August 4, 2011

Rare Element Discovers Heavy Rare Earths at Whitetail Ridge, East Taylor and Carbon and High Grade at East Taylor within the Bear Lodge Project


        --  Three areas located in western half of district enriched in
            europium, terbium, dysprosium and gadolinium

        --  Some of the highest heavy rare-earth grades reported from North
            American deposits

        --  New REE discovery at East Taylor (55 feet @ 3.38% and 55 feet @
            7.84% REO)

        --  Drilling program and re-assaying of key HREE-enriched drill
            holes in progress

LAKEWOOD, CO, Aug. 4, 2011 /PRNewswire/ - Rare Element Resources Ltd. (TSX: RES and NYSE-AMEX: REE) announces the identification of high grades of heavy rare-earth elements
(HREE) in the Whitetail Ridge resource area, and the East Taylor and
Carbon target areas, and the discovery of high-grade REE mineralization
at the East Taylor target at the Bear Lodge project (Figure 1). All
three of the mineralized zones are located in the western half of an
expanding rare-earth mineralized district (the Bear Lodge REE
District). The western areas are characterized by high grades (>3% REO)
and substantial quantities of the light rare earths (LREE), along with
some of the highest grades of heavy rare earths in North American
deposits. They are particularly enriched in europium, terbium,
dysprosium, and gadolinium (Eu, Tb, Dy, and Gd). The East Taylor and
Carbon targets also contain significant yttrium.

"We are very pleased with the recognition of substantial grades of heavy
rare earths, in addition to the known high grades of light rare earths,
in the western part of the Bear Lodge rare-earth district," said Dr.
Don Ranta, President of Rare Element. "Seven drill holes supported by
surface geology in three target areas provide encouragement that we
will be able to define significant tonnages of this mineralization with
further drilling. Discovery of high-grade REE at East Taylor is a major
step forward in expanding the potential size of the district. The
higher HREE values and projected increased demand for select light and
heavy REE could have strongly positive economic benefits to the Bear
Lodge project. These deposits may represent a superior source of the
most valuable rare earths, which include neodymium, praseodymium,
europium, terbium, and dysprosium," he said. Rare Element is
considering a variety of alliances in the advancement of its
rare-earths project.

Bear Lodge Rare-Earth District--Zonation of light and heavy REE

Discoveries of high-grade REE mineralization at Whitetail Ridge, East
Taylor, and Carbon expand the area of known REE mineralization well
outside of the Bull Hill deposits and identify a "district" underlain
by significant and potentially economic REE mineralization. The data
indicate that the Bear Lodge REE District covers a crudely elliptical
area that extends approximately 5740 feet (1750m) northwest-southeast
by 4260 feet (1300m) northeast-southwest (Figure 1). The Whitetail
Ridge resource area and Carbon target are located northwest of the Bull
Hill REE deposits, and the East Taylor target is located west of the
Bull Hill deposits. Based on a re-evaluation of assay data for the
Whitetail Ridge and Carbon areas during the Company's most recent
resource estimation (news release dated 10 June 2011), and newly
received REE assay data from the East Taylor target area, assay grades
for individual rare-earth elements between deposits and target areas at
the Bear Lodge project suggest a zonation of REE distribution in the
district. The mineralization at Whitetail Ridge, East Taylor, and
Carbon has a distribution characterized by elevated abundances of HREE
relative to the mineralization at Bull Hill. The three western
mineralized zones are characterized by high grades and substantial
quantities of the light rare earths (LREE), as well as some of the
highest grades of heavy rare earths in North American deposits. They
are particularly enriched in europium, terbium, dysprosium, and
gadolinium (Eu, Tb, Dy, and Gd), as shown in Table 1. The mineralized
intervals in SUN-090 were submitted for REE analyses earlier this year,
and the assay results are reported for the first time in this news
release. Total REO assays for drill-hole SUN-079 were reported earlier
this year in a news release dated April 6, 2011. LREE generally include
Ce, La, Nd, Pr, and Sm; HREE include Eu, Gd, Tb, Dy, Ho, Er, Tm, Yb,
Lu, and Y.

These new discoveries indicate good potential for new deposits of
high-grade rare-earth elements in the western half of the Bear Lodge
REE project, and those deposits appear particularly enriched in the
heavy rare earths. A grade comparison of individual rare-earth elements
between the Bull Hill resource, the Whitetail Ridge resource, and drill
holes at the East Taylor and Carbon target areas is given below in
Table 1. The location and geologic setting of the deposits and targets
are shown in Figure 1.

Figure 1. Location and Geological Map of the Bear Lodge Rare-Earth District,
including Bull Hill, Whitetail Ridge, East Taylor, Carbon, and other

Table 1. Comparison of REO grades at Bull Hill, Whitetail Ridge, East Taylor,
and Carbon

    |AREA             |Bull Hill |Whitetail|East Taylor         |Carbon              |
    |                 |          |Ridge    |                    |                    |
    |ResourceCategory |Indicated |Inferred |Exploration/SUN090, |Exploration/SUN079, |
    |                 |          |         |45-100', 105-160'   |15-45'              |
    |Rare EarthOxide  |          |         |                    |                    |
    |La2O3            |1.08      |0.81     |1.23                |0.96                |
    |Ce2O3            |1.64      |1.19     |1.98                |1.89                |
    |Pr2O3            |0.186     |0.158    |0.264               |0.23                |
    |Nd2O3            |0.65      |0.64     |0.894               |0.91                |
    |Sm2O3            |0.099     |0.142    |0.191               |0.165               |
    |Eu2O3            |0.021     |0.042    |0.056               |0.040               |
    |Gd2O3            |0.048     |0.103    |0.173               |0.097               |
    |Tb2O3            |0.0037    |0.0115   |0.026               |0.013               |
    |Dy2O3            |0.0104    |0.0361   |0.092               |0.062               |
    |Y2O3             |0.032     |0.087    |0.319               |0.283               |
    |SUM Eu+Tb+Dy |0.0351    |0.090    |0.174               |0.115               |
    |SUM          |0.871     |0.888    |1.332               |1.255               |
    |Nd+Pr+Eu+Tb+Dy   |          |         |                    |                    |
    |Grade (%REO)     |3.77      |3.24     |5.61                |4.69                |
    |Metric Tonnes    |4.45      |1.5      |------              |------              |

Identification of High-grade HREEs at the Whitetail Ridge Deposit

The identification of significant HREE mineralization at the Whitetail
Ridge resource area is the result of a detailed evaluation of assay
data during the most recent resource estimation work (news release
dated June 14, 2011). This recognition triggered a review of all the
REE mineralized drill holes in the general western area. The Whitetail
Ridge deposit is located approximately 1500 feet (450 m) northwest of
the main Bull Hill rare-earth deposit (Figure 1). The area was
identified previously as an exceptional REE mineralization target (news
release dated October 13, 2009), based on factors including: 1) the
intersection of REE mineralization as FMR (FeOx-MnOx-REE; designated as
MnOx veins in Figure 1) dikes and veins in five nearby historic drill
holes; 2) detailed geological mapping of FMR vein material in historic
exploration trenches (Figure 1); and 3) a broad positive ground
geophysical anomaly of a type coincident with significant REE
mineralization in other parts of the project area. The size of the
geophysical anomaly (approximately 1400 by 2000 feet, 400 by 610 m,
elongate northeasterly) provides an indication that this REE target may
be larger than others in the district. Detailed mapping suggests that
the REE mineralization consists of northwest-striking FMR dikes and an
FMR stockwork zone that is elongate northeasterly, with dimensions of
roughly 1250 feet (380 meters) by 950 feet (290 meters). The enveloping
geophysical anomaly is larger and may indicate a broader distribution
of REE mineralization beneath the extensive soil and colluvial cover.
Preliminary mineralogical studies by Dr. Anthony N. Mariano indicate
that monazite (an REE-Th phosphate) may represent a significant
proportion of the REE mineralogy, and that the HREE mineralization may
reside in the monazite. Grades for europium, gadolinium, terbium, and
dysprosium for the current Whitetail Ridge resource estimate, as
reported in Table 1, are among the highest in North American REE

During the 2010 drilling program, two core holes were completed in the
Whitetail Ridge area from a single drill site (Figure 1). Both holes
encountered significant intercepts of REE mineralization that exhibit
strong enrichment in both LREE and HREE (Tables 1 and 2; news release
dated November 9, 2010). Only a small portion of the large Whitetail
Ridge target area was tested with the holes, but they give a good
indication of the total potential of the target. These holes, plus
historic drill-hole assay data from five widely spaced older holes in
the general target area, surface mapping, and trench sampling assay
data were all used directly or indirectly by Ore Reserves Engineering
to estimate an inferred mineral resource for Whitetail Ridge of 1.7
million tons (1.5 million metric tonnes) averaging 3.24% total REO
(news release dated June 14, 2011). Drilling is currently underway at
the Whitetail Ridge deposit and surrounding target area. Approximately
12 to 15 additional holes are planned for the target area this year.

Table 2. REO Grades and Distribution in the Oxidized Zone of the
Whitetail Ridge Deposit

    |Element      |Ce   |La   |Nd   |Pr   |Sm   |Gd   |Y    |Eu   |Dy    |Tb    |    Er|    Yb|     Lu|     Ho|     Tm|
    |Assay        |1.19 |0.81 |0.64 |0.158|0.142|0.103|0.087|0.042|0.0361|0.0115|0.0057|0.0033|0.00040|0.00374|0.00052|
    |REO %        |     |     |     |     |     |     |     |     |      |      |      |      |       |       |       |
    |Distribution |36.73|25.00|19.75|4.88 |4.38 |3.18 |2.68 |1.30 |1.11  |0.35  | 0.176| 0.102|  0.012|  0.115|  0.016|
    |Oxide %      |     |     |     |     |     |     |     |     |      |      |      |      |       |       |       |

New High-grade REE Discovery at East Taylor and HREE-enrichment

The East Taylor target is located approximately 2500 feet (760 m) west
of the main Bull Hill rare-earth deposit and 2500 feet southwest of the
Whitetail Ridge deposit (Figure 1). The Taylor target area was
principally known as a gold target until the 2010 drilling program
intersected a thick FMR zone in reverse circulation (RC) drill-hole
SUN-090. Drill-hole SUN-090 and an earlier RC hole drilled by Newmont
(SUN-009) were collared adjacent to an outcrop of FMR veins identified
by the U.S. Geological Survey (Staatz, 1983) (Figure 1). The zone
appears to have an easterly strike, as opposed to the dominant
northwesterly and northerly mineralized structures in the Bull
Hill/Whitetail Ridge deposits. Preliminary geological mapping and
projection of FMR intercepts in drill holes suggest that the REE
mineralization consists of dikes and adjacent stockwork with dimensions
of roughly 700 feet (210 meters) east-west by 250 feet (75 meters)
north-south, and the mineralization is open to the east.

The REE mineralization was recognized in drill chips from SUN-090 by
Rare Element geologist, Allen Andersen. The mineralized intercepts were
sent subsequently for quantitative REE assays, reported here in Tables
1 and 3. Newmont hole SUN-009 also intersected strong REE
mineralization in a correlative intercept (Table 3), The high-grade REE
zone in drill-hole SUN-090 is contained within a well-mineralized gold
zone that averages 0.038 ounces per ton (1.3 grams per tonne) from 0 to
205 feet (0-62.5 m). Correlative FMR mineralization was recognized also
in Newmont drill hole SUN-023, which was not assayed for REE. Several
core holes are planned as further step-off tests of the target area in
2011, including a core-hole twin of drill-hole SUN-090.

Table 3. REE- mineralized intercepts at the East Taylor Target area

    |Drill Hole|Interval (feet)|Mineralized Intercept|             |
    |          |               |(feet)               |Total REO (%)|
    |SUN-090   |45 - 100       |              55     |      3.38   |
    |          |105 - 160      |              55     |      7.84   |
    |SUN-009*  |80-165         |              85     |      >1.4*  |
    |          |540-575        |              35     |      >1.4*  |

* Note: REE assays for Newmont drill-hole SUN-009 were done using partial
digestion analytical methods. In many cases values exceeded the upper
limit of the method for individual REE (i.e. upper assay limit for Ce
was 5000 ppm.

It should be noted that the Company's proprietary internal standards
submitted with the samples from drill hole SUN-090 were certified at
that time for only Y, La, Ce, Pr, Nd, Sm, Th, and U, and not for the
other REE. The samples are now being re-submitted with the newly
developed standards that are certified for Y, La, Ce, Pr, Nd, Sm, Eu,
Gd, Tb, Dy, Ho, Th, and U. Rare Element's rigorous QA/QC program
exceeds industry standards, as REE assays are routinely reported and
assessed using only analytical laboratory standards for evaluation of
data quality.

Discovery of High-grade HREEs at the Carbon REE Target

The Carbon REE mineralization was identified by Rare Element geologist,
Allen Andersen, in drill-hole SUN-079, which is a reverse circulation
drill hole that was part of the Company's 2010 gold exploration
program. The Carbon REE target is located about 1200 feet (370 m)
northwest of the Whitetail Ridge deposit along an apparent
northwest-trending zone of mineralization (Figure 1). Two
reverse-circulation drill holes (SUN-076 and SUN-079) completed during
the 2010 Sundance gold exploration program cut significant REE
mineralization in FMR vein material. REE-bearing intercepts from the
Carbon target area are summarized in Table 4. Total REO assays for
drill-holes SUN-079 and SUN-076 were reported earlier this year in a
news release dated April 6, 2011. If this mineralization is a
continuation of the Whitetail Ridge dike system and the Bull Hill
system, the total mineralization trend may reach more than 5000 feet
(1500m) in length.

Table 4. REE-mineralized intercepts at the Carbon target area

Drill Hole SUN-076 (N45W, -45 ; total depth 615 feet)

    |Interval|  Mineralized   |                     |        |
    |(feet)  |Intercept (feet)|Mineralized lithology|TREO (%)|
    |100-110 |          10    |FMR drill chips      |   1.66 |

Drill Hole SUN-079 (S80W, -45 ; total depth 775 feet)

    |Interval|   Mineralized   |                     |        |
    |(feet)  |Intercept  (feet)|Mineralized lithology|TREO (%)|
    |0-5     |            5    |FMR drill chips      |   1.69 |
    |15-45   |           30    |FMR drill chips      |   4.69 |
    |700-760 |           60    |FMR drill chips      |   3.58 |

Assays, Quality Control, and Standard Certification

ALS Chemex conducted the assaying for the rare-earth elements reported
here in their Vancouver, British Columbia assay facility. ALS Chemex
Vancouver is accredited to ISO 9001 and operates according to ALS Group
standards consistent with ISO 17025 methods at other laboratories. The
samples were prepared and subjected to lithium metaborate fusion,
followed by ICP analysis and a mass spectroscopy finish.

Analytical quality is monitored through the use of randomly inserted
quality control samples, including standards, blanks, and duplicates,
which are blinded to the analytical laboratory. No duplicates were
submitted for the SUN-090 samples, owing to insufficient sample.
Results of the analyses at ALS Chemex are evaluated continuously by Dr
Jeffrey Jaacks, the Company's QA/QC consultant, who is a Qualified
Person according to National Instrument 43-101. The results from the
current data set indicate acceptable accuracy and precision. Blank
analyses also indicate no issues with carry-over contamination.

Rare Element Resources developed a set of proprietary internal REE
analytical standards using Bear Lodge deposit mineralized material
during late 2009 and early 2010 under the supervision of Dr. Jaacks.
The original round robin assay series at four laboratories indicated
that these materials could be used as standards for Y, La, Ce, Pr, Nd,
Sm, Th, and U analyses. However, the results also indicated that the
concentration of the remaining elements in the REE series were at the
lower end of the working range of the analytical method, and standard
values gave unacceptable accuracy and precision for Eu, Gd, Tb, Dy, Ho,
Er, Tm, Yb, and Lu analyses. The Company conducted a new round robin
standard certification program during the first half of the current
year. The results from most recent round robin assay series qualify the
reference materials for a greater number of rare-earth elements.
Improvements in analytical methods, and a larger base of certification
analyses generated by utilizing eight analytical laboratories,
indicates that the standards can be used as reference materials for Au,
Y, La, Ce, Pr, Nd, Sm, Eu, Gd, Tb, Dy, Ho, Th, and U analyses.

Rare Element Resources Ltd (TSX: RES & NYSE-AMEX: REE) is a publicly traded mineral resource company focused on exploration and
development of rare-earth elements and gold on the Bear Lodge property.

Rare-earth elements are key components of the green energy technologies
and other high-technology applications. Some of the major applications
include hybrid automobiles, plug-in electric automobiles, advanced wind
turbines, computer hard drives, compact fluorescent light bulbs, metal
alloys, additives in ceramics and glass, petroleum cracking catalysts,
and a number of critical military applications. China currently
produces more than 95% of the 130,000 metric tonnes of rare-earths
consumed annually worldwide, and China has been reducing its exports of
rare earths each year. The rare-earth market is growing rapidly, and is
projected to accelerate if the green technologies are implemented on a
broad scale.


Donald E. Ranta, PhD, PGeo, President & CEO

Donald E. Ranta, PhD, PGeo, serves the Board of Directors of the Company
as an internal, technically Qualified Person. Technical information in
this news release has been reviewed by Dr. Ranta and has been prepared
in accordance with Canadian regulatory requirements that are set out in
National Instrument 43-101. This news release was prepared by Company
management, who take full responsibility for content. Neither TSX nor
its Regulation Services Provider (as that term is defined in the
policies of the TSX) accepts responsibility for the adequacy or
accuracy of this release.

Forward Looking Statements

Except for statements of historical fact, certain information contained
herein constitutes forward-looking statements. Forward looking
statements are usually identified by our use of certain terminology,
including "will", "believes", "may", "expects", "should", "seeks",
"anticipates", "has potential to", or "intends' or by discussions of
strategy or intentions. Such forward-looking statements involve known
and unknown risks, uncertainties and other factors which may cause our
actual results or achievements to be materially different from any
future results or achievements expressed or implied by such
forward-looking statements. Forward-looking statements are statements
that are not historical facts, and include but are not limited to,
estimates and their underlying assumptions; statements regarding plans,
objectives and expectations with respect to the effectiveness of the
Company's business model; future operations, products and services; the
impact of regulatory initiatives on the Company's operations; the size
of and opportunities related to the market for the Company's products;
general industry and macroeconomic growth rates; expectations related
to possible joint and/or strategic ventures and statements regarding
future performance.

Forward-looking statements used in this discussion are subject to
various risks and uncertainties, most of which are difficult to predict
and generally beyond the control of the Company. If risks or
uncertainties materialize, or if underlying assumptions prove
incorrect, our actual results may vary materially from those expected,
estimated or projected. Forward-looking statements in this document are
not a prediction of future events or circumstances, and those future
events or circumstances may not occur. Given these uncertainties, users
of the information included herein, including investors and prospective
investors are cautioned not to place undue reliance on such
forward-looking statements.

SOURCE Rare Element Resources Ltd.