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<P align="center" style="font-size: 14pt"><B>UNITED STATES<BR>
SECURITIES AND EXCHANGE COMMISSION<BR>
<FONT style="font-size: 12pt">Washington, D.C. 20549
</FONT></B>

<P align="center" style="font-size: 18pt"><B>FORM 8-K</B>

<P align="center" style="font-size: 12pt"><B>CURRENT REPORT<BR>
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934</B>

<P align="center" style="font-size: 10pt"><B>Date of Report (Date of earliest event reported): September 4, 2008</B>

<P align="center">

<P align="center" style="font-size: 24pt"><B>CRAY INC.<BR></B>
<FONT style="font-size: 10pt">(Exact name of registrant as specified in its charter)
</FONT>

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    <TD width="32%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="33%">&nbsp;</TD>
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    <TD width="32%">&nbsp;</TD>
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    <TD style="border-bottom: 1px solid #000000"><B>Washington</B></TD>
    <TD>&nbsp;</TD>
    <TD style="border-bottom: 1px solid #000000"><B>0-26820</B></TD>
    <TD>&nbsp;</TD>
    <TD style="border-bottom: 1px solid #000000"><B>93-0962605</B></TD>
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<TR valign="top">
    <TD>(State or other Jurisdiction of Incorporation)</TD>
    <TD>&nbsp;</TD>
    <TD>(Commission File Number)</TD>
    <TD>&nbsp;</TD>
    <TD>(IRS Employer Identification No.)</TD>
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    <TD style="border-bottom: 1px solid #000000"><B>411 First Avenue South, Suite 600<BR>Seattle, WA<BR></B></TD>
    <TD>&nbsp;</TD>
    <TD style="border-bottom: 1px solid #000000"><B>98104-2860</B></TD>
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<TR valign="top">
    <TD>(Address of Principal Executive Offices)</TD>
    <TD>&nbsp;</TD>
    <TD>(Zip Code)</TD>
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<P align="center" style="font-size: 10pt">Registrant&#146;s telephone number, including area code: <B>(206) 701-2000</B>

<DIV align="center" style="font-size: 10pt">Registrant&#146;s facsimile number, including area code: <B>(206) 701-2500</B>
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    <TD nowrap style="border-bottom: 1px solid #000000"><B>None<BR></B></TD>
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    <TD nowrap>(Former name or former address if changed since last report.)</TD>
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<P align="left" style="font-size: 10pt">Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions:

<P align="left" style="font-size: 10pt">
<FONT face="Wingdings">&#111;</FONT> Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)<BR><BR>
<FONT face="Wingdings">&#111;</FONT> Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)<BR><BR>
<FONT face="Wingdings">&#111;</FONT> Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))<BR><BR>
<FONT face="Wingdings">&#111;</FONT> Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))<BR>


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<P align="center" style="font-size: 10pt; display: none">1
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<P align="left" style="font-size: 10pt"><B>Item&nbsp;7.01 Regulation&nbsp;FD Disclosure</B>


<P align="left" style="font-size: 10pt; text-indent: 4%">Under Rule&nbsp;10b5-1, directors, officers and employees may adopt written pre-arranged stock trading plans when they
are not in possession of material non-public information in order to diversify their investment portfolios and make
market trades of our common stock regardless of any material, non-public information they may receive after adopting
their plans. The actual transactions by directors and executive officers under these plans will be disclosed publicly
through Form&nbsp;144 and Form&nbsp;4 filings with the Securities and Exchange Commission. As a matter of policy, we do not
report on Rule&nbsp;10b5-1 plans entered into by non-executive officers or other employees.


<P align="left" style="font-size: 10pt; text-indent: 4%">On December&nbsp;20, 2005, we issued shares of restricted stock to executive officers and other officers and senior
managers pursuant to a shareholder approved plan, including 87,500 shares to Margaret A Williams, Senior Vice
President. The restrictions on Ms.&nbsp;Williams&#146; shares lapsed on June&nbsp;30, 2007, and at that time she sold 35, 300 of
those shares to raise funds for the associated income and other taxes due upon the lapse of those restrictions.


<P align="left" style="font-size: 10pt; text-indent: 4%">Ms.&nbsp;Williams has entered into a Rule&nbsp;10b5-1 plan to permit sales of the remaining 52,200 shares. The purpose of
these sales is to diversify Ms.&nbsp;Williams&#146; investments. The sales will occur between October&nbsp;1, 2008, and June&nbsp;30, 2009,
with 26,100 shares to be sold if the market price for our common stock is at least $8.00 per share and all of those
shares to be sold if the market price for our common stock is at least $10.00 per share. All sales will be in the
open market at prevailing market prices.


<P align="left" style="font-size: 10pt; text-indent: 4%">The information in Item&nbsp;7.01 is furnished and shall not be deemed &#147;filed&#148; for purposes of Section&nbsp;18 of the
Securities Exchange Act of 1934, as amended (the &#147;Exchange Act&#148;), nor shall such information be deemed incorporated by
reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly
set forth by specific reference in such filing.


<P align="center" style="font-size: 10pt"><B>SIGNATURES</B>



<P align="left" style="font-size: 10pt; text-indent: 4%">Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant caused this report to be
signed on its behalf by the undersigned thereunto duly authorized.


<P align="left" style="font-size: 10pt">September&nbsp;8, 2008



<P align="left" style="margin-left:45%; font-size: 10pt">Cray Inc.



<P align="left" style="margin-left:45%; font-size: 10pt">By: <U><B>/</B>s/&nbsp;&nbsp;Kenneth W. Johnson&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
Kenneth W. Johnson<BR>
Senior Vice President and General Counsel<BR>


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<P align="center" style="font-size: 10pt; display: none">2




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{"company-data": {"conformed-name": "CRAY INC", "cik": "0000949158", "assigned-sic": "3571", "irs-number": "930962605", "state-of-incorporation": "WA", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "000-26820", "film-number": "081061210"}, "business-address": {"street1": "411 FIRST AVE SOUTH", "street2": "SUITE 600", "city": "SEATTLE", "state": "WA", "zip": "98104-2860", "phone": "2067012000"}, "mail-address": {"street1": "411 FIRST AVE SOUTH", "street2": "SUITE 600", "city": "SEATTLE", "state": "WA", "zip": "98104-2860"}, "former-company": {"former-conformed-name": "TERA COMPUTER CO \\WA\\", "date-changed": "19950809"}}
Filed by Bowne Pure Compliance
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): September 4, 2008
CRAY INC.
(Exact name of registrant as specified in its charter)
Washington
0-26820
93-0962605
(State or other Jurisdiction of Incorporation)
(Commission File Number)
(IRS Employer Identification No.)
411 First Avenue South, Suite 600
Seattle, WA
98104-2860
(Address of Principal Executive Offices)
(Zip Code)
Registrant's telephone number, including area code:
(206) 701-2000
Registrant's facsimile number, including area code:
(206) 701-2500
None
(Former name or former address if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions:
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 7.01 Regulation FD Disclosure
Under Rule 10b5-1, directors, officers and employees may adopt written pre-arranged stock trading plans when they
are not in possession of material non-public information in order to diversify their investment portfolios and make
market trades of our common stock regardless of any material, non-public information they may receive after adopting
their plans. The actual transactions by directors and executive officers under these plans will be disclosed publicly
through Form 144 and Form 4 filings with the Securities and Exchange Commission. As a matter of policy, we do not
report on Rule 10b5-1 plans entered into by non-executive officers or other employees.
On December 20, 2005, we issued shares of restricted stock to executive officers and other officers and senior
managers pursuant to a shareholder approved plan, including 87,500 shares to Margaret A Williams, Senior Vice
President. The restrictions on Ms. Williams' shares lapsed on June 30, 2007, and at that time she sold 35, 300 of
those shares to raise funds for the associated income and other taxes due upon the lapse of those restrictions.
Ms. Williams has entered into a Rule 10b5-1 plan to permit sales of the remaining 52,200 shares. The purpose of
these sales is to diversify Ms. Williams' investments. The sales will occur between October 1, 2008, and June 30, 2009,
with 26,100 shares to be sold if the market price for our common stock is at least $8.00 per share and all of those
shares to be sold if the market price for our common stock is at least $10.00 per share. All sales will be in the
open market at prevailing market prices.
The information in Item 7.01 is furnished and shall not be deemed "filed" for purposes of Section 18 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), nor shall such information be deemed incorporated by
reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly
set forth by specific reference in such filing.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant caused this report to be
signed on its behalf by the undersigned thereunto duly authorized.
September 8, 2008
Cray Inc.
By:
/
s/  Kenneth W. Johnson
Kenneth W. Johnson
Senior Vice President and General Counsel