Vancouver, BC, January 21, 2008. Brazilian Diamonds Ltd (BDY: TSX & AIM) ("Brazilian Diamonds" or the "Company") is pleased to announce that bulk sampling on the Company's 100% owned Salvador 1 diamond bearing kimberlite in central Bahia State, Brazil has recommenced and the important ISO 17025 accreditation for kimberlite indicator mineral recovery from heavy mineral concentrates at the Company's laboratory in Patos de Minas, Minas Gerais has been reconfirmed following an extensive Brazilian government departmental audit.

Salvador 1 testing programme

The excavation and testing programme at Salvador 1 continues the Company's evaluation of the Salvador 1 kimberlite following the encouraging recovery of diamonds during a smaller, mini-bulk sampling programme carried out early in 2007. The programme comprises pitting and testing at six locations spaced across the Salvador 1 kimberlite, which is approximately six hectares in surface area, with each pit designed to recover approximately 1,300 tonnes of kimberlite. Excavation of the first pit (Pit 1) was completed late last year and excavation of the second and third pits commenced prior to the Christmas break. Diamond-bearing sand and gravel overlie each of these pits.

At least six different kimberlitic rock types or "phases" have been identified from the field examination of exposures in Pit 1. Each of these phases is interpreted to represent a different intrusive event and thus potentially may carry a different diamond sample. The identification of multiple phases emphasizes the importance of testing the entirety of the six different pits to determine a representative diamond concentration for the body. The different phases also have variable processing characteristics, requiring some ongoing adjustments to the primary disaggregation plant on site.

The Company has also now completed the third of a three hole diamond drill programme to test the body at depth. As with the previous two holes, encouragingly the third hole was completed to its targeted depth of 200m and ended in kimberlite.

Patos de Minas Laboratory

The Company's diamond laboratory accreditation to ISO 17025 has been confirmed following the completion of a comprehensive audit by INMETRO (the National Institute of Metrology, Normatization and Industrial Quality) in Brazil. The Patos de Minas Laboratory is Brazil's only Indicator Mineral Laboratory accredited to ISO 17025 and represents an important element of the Company's technical competence providing a significant advantage in achieving a fast and reliable turnaround of sample results from
the Company's field and bulk sampling programmes as we undertake the systematic evaluation of our extensive portfolio of kimberlites.

Dr. Harrison Cookenboo (P.Geo), a Consulting Geologist and Qualified Person as defined under National Instrument 43-101, is responsible for the technical disclosure in this release and has reviewed and approved the contents of this release. Dr. Cookenboo assisted in the design of the Salvador 1 testing programme and recently completed a site field visit which included the examination of the kimberlite exposed in Pit 1 as referred to in this announcement.

Editors' Note

Brazilian Diamonds is a leading Brazil-based exploration company focused on the discovery of kimberlites on its extensive portfolio of properties in the States of Minas Gerais and Bahia, with the goal of becoming a significant producer of diamonds.

The Company is awaiting final approval before commencing the environmental licensing process for development of the Canastra 1 kimberlite body for which mine feasibility work has already been completed and the required Mines Department approvals are already in place. It is intended to bring Canastra 1 into production once the environmental licensing process is completed.

The Company's Salvador diamond project in Bahia includes the diamondiferous Salvador 1 kimberlite. This project was acquired from De Beers which retains a right to reacquire up to 40 per cent. of any kimberlite found on the Salvador properties which is confirmed to contain more that 200 carats of diamonds.

The Company has a fully operational diamond separation/analysis laboratory at Patos de Minas, Minas Gerais which is strategically located near its properties in the Santo Antônio and Coromandel areas. The Company has a highly experienced team including six geologists located at the Company's facilities in Brazil.

The Company's strategy for non-core activities on its properties is to form joint ventures. A Cdn$1,000,000 feasibility study is underway for a joint venture for the mining of alluvial diamonds on its properties in the Santo Antônio river drainage. The joint venture involves two important Brazilian companies: CODEMIG, the state owned mining development organization and Mineracao Rio Novo Ltda., a wholly owned subsidiary of Andrade Gutierrez SA, one of Brazil's largest civil engineering firms and an existing large scale, dredge based producer of alluvial diamonds.

For further information refer to the Company's website www.braziliandiamonds.com or contact: