Canada Rare Earth Corporation

Rare Earth Metals Inc. (“RA” or the “Company”) (TSX.V : RA) is pleased to announce that it has added to its land holdings in the Red Wine/Letitia Lake area of west central Labrador through the completion of an option agreement (the “Option Agreement”) with Zimtu Capital Corp., Gary Lewis, Aubrey Budgell and Neh Pinseni ( the “Optionors”) covering additional mining claims totaling 508 claim units (the “Zimtu Property”). The new claims are situated at six separate areas along the strike length of the belt and add potential strike extensions to the highly prospective mineralized zones already delineated at the historic Two Tom, Mann #1, Mann #2, and Michelin showings, as well as the newly discovered mineralization on the Playfair, South Block (see previous press releases dated August 4, 2010 and August 31, 2010). All airborne radiometric and magnetic data is being compiled on the new acquisition. Prospecting and mapping to further evaluate the Zimtu Property will immediately take place on the new ground. The Company now controls a total of 1359 claim units totaling 338.5 square kilometers and gives Rare Earth Metals up to 70% control of all staked ground in the emerging Red Wine Rare Metal Belt. A map of the new claims can be found on the Company’s website at www.RareEarthMetals.ca.

The Option Agreement, which is subject to approval by the TSX Venture Exchange, provides the Company with the right to earn a 100% interest in the Zimtu Property by making the following payments and issuing the following common shares to the Optionors: (i) $50,000 on signing and 1,000,000 common shares on TSX.V approval; (ii) $50,000 and 500,000 common shares on the first anniversary; and (iii) $50,000 and 500,000 common shares on the second anniversary. During the term of the agreement Rare Earth Metals will ensure that the claims are maintained in good standing. The Optionors will retain a 2% Net Smelter Royalty (“NSR”) on the Zimtu Property; 50% of which (ie. 1% NSR) can be purchased by the Company for $1,000,000.

Field work, including prospecting, channel sampling, geological mapping, and diamond drill testing is continuing on the various known mineralized zones on properties previously owned by the Company and such work will extend to the new prospects. Results from this will be released as they become available.

Paul Nielsen, PGeo, is aqualified 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