Vancouver, B.C., August 16, 2007. During the first half of 2007, Brazilian Diamonds Limited (BDY: TSX/AIM), ("Brazilian Diamonds" or the "Company") has continued to focus its exploration activities on exploring kimberlite bodies located on its properties in Brazil while seeking ways to maximize the value from its extensive diamondiferous alluvial gravel inventories located on some of these same properties. The Company is encouraged by the recent publication of the government's inter-departmental deliberations over the finalization of permanent boundaries for the Serra da Canastra National Park which is located in proximity to the Canastra 1 project. A new draft bill (Projeto de Lei No. 1448/2007) has now been submitted to the Brazilian Congress which excludes the Company's Diamond areas from any new proposed National Park Boundary. Whilst it is difficult to estimate the time required for new legislation to pass through the Congress, it appears to have support from both the Government and Opposition parties and therefore is expected to be resolved expeditiously. Once approved, the Company will be able to commence trial mining at its Canastra 1 project.

The Company is still awaiting the last of the micro Diamond results from the Stage II drilling program at the large Regis kimberlite and once received they will be evaluated along with results previously received to determine the next stage of exploration work on this project.

Following completion of Stage I bulk sampling at the Santo Antonio do Bonito alluvials project, the Company is continuing discussions with its joint venture partners over the economic viability of developing a large scale, dredge based mining operation on the property. The Company is also examining the possibility of establishing other forms of large scale mining operation at this project. Decisions on these prospects are expected to be made before the end of 2007.

The Company is now preparing to begin the mini-bulk testing of its 6 hectare, Salvador 1 kimberlite. The required mining and environmental licenses have been issued by the relevant authorities and the Company has completed construction of a mobile treatment plant which is now being moved to the project site. The results from the first of these test pits are expected in the fourth quarter of 2007. Following completion of this mini-bulk sample, the Company will assess the results obtained with a view to implementing a larger scale bulk sample as part of a pre-feasibility study for a future mine development.

Following its change of name from Teather & Greenwood Limited to Landsbanki Securities (UK) Limited with effect from 9 August 2007, the name of the Company's broker has changed to Landsbanki Securities (UK) Limited.

For further information including the full quarterly report, please refer to the Company's website www.braziliandiamonds.com or contact: