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Diamonds North acquires 100% interest in the Banks Island Project
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VANCOUVER, July 5th, 2007 - Diamonds North Resources Ltd. (TSX-V: DDN)
announces the acquisition of 100% interest in the Banks Island diamond
project in the Northwest Territories after an offer to purchase
Majescor Resources Inc.'s 50% interest in the property was accepted.

Diamonds North Resources will receive Majescor's 50% interest in the
property in exchange for one million common shares of Diamonds North to
Majescor Resources and a 1.5% royalty on diamonds, metals or other
minerals the project may produce. Diamonds North has the right to
purchase one half of the royalty for C$1 million at any time.

So far, 65 targets have been identified on 10% of the property
including one high priority target estimated to be 12 to 14 hectares in
size. Diamonds North will grant Majescor a warrant to purchase up to
one million common shares at a price of $1.50 per share exercisable for
a period of two years. This warrant however, is subject to Diamonds
North verifying the designated 12 to 14 hectare target is a kimberlite
pipe of at least 200 metres in diameter. Upon verifying that the target
is kimberlite of at least 200 metres in diameter, Majescor will have
six months to exercise the warrant, otherwise the warrant will expire.

This transaction is the latest in a series of strategic business
development initiatives by Majescor who has decided to focus on Quebec
and Madagascar, as a multi-commodity explorer.

"The opportunity to test a 12-14 hectare target on a property with
exceptional mineral chemistry is what diamond explorers dream of.
Recognizing the shift in Majescor's focus and our determination to
discover Canada's next major diamond deposit we jumped at the
opportunity to capture 100% of this property and now have the ability
to rapidly advance it. This transaction now positions Diamonds North
with 100% ownership of what we believe are 3 of Canada's best diamond
properties, Amaruk, Hepburn and now Banks Island, each with the
potential to host a large scale diamond mine similar to the Ekati or
Diavik diamond mines," says Mark Kolebaba, president and CEO of
Diamonds North Resources.

This transaction is in line with the Company's objective of discovering
a $10 billion diamond deposit. Banks Island has yielded some the most
prospective mineral chemistry in Canada. A 12 to 14 hectare kimberlite
could represent up to 80 million tonnes of kimberlite. For reference,
the Ekati Diamond Mine is comprised of 8 kimberlites that form
approximately 78 million tonnes of kimberlite ore.

Diamonds North retains the voting rights on all Diamonds North shares
held by Majescor. Majescor has agreed to provide Diamonds North with 5
business days notice prior to the sale of any of the shares and is
limited to selling no more than 200,000 shares over any 2 month period.
Shares are subject to a 4 month hold period from the date of issue and
the purchase agreement is subject to regulatory approval.

"Majescor has been an exceptional partner and we would welcome the
opportunity to work with them again. We are pleased to have Majescor as
a valued shareholder and we wish them success on their new focus on
Quebec and Madagascar as a multi-commodity explorer," says Kolebaba.

The Banks Island project was initiated in 2003 as a 50:50 joint venture
between Diamonds North and Majescor. As a result of regional
reconnaissance work conducted in 2004 and 2005, high interest
kimberlite indicator minerals were discovered in stream samples some of
which exhibit primary textures indicating nearby sources. During the
2006 exploration program the joint venture partners completed an
airborne geophysical survey totaling 4,700 line kilometres over a
priority target area covering only 10% of the property.

In January 2007 the Joint Venture partners announced (see News Release
NR07-02, January 10th, 2007) that 65 geophysical anomalies were
identified by the airborne geophysical survey. Seven of the targets
are considered moderate to high priority, including one target
estimated at 12 hectares (300 x 400 metres). The 12 hectare target is
one of the highest priority targets within the survey area. It is
defined by an obvious circular and well isolated, weak magnetic
signature. A detailed ground magnetic survey will be completed over the
target for confirmation prior to drilling (view the high priority
target and airborne survey at www.diamondsnorth.com/s/banks.asp).
Based on this data Diamonds North believes the Banks Island property
may represent a new kimberlite district in Canada.

The Banks Island project is comprised of approximately 1.2 million
acres of exploration permits on the northeast corner of Banks Island in
the Northwest Territories. De Beers Canada Inc., one of the main
competitors in the region, holds approximately 3 million acres of
permits on Northwest Victoria Island which is 20 kilometres southeast
of the Banks Island diamond project.

In addition, under the terms of this agreement, Diamonds North will
receive all rights to the Lena East property, including a 1.5% royalty
which was previously owned 50:50 between Diamonds North and Majescor.

Bruce Kienlen (P.Geol) is Diamonds North's qualified persons reviewing
this project and is responsible for the design and conduct of the
exploration program and the verification and quality assurance of
analytical results.

Diamonds North Resources is focused on discovering Canada's next
diamond mine. The Company is rapidly evolving and committed to building
long-term value through ongoing diamond discoveries.

On behalf of Diamonds North Resources Ltd.

Mark Kolebaba
President & CEO

For additional information please contact:

Nancy Curry
VP Corporate Communications
Diamonds North Resources Ltd.
Telephone: (604) 689-2010
Facsimile: (604) 484-7143
Email: info@diamondsnorth.com
Website: www.diamondsnorth.com

Ali Mahdavi amahdavi@genoa.ca; or
Kevin O'Connor koconnor@genoa.ca
Genoa Management Limited
Telephone: (416) 962-3300
Facsimilie: (416) 962-3301
Email: info@genoa.ca

The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this release. Statements
in this press release, other than purely historical information,
including statements relating to the Company's future plans and
objectives or expected results, may include forward-looking statements.
Forward-looking statements are based on numerous assumptions and are
subject to all of the risks and uncertainties inherent in resource
exploration and development. As a result, actual results may vary
materially from those described in the forward-looking statements.

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Copyright (c) 2007 DIAMONDS NORTH RESOURCES LTD. (DDN) All rights
reserved. For more information visit our website at
http://www.diamondsnorth.com/ or send mailto:info@diamondsnorth.com
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