subscribed for pursuant to the Over Subscription  Privilege
(which may take the form of a written election on the  Subscription  Certificate
indicating  your  desire  to  cancel  I3 debt  owed to you in  exchange  for the
issuance of Units),  and (ii) a properly  completed  and  executed  Subscription
Certificate.  The  Subscription  Agent  will not  honor a Notice  of  Guaranteed
Delivery unless a properly completed and executed  Subscription  Certificate and
full payment for the Units is received by the Subscription Agent by the close of
business on the third business day after the Expiration Date.

         You will not be allowed to  rescind a purchase  after the  Subscription
Agent has  received  your  payment  either  by means of a notice  of  guaranteed
delivery or a check.

         Nominees  who hold  common  stock for the  account of  others,  such as
brokers,  trustees or depositories for securities,  should notify the respective
beneficial  owners of such common  stock as soon as possible to  ascertain  such
beneficial owners and to obtain  instructions with respect to the Rights. If the
beneficial  owner so instructs,  the nominee  should  complete the  Subscription
Certificate and submit it to the Subscription Agent with the proper payment.  In
addition,  beneficial  owners of common stock held through such a nominee should
contact  the nominee  and  request  the  nominee to effect the  transactions  in
accordance with the beneficial owner's instructions.

No Transferability of Rights

         The  Rights  evidenced  by  a  Subscription   Certificate  may  not  be
transferred and will not be listed for trading in the over the counter market or
on any securities exchange.


                                       16
<PAGE>

Amendment, Extension or Termination of the Offer

         The Company reserves the right, in its sole discretion to:

         (a)    terminate  the Rights  offer  prior to delivery of the Units for
which Rights holders have  subscribed  pursuant to the exercise of Rights in the
primary subscription or the Over Subscription Privilege;

         (b)    extend the Expiration Date to a later date;

         (c)    change the record  date prior to  distribution  of the Rights to
shareholders; or

         (d)    amend or modify the terms of the Rights  offer.  If the  Company
amends the terms of the Rights offer, an amended  Prospectus will be distributed
to holders  of record of Rights  and to  holders  of Rights who have  previously
exercised Rights.  All holders of Rights who exercise their Rights prior to such
amendment  or within  four  business  days  after  the  mailing  of the  amended
Prospectus will be given the opportunity to confirm the exercise of their Rights
by executing and delivering a consent form.

         Any Rights holder who exercised Rights before or within four days after
mailing of an amended  Prospectus  relating to an  amendment of the Rights offer
and fails to deliver, in a proper and timely manner, a properly executed consent
form will be deemed to have  rejected the amended  terms of the Rights offer and
have  elected  to  revoke  in full  his  exercise  of the  Rights  and the  Over
Subscription  Privilege.  If a Rights holder's  exercise of Rights is so revoked
the full amount of the  Subscription  Price paid by such Right's  holder will be
returned to the Right's holder.

         A Rights holder whose executed Subscription  Certificate is received by
the  Subscription  Agent  more than four days  after the  mailing  of an amended
Prospectus  will be deemed to have  accepted  any  amended  terms of the  Rights
offering in connection with the exercise of his Rights and the Over Subscription
Privilege.

         If the Company  elects to terminate the Rights offer before  delivering
the Units for which Rights holders have subscribed,  the Subscription Price paid
will be returned by mail.  Except for the obligation to return the  Subscription
Price paid by Right's  holders who attempted to exercise  their Rights,  neither
the Company or the Subscription Agent will have any obligation or liability to a
Rights holder or purchaser of Rights in the event of an amendment or termination
of the Rights offer.

Delivery of Share Certificates and Warrants

         Certificates  representing  common  stock  and the  warrants  purchased
pursuant to the primary subscription will be delivered to the purchasers as soon
as practicable  after the  corresponding  Rights have been validly exercised and
full  payment for such common stock and  warrants  represented  by the Units has
been  received  and  cleared.  Certificates  representing  common  stock and the
warrants purchased pursuant to the Over Subscription Privilege will be delivered
to the purchaser as soon as practicable  after the Expiration Date and after all
allocations have been affected.  It is expected that such stock certificates and
warrant  certificates  will  be  available  for  delivery  three  business  days
following the Expiration Date.

Subscription Agent

         The  Subscription  Agent is American  Stock  Transfer & Trust  Company,
which  will  receive  for its  administrative,  processing,  invoice  and  other
services as subscription  agent, a fee estimated at $15,000,  and  reimbursement
for all  out-of-pocket  expenses  related to the Rights offer.  The Subscription
Agent is also the Company's  transfer  agent and registrar and will serve as the
Warrant  Agent  for  the   warrants.   Questions   regarding  the   Subscription
Certificates  should be directed to the American Stock Transfer & Trust Company,
59  Maiden  Lane,  Plaza  Entrance,   New  York,  New  York  10038   (telephone:
(800) 937-5449). Shareholders may consult their brokers or nominees.

What Happens to Unsubscribed Units

         To the extent that any  unsubscribed  Units remain as of the Expiration
Date, they will expire.


                                       17
<PAGE>


Certain Federal Income Tax Considerations Regarding the Rights Offering

         The following is a summary of certain income tax consequences to I3 and
shareholders  of I3  residing  in the United  States  resulting  from the Rights
Offering. The discussion set forth below is based upon the Internal Revenue Code
of 1986, as amended, the Treasury Regulations promulgated  thereunder,  judicial
authority and current administrative rulings and pronouncements, as currently in
effect.  I3 has not  requested a ruling from the Internal  Revenue  Service (the
"IRS")  with  respect  to the  federal  income  tax  consequences  of the Rights
Offering.  Accordingly, no assurance can be given that the tax consequences will
be as described  below.  Further,  the federal  income tax  consequences  to any
particular  shareholder  may be  affected by matters not  discussed  below.  For
example,  certain types of investors  (including  individuals who are not United
States citizens or residents, foreign corporations, life insurance companies and
tax exempt  organizations) may be subject to special rules not addressed herein.
There also may be state, local or foreign tax considerations  applicable to each
shareholder.  THE DISCUSSION SET FORTH BELOW IS INCLUDED FOR GENERAL INFORMATION
ONLY.  EACH  SHAREHOLDER  IS  URGED TO  CONSULT  HIS OWN TAX  ADVISOR  AS TO THE
CONSEQUENCES OF THE RIGHTS  OFFERING TO HIM UNDER FEDERAL AND APPLICABLE  STATE,
LOCAL AND FOREIGN TAX LAWS.

         Consequences of Rights  Offering.  The discussion of federal income tax
consequences  of the Rights  Offering set forth below assumes that the shares of
common stock owned by a shareholder and the shares issued pursuant to the Rights
Offering constitute capital assets in the hands of such shareholder.

         Subject to the assumptions and qualifications above, for federal income
tax purposes:

         1.     A  shareholder  should not  recognize  any gain or loss upon his
receipt of a Right.

         2.     If a shareholder  exercises a Right, the tax basis of such Right
in  the  hands  of  the  shareholder   will  be  determined  by  allocating  the
shareholder's  existing tax basis for his shares with respect to which the Right
was  distributed  ("Old  Shares")  between  his Old  Shares  and the  Right,  in
proportion to their relative fair market values on the date of distribution. If,
however,  the fair market value of the Rights distributed to the shareholder (on
the date of  distribution)  is less than 15% of the fair market value of his Old
Shares,  the tax  basis of each  Right  will be  deemed  to be zero  unless  the
shareholder  affirmatively  elects,  by attaching  an election  statement to his
federal  income tax  return for the year in which he  receives  his  Rights,  to
compute the tax basis of his Rights in accordance  with the preceding  sentence.
Once  made,  such an  election  is  irrevocable.  A Right will not be treated as
having any tax basis if it lapses and, therefore, the holder of an expired Right
will not recognize a loss for tax purposes.

         3.     If a shareholder  sells a Right,  the shareholder will generally
recognize capital gain or loss in an amount equal to the difference  between the
proceeds of the sale and the  shareholder's  tax basis for such Right. Such gain
or loss will be  long-term  capital  gain or loss if the  shareholder's  holding
period for such Right (which will include the  shareholder's  holding period for
his or her Old Shares) is more than one year on the date of sale. However, since
the Rights are  non-transferable,  this provision of the tax law is inapplicable
to the Rights.

         4.     No gain or loss will  generally be  recognized  by a shareholder
upon  the  purchase  of a share  pursuant  to the  exercise  of a Right  (or the
Over-Subscription  Privilege). The tax basis of the shares purchased pursuant to
the exercise of Rights (or the Over-Subscription Privilege) will be equal to the
sum of (a)  the  holder's  tax  basis  for  the  Rights  exercised,  and (b) the
Subscription  Price  paid for such  shares.  The  holding  period of the  shares
purchased  pursuant  to  the  exercise  of  Rights  (or  the   Over-Subscription
Privilege)  will commence on the date of exercise.  Upon the subsequent  sale of
such shares, the shareholder will generally recognize capital gain or loss in an
amount  equal  to the  difference  between  the  proceeds  of the  sale  and the
shareholder's  tax basis for such  shares.  Such gain or loss will be  long-term
capital gain or loss if the shareholder's holding period for such shares is more
than one year on the date of sale.

         5.     I3 will  generally  not  recognize any gain or loss upon (a) the
issuance  of  Rights,  (b) the  receipt of payment  for shares  pursuant  to the
exercise  of Rights  (or the  Over-Subscription  Privilege)  or (c) the lapse of
Rights.

Participation of Certain Shareholders

         Certain shareholders  of I3,  whom  together own  more  than 50% of the
Company's  outstanding  capital stock,  have recently  loaned I3 an aggregate of
$823,500.  Although there can be no assurance, the Company expects each of these
shareholders to exercise his or her Rights to purchase shares of I3 common stock
by canceling all or a portion of the principal  amount of I3 debt owed to him or
her in payment for Units.


                                       18
<PAGE>


                                 USE OF PROCEEDS

The net proceeds to the Company from the sale of 38,229,157 Units offered hereby
through  the  primary  Rights   offering  are  estimated  to  be   approximately
$1,146,875,  assuming  an  offering  price of $.03 per  Unit,  before  deducting
estimated  offering  expenses.  With the balance of the funds, we will invest in
new equipment and facilities  and reduce  short-term  debt and current  payables
related to production  equipment and supplies.  Additional capital equipment for
new product production lines is required for 2003 revenues. The balance of funds
will be used for operations and general corporate purposes.

Facilities and Equipment................................          $  800,000

Debt Reduction..........................................          $  115,000

Legal and Fees..........................................          $   55,000

Working Capital.........................................          $  176,875

Total...................................................          $1,146,875

The  amounts  and timing of the  Company's  actual  expenditures  will depend on
several  factors,  including the completion of equipment  modifications  and the
amount of cash  generated by the Company's  operations.  Pending such uses,  the
Company will invest the funds in  short-term  interest  bearing  accounts with a
financial institution.


                           PRICE RANGE OF COMMON STOCK
                               AND DIVIDEND POLICY

         The  Company's  Common Stock was quoted on the Nasdaq  SmallCap  Market
under the symbol  "INIS" from August 19, 1997,  to April 2, 2001,  at which time
I3's stock was delisted from Nasdaq for failure to maintain a per share price of
at least $1.00.  Since that time,  I3's common stock has been traded in the over
the counter  market in the "pink  sheets."  The table below sets forth,  for the
fiscal quarters indicated,  the high and low sale prices for the Common Stock as
reported by the Nasdaq SmallCap Market or the high and low closing bid prices as
reported in the pink sheets, as the case may be.

                                                     High          Low
                                                     -----        -----
Fiscal Year Ended December 31, 2001
First Quarter                                        $0.35        $0.09
Second Quarter                                       $0.13        $0.04
Third Quarter                                        $0.09        $0.03
Fourth Quarter                                       $0.05        $0.02

Fiscal Year Ended December 31, 2002
First Quarter                                        $0.15        $0.02
Second Quarter                                       $0.13        $0.05
Third Quarter                                        $0.09        $0.05
Fourth Quarter                                       $0.06        $0.03

Fiscal Year Ending December 31, 2003
First Quarter                                        $0.06        $0.04
Second Quarter (through 7/21/03)                     $0.06        $0.03




                                       19
<PAGE>


         On July 21, 2003, the last reported bid price for the Company's  Common
Stock as  reported  in the pink  sheets was $.03.  As of such  date,  there were
approximately  320 holders of record of the Company's Common Stock (although the
Company  believes  that the number of  beneficial  owners of its Common Stock is
substantially higher).

         We intend to retain any future  earnings for use in the business and do
not intend to pay cash  dividends  in the  foreseeable  future.  The  payment of
future  dividends,  if any, will be at the discretion of the Company's  Board of
Directors and will depend, among other things, upon future earnings, operations,
capital requirements,  restrictions in future financing agreements,  the general
financial condition of the Company and general business conditions.


                          DESCRIPTION OF CAPITAL STOCK

         The  authorized  capital stock of the Company  consists of  250,000,000
shares  of Common  Stock,  $.01 par value per  share,  and  5,000,000  shares of
preferred Stock, $.01 par value per share ("Preferred Stock"). As of the date of
this  Prospectus,  there  are  95,572,893  shares  of Common  Stock  issued  and
outstanding and held of record by approximately  320 stockholders and 850 issued
and outstanding shares of Series B Preferred Stock.

Common Stock

         The shares of Common Stock currently outstanding are, and the shares of
Common  Stock that will be  outstanding  upon the  consummation  of this  Rights
offering will be, validly issued, fully paid and non-assessable.  Each holder of
Common  Stock is  entitled  to one vote for each  share  owned of  record on all
matters  voted  upon  by  the  stockholders.  In  the  event  of a  liquidation,
dissolution  or  winding up of the  Company,  the  holders  of Common  Stock are
entitled  to share  equally and  ratably in the assets of the  Company,  if any,
remaining  after the payment of all debts and liabilities of the Company and the
liquidation  preference of any outstanding  Preferred  Stock. The holders of the
Common Stock have no preemptive rights or cumulative voting rights and there are
no redemption,  sinking fund or conversion  provisions  applicable to the Common
Stock.

         Holders of Common  Stock are entitled to receive  dividends  if, as and
when declared by the Board of Directors, out of funds legally available for such
purpose,  subject to the dividend and liquidation  rights of any Preferred Stock
that may be issued.

Preferred Stock

         Pursuant to the Company's Restated Articles of Incorporation, the Board
of Directors is authorized, without further action by the stockholders, to issue
up to 5,000,000 shares of Preferred Stock in one or more series and to establish
the  designations,   preferences,   qualifications,   privileges,   limitations,
restrictions, options, conversion rights and other special or relative rights of
any series of  Preferred  Stock so issued.  The  issuance of shares of Preferred
Stock could  materially  adversely  affect the voting  power and other rights of
holders of Common Stock.  Because the terms of the Preferred  Stock may be fixed
by the Board of Directors without  stockholder action, the Preferred Stock could
be issued  quickly with terms  designated  to defeat a proposed  takeover of the
Company,  or to make the removal of  management  or the directors of the Company
more  difficult.  The authority to issue  Preferred  Stock or rights to purchase
such stock  could be used to  discourage  a change in  control  of the  Company.
Management of the Company is not aware of any threatened  transactions to obtain
control  of the  Company,  and the  Board  has no  current  plans to  issue  any
additional shares of Preferred Stock.

Series B Preferred Stock

         The Series B Preferred Stock is redeemable at $1,000 per share in March
2022. The Series B Preferred  Stock does not accrue a dividend and has no voting
rights except in the case of certain major corporate actions.



                                       20
<PAGE>

Indemnification

         As  permitted  by the Texas  Business  Corporation  Act  ("TBCA"),  the
Company's  Restated  Articles of  Incorporation  provide  that the Company  will
indemnify its officers,  directors,  employees and agents to the fullest  extent
permitted  by the TBCA  against  actions  that may  arise  against  them in such
capacities and to advance expenses in connection with any such actions. The TBCA
provides that a corporation may indemnify a person who was, is, or is threatened
to be made a named  defendant  in a  proceeding  because such person is or was a
director if it is determined in accordance  with the provisions of the TBCA that
the person (i) conducted himself in good faith, (ii) reasonably believed, in the
case of conduct in his official  capacity as  director,  that his conduct was in
the  corporation's  best interests or, in other cases, that his conduct at least
was not  opposed  to the  corporation's  interests  and (iii) in the case of any
criminal  proceeding,  had no  reasonable  cause  to  believe  his  conduct  was
unlawful.  A director may not be  indemnified  with  respect to a proceeding  in
which  the  person  is found  liable  on the basis  that  personal  benefit  was
improperly  received by him,  whether or not the benefit resulted from an action
taken in the person's official capacity,  or in which the person is found liable
to the corporation. Officers, employees and agents of a corporation are entitled
to be indemnified by the  corporation  as, and to the same extent  provided for,
directors of the  corporation.  The Company  carries  directors'  and  officers'
liability insurance with an aggregate policy limit of $2,000,000.

Warrants

         The  warrants to be issued as part of the Units will entitle the holder
thereof to purchase  two  additional  shares of Common Stock for each Unit held.
Each Unit includes one Series A Warrant with an exercise price of $.04 per share
and one Series B Warrant  exercisable  at $.05 per share.  The warrants are only
exercisable on or prior to July 31, 2007.  The warrants  confer no voting rights
until  exercised  for  Common  Stock.  The  Company  has the right to redeem the
warrants  and  repurchase  them for $.001 per  Warrant  Share  (the  "Redemption
Price") if the average closing price of I3's common stock equals or exceeds $.12
per share with  respect to Series A Warrants  and $.15 per share with respect to
Series B Warrants for any 20 consecutive  business day period.  Warrant  holders
will be given a  minimum  of 30 days  written  notice  of the date on which  the
Warrants will be redeemed. Holders of Warrants may exercise their Warrants up to
the day before the Redemption  Date, but thereafter  their Warrant  Certificates
will only be exchangeable  for the Redemption  Price. The warrants are evidenced
by Warrant  Certificates  that contain  certain of the terms  applicable  to the
warrants,  but are  also  subject  to the  terms  and  conditions  of a  Warrant
Agreement  between the Company  and the  Warrant  Agent.  A copy of the Series A
Warrant Agreement appears as Exhibit D to this Prospectus and a copy of the form
of Series A Warrant  Certificate  is included as Exhibit E. The Series B Warrant
Agreement and Series B Warrant  Certificate are identical  except for the amount
of the Warrant Exercise Price and the Company Call Price.


Trading Market, Transfer Agent and Registrar

         The Common  Stock is traded in the over the counter  market in the pink
sheets under the symbol "INIS."  American  Stock  Transfer & Trust Company,  New
York, New York is the transfer agent and registrar for the Common Stock.

Anti-Takeover Measures

         As a Texas corporation, the Company is subject to the provisions of the
TBCA that became effective on September 1, 1997. In general,  the TBCA prohibits
a Texas "issuing  public  corporation"  (such as the Company) from engaging in a
"business  combination" with any shareholder who is a beneficial owner of 20% or
more of the  corporation's  outstanding  stock for a period of three years after
such  shareholder's  acquisition of a 20% ownership  interest,  unless:  (i) the
board  of  directors  of  the  corporation   approves  the  transaction  or  the
shareholder's  acquisition of shares prior to the acquisition or (ii) two-thirds
of the unaffiliated shareholders of the corporation approve the transaction at a
shareholders'   meeting.   The  TBCA  may  have  the  effect  of   inhibiting  a
non-negotiated  merger or other business combination  involving the Company. The
Company  is  subject  to the  terms of the  TBCA,  unless  its  shareholders  or
directors take action  electing not to be governed by its terms (which action is
not currently contemplated).


                                       21
<PAGE>

                                  LEGAL MATTERS

         The validity of the shares of Common Stock and Warrants  comprising the
Units offered by the Company hereby will be passed upon for the Company by Locke
Liddell & Sapp LLP.


                                     EXPERTS

         The  consolidated  balance  sheets of  International  Isotopes Inc. and
subsidiaries as of December 31, 2002, and 2001, and the consolidated  statements
of  operations,  stockholder  deficit,  and cash  flows for the years then ended
incorporated  by reference in this  prospectus,  have been  included in reliance
upon the  report of  Hansen,  Barnett & Maxwell,  independent  certified  public
accountants,  given on the authority of that firm as experts in  accounting  and
auditing.


                INCORPORATION OF CERTAIN INFORMATION BY REFERENCE

         I3's Form  10-KSB for the fiscal year ended  December  31,  2002,  Form
10-QSB for the three months ended March 31, 2003, and all other reports filed by
I3 pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as
amended,  since the end of the  fiscal  year  covered  by such Form  10-KSB  are
incorporated  into this prospectus by reference.  I3 will provide without charge
to  each  person,  including  any  beneficial  owner,  to whom a  prospectus  is
delivered,  upon  written  or  oral  request,  a  copy  of  any  and  all of the
information that has been  incorporated by reference but not delivered with this
prospectus.  Such  requests  may be  addressed  to the  Secretary  of I3 at 4137
Commerce Circle, Idaho Falls, Idaho 83401; Telephone: (208) 524-5300.

         I3 is  subject  to the  informational  requirements  of the  Securities
Exchange Act of 1934, as amended,  and in accordance  therewith files quarterly,
annual,  and current reports and proxy statements and other information with the
Securities and Exchange  Commission.  The public may read and copy any materials
I3 files with the Securities and Exchange  Commission at the Commission's Public
Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549. The public may
obtain  information on the operation of the Public Reference Room by calling the
Commission at  1-800-SEC-0330.  The  Commission  maintains an Internet site that
contains  reports,  proxy and  information  statements,  and  other  information
regarding issuers that file electronically  with the Commission.  The address of
such site is http://www.sec.gov.


                             ADDITIONAL INFORMATION

         The  Company has filed with the  Securities  and  Exchange  Commission,
Washington,  D.C.  20549,  a  Registration  Statement  on  Form  S-3  under  the
Securities  Act with respect to the Common Stock and  Warrants  offered  hereby.
This  Prospectus  does  not  contain  all of the  information  set  forth in the
Registration  Statement  and exhibits and  schedules  thereto,  certain parts of
which having been omitted in accordance  with the rules and  regulations  of the
Commission.  For further  information with respect to the Company and the Common
Stock,  reference  is made to the  Registration  Statement  and the exhibits and
schedules  thereto  which may be  inspected  and copied at the public  reference
facilities of the Commission at 450 Fifth Street, N.W., Washington,  D.C. 20549.
Copies of such material can be obtained from the  Commission's  Public Reference
Section at prescribed  rates. The Commission  maintains a Web site that contains
reports,  proxy  and  information  statements  and other  information  regarding
registrants  that  file  electronically  with  the  Commission  pursuant  to its
Electronic Data Gathering  Analysis and Retrieval  ("EDGAR") system. The address
of the Commission's  Web site is  http/www.sec.gov.  The Registration  Statement
including all exhibits thereto and amendments  thereof,  has been filed with the
Commission  through EDGAR.  Descriptions  contained in this prospectus as to the
contents  of  any  contract  or  other  documents  filed  as an  exhibit  to the
Registration Statement are not necessarily complete and each such description is
qualified by reference to such contract or document.


                                       22
<PAGE>



                                    EXHIBIT A

                        Form of Subscription Certificate











                                       A-1
<PAGE>

<TABLE>
<S><C>

 CERTIFICATE NUMBER                           INTERNATIONAL ISOTOPES INC.                            NUMBER OF RIGHTS
 ------------------                                                                                --------------------
                                          SUBSCRIPTION CERTIFICATE FOR RIGHTS

                                     SUBSCRIPTION CERTIFICATE FOR UNITS VOID IF NOT        SUBSCRIPTION PRICE U.S. $.03 PER UNIT
                                       EXERCISED AT OR BEFORE 5:00 P.M. (NEW YORK
                                      TIME) ON SEPTEMBER 12, 2003, THE EXPIRATION
                                       DATE. THIS SUBSCRIPTION CERTIFICATE IS NOT
                                                     TRANSFERABLE.

EXPIRATION DATE: September 12, 2003

THIS  SUBSCRIPTION   CERTIFICATE
MAY BE  USED  TO  SUBSCRIBE  FOR
UNITS. FULL INSTRUCTIONS  APPEAR
ON THE BACK OF THIS SUBSCRIPTION
CERTIFICATE.

REGISTERED OWNER:

The  registered  owner  of  this
Subscription Certificate,  named
above is  entitled to the number
of Rights to subscribe for Units
(each Unit consisting of (i) one
share of common stock, par value
$.01 per share,  (ii) one Series
A   Warrant   to   purchase   an
additional  share  at  $.04  per
share,  and (iii)  one  Series B
Warrant  to   purchase   another
share  at  $.05  per  share)  of
International    Isotopes   Inc.
shown above, in the ratio of one
Unit for each 2.5  Rights  held,
and   upon   the    terms    and
conditions  and at the price for
each  Unit   specified   in  the
Prospectus dated July 24, 2003.

Date:  _______________, 2003                                                     IMPORTANT:  Complete appropriate form on reverse.

   INTERNATIONAL ISOTOPES INC.
                                                                                       -------------------------------------
                                                                                                     PRESIDENT
   ---------------------------
            SECRETARY
</TABLE>



                                                                 A-2
<PAGE>

<TABLE>
<S><C>


                                                                      Expiration Date:  September 12, 2003



                             PLEASE COMPLETE ALL APPLICABLE INFORMATION


          By Mail:                            By Hand:                      By Overnight Courier:
 To:  American Stock Transfer        To:  American Stock Transfer        To:  American Stock Transfer
 & Trust Company                     & Trust Company                     & Trust Company
 59 Maiden Lane, Plaza Entrance      59 Maiden Lane, Plaza Entrance      59 Maiden Lane, Plaza Entrance
 New York, New York  10038           New York, New York  10038           New York, New York  10038


TO SUBSCRIBE:  I hereby irrevocably  subscribe for the dollar amount of Units indicated as the total
of A and B below upon the terms and conditions  specified in the Prospectus related hereto,  receipt
of which is acknowledged.

      Please check |_| below:

| |   A.  Subscription:

                        / 2.5 =             .000  x         $.03          =  $
      ------------------       -----------------     --------------------    -----------------
      (Rights Exercised)       (Units Requested)     (Subscription Price)    (Amount Required)

| |   B.  Over-Subscription Privilege:*

                                            .000  x         $.03          =  $
                               -----------------     --------------------    -----------------
                               (Units Requested)     (Subscription Price)    (Amount Required)

      C.  Total Subscription Price:  (A + B)                              =  $
                                                                             -----------------
      D.  Method of Payment (Check and Complete Appropriate Box(es)):

| |   Check in the amount of $_________ payable to Subscription Agent.
| |   Certified Check, bank draft or money order in the amount of $_________ payable to Subscription
      Agent.
| |   Wire transfer in the amount of $_________ directed to American Stock Transfer & Trust Company,
      Subscription  Agent,  JP Morgan  Chase Bank  WIRE  CLEARING  ACCOUNT  ABA #021000021,  Account
      #323890121, Attention: Reorg. Dept.
| |   Cancellation of Debt in the principal amount of $__________ owed by I3 to the undersigned.

      E.  Notice of Guaranteed Delivery:

| |   CHECK HERE IF RIGHTS ARE  BEING EXERCISED  PURSUANT TO A NOTICE OF GUARANTEED  DELIVERY TO THE
      SUBSCRIPTION AGENT PRIOR TO THE EXPIRATION DATE AND COMPLETE THE FOLLOWING:

      Name(s) of Registered Owner(s)_________________________________________________________
      Window Ticket Number (if any)__________________________________________________________
      Date of Execution of Notice of Guaranteed Delivery_____________________________________
      Name of Eligible Institution which Guaranteed Delivery_________________________________
      Registered Owner(s) Telephone Number___________________________________________________


                                    SPECIAL DELIVERY INSTRUCTIONS

Unless otherwise  indicated below, the Subscription  Agent is hereby authorized to issue and deliver
stock  certificates  and warrants to the  undersigned  at the address  appearing on the face of this
Subscription Certificate.

| |   Check this box if stock  certificates and warrants  are to be issued in a name other than that
      of the Rights Holder.
</TABLE>


                                                 A-3
<PAGE>


                                    EXHIBIT B


                      Form of Notice of Guaranteed Delivery








                                      B-1

<PAGE>


                        NOTICE OF GUARANTEED DELIVERY OF
                           SUBSCRIPTION RIGHTS AND THE
                         SUBSCRIPTION PRICE FOR UNITS OF
                           INTERNATIONAL ISOTOPES INC.
                       SUBSCRIBED FOR IN THE RIGHTS OFFER

         As set forth in the  Prospectus  under "The Rights  Offer - Payment for
Units,"  this  form or one  substantially  equivalent  may be used as a means of
effecting  subscription and payment for all Units of International Isotopes Inc.
("I(3)")  subscribed for in the Rights offer. Such form may be delivered by hand
or sent by facsimile transmission, overnight courier or mail to the Subscription
Agent.

                           The Subscription Agent is:
                     American Stock Transfer & Trust Company

                              General Information
                                 (800) 937-5449

<TABLE>
<S><C>
                 By Mail:                                   By Facsimile:
 American Stock Transfer & Trust Company                   (718) 234-5001
     59 Maiden Lane, Plaza Entrance                     Confirm by Telephone
       New York, New York  10038                           (800) 937-5449

                By Hand:                                By Overnight Courier:
 American Stock Transfer & Trust Company       American Stock Transfer & Trust Company
     59 Maiden Lane, Plaza Entrance                59 Maiden Lane, Plaza Entrance
        New York, New York  10038                     New York, New York  10038

</TABLE>


                   DELIVERY OF THIS INSTRUMENT TO AN ADDRESS,
                       OR TRANSMISSION OF INSTRUCTIONS VIA
                  A TELECOPY OR FACSIMILE NUMBER, OTHER THAN AS
              SET FORTH ABOVE, DOES NOT CONSTITUTE A VALID DELIVERY

         The New York Stock Exchange  member firm or bank or trust company which
completes  this form must  communicate  the  guarantee  and the  number of Units
subscribed  for to the  Subscription  Agent  and must  deliver  this  Notice  of
Guaranteed  Delivery  guaranteeing  delivery  of (i)  payment  in  full  for all
subscribed   Units   (including   any   Units   subscribed   for   through   the
over-subscription   privilege)  and  (ii)  a  properly  completed  and  executed
Subscription  Certificate  (which  certificate  and full  payment  must  then be
delivered  by the  close  of  business  on the  third  business  day  after  the
expiration date) to the Subscription Agent prior to 5:00 p.m., New York time, on
the expiration date (September 12, 2003, unless extended). Failure to do so will
result in a forfeiture of the Rights.



                                       B-2
<PAGE>

                                    GUARANTEE

         The undersigned, a member firm of the New York Stock Exchange or a bank
or trust company,  guarantees delivery to the Subscription Agent by the close of
business  (5:00  p.m.,  New York  time) on the  third  business  day  after  the
expiration  date  (September  17,  2003,  unless  extended)  of  (A) a  properly
completed  and  executed  Subscription  Certificate  and (B) payment of the full
subscription  price of Units  subscribed for in the Rights offer  (including the
over-subscription  privilege,  if applicable) as subscription  for such Units as
indicated herein or in the Subscription Certificate.


-------------------------------------------    ---------------------------------
Number of Units subscribed for                 Number of Units subscribed for
(excluding the over-subscription privilege)    pursuant to the over-subscription
for which you are guaranteeing delivery        privilege for which you are
of Rights and payment                          guaranteeing delivery of Rights
                                               and payment

Number of Rights to be delivered:              _____________________________

Total subscription price payment
to be delivered:                               $_____________________________

Method of delivery [circle one]                A.  Through DTC
                                               B.  Direct to Corporation

         Please note that if you are guaranteeing for  over-subscription  Units,
and are a DTC  participant,  you must also execute and forward to American Stock
Transfer & Trust Company a Nominee Holder Over-Subscription Exercise Form.

 ------------------------------                -----------------------------
 Name of Firm                                  Authorized Signature

 ------------------------------                -----------------------------
 Address                                       Title

 ------------------------------                -----------------------------
 Zip Code                                      (Type or Print)

 ------------------------------                -----------------------------
 Name of Registered Holder (If Applicable)

 ------------------------------                -----------------------------
 Telephone Number                              Date

         IF THE RIGHTS ARE TO BE DELIVERED  THROUGH DTC, A REPRESENTATIVE OF THE
SUBSCRIPTION AGENT WILL PHONE YOU WITH A PROTECT  IDENTIFICATION  NUMBER,  WHICH
NEEDS TO BE COMMUNICATED BY YOU TO DTC.

         PLEASE NOTE THAT IF YOU ARE  GUARANTEEING FOR  OVER-SUBSCRIPTION  UNITS
AND ARE A DTC PARTICIPANT YOU MUST ALSO EXECUTE AND FORWARD TO THE  SUBSCRIPTION
AGENT A NOMINEE HOLDER OVER-SUBSCRIPTION EXERCISE FORM.



                                      B-3
<PAGE>


                                   EXHIBIT C


             Form of Nominee Holder Over Subscription Exercise Form









                                      C-1
<PAGE>


                           INTERNATIONAL ISOTOPES INC.
                                  RIGHTS OFFER
                 NOMINEE HOLDER OVER-SUBSCRIPTION EXERCISE FORM
                   PLEASE COMPLETE ALL APPLICABLE INFORMATION
<TABLE>
<S><C>

         By Mail:                         By Hand:                   By Overnight Courier:
To: American Stock Transfer      To: American Stock Transfer      To: American Stock Transfer
& Trust Company                  & Trust Company                  & Trust Company
59 Maiden Lane, Plaza Entrance   59 Maiden Lane, Plaza Entrance   59 Maiden Lane, Plaza Entrance
New York, New York  10038        New York, New York  10038        New York, New York  10038

</TABLE>

         THIS  FORM  IS  TO  BE  USED  BY  NOMINEE   HOLDERS  TO  EXERCISE   THE
OVER-SUBSCRIPTION  PRIVILEGE  IN  RESPECT  OF  RIGHTS  THAT WERE  EXERCISED  AND
DELIVERED THROUGH THE FACILITIES OF A COMMON DEPOSITORY.  ALL OTHER EXERCISES OF
OVER-SUBSCRIPTION   PRIVILEGES   MUST  BE  EFFECTED  BY  THE   DELIVERY  OF  THE
SUBSCRIPTION CERTIFICATES.

                               -------------------

         THE  TERMS  AND  CONDITIONS  OF THE  RIGHTS  OFFER  ARE  SET  FORTH  IN
INTERNATIONAL  ISOTOPES'  PROSPECTUS DATED: JULY 24, 2003 (THE "PROSPECTUS") AND
ARE  INCORPORATED  HEREIN BY REFERENCE.  COPIES OF THE  PROSPECTUS ARE AVAILABLE
UPON REQUEST FROM INTERNATIONAL ISOTOPES.

                               -------------------

         VOID UNLESS RECEIVED BY THE SUBSCRIPTION  AGENT WITH PAYMENT IN FULL BY
5:00  P.M.,  NEW  YORK  TIME,  ON  SEPTEMBER  12,  2003,   UNLESS   EXTENDED  BY
INTERNATIONAL ISOTOPES (THE "EXPIRATION DATE").


1.       The undersigned hereby certifies to the Subscription Agent that it is a
         participant   in   ___________________   [Name  of   Depository]   (the
         "Depository")  and that it has either (i)  exercised  all of the Rights
         and delivered such exercised Rights to the Subscription  Agent by means
         of transfer to the Depository  Account of International  Isotopes Inc.,
         or (ii)  delivered  to the  Subscription  Agent a Notice of  Guaranteed
         Delivery in respect of the  exercise of the Rights and will deliver the
         Rights  called  for  in  such  Notice  of  Guaranteed  Delivery  to the
         Subscription  Agent by means of transfer to such Depository  Account of
         International Isotopes Inc.

2.       The undersigned  hereby  exercises the  over-subscription  privilege to
         purchase,  to  the  extent  available,   Units  and  certifies  to  the
         Subscription  Agent  that  such  over-subscription  privilege  is being
         exercised for the account or accounts of persons (which may include the
         undersigned) on whose behalf all Rights have been exercised. (*)

3.       The undersigned  understands that payment of the subscription  price of
         $.03 per Unit for each Unit (each Unit  consists of one share of common
         stock and two warrants to purchase an additional two shares) subscribed
         for pursuant to the over-subscription privilege must be received by the
         Subscription  Agent at or  before  5:00  p.m.,  New York  time,  on the
         Expiration  Date,  and represents  that such payment,  in the aggregate
         amount of $___________ either (check appropriate box):

         | |    has  been  or is  being  delivered  to  the  Subscription  Agent
                pursuant to the Notice of Guaranteed  Delivery referred to above
                or;

         | |    is being delivered to the Subscription Agent herewith; or

         | |    has been delivered separately to the Subscription Agent;



                                      C-2
<PAGE>

                and, in the case of funds not delivered  pursuant to a Notice of
                Guaranteed Delivery, is or was delivered in the manner set forth
                below (check appropriate box and complete  information  relating
                thereto):

         | |    uncertified check

         | |    certified check

         | |    bank draft

         | |    money order

         | |    cancellation of debt


 ________________________________________       ________________________________
 Depository Subscription Confirmation           Name of Nominee Holder
 Number

 ________________________________________       ________________________________
 Depository Participant Number                  Address

 Contact Name ___________________________       ________________________________
                                                City        State       Zip Code

 Phone Number____________________________       By:_____________________________


 Dated:___________________, 2003                Name:___________________________


                                                Title:__________________________


*        PLEASE COMPLETE THE BENEFICIAL  OWNER  CERTIFICATION ON THE BACK HEREOF
         CONTAINING  THE RECORD  DATE  POSITION OF RIGHTS  OWNED,  THE NUMBER OF
         UNITS SUBSCRIBED FOR (OTHER THAN  OVER-SUBSCRIPTIONS) AND THE NUMBER OF
         OVER-SUBSCRIPTION UNITS, IF APPLICABLE, REQUESTED BY EACH SUCH OWNER.




                                      C-3
<PAGE>

                           INTERNATIONAL ISOTOPES INC.
                         BENEFICIAL OWNER CERTIFICATION


         The  undersigned,  a bank,  broker  or other  nominee  holder of Rights
("Rights")  to  purchase  Units (one share of common  stock plus one  warrant to
purchase an additional share) ("Units") of International  Isotopes Inc. ("I(3)")
pursuant to the Rights offer  described  and  provided for in I(3)'s  Prospectus
dated July 24, 2003 (the "Prospectus")  hereby certifies to I(3) and to American
Stock Transfer & Trust  Company,  as  Subscription  Agent for such Rights offer,
that for each numbered line filled in below the  undersigned  has exercised,  on
behalf of the  beneficial  owner  thereof  (which may be the  undersigned),  the
number of Rights  specified on such line,  and such  beneficial  owner wishes to
subscribe for the purchase of additional Units pursuant to the over-subscription
privilege (as defined in the  Prospectus),  in the amount set forth in the third
column of such line:

                                                      Number of Units Requested
                                                           Pursuant to the
     Record Date Shares  Number of Rights Exercised  Over-Subscription Privilege
     ------------------  --------------------------  ---------------------------
1.
     ------------------  --------------------------  ---------------------------
2.
     ------------------  --------------------------  ---------------------------
3.
     ------------------  --------------------------  ---------------------------
4.
     ------------------  --------------------------  ---------------------------
5.
     ------------------  --------------------------  ---------------------------
6.
     ------------------  --------------------------  ---------------------------
7.
     ------------------  --------------------------  ---------------------------
8.
     ------------------  --------------------------  ---------------------------
9.
     ------------------  --------------------------  ---------------------------
10.
     ------------------  --------------------------  ---------------------------


 ------------------------------                  -------------------------------
 Name of Nominee Holder                          Depository Participant Number


 ------------------------------                  -------------------------------
 Name:                                           Depository Primary Subscription
 Title:                                          Confirmation Number(s)

 Dated: ___________, 2003




                                      C-4
<PAGE>


                                    EXHIBIT D


                            Form of Warrant Agreement










                                      D-1

<PAGE>

                           SERIES A WARRANT AGREEMENT


         AGREEMENT,  dated as  of this 15th day of July,  2003,  by and  between
INTERNATIONAL  ISOTOPES INC., a Texas  corporation  (the "Company") and AMERICAN
STOCK TRANSFER & TRUST COMPANY, as warrant agent (the "Warrant Agent").

         WHEREAS,  in  connection  with a Rights  Offering by the Company to its
existing  shareholders  the Company is offering  Rights to purchase Units of its
securities  consisting of (i) one share of Common Stock at $.03 per share,  (ii)
one warrant to purchase an  additional  share of Common  Stock at $.04 per share
(the "Series A  Warrants"),  and (iii) one warrant to purchase  another share of
Common Stock for $.05 per share (the "Series B Warrants");

         WHEREAS,  the Company desires the Warrant Agent to act on behalf of the
Company,  and the  Warrant  Agent is willing to so act, in  connection  with the
issuance,  registration,  transfer,  and exchange of the Series A Warrants,  the
issuance of certificates representing the Series A Warrants, the exercise of the
Series A Warrants, and the rights of the Registered Holders thereof;

         NOW  THEREFORE,  in  consideration  of  the  premises  and  the  mutual
agreements  hereinafter  set forth and for the purpose of defining the terms and
provisions of the Series A Warrants and the certificates representing the Series
A Warrants and the respective rights and obligations  thereunder of the Company,
the Registered  Holders of certificates  representing  the Series A Warrants and
the Warrant Agent, the parties hereto agree as follows:

         1.     Definitions.  As used herein, the following terms shall have the
following meanings, unless the context shall otherwise require:

                (a)   "Common Stock" shall mean the Common Stock of the Company,
         par value of $.01 per share.

                (b)   "Corporate  Office"  shall mean the office of the  Warrant
         Agent (or its successor) at which at any particular  time its principal
         business shall be administered,  which office is located as of the date
         hereof at 59 Maiden Lane, Plaza Entrance, New York, New York 10038.

                (c)   "Depository"  shall mean the  Depository  Trust Company or
         other  securities  depository  serving  the  purpose  of  a  book-entry
         registration and transfer system.

                (d)   "Exercise  Price" shall mean the purchase price to be paid
         upon  exercise of each  Warrant in  accordance  with the terms  hereof,
         which price shall be $.04 per share, subject to adjustment from time to
         time pursuant to the provisions of Section 6 hereof.

                (e)   "Registered  Holder"  shall  mean the person in whose name
         any certificate  representing Warrants shall be registered on the books
         maintained by the Warrant Agent pursuant to Section 7.

                (f)   "Redemption Price" shall mean $.001 per Warrant Share.

                (g)   "Transfer  Agent"  shall mean  American  Stock  Transfer &
         Trust  Company,  as the Company's  transfer  agent,  or its  authorized
         successor, as such.

                (h)   "Warrant   Shares"  shall  mean  shares  of  Common  Stock
         issuable upon exercise of Warrants.

                (i)   "Warrants" or "Series A Warrants"  shall mean the Series A
         Warrants  issued to  Registered  Holders  pursuant to the terms of this
         Series A Warrant Agreement.


                                       D-2
<PAGE>

         2.     Warrants and Issuance of Warrant Certificates.

                (a)   A Warrant shall initially entitle the Registered Holder of
         the Warrant Certificate representing such Warrant to purchase one share
         of Common Stock upon the exercise thereof, in accordance with the terms
         hereof,  subject to modification  and adjustment as provided in Section
         6.

                (b)   From time to time, up to the Warrant  Expiration Date, the
         Transfer Agent shall execute and deliver stock certificates in required
         whole  number   denominations   representing  up  to  an  aggregate  of
         38,229,157  shares of Common Stock,  subject to adjustment as described
         herein,   upon  the  exercise  of  Warrants  in  accordance  with  this
         Agreement.

                (c)   From time to time, up to the Warrant  Expiration Date, the
         Warrant  Agent  shall  execute  and  deliver  Warrant  Certificates  in
         required whole number  denominations to the persons entitled thereto in
         connection   with  any  transfer  or  exchange   permitted  under  this
         Agreement; provided that no Warrant Certificates shall be issued except
         (i) those  initially  issued  hereunder,  (ii)  those  issued  upon the
         exercise  of  fewer  than  all  Warrants  represented  by  any  Warrant
         Certificate,   to  evidence  any  unexercised   Warrants  held  by  the
         exercising  Registered Holder,  (iii) those issued upon any transfer or
         exchange  pursuant to Section 7; (iv) those  issued in  replacement  of
         lost, stolen,  destroyed or mutilated Warrant Certificates  pursuant to
         Section 8; and (v) at the option of the Company, in such form as may be
         approved by its Board of  Directors,  to reflect (a) any  adjustment or
         change in the  Exercise  Price or the number of shares of Common  Stock
         purchasable  upon exercise of the Warrants,  made pursuant to Section 6
         hereof  and (b)  other  modifications  approved  by  Warrantholders  in
         accordance with Section 13.4 hereof.

         3.     Form and Execution of Warrant Certificates.

                (a)   The Warrant  Certificates  shall be  substantially  in the
         form annexed  hereto as Exhibit A (the  provisions  of which are hereby
         incorporated herein) and may have such letters,  numbers or other marks
         of  identification  or  designation  and  such  legends,  summaries  or
         endorsements  printed,  lithographed,  engraved or typed thereon as the
         Company  may  deem  appropriate  and as are not  inconsistent  with the
         provisions of this Agreement,  or as may be required to comply with any
         law or with any rule or regulation  made  pursuant  thereto or with any
         rule or regulation  of any stock  exchange on which the Warrants may be
         listed, or to conform to usage. The Warrant Certificates shall be dated
         the date of issuance thereof (whether upon initial issuance,  transfer,
         exchange or in lieu of mutilated,  lost,  stolen,  or destroyed Warrant
         Certificates) and issued in registered form. Warrants shall be numbered
         serially with the letters AW.

                (b)   Warrant  Certificates  shall be  executed on behalf of the
         Company by its Chairman of the Board,  President or any Vice  President
         and by its Secretary or an Assistant Secretary, by manual signatures or
         by facsimile  signatures  printed  thereon.  In case any officer of the
         Company  who shall have signed any of the  Warrant  Certificates  shall
         cease to be such officer of the Company  before the date of issuance of
         the Warrant  Certificates and issue and delivery thereof,  such Warrant
         Certificates  may  nevertheless  be issued and delivered  with the same
         force  and  effect  as  though  the  person  who  signed  such  Warrant
         Certificates  had not ceased to be such officer of the  Company.  After
         execution by the Company,  Warrant  Certificates  shall be delivered by
         the Warrant Agent to the Registered Holder.


                                       D-3
<PAGE>

         4.     Cash Exercise and Redemption

         4.1    Optional Exercise

         Warrants may be exercised  by a  Registered  Holder,  at any time until
July 31,  2007  (the  "Warrant  Expiration  Date"),  in  whole  or in  part,  by
delivering to the Warrant Agent at 59 Maiden Lane, Plaza Entrance, New York, New
York  10038 (or such  other  office or  agency  of the  Warrant  Agent as it may
designate  by notice in writing to the  Registered  Holder at the address of the
Registered  Holder  appearing on the books of the Warrant  Agent) (a) either (i)
such Warrants by book-entry transfer through the facilities of the Depository or
(ii) the Warrant  Certificates  evidencing the Warrants if Warrant  Certificates
have been issued to the Registered  Holder,  (b) a certified or cashier's  check
payable to the Company or a wire  transfer in the amount of the  Exercise  Price
multiplied by the number of shares for which the Warrant is being exercised (the
"Purchase  Price"),  and (c)  written  notice  of  such  election  to  exercise,
designated  "International  Isotopes  Inc.  Warrant  Exercise,"  by  hand  or by
facsimile,  which notice shall be in the form of an election to purchase  shares
of  Common  Stock of the  Company  substantially  in the  form set  forth on the
reverse side of the Warrant Certificate,  properly completed and executed by the
Registered  Holder.  The Warrant Agent shall forward to the Company the Purchase
Price received as a result of any exercise of Warrants by wire transfer within 2
business days.

         4.2    Redemption

                (a)   Provided that adequate  provision has been made  therefor,
         upon the  resolution  of its Board of  Directors , the Company may, but
         shall not be required to, call for redemption at a redemption  price of
         $.001 per Warrant Share (the "Redemption Price") all of the Warrants at
         any  time,  provided:  (i) it  provides  to each  Registered  Holder of
         Warrants to be  redeemed a minimum of thirty  (30) days' prior  written
         notice,  and (ii) if the  average  closing  price  or bid  price of the
         Common Stock, as reported by the principal exchange on which the Common
         Stock is traded, the NASDAQ Stock Market,  Inc., the OTC Bulletin Board
         or the Pink Sheet LLC, as the case may be,  equals or exceeds  $.12 for
         twenty (20)  consecutive  trading days ending  within 180 days prior to
         the date of issuance of the notice of redemption. In such an event, the
         Company shall cause to be filed with the Warrant Agent a certified copy
         of such  resolution  and a form of notice of redemption and the Warrant
         Agent  shall  mail to each of the  Registered  Holders  of the  Warrant
         Certificates to be redeemed,  by first class mail, postage prepaid,  to
         his last address  appearing on the records of the Warrant  Agent,  such
         written  notice of such  redemption.  Such notice  shall  identify  the
         Warrants  to be  redeemed,  state  the  date  set for  redemption  (the
         "Redemption  Date"),  the Redemption Price, and the date upon which the
         Registered Holder's right to exercise the Warrants will terminate,  and
         describe  the  manner  in  which   Warrant   Certificates   are  to  be
         surrendered.  Any notice mailed in the manner  provided herein shall be
         conclusively  presumed  to have  been  duly  given  whether  or not the
         Registered  Holder receives such notice.  Failure to mail notice to any
         Registered  Holder,   shall  not  affect  the  validity  of  any  other
         redemptions for which notice had been duly provided,  only  redemptions
         of persons lacking notice.

                (b)   On or before the Redemption  Date, each Registered  Holder
         of Warrants to be redeemed,  unless he has previously exercised or will
         exercise  such  Warrants  on  or  before  the  Redemption  Date,  shall
         surrender the Warrant  Certificate or  Certificates  representing  such
         Warrants to the Warrant  Agent.  The  Warrants to be redeemed  shall be
         exercisable  up to and  including  the date  immediately  preceding the
         Redemption Date. Upon receipt of such Warrant Certificates, the Warrant
         Agent,  as  paying  agent,  shall  pay the  Redemption  Price  for such
         Warrants to the order of the Registered  Holders thereof.  Any Warrants
         to redeemed will be canceled by the Warrant  Agent upon receipt.  After
         the  Redemption  Date,  all rights with respect to such Warrants  shall
         cease,  except for the right to  receive  the  Redemption  Price of the
         Warrants.


                (c)   Upon or prior to the  Redemption  Date,  the Company shall
         deposit in trust with the Warrant  Agent a sum equal to the  Redemption
         Price  of  all  Warrants  called  for  redemption,   with   irrevocable
         instructions  and  authority to the Warrant  Agent to pay, on and after
         the Redemption  Date, the  Redemption  Price to the Registered  Holders
         upon the  surrender  of the Warrant  Certificates.  The  deposit  shall
         constitute full payment of the Warrants to the Registered Holders,  and
         from and after the date of the deposit, the Warrants shall be deemed to
         be  no  longer  outstanding.  The  balance  of  the  deposit  remaining
         unclaimed  at the end of one year  from the  Redemption  Date  shall be
         released to the Company, after which the holders of Warrants called for
         redemption shall be entitled to receive payment of the Redemption Price
         only from the Company.



                                       D-4
<PAGE>

         5.     Delivery of Stock Certificates; No Fractional Shares

         5.1    Within ten (10)  business days after the payment of the Purchase
Price following the exercise by a Registered Holder of a Warrant (in whole or in
part), the Warrant Agent, at Company expense, shall issue or cause the Company's
stock  transfer  agent to issue in the  name of and  deliver  to the  Registered
Holder  (a) a  certificate  or  certificates  for the  number of fully  paid and
nonassessable  Warrant Shares to which the  Registered  Holder shall be entitled
upon such  exercise,  and (b) a new Warrant of like tenor to purchase up to that
number  of  Warrant  Shares,  if any,  as to  which  such  Warrant  has not been
exercised if such Warrant has not expired.  The Registered  Holder shall for all
purposes be deemed to have become the holder of record of such Warrant Shares on
the date such Warrant was exercised  (the date the  Registered  Holder has fully
complied  with the  requirements  of Section 4.1),  irrespective  of the date of
delivery of the  certificate or  certificates  representing  the Warrant Shares;
provided  that,  if the date  such  exercise  is made is a date  when the  stock
transfer  books of the Company are closed,  such person  shall be deemed to have
become the holder of record of such  Warrant  Shares at the close of business on
the next succeeding date on which the stock transfer books are open.

         5.2    No  fractional  shares  shall be issued upon the exercise of any
Warrant.  In lieu of fractional  shares,  the Company  shall pay the  Registered
Holder  a sum in cash  equal  to the  Daily  Price  (as  defined  below)  of the
fractional share on the date of exercise.

         "Daily Price" of a Warrant Share shall mean:

                      (a)   If the  Company's  Common Stock is listed and traded
         on an exchange or is quoted on the Nasdaq National Market,  the closing
         or last sale price on such day;

                      (b)   If the  Company's  Common Stock is not traded on and
         exchange or quoted on the Nasdaq National Market,  but is traded in the
         over-the-counter  market,  the  average  of the  closing  bid and asked
         prices reported on such day; and

                      (c)   If none of the above is applicable,  the Daily Price
         shall be the fair market  value of the Common  Stock as  determined  in
         good faith by the Company's Board of Directors.

         6.     Adjustments Upon Certain Events

         6.1    Effect of Reorganization

                (a)   Reorganization - No Change of Control

                Upon   a   merger,   consolidation,   acquisition   of   all  or
         substantially  all of the  property  or  stock,  liquidation  or  other
         reorganization of the Company (collectively, a "Reorganization") during
         the  Exercise  Period,  as a result  of which the  shareholders  of the
         Company  receive  cash,  stock or other  property in exchange for their
         shares of Common Stock and the holders of the  Company's  voting equity
         securities  immediately  prior  to the  Reorganization  together  own a
         majority  interest of the voting  equity  securities  of the  successor
         corporation  following such  Reorganization,  lawful provision shall be
         made so that the holder shall  thereafter be entitled to receive,  upon
         exercise of this  Warrant,  the number of shares of  securities  of the
         successor  corporation resulting from such Reorganization (and cash and
         other property),  to which a holder of the Warrant Shares issuable upon
         exercise of a Warrant would have been  entitled in such  Reorganization
         if  such  Warrant  had  been  exercised   immediately   prior  to  such
         Reorganization.  In any such case, appropriate adjustment (as determine
         in good faith by the Company's Board of Directors) shall be made in the
         application  of the  provisions  of the  Warrants  with  respect to the
         rights and interest of the Registered  Holders after the Reorganization
         to the end that the  provisions  of this Warrant  Agreement  (including
         adjustments of the Exercise Price and the number and type of securities
         purchasable  pursuant to the terms of this Warrant  Agreement) shall be
         applicable  after that event, as near as reasonably may be, in relation
         to any shares  deliverable  after that event upon the  exercise  of any
         Warrant.


                                       D-5
<PAGE>

                (b)   Reorganization - Change of Control; Termination of Warrant

                Upon a Reorganization prior to or during the Exercise Period, as
         a result of which the  shareholders of the Company receive cash,  stock
         or other  property in exchange for their shares of Common Stock and the
         holders of the Company's voting equity securities  immediately prior to
         such  Reorganization  together own less than a majority interest of the
         voting equity  securities of any successor  corporation  following such
         Reorganization, Registered Holders of Warrants shall be given notice at
         least ten (10) days prior to the effectiveness thereof. Notwithstanding
         any other  provision  hereof,  the Warrants  shall  become  immediately
         exercisable in full upon such notice to the Registered Holders, subject
         to the effectiveness of the  Reorganization,  provided,  however,  that
         such acceleration of  exercisability  will not occur if, in the opinion
         of the Company's outside  accountants,  such acceleration  would render
         unavailable  "pooling  of  interests"   accounting  treatment  for  any
         Reorganization for which pooling of interests  accounting  treatment is
         sought by the Company (in which event,  lawful  provision shall be made
         so that the Registered Holders shall thereafter be entitled to receive,
         upon exercise of their Warrants up to the Warrant  Expiration Date, the
         number of shares of securities of the successor  corporation  resulting
         from  such  Reorganization  (and cash and  other  property)  to which a
         Registered  Holder of the Warrant Stock  issuable upon exercise of such
         Warrants  would  have  been  entitled  in such  Reorganization  if such
         Warrant had been exercised  immediately prior to such  Reorganization).
         Each  Registered  Holder  shall have five (5) days from the  receipt of
         such  notice to give  notice  to the  Warrant  Agent,  on behalf of the
         Company,  whether it intends to conditionally  exercise his Warrant, in
         whole or in part.  Notwithstanding any other provision hereof, Warrants
         shall  become  forever  null and void to the extent  not  conditionally
         exercised  on or  before  5:00  p.m.,  Eastern  time,  on the fifth day
         following the receipt by the  Registered  Holders  thereof of notice of
         the proposed  Reorganization (unless the acceleration of exercisability
         is denied by the  Company in order to preserve  "pooling of  interests"
         accounting treatment as set forth above).

         6.2    Adjustments for Stock Splits, Dividends

         If the Company  shall issue any shares of the same class as the Warrant
Stock as a stock dividend or subdivide the number of  outstanding  shares of the
same class as the  Warrant  Shares  into a greater  number of shares,  then,  in
either  such  case,  the  Exercise  Price in  effect  before  such  dividend  or
subdivision shall be proportionately reduced and the number of Warrant Shares at
that  time  issuable   pursuant  to  the  exercise  of  the  Warrants  shall  be
proportionately  increased;  and, conversely,  if the Company shall contract the
number  of  outstanding  shares  of the same  class  as the  Warrant  Shares  by
combining such shares into a smaller  number of shares,  then the Exercise Price
in effect before such  combination  shall be  proportionately  increased and the
number of Warrant  Shares at that time  issuable  pursuant  to the  exercise  or
conversion of the Warrants shall be proportionately  decreased.  Each adjustment
in the number of Warrant Shares issuable shall be to the nearest whole share.

         6.3    Certificate as to Adjustments

         In the case of any  adjustment in the Exercise Price or number and type
of securities issuable upon exercise of the Warrants,  the Company will promptly
give written notice to the Registered  Holders  through the Warrant Agent in the
form of a  certificate,  certified  and  confirmed by an officer of the Company,
setting forth the adjustment in reasonable detail.

         7.     Exchange and Registration of Transfer.

                      (a)   Warrant  Certificates  may be  exchanged  for  other
         Warrant Certificates representing an equal aggregate number of Warrants
         of the same class or may be  transferred  in whole or in part.  Warrant
         Certificates  to be exchanged shall be surrendered to the Warrant Agent
         at its  Corporate  Office,  and upon  satisfaction  for the  terms  and
         provisions  hereof,  the Company shall  execute,  and the Warrant Agent
         shall  countersign,  issue and deliver in exchange therefor the Warrant
         Certificate  or  Certificates  which the  Registered  Holder making the
         exchange shall be entitled to receive.


                                       D-6
<PAGE>

                      (b)   The Warrant  Agent shall keep at its office books in
         which, subject to such reasonable  regulations as it may prescribe,  it
         shall  register  Warrant  Certificates  and  the  transfer  thereof  in
         accordance  with  its  regular  practice.   Upon  due  presentment  for
         registration of transfer of any Warrant  Certificate at its office, the
         Company  shall execute and the Warrant Agent shall issue and deliver to
         the transferee or transferees a new Warrant Certificate or Certificates
         representing an equal aggregate number of Warrants.

                      (c)   With respect to all Warrant  Certificates  presented
         for  registration  of  transfer,  or  for  exchange  or  exercise,  the
         subscription form on the reverse thereof shall be duly endorsed,  or be
         accompanied  by a written  instrument  or  instruments  of transfer and
         subscription, in form satisfactory to the Company, duly executed by the
         Registered Holder or his attorney-in-fact duly authorized in writing.

                      (d)   The Company may require  payment by such holder of a
         sum sufficient to cover any tax or other  governmental  charge that may
         be imposed in connection therewith.

                      (e)   All Warrant Certificates surrendered for exercise or
         for  exchange  in case  of  mutilated  Warrant  Certificates  shall  be
         promptly cancelled by the Warrant Agent and thereafter  retained by the
         Warrant Agent until termination of this Agreement or resignation of the
         Warrant Agent.

                      (f)   Prior  to  due  presentment   for   registration  of
         transfer thereof,  the Company and the Warrant Agent may deem and treat
         the Registered Holder of any Warrant  Certificate as the absolute owner
         thereof and of each Warrant  represented thereby  (notwithstanding  any
         notations of  ownership or writing  thereon made by anyone other than a
         duly  authorized  officer of the Company or the Warrant  Agent) for all
         purposes and shall not be affected by any notice to the contrary.

         8.     Lost or Damaged Warrant Certificate

         Upon receipt by the Warrant Agent of satisfactory evidence of the loss,
theft,  destruction  or damage of any  Warrant  and either (in the case of loss,
theft or destruction) reasonable  indemnification or (in the case of damage) the
surrender of such Warrant for  cancellation,  the Warrant Agent will execute and
deliver  to the  Registered  Holder,  without  charge,  a new  Warrant  of  like
denomination.

         9.     Covenants as to Warrant Shares

         9.1    Reservation of Shares

         The Company  covenants  that at all times  during the  Exercise  Period
there shall be reserved for issuance and delivery  upon exercise of the Warrants
such  number of  Warrant  Shares as is  necessary  for  exercise  in full of all
outstanding Warrants and, from time to time, it will take all steps necessary to
provide  sufficient  reserves  of Warrant  Shares.  All shares of Warrant  Stock
issued pursuant to the exercise of the Warrants will,  upon their  issuance,  be
validly issued,  fully paid and  nonassessable,  free and clear of all liens and
other  encumbrances or restrictions on sale and free and clear of all preemptive
rights,  except restrictions arising (a) under federal and state securities law,
(b) not by or through the Company,  or (c) by agreement  between the Company and
the Registered Holders or their successors.


                                       D-7
<PAGE>

         9.2    Registration of Warrant Shares

         The Company has  registered  the Warrants and the Warrant  Shares under
the Securities  Act of 1933 and Rule 415  thereunder  pursuant to a Registration
Statement  on Form S-3. In  connection  with such  Registration  Statement,  the
Company agrees to use its best efforts to:

                      (a)   prepare and file with the Commission such amendments
         and supplements to the Registration  Statement and the Prospectus filed
         as part thereof and take such other action, if any, as may be necessary
         to keep the Registration  Statement  effective until the earlier of (i)
         the  expiration,  cancellation  or repurchase of the Warrants,  or (ii)
         when all of the Warrants have been exercised by the Registered Holders;

                      (b)   during the period when the Registration Statement is
         required to remain  effective,  will file all documents  required to be
         filed  with the  Commission  pursuant  to  Section  13, 14 or 15 of the
         Exchange Act within the time periods  requiring by the Exchange Act and
         the rules and regulations promulgated thereunder; and

                      (c)   bear all expenses in connection  with the procedures
         in  paragraphs  (a)  and  (b) of this  Section  9.2  and the  continued
         registration  of  the  Warrant  Shares  pursuant  to  the  Registration
         Statement,  other  than any  fees  and  expenses  of  counsel  or other
         advisers to the Registered Holders.

         10.    Agreement of Warrant Holders

         Every  holder of a Warrant,  by his  acceptance  thereof,  consents and
agrees with the Company,  the Warrant  Agent and every other holder of a Warrant
that:

                      (a)   The Warrants are  transferable  only on the registry
         books of the Warrant Agent by the  Registered  Holder thereof in person
         or by his attorney  duly  authorized in writing and only if the Warrant
         Certificates  representing  such Warrants are surrendered at the office
         of  the  Warrant  Agent,  duly  endorsed  or  accompanied  by a  proper
         instrument  of  transfer  satisfactory  to the  Warrant  Agent  and the
         Company  in  their  sole  discretion,  together  with  payment  of  any
         applicable transfer taxes; and


                                       D-8
<PAGE>

                      (b)   The  Company  may deem and treat the person in whose
         name the Warrant  Certificate  is  registered  as the holder and as the
         absolute, true and lawful owner of the Warrants represented thereby for
         all  purposes,  and the Company  shall not be affected by any notice or
         knowledge to the contrary.

         11.    Cancellation of Warrant Certificates

         If the Company shall  purchase or acquire any Warrant or Warrants,  the
Warrant Certificate or Warrant Certificates  evidencing the same shall thereupon
be  cancelled  by it and retired.  The Warrant  Agent shall also cancel  Warrant
Certificates  following  exercise  of any or  all  of the  Warrants  represented
thereby or delivered to it for transfer, split-up, combination or exchange.

         12.    Concerning the Warrant Agent

         The Warrant Agent acts hereunder as agent and in a ministerial capacity
for the Company,  and its duties shall be  determined  solely by the  provisions
hereof.  The  Warrant  Agent  shall  not,  by  issuing  and  delivering  Warrant
Certificates or by any other act hereunder be deemed to make any representations
as to the validity,  value or authorization  of the Warrant  Certificates or the
Warrants  represented  thereby or of any securities or other property  delivered
upon  exercise of any Warrant or whether any stock  issued upon  exercise of any
Warrant is fully paid and nonassessable.

         The Warrant Agent shall account promptly to the Company with respect to
Warrants  exercised and concurrently pay the Company,  as provided in Section 4,
all moneys received by the Warrant Agent upon the exercise of such Warrants. The
Warrant Agent shall,  upon request of the Company from time to time,  deliver to
the Company such complete  reports of  registered  ownership of the Warrants and
such  complete  records of  transactions  with  respect to the  Warrants and the
shares of Common Stock as the Company may request.  The Warrant Agent shall also
make  available to the Company for  inspection by its agents or employees,  from
time to time as either of them may request,  such original books of accounts and
records  (including  original  Warrant  Certificates  surrendered to the Warrant
Agent upon  exercise of Warrants) as may be  maintained  by the Warrant Agent in
connection  with  the  issuance  and  exercise  of  Warrants   hereunder,   such
inspections to occur at the Warrant Agent's office during normal business hours.

         The  Warrant  Agent  shall  not  at any  time  be  under  any  duty  or
responsibility to any holder of Warrant Certificates to make or cause to be made
any adjustment of the Exercise Price provided in this Agreement, or to determine
whether any fact exists which may require any such adjustments,  or with respect
to the nature or extent of any such  adjustment,  when made,  or with respect to
the  method  employed  in making  the same.  It shall not (i) be liable  for any
recital or statement of facts contained herein or for any action taken, suffered
or omitted by it in  reliance on any Warrant  Certificate  or other  document or
instrument believed by it in good faith to be genuine and to have been signed or
presented by the proper party or parties, (ii) be responsible for any failure on
the part of the  Company to comply  with any of its  covenants  and  obligations
contained in this  Agreement or in any Warrant  Certificate,  or (iii) be liable
for any act or omission in  connection  with this  Agreement  except for its own
negligence or willful misconduct.

         The Warrant Agent may at any time consult with counsel  satisfactory to
it (who  may be  counsel  for the  Company)  and  shall  incur no  liability  or
responsibility for any action taken,  suffered or omitted by it in good faith in
accordance with the opinion or advice of such counsel.


                                       D-9
<PAGE>

         Any notice, statement, instruction, request, direction, order or demand
of the Company shall be  sufficiently  evidenced by an instrument  signed by the
Chairman  of the  Board,  President,  any  Vice  President,  its  Secretary,  or
Assistant  Secretary,  (unless  other  evidence  in  respect  thereof  is herein
specifically  prescribed).  The Warrant Agent shall not be liable for any action
taken,  suffered or omitted by it in  accordance  with such  notice,  statement,
instruction, request, direction, order or demand believed by it to be genuine.

         The Company agrees to pay the Warrant Agent reasonable compensation for
its  services  hereunder  and  to  reimburse  it  for  its  reasonable  expenses
hereunder; it further agrees to indemnify the Warrant Agent and save it harmless
against any and all losses, expenses and liabilities, including judgments, costs
and counsel  fees,  for  anything  done or omitted by the  Warrant  Agent in the
execution  of its  duties and  powers  hereunder  except  losses,  expenses  and
liabilities  arising as a result of the Warrant  Agent's  negligence  or willful
misconduct.

         The  Warrant  Agent may resign its  duties and be  discharged  from all
further duties and liabilities hereunder (except liabilities arising as a result
of the Warrant  Agent's own negligence or willful  misconduct),  after giving 30
days' prior  written  notice to the Company.  At least 15 days prior to the date
such resignation is to become effective, the Warrant Agent shall cause a copy of
such notice of resignation to be mailed to the Registered Holder of each Warrant
Certificate at the Company's expense. Upon such resignation, or any inability of
the Warrant  Agent to act as such  hereunder,  the Company  shall  appoint a new
Warrant  Agent in writing.  If the Company  shall fail to make such  appointment
within  a  period  of 15 days  after it has been  notified  in  writing  of such
resignation by the resigning  Warrant Agent,  then the Registered  Holder of any
Warrant  Certificate  may apply to any court of competent  jurisdiction  for the
appointment of a new Warrant Agent. Any new Warrant Agent,  whether appointed by
the Company or by such a court shall be a bank or trust company having a capital
and surplus,  as shown by its last published report to its stockholders,  of not
less than $10,000,000 or a stock transfer  company.  After acceptance in writing
of such  appointment  by the new Warrant Agent is received by the Company,  such
new  Warrant  Agent  shall be vested with the same  powers,  rights,  duties and
responsibilities as if it had been originally named herein as the Warrant Agent,
without any further assurance, conveyance, act or deed; but if for any reason it
shall be necessary  or  expedient to execute and deliver any further  assurance,
conveyance,  act or deed,  the same shall be done at the  expense of the Company
and shall be legally and validly executed and delivered by the resigning Warrant
Agent.  Not later than the effective  date of any such  appointment  the Company
shall file notice thereof with the resigning  Warrant Agent and shall  forthwith
cause a copy of such  notice  to be  mailed  to the  Registered  Holder  of each
Warrant Certificate.

         Any  corporation  into which the Warrant Agent or any new Warrant Agent
may be converted or merged or any corporation  resulting from any  consolidation
to which the  Warrant  Agent or any new  Warrant  Agent  shall be a party or any
corporation  succeeding  to the trust  business of the Warrant  Agent shall be a
successor  Warrant Agent under this Agreement  without any further act, provided
that such  corporation  is eligible for  appointment as successor to the Warrant
Agent  under the  provisions  of the  preceding  paragraph.  Any such  successor
Warrant Agent shall  promptly cause notice of its succession as Warrant Agent to
be  mailed  to  the  Company  and to  the  Registered  Holder  of  each  Warrant
Certificate.

         The Warrant Agent, its  subsidiaries and affiliates,  and any of its or
their  officers  or  directors,  may buy and  hold or  sell  Warrants  or  other
securities of the Company and otherwise deal with the Company in the same manner
and to the same  extent and with like  effects as though it were not the Warrant
Agent.  Nothing herein shall preclude the Warrant Agent from acting in any other
capacity for the Company or for any other legal entity.

         13.    Miscellaneous

         13.1   Registered Holder as Owner

         The Warrant Agent shall deem and treat the Registered  Holder of record
of any Warrant as the absolute  owner for all purposes  regardless of any notice
to the contrary.


                                      D-10
<PAGE>

         13.2   No Shareholder Rights

         The  Warrants  shall not entitle the  Registered  Holders to any voting
rights  or any other  rights as a  shareholder  of the  Company  or to any other
rights except the rights  stated  herein;  and no dividend or interest  shall be
payable or shall accrue in respect of the Warrant or the Warrant  Shares,  until
the Warrants are exercised.

         13.3   Notices

         Unless  otherwise  provided,  any notice under this  Warrant  Agreement
shall  be given in  writing  and  shall be  deemed  effectively  given  (a) upon
personal delivery to the party to be notified,  (b) upon confirmation of receipt
by fax by the party to be notified,  (c) two business  days after deposit with a
reputable overnight courier, prepaid for overnight delivery and addressed as set
forth in (d), or (d) five days after  deposit with the United States Post Office
or any foreign postal  service,  postage  prepaid,  registered or certified with
return  receipt  requested  and  addressed  to the party to be  notified  at the
address indicated below, or at such other address as such party may designate by
ten (10) days' advance  written notice to the other party given in the foregoing
manner.

          If to the Warrant Agent:   American Stock Transfer Company
                                     59 Maiden Lane, Plaza Entrance
                                     New York, New York  10038
                                     Attn: Wilbert Myles
                                     Telephone: (718) 921-8247
                                     Facsimile: (718) 921-8323

          If to the Company:         International Isotopes Inc.
                                     4132 Commerce Circle
                                     Idaho Falls, Idaho  83401
                                     Attn:  Chief Executive Officer
                                     Telephone:  (208) 524-5300
                                     Facsimile:  (208) 524-1411

         13.4   Amendments and Waivers

         The Warrant  Agent may by  supplemental  agreement  make any changes or
corrections  in this  Agreement (i) that it shall deem  appropriate  to cure any
ambiguity  or to correct any  defective  or  inconsistent  provision or manifest
mistake  or  error  herein  contained;  or (ii)  that it may deem  necessary  or
desirable and which shall not adversely  affect the interests of the  Registered
Holders of Warrant  Certificates;  provided,  however, that this Agreement shall
not otherwise be modified,  supplemented  or altered in any respect  except with
the  consent  in  writing of the  Registered  Holders  of  Warrant  Certificates
representing not less than 50% of the Warrants then  outstanding;  and provided,
further,  that no change in the number or nature of the  securities  purchasable
upon the  exercise  of any  Warrant,  or the  Purchase  Price  therefor,  or the
acceleration of the Warrant  Expiration  Date, shall be made without the consent
in writing of the Registered Holder of the Warrant Certificate representing such
Warrant,  other  than  such  changes  as are  specifically  prescribed  by  this
Agreement as originally executed.

         13.5   Governing Law

         This Warrant  Agreement  shall be governed by and  construed  under the
laws of the State of Texas without regard to principles of conflict of laws. The
parties  irrevocably  consent  to the  jurisdiction  and  venue of the state and
federal  courts located in Travis  County,  Texas in connection  with any action
relating to this Warrant Agreement.


                                      D-11
<PAGE>

         13.6   Successors and Assigns; Transfer

         The terms and conditions of this Warrant  Agreement  shall inure to the
benefit  of and be  binding  on the  respective  successors  and  assigns of the
parties.  This  Warrant  Agreement  may not be  transferred  or  assigned by the
Warrant Agent without the consent of the Company.

         13.7   Headings

         The  headings of the various  sections of this Warrant  Agreement  have
been inserted for  convenience  of reference  only and shall not be deemed to be
party of this Warrant Agreement.

         13.8   Entire Agreement; Counterparts

         This Warrant  Agreement  constitutes the entire  agreement  between the
parties  about its subject and  supersedes  all prior  agreements.  This Warrant
Agreement may be executed in  counterparts,  which together shall constitute one
agreement.

         IN WITNESS WHEREOF, the parties have executed this Warrant Agreement as
of the date first written above.


                                    INTERNATIONAL ISOTOPES INC.


                                    By: _______________________________
                                        Steve T. Laflin, Chief Executive Officer


                                    Warrant Agent:

                                    AMERICAN STOCK TRANSFER COMPANY


                                    By: ________________________________
                                    Name:_______________________________
                                    Title:______________________________





                                      D-12
<PAGE>


                                    EXHIBIT E


                           Form of Warrant Certificate








                                      E-1
<PAGE>

<TABLE>
<S><C>
 ___________________________________________________________________________________________________________________________________

 NUMBER                                        VOID AFTER JULY 31, 2007                                       WARRANT TO PURCHASE

 WA________                                                                                                  ______________________

                                                                                                             SHARES OF COMMON STOCK

                                                                                                             CUSIP ________________


                                              INTERNATIONAL ISOTOPES INC.

                                       SERIES A WARRANT TO PURCHASE COMMON STOCK




 This Series A Warrant Certificate ("Warrant Certificate") certifies that




 or its registered assigns, is the registered holder of a Warrant (the "Warrant") of International Isotopes Inc. (the "Company"), to
 purchase the number of shares (the "Shares") of Common Stock,  par value $0.01 per share (the "Common  Stock"),  of the Company set
 forth above. This Warrant expires on July 31, 2007 (such date, the "Expiration  Date") and entitles the holder to purchase from the
 Company the number of fully paid and nonassessable  Shares set forth above at the exercise price (the "Exercise Price")  multiplied
 by the number of shares set forth above (the "Purchase  Price"),  payable to the Company by wire transfer in immediately  available
 funds of the Purchase  Price to an account of the Warrant  Agent  specified in writing by the Warrant  Agent for such purpose or by
 delivery of a certified check in immediately  available funds of the Exercise Amount to the Warrant Agent at its corporate  office.
 The initial Exercise Price shall be $.04 .
     Subject to the terms and conditions set forth herein and in the Warrant Agreement,  this Warrant may be exercised by the Holder
     thereof, by:
     (i) providing written notice of such election  ("Warrant  Exercise Notice") to exercise the Warrant to the Warrant Agent at the
 address set forth in the Warrant Agreement,  "Re: International Isotopes Inc. Warrant Exercise," by hand or by facsimile,  no later
 than 5:00 p.m., New York City time, on the Expiration  Date,  which Warrant  Exercise Notice shall be in the form of an election to
 purchase  Shares of Common  Stock of the  Company  substantially  in the form set forth on the  reverse  side of this  certificate,
 properly completed and executed by the Holder.
     (ii) delivering,  either (x) such Warrants to the Warrant Agent by book-entry transfer through the facilities of the Depository
 or, (y) the  Warrant  Certificates  evidencing  such  Warrants to the Warrant  Agent if Warrant  Certificates  have been issued and
 delivered pursuant to the Warrant Agreement; and
     (iii) paying the applicable Purchase Price, together with any applicable taxes and governmental charges.
     The  Exercise  Price and the number of Shares  purchasable  upon  exercise of this Warrant are subject to  adjustment  upon the
     occurrence of certain events as set forth in the Warrant Agreement.
     No Warrant may be exercised after the Expiration  Date.  After the Expiration Date, the Warrants will become wholly void and of
     no value.
     This Warrant may be redeemed by the Company at a  redemption price  of $.001 per warrant share  if the average closing price of
     the Company's Common Stock exceeds $.12 for twenty consecutive business days.
     REFERENCE IS HERBY MADE TO THE FURTHER  PROVISIONS OF THIS WARRANT  CERTIFICATE SET FORTH ON THE REVERSE  HEREOF.  SUCH FURTHER
 PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS THOUGH FULLY SET FORTH AT THIS PLACE.
     This Warrant Certificate shall not be valid unless countersigned by the Warrant Agent.
     IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be executed by its duly authorized officer.

     Dated:                                                                                    INTERNATIONAL ISOTOPES INC.


     By:_________________________________                                                      By:_________________________________

        Secretary                                                                                 President

 ___________________________________________________________________________________________________________________________________
</TABLE>


                                      E-2
<PAGE>

                           INTERNATIONAL ISOTOPES INC.


         This Warrant evidenced by this Warrant  Certificate is a part of a duly
authorized  issue of  Warrants  to  purchase a maximum of  38,229,157  shares of
Common Stock issued pursuant to that certain Series A Warrant  Agreement,  dated
as of July 15,  2003 (the "Warrant Agreement"),  duly executed  and delivered by
the Company and American Stock  Transfer & Trust Company,  as Warrant Agent (the
"Warrant  Agent").  The Warrant Agreement hereby is incorporated by reference in
and made a part of this  instrument and is hereby  referred to for a description
of  the  rights,  limitation  of  rights,  obligations,  duties  and  immunities
thereunder  of the  Warrant  Agent,  the  Company  and the  holders  (the  words
"holders" or "holder"  meaning the registered  holders or registered  holder) of
the  Warrants.  A copy of the Warrant  Agreement may be inspected at the Warrant
Agent's  corporate office and is available upon written request addressed to the
Company.  All capitalized  terms used herein but not defined that are defined in
the Warrant Agreement shall have the meanings assigned to them therein.

         Warrants may be exercised to purchase  Shares from the Company  through
5:00 p.m. New York City time on the Expiration Date, at the Expiration Price set
forth on the face  hereof,  subject to  adjustment  as  described in the Warrant
Agreement.  Subject  to the terms and  conditions  set forth  herein  and in the
Warrant  Agreement,  the  Holder  of  the  Warrant  evidenced  by  this  Warrant
Certificate may exercise such Warrant by:

         (i)  providing a Warrant  Exercise  Notice to the Warrant  Agent at the
address set forth in the Warrant  Agreement,  "Re:  International  Isotopes Inc.
Warrant  Exercise," by hand or by facsimile,  no later than 5:00 p.m.,  New York
City time, on the Expiration Date, which Warrant Exercise Notice shall be in the
form  of an  election  to  purchase  Shares  of  Common  Stock  of  the  Company
substantially  in the form set forth on the  reverse  side of this  certificate,
properly completed and executed by the Holder.

         (ii)  delivering,  either (x) such  Warrants  to the  Warrant  Agent by
book-entry  transfer through the facilities of the Depository or (y) the Warrant
Certificates   evidencing   such  Warrants  to  the  Warrant  Agent  if  Warrant
Certificates have been issued and delivered  pursuant to the Warrant  Agreement;
and

         (iii)  paying  the  applicable   Purchase  Price,   together  with  any
applicable taxes and governmental charges.

         The Exercise  Amount shall be payable by wire  transfer in  immediately
available  funds  of the  Purchase  Price to an  account  of the  Warrant  Agent
specified  in writing by the Warrant  Agent for such purpose or by delivery of a
certified  check in immediately  available  funds of the Exercise  Amount to the
Warrant Agent at its corporate office. The initial Exercise Price shall be $.04.

         In the event that upon any exercise of the Warrant evidenced hereby the
number  of Shares  actually  purchased  shall be less  than the total  number of
Shares purchasable upon exercise of the Warrant evidenced hereby, there shall be
issued  to  the  holder  hereof,  or  such  holder's  assignee,  a  new  Warrant
Certificate  evidencing  a Warrant to purchase the Shares not so  purchased.  No
adjustment  shall be made for any cash  dividends  on any Shares  issuable  upon
exercise of this Warrant.  After the Expiration Date, unexercised Warrants shall
become wholly void and of no value.

         The Company  shall not be required to issue  fractions of Shares or any
certificates  that  evidence  fractional  Shares.  If any fraction of a share of
Common Stock would,  except for the  provisions  of the preceding  sentence,  be
issuable upon  exercise of any Warrant or Warrants,  the Company  shall,  at its
election,  either (i) purchase such fraction for an amount in cash equal to such
fraction of the Daily Price (as defined in the Warrant  Agreement) of a share of
Common Stock or (ii) round up the number of Shares  issued upon exercise of such
Warrant or Warrants to the next whole integer.

         Warrant  Certificates,  when surrendered at the Warrant Agent Office by
the registered holder thereof in person or by a legal representative or attorney
duly  authorized  in  writing,  by mail or by  book-entry  delivery  through the
facilities of the Depositary may be exchanged,  in the manner and subject to the
limitations  provided  in the  Warrant  Agreement,  but  without  payment of any
service charge, for another Warrant Certificate or Warrant  Certificates of like
tenor evidencing Warrants to purchase in the aggregate a like number of Shares.

         The Company and Warrant Agent may deem and treat the registered  holder
hereof as the absolute owner of this Warrant  Certificate  (notwithstanding  any
notation of ownership or other writing hereon made by anyone) for the purpose of
any exercise hereof and for all other purposes,  and neither the Company nor the
Warrant Agent shall be affected by any notice to the contrary.

         This  Warrant may be redeemed by the Company at a  repurchase  price of
$.001 per Warrant (the  "Redemption  Price") if the average closing price of the
Company's  Common Stock exceeds $.12 for twenty  consecutive  business days. The
Company will give a minimum of 30 days notice of the Redemption Date. The holder
may  exercise  this  Warrant  up to the day  before  the  Redemption  Date,  but
thereafter will only be entitled to receive the Redemption Price in exchange for
this Warrant Certificate.

                                      E-3
<PAGE>

                              ELECTION TO EXERCISE
                  (TO BE EXECUTED UPON EXERCISE OF THE WARRANT)

         The  undersigned  hereby  irrevocably  elects to  exercise  the  right,
represented by this Warrant Certificate,  to purchase  ____________ newly issued
shares of Common Stock of  International  Isotopes Inc.  (the  "Company") at the
Exercise Price of $___________ per share. The undersigned  represents,  warrants
and  promises  that it has the full power and  authority to exercise and deliver
the Warrants exercised hereby.

         The undersigned represents, warrants and promises that it has delivered
or will  deliver in payment  for such  Shares  $__________  by wire  transfer in
immediately  available  funds of the Purchase Price to an account of the Warrant
Agent  specified in writing by the Warrant Agent for such purpose or by delivery
of a certified check in immediately available funds of the Purchase Price to the
Warrant Agent at its corporate office.

         The undersigned requests that a certificate  representing the Shares be
registered and delivered as follows:

                              __________________________________________________
                                                    Name

                              __________________________________________________
                                                   Address

                              __________________________________________________
                                       Delivery Address (if different)

         If such  number of Shares is less than the  aggregate  number of Shares
purchasable  hereunder,  the undersigned requests that a new Warrant Certificate
representing  the balance of such Shares shall be  registered  and  delivered as
follows:

                              __________________________________________________
                                                    Name

                              __________________________________________________
                                                   Address

                              __________________________________________________
                                       Delivery Address (if different)


_________________________________       ________________________________________
Social Security or Other Taxpayer                     Signature
 Identification Number of Holder

                                        Note:    The   above    signature   must
                                        correspond with the name as written upon
                                        the face of this Warrant  Certificate in
                                        every particular,  without alteration or
                                        enlargement or any change whatsoever. If
                                        the certificate  representing the Shares
                                        or any Warrant Certificate  representing
                                        Warrants   not   exercised   is   to  be
                                        registered  in a name other than that in
                                        which  this   Warrant   Certificate   is
                                        registered,  the signature of the holder
                                        hereof  must  be  guaranteed.

SIGNATURE GUARANTEED:



                                      E-4
<PAGE>


                                       I3


                           INTERNATIONAL ISOTOPES INC.

                         38,229,157 Units, consisting of
                      38,229,157 Shares of Common Stock and
                               76,558,314 Warrants





                                      E-5
<PAGE>

                                     PART II

                     Information Not Required in Prospectus


Item 13. Other Expenses of Issuance and Distribution.

         The estimated  expenses of this offering,  all of which will be paid by
Registrant, are as follows:

         SEC Registration Fee                                      $   512.00
         Accounting Fees and Expenses                              $ 5,000.00
         Registrant's Legal Fees and Expenses                      $45,000.00
         Printing Fees                                             $ 1,000.00
         Transfer Agent and Registrar's Fees and Expenses          $15,000.00
         Miscellaneous Expenses                                    $ 4,000.00
                                                                   ----------
         Total                                                     $70,512.00
 ------------------
 o  To be completed by amendment

         (a)    Item 14. Indemnification of Directors and Officers

         As  permitted  by the Texas  Business  Corporation  Act  ("TBCA"),  the
Company's  Restated  Articles of  Incorporation  provide  that the Company  will
indemnify its officers,  directors,  employees and agents to the fullest  extent
permitted  by the TBCA  against  actions  that may  arise  against  them in such
capacities,  and to  advance  expenses  in  connection  with any  such  actions.
Registrant's  Restated Articles of Incorporation  provides that directors of the
Company will not be  personally  liable to Registrant  or its  stockholders  for
monetary damages for any act or omission in his capacity as a director except as
authorized  under the TBCA. The TBCA provides that a corporation may indemnify a
person  who  was,  is,  or is  threatened  to be  made a  named  defendant  in a
proceeding  because  such  person is or was a director  if it is  determined  in
accordance with the provisions of the TBCA that the person (i) conducted himself
in good faith, (ii) reasonably believed,  in the case of conduct in his official
capacity as director,  that his conduct was in the corporation's  best interests
or,  in  other  cases,  that  his  conduct  at  least  was  not  opposed  to the
corporation's interests and (iii) in the case of any criminal proceeding, had no
reasonable  cause to believe  his conduct was  unlawful.  A director  may not be
indemnified  with respect to a proceeding in which the person is found liable on
the basis that personal  benefit was improperly  received by him, whether or not
the benefit resulted from an action taken in the person's official capacity,  or
in which the person is found liable to the corporation.  Officers, employees and
agents of a corporation  are entitled to be indemnified by the  corporation  as,
and to the same extent provided for, directors of the corporation.

         Registrant carries directors' and officers' liability insurance with an
aggregate policy limit of $2,000,000.


                     Recent Sales of Unregistered Securities

         In May 2003 eleven of the  Company's  current  shareholders  loaned the
Company an aggregate of  $823,500.  The loans bear  interest at 5% per annum and
are due in May 2004. Each of the eleven  shareholders is an accredited  investor
and the private  placement of the debt securities was exempt pursuant to Section
4(2) of the Securities Act of 1933.



                                      II-1
<PAGE>


Item 16. Exhibits.

(a)      Exhibits

         3.1          Restated   Articles  of   Incorporation   of  the  Company
                      (incorporated  by reference to Exhibit 3.1 to the Company'
                      Registration  Statement  on form  SB-2  (Registration  No.
                      333-26269)).

         3.2          Bylaws  of  the  Company  (incorporated  by  reference  to
                      Exhibit 3.2 to the  Company's  Registration  Statement  on
                      Form SB-2 (Registration No. 333-26269)).

         4.1          Specimen  Common  Stock   Certificate   (incorporated   by
                      reference  to Exhibit  4.1 to the  Company's  Registration
                      Statement on Form SB-2 (Registration No. 333-26269)).

         5.1          Authorizing legal opinion of Locke Liddell & Sapp LLP with
                      respect to the issuance of the securities.

         10.1         Copy of Company's 2002 Long Term Incentive Plan, including
                      forms of nonqualified  Stock Option  Agreement,  Incentive
                      Stock  Option  Agreement  and  Restrictive   Stock  Option
                      Agreement  (incorporated  by  reference to Exhibit 10.1 to
                      the  Company's  Annual  Report on form 10-KSB for the year
                      ended December 31 2002).

         23.1         Consent of Hansen, Barnett & Maxwell.

         23.2         Consent of Locke  Liddell & Sapp LLP  (included in Exhibit
                      5.1).

         24           Power of Attorney (included as part of Signature page).

 --------------------
 *To be filed by amendment.


Item 17. Undertakings.

         Insofar as indemnification for liabilities arising under Securities Act
of 1933,  as amended  (the `Act") may be permitted  to  directors,  officers and
controlling  persons of  Registrant  pursuant to the  provisions of its Restated
Articles of Incorporation,  its By-Laws,  the Texas Business  Corporation Act or
otherwise, Registrant has been advised that in the opinion of the Securities and
Exchange  Commission such  indemnification is against public policy as expressed
in the Act and is,  therefore,  unenforceable.  In the  event  that a claim  for
indemnification  against  liabilities  (other than the payment by Registrant for
expenses  incurred or paid by an  officer,  director  or  controlling  person of
Registrant  in the  successful  defense of any action,  suit or  proceeding)  is
asserted by such director,  officer or controlling person in connection with the
securities  being  registered,  Registrant  will,  unless in the  opinion of its
counsel the matter has been settled by controlling precedent,  submit to a court
of appropriate  jurisdiction the question whether such  indemnification by it is
against  public policy as expressed in the Act and will be governed by the final
adjudication of such issue.

         The undersigned Registrant hereby undertakes:

         (1)    For purposes of determining  any liability  under the Securities
                Act,  to  treat  the  information   omitted  from  the  form  of
                prospectus  filed  as  part of this  registration  statement  in
                reliance  upon Rule 430A and  contained in a form of  prospectus
                filed by  Registrant  under Rule  424(b)(1),  or (4),  or 497(h)
                under the Securities Act as part of this Registration  Statement
                as of the time the Commission declared it effective.

         (2)    For determining any liability under the Securities Act, to treat
                each post-effective amendment that contains a form of prospectus
                as a new  registration  statement for the securities  offered in
                the registration statement,  and that offering of the securities
                at  that  time  as the  initial  bona  fide  offering  of  those
                securities.


                                      II-2
<PAGE>


                      POWER OF ATTORNEY TO SIGN AMENDMENTS

         KNOW  ALL MEN BY THESE  PRESENTS,  that  each  person  whose  signature
appears below does hereby  constitute  and appoint Steve T. Laflin and Dr. Ralph
M. Richart, and each of them, with full power to act without the other, his true
and lawful  attorney-in-fact and agent for him and in his name, place and stead,
in any and all  capacities,  to sign any or all amendments to this  Registration
Statement and to file the same, with all exhibits  thereto,  and other documents
in connection therewith,  with the Securities and Exchange Commission,  granting
unto  said  attorneys-in-fact  and  agents,  and each of them,  full  power  and
authority to do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate  the same, as fully,
for all  intents  and  purposes,  as he  might or  could  do in  person,  hereby
ratifying and confirming all that said  attorneys-in-fact  and agents, or any of
them, may lawfully do or cause to be done by virtue hereof.




                                      II-3
<PAGE>



                                   SIGNATURES


         In accordance  with the  requirements  of the  Securities  Act of 1933,
Registrant certifies that it has reasonable grounds to believe that it meets all
of the  requirements  for filing on Form S-3 and authorized this Amendment No. 1
to  Registration  Statement  to be signed on its behalf by the  undersigned,  in
Idaho Falls, State of Idaho, on the 23rd day of July, 2003.


                                           INTERNATIONAL ISOTOPES INC.




                                           By: /s/ Steve T. Laflin
                                               -------------------
                                               Steve T. Laflin
                                               President and CEO

         In accordance with the requirements of the Securities Act of 1933, this
Registration  Statement  has  been  signed  by  the  following  persons  in  the
capacities and on the dates stated.


  Signature                       Title                         Date

  /s/ Steve T. Laflin             President, CEO and CFO        July 23, 2003
  ------------------------
  Steve T. Laflin

  /s/ Dr. Ralph M. Richart        Chairman                      July 23, 2003
  ------------------------
  Dr. Ralph M. Richart

  /s/ Christopher Grosso          Director                      July 23, 2003
  ------------------------
  Christopher Grosso





                                      II-4
<PAGE>