Canada Rare Earth Corporation

Thunder Bay, ON – Rare Earth Metals Inc (“Rare Earth Metals”, “RA”, “REM” or the “Company”) (TSX VENTURE:RA) is pleased to announce that it has submitted to the TSX-Venture Exchange for their approval documentation for closing the first tranche of its non-brokered flow-through financing previously announced October 27 and November 1, 2010. Subject to regulatory approval, the Company will issue 3,840,448 flow-though common shares and 1,920,224 share purchase warrants with each full warrant entitling the holder to acquire one additional non-flow-through common share of the Company at an exercise price of $0.60 for a period of one year from the date of closing, for total proceeds raised of $1,766,606.08. The warrants are subject to the right of the Company to accelerate the exercise period for the warrants to a 30 day exercise period if after the four month hold period the shares of the Company trade above $0.80 for ten consecutive trading days.

The securities issued under this private placement are subject to a four month hold period from the closing date.
A cash finders’ fee equal to 8% of the gross proceeds raised in the financing will be paid by the Company to certain finders.
The proceeds of the private placement will be used for on-going exploration expenditures.

The Company is also pleased to announce that it has optioned a 20 claim unit property in western Newfoundland. Recent prospecting by the owners has identified an area of angular float containing anomalous Rare Earth Elements which exhibit high Heavy Rare Earth Element ratios. The property is underlain by the Hare Hill per-alkaline intrusive suite which is host to a number of known REE and U showings.

A total of four samples were taken and results ranged from 0.83% to 1.77% Total Rare Earth Oxides (TREO) with an average of 1.22% TREO. The ratio of Heavy Rare Earth Oxides (HREO including Y2O3) to TREO ranged from 63% to 71% with an average of 68%. Within the REO package the most abundant oxides included Y2O3 which ranged from 0.38% to 0.83% ((average of 0.55%), Ce2O3 which ranged between 0.10% and 0.22% (average 0.17%), La2O3 between 0.05 % and 0.10% (avg 0.07%), Nd2O3 between 0.06% to 0.12% (average 0.09%) and Dy2O3 between 0.05% to 0.10% (average 0.07%). A trenching program will be initiated to try to locate the mineralization in bedrock and to better define the mineralization controls

Rare Earth Metals can earn a 100% interest in the property for payments of $43,000 and the issuance of 200,000 shares over three years (including $2000 and 10,000 shares on approval). Once vested, the vendor will be entitled to a 2% NSR. Half the NSR (1%) can be purchased by the Company for $1,000,000. The agreement is subject to TSX approval.

Wayne Reid, PGeo, is a qualified person as defined in National Instrument 43-101, and has reviewed and approved the technical information forming the basis for release.

About Rare Earth Metals Inc.

Rare Earth Metals is a well-funded company with a focus on exploring for Rare Earth Element deposits. The Company’s shares are listed on the TSX-V exchange under the symbol RA and the OTCQX exchange under the symbol RAREF. The Company presently has two advanced projects in Ontario and Newfoundland and Labrador, both exhibiting multi element potential (REEs, Niobium, Beryllium, Zirconium and Iron Ore) and proximity to available infrastructure. Its flagship properties are the Clay-Howells Prospect and the Red Wine Project. The Company has recently acquired additional properties in the Coldwell Complex near Marathon, Ontario and the Lavergne-Springer REE Prospect near Sturgeon Falls, Ontario. Additional information concerning the Company is contained in documents filed by the Company with securities regulators, available under the Company’s profile at www.sedar.com. For more information please visit the Rare Earth Metals website at www.rareearthmetals.ca.

ON BEHALF OF THE BOARD OF DIRECTORS OF RARE EARTH METALS INC.:

“Michael Stares”
President and CEO

“Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.”

This release includes certain statements that may be deemed forward-looking statements. All statements in this release, other than statements of historical facts, that address future production, reserve potential, exploration drilling, exploitation activities and events or developments that the Company expects are forward-looking statements. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices, exploitation and exploration successes, continued availability of capital and financing, and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and those actual results or developments may differ materially from those projected in the forward-looking statements. For more information on the Company, Investors should review the Company’s filings that are available at www.sedar.com.

FOR FURTHER INFORMATION PLEASE CONTACT:

Rare Earth Metals Inc.

Michael Stares
President and CEO
Phone: (807) 623-6840
Fax: (807) 623-9526
www.RareEarthMetals.ca