<?xml version="1.0"?>
<ownershipDocument>

    <schemaVersion>X0202</schemaVersion>

    <documentType>4</documentType>

    <periodOfReport>2007-10-05</periodOfReport>

    <notSubjectToSection16>0</notSubjectToSection16>

    <issuer>
        <issuerCik>0000098618</issuerCik>
        <issuerName>ALANCO TECHNOLOGIES INC</issuerName>
        <issuerTradingSymbol>ALAN</issuerTradingSymbol>
    </issuer>

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0001194268</rptOwnerCik>
            <rptOwnerName>HECKER JAMES T</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>15575 N. 83RD WAY</rptOwnerStreet1>
            <rptOwnerStreet2>SUITE 3</rptOwnerStreet2>
            <rptOwnerCity>SCOTTSDALE</rptOwnerCity>
            <rptOwnerState>AZ</rptOwnerState>
            <rptOwnerZipCode>85260</rptOwnerZipCode>
            <rptOwnerStateDescription></rptOwnerStateDescription>
        </reportingOwnerAddress>
        <reportingOwnerRelationship>
            <isDirector>1</isDirector>
            <isOfficer>0</isOfficer>
            <isTenPercentOwner>0</isTenPercentOwner>
            <isOther>0</isOther>
        </reportingOwnerRelationship>
    </reportingOwner>

    <derivativeTable>
        <derivativeTransaction>
            <securityTitle>
                <value>Class A Common Stock Options</value>
            </securityTitle>
            <conversionOrExercisePrice>
                <value>2.00</value>
            </conversionOrExercisePrice>
            <transactionDate>
                <value>2007-10-05</value>
            </transactionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>A</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
            </transactionCoding>
            <transactionAmounts>
                <transactionShares>
                    <value>50000</value>
                </transactionShares>
                <transactionPricePerShare>
                    <value>2.00</value>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>A</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <exerciseDate>
                <value>2011-10-05</value>
                <footnoteId id="F1"/>
            </exerciseDate>
            <expirationDate>
                <value>2012-10-05</value>
            </expirationDate>
            <underlyingSecurity>
                <underlyingSecurityTitle>
                    <value>Class A Common Stock</value>
                </underlyingSecurityTitle>
                <underlyingSecurityShares>
                    <value>50000</value>
                </underlyingSecurityShares>
            </underlyingSecurity>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>50000</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </derivativeTransaction>
    </derivativeTable>

    <footnotes>
        <footnote id="F1">Vesting schedule as follows:  10% on 10/5/07, 15% on 10/5/08, 25% on 10/5/09, 25% on 10/5/10, 25% on 10/5/11</footnote>
    </footnotes>

    <ownerSignature>
        <signatureName>James T. Hecker</signatureName>
        <signatureDate>2007-10-09</signatureDate>
    </ownerSignature>
</ownershipDocument>
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X0202
4
2007-10-05
0
0000098618
ALANCO TECHNOLOGIES INC
ALAN
0001194268
HECKER JAMES T
15575 N. 83RD WAY
SUITE 3
SCOTTSDALE
AZ
85260
1
0
0
0
Class A Common Stock Options
2.00
2007-10-05
4
A
0
50000
2.00
A
2011-10-05
2012-10-05
Class A Common Stock
50000
50000
D
Vesting schedule as follows:  10% on 10/5/07, 15% on 10/5/08, 25% on 10/5/09, 25% on 10/5/10, 25% on 10/5/11
James T. Hecker
2007-10-09