LAKEWOOD, COLORADO--(Marketwire - Oct. 27, 2011) - Rare Element Resources Ltd. (News - Market indicators)(NYSE Amex:REE) is pleased to announce rare earth element (REE) assay results from 21 drill holes completed during the ongoing 2011 core drilling program at the Company's 100% owned Bear Lodge property, located in northeastern Wyoming, USA. The 21 holes intercepted many high-grade REE zones and extensive intercepts of veins and stockwork FMR mineralization. Whitetail Ridge drill holes were all step-offs from the resource, and the holes at East Taylor confirmed and expanded the initial reverse circulation drill results reported in a news release dated 4 August 2011.

Company Vice President of Exploration, Dr. Jim Clark states: "We continue to receive encouraging results from the Bull Hill resource area, and we are extending that mineralization west of the Bull Hill drainage. Our results at the Whitetail Ridge Resource Area confirm the Company's initial impression regarding the potential size and tenor of the REE mineralization there, and the East Taylor target is an exciting find, with the original RC drill assay values now confirmed with core drilling. We are investigating the significance of the overlapping REE and gold mineralization at both East Taylor and Whitetail Ridge."

The drill hole results include those for 12 holes from the Bull Hill Resource Area, 6 holes from the Whitetail Ridge Resource Area, and 3 holes from the East Taylor REE-gold target area. Rare Element announced updated resources for the Bull Hill and Whitetail Ridge areas on 14 June 2011. The objectives of the current drilling program are to continue the expansion and upgrading of the Bull Hill and Whitetail Ridge oxide resources, and to explore for additional REE resources at the East Taylor target area. The Company announced the identification of significant heavy rare earth (HREE) enrichment at the Whitetail Ridge Resource Area and the East Taylor and Carbon target areas in the news release dated 4 August 2011. Highlights of the current drill program include the following high-grade intercepts:

Drilling Results

REE assay values are reported by convention as the combined oxide equivalents (REO) of the fifteen elements in the lanthanide series + yttrium. The oxide equivalents are approximately 15.6% higher than the combined metal assay values. The Bull Hill deposits at the Bear Lodge project contain predominantly the "light" REE (lanthanum, cerium, praseodymium, neodymium, and samarium), with economically important quantities of several of the "heavy" REE (europium, dysprosium, and terbium). The Whitetail Ridge Resource area, and the East Taylor and Carbon REE-gold target areas, show significant HREE enrichment, with enhanced abundances of Eu, Dy, Tb, and Y (see news release dated 4 August 2011).

The host for all rare earth mineralization in the Bear Lodge Mountains is a large alkaline igneous complex that forms the core of the mountain range. Rare earth mineralization intersected in the twenty-one drill holes is primarily contained within the near-surface oxidized (FMR) and partly oxidized (oxide carbonate) equivalents of carbonatite dikes that are widespread in the district and concentrated in dike swarms and stockwork zones along the southwest flank of the Bull Hill diatreme, west of the Bull Hill drainage, and in association with the Whitetail Ridge diatreme, northwest of Bull Hill. The host rocks at Bull Hill and Whitetail Ridge consist largely of heterolithic intrusive breccia, while west of Bull Hill the host rocks are predominantly trachyte, phonolite, and subordinate breccia. FMR refers to the major constituents of the highly oxidized, former carbonatite dikes that occur in the depth range from the surface to 300-500 beneath the surface– F (FeOx)-M (MnOx)-R (REE minerals).

Bull Hill Resource Area and Bull Hill West Target Area

Seven of the 12 holes in the Bull Hill Resource Area were drilled along a prescribed NE-SW grid, at azimuths of either 045 degrees or 225 degrees, the former as infill holes in the main Bull Hill SW deposit, and the latter as holes testing the Bull Hill West area, west of the Bull Hill drainage. The resource evaluation grid was established for the Bull Hill SW deposit in conjunction with Ore Reserves Engineering, the Company's resource estimation consultant. Core holes drilled along other bearings were oriented to test areas of structural complexity. The bearing, inclination, and significant assay intercepts from the Bull Hill area drill holes are summarized in Table 1 below.

Table 1. Significant assay intercepts from the Bull Hill Resource Area (includes Bull Hill SW and Bull Hill W)

Whitetail Ridge

Rare earth mineralization in and adjacent to the Whitetail Ridge Resource area is associated with the Whitetail Ridge diatreme. The REE mineralization occurs in dominantly NW-trending dikes, veins, and stockwork zones, and it may occur also as disseminations in recrystallized diatreme breccia matrix. The latter occurrence mode has yet to be confirmed in detailed mineralogical studies, for which samples are being collected. Five of the six drill holes were drilled on the NE/SW resource evaluation grid at azimuths of 045 degrees (3 holes) and 225 degrees (2 holes), and the sixth hole was drilled at an azimuth of 205 degrees. The bearing, inclination, and significant assay intercepts from the Whitetail Ridge area drill holes are summarized in Table 2 below.

Table 2. Significant assay intercepts from the Whitetail Ridge Resource Area

East Taylor Target Area

The East Taylor target is located approximately 2500 feet (760 m) west of the main Bull Hill rare-earth deposit and 2500 feet southwest of the Whitetail Ridge deposit. The zone appears to have an easterly strike, as opposed to the dominant northwesterly and northerly mineralized structures in the Bull Hill/Whitetail Ridge deposits. Preliminary geological mapping and projection of FMR intercepts in drill holes suggest that the REE mineralization consists of dikes and adjacent stockwork with dimensions of more than 700 feet (210 meters) east-west by 250 feet (75 meters) north-south, and the mineralization is open to the east. The identification of the zone and its enrichment in HREE, relative to the Bull Hill deposits, was discussed in a news release dated 4 August 2011. That news release reported REE assay values from reverse circulation drilling during the Company's 2010 gold exploration program, and those assay values exhibited exceptional HREE enrichment.

The assay results reported here from the East Taylor target are from core holes drilled to confirm the reverse circulation drill hole assay results. Two holes were drilled across the zone at an azimuth of 060 degrees, and the third hole was vertical. The bearing, inclination, and significant assay intercepts from the Whitetail Ridge area drill holes are summarized in Table 3 below. The yttrium (Y) abundance values for the significant intercepts are also noted in Table 3, owing to the association of Y with anomalous HREE values. The Company will discuss the HREE mineralization in the East Taylor drill holes in more detail in a future news release.

Table 3. Significant assay intercepts from the East Taylor target area

As discussed in the news release of 4 August 2010, the East Taylor area was originally a gold target, and the current assay results demonstrate significant gold mineralization in intercepts that overlap with the REE mineralization (Table 4).

Table 4. Significant gold assay intercepts from the East Taylor target area

Assays, Quality Control, and Standard Certification

ALS Chemex conducted the assaying for the rare earth elements reported here in their Vancouver, British Columbia assay facility. ALS Chemex Vancouver is accredited to ISO 9001 and operates according to ALS Group standards consistent with ISO 17025 methods at other laboratories. The samples were prepared and subjected to lithium metaborate fusion, followed by ICP analysis and a mass spectroscopy finish.

Analytical quality is monitored through the use of randomly inserted quality control samples, including standards, blanks, and duplicates, which are blinded to the analytical laboratory. Results of the analyses at ALS Chemex are evaluated continuously by Dr Jeffrey Jaacks, the Company's QA/QC consultant, who is a Qualified Person according to National Instrument 43-101. The results from the current data set indicate acceptable accuracy and precision. Blank analyses also indicate no issues with carry-over contamination.

Rare Element Resources has developed a set of proprietary internal REE analytical standards using Bear Lodge deposit mineralized material. The results from an eight laboratory round robin assay series conducted earlier this year qualify the reference materials for a greater number of rare earth elements. The data indicate that the standards can be used as reference materials for Au, Y, La, Ce, Pr, Nd, Sm, Eu, Gd, Tb, Dy, Ho, Th, and U analyses. The work was conducted under the supervision of Dr. Jeffrey Jaacks, the Company's QA/QC consultant. Dr. Jaacks is a Qualified Person according to National Instrument 43-101.

Rare Element Resources Ltd (News - Market indicators)(NYSE Amex:REE) is a publicly traded mineral resource company focused on exploration and development of rare-earth elements and gold on the Bear Lodge property.

Rare-earth elements are key components of the green energy technologies and other high-technology applications. Some of the major applications include hybrid automobiles, plug-in electric automobiles, advanced wind turbines, computer hard drives, compact fluorescent light bulbs, metal alloys, additives in ceramics and glass, petroleum cracking catalysts, and a number of critical military applications. China currently produces more than 95% of the 130,000 metric tonnes of rare-earths consumed annually worldwide, and China has been reducing its exports of rare earths each year. The rare-earth market is growing rapidly, and is projected to accelerate if the green technologies are implemented on a broad scale.

Donald E. Ranta, PhD, PGeo, serves the Board of Directors of the Company as an internal, technically Qualified Person. Technical information in this news release has been reviewed by Dr. Ranta and has been prepared in accordance with Canadian regulatory requirements that are set out in National Instrument 43-101. This news release was prepared by Company management, who take full responsibility for content.

Forward Looking Statements

Except for statements of historical fact, certain information contained herein constitutes forward-looking statements. Forward looking statements are usually identified by our use of certain terminology, including "will", "believes", "may", "expects", "should", "seeks", "anticipates", "has potential to", or "intends' or by discussions of strategy or intentions. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results or achievements to be materially different from any future results or achievements expressed or implied by such forward-looking statements. Forward-looking statements are statements that are not historical facts, and include but are not limited to, estimates and their underlying assumptions; statements regarding plans, objectives and expectations with respect to the effectiveness of the Company's business model; future operations, products and services; the impact of regulatory initiatives on the Company's operations; the size of and opportunities related to the market for the Company's products; general industry and macroeconomic growth rates; expectations related to possible joint and/or strategic ventures and statements regarding future performance.

Forward-looking statements used in this discussion are subject to various risks and uncertainties, most of which are difficult to predict and generally beyond the control of the Company. If risks or uncertainties materialize, or if underlying assumptions prove incorrect, our actual results may vary materially from those expected, estimated or projected. Forward-looking statements in this document are not a prediction of future events or circumstances, and those future events or circumstances may not occur. Given these uncertainties, users of the information included herein, including investors and prospective investors are cautioned not to place undue reliance on such forward-looking statements.