Mr. Donald Ranta reports

RARE ELEMENT REPORTS THIRD QUARTER FINANCIAL RESULTS

Rare Element Resources Ltd. has released its unaudited condensed consolidated interim financial statements and management's discussion and analysis for the nine months ended March 31, 2011, and has filed them on SEDAR. These financial statements were prepared using international financial reporting standards which Rare Element early adopted as of July 1, 2010. Note 17 in the financial statements reconciles the changes in the comparative periods from Canadian generally accepted accounting principles to international financial reporting standards, which will be fully adopted in Canada in 2011.

All dollar amounts stated herein are in U.S. dollars.

Nine months ended March 31, 2011, financial highlights

During the nine months ended March 31, 2011, $5,677,048 (2010: $2,007,676) was spent on the Bear Lodge rare-earth project, and $1,021,285 (2010: nil) was spent on the Sundance gold project. Both projects are located on the same property position.

Administrative expenditures, excluding the non-cash share-based payments, amounted to $1,392,410 (2010: $920,516) for the period, up 51 per cent compared with the same period last year.

Loss for the period was $4,483,587 (2010: $1,477,745) or 12 cents per share (2010: four cents), up 203 per cent from the same period in the prior year due to non-cash share-based payments.

Cash and cash equivalents at March 31, 2011, were $73,523,043 (June 30, 2010: $11,460,476), reflecting the $57.5-million financing completed in December, 2010.

Business highlights

The geological team completed its 2010 rare-earth drilling and exploration program on the Bear Lodge property in November, 2010, and announced the final rare earth element assay results on April 6, 2011. The complete results from the 2010 drilling program will be incorporated into an updated NI 43-101-compliant resource estimate scheduled for release during the second quarter of 2011. The goal for these drill hole results is to upgrade a portion of the REE resources from the inferred category to measured and indicated and to expand the resources.

The company completed the NI 43-101-compliant preliminary economic analysis of the Bear Lodge REE deposit as announced on Sept. 28, 2010, which shows that the project has an internal rate of return of approximately 40 per cent using historical REO concentrate prices, which have recently increased by approximately 700 per cent. The technical report was prepared by independent consultant, John T. Boyd Co., with the assistance of consultants Mountain States R&D International and Ore Reserves Engineering. This press release highlights some of the information contained in the technical report, and, for investors to understand the information fully in this press release, they should read the technical report in its entirety, including all qualifications, assumptions and exclusions that relate to the information set out in this press release.

The company announced its first NI 43-101-compliant inferred mineral resource estimate for the 100-per-cent-owned Sundance gold project in the Bear Lodge Mountains on March 15, 2011.

We seek Safe Harbor.