KLONDIKE SILVER CORP.

711-675 West Hastings Street, Vancouver, B.C. V6B 1N2 (604) 685-2222 *Fax: (604) 685-3764

FOR IMMEDIATE RELEASE           

TSXV: KS

August 15, 2007                                                                                            

www.klondikesilver.com                             

SANDON MINING COMPLEX COMMENCES MILLING

Klondike Silver Corp. (TSX-V: KS) is pleased to announce that it is planning the opening of its Sandon Mining Complex in Sandon, British Columbia, Canada.  The Company has been rehabbing old underground workings at its Silvana Mine and the Wonderful Property both located within 5 kilomtetres of the Company’s Sandon Mill.  This rehab work has exposed several lead-zinc-silver veins, some of which have already had development work conducted.  The Company intends to commence the mining of some of these veins in August while it continues exploration work on other properties and target areas located within trucking distance of the Sandon Mill. 

The Company has scheduled the commencement of rehab work at its Hinckley Mine also located within 5 kilometres of the Sandon Mill.  The Company is looking for several areas to draw material for processing at its Sandon Mining Complex.  The Company has a full suite of drills, trucks, loaders and other equipment necessary to commence mining in various areas.

The Sandon Mill is a 100 ton per day mill which the Company has renovated and upgraded where required.  Mining permits for the Silvana Mine, environmental permits for processing, underground operation permits have all been either previously received or applied for and approved.  The Company hopes to have sufficient mill feed in order to commence running ore through the Sandon Mill in September. 

The Company is also pleased to report that it has completed a private placement of 3,500,000 units at a price of $0.40 per unit (737,500 units each consisting of one flow-through common share and one common share purchase warrant, and 2,762,500  units each consisting of one non flow-through common share and one common share purchase warrant). Each common share purchase warrant will entitle the holder to purchase one common share for a period of two years at price of $0.40 per share in the first year and at a price of $0.50 in the second year.  In connection with the transaction, the following parties were paid cash commissions totaling $51,680: Gateway Securities Inc., Standard Securities Capital Corp. and Research Capital Corp.  Any shares issued will be subject to a hold period expiring on December 10, 2007.  Proceeds of the private placement will be used to conduct preliminary assessment work on the Company's newly staked properties in Mexico and for general working capital.

On behalf of the Board of Directors

KLONDIKE SILVER CORP.

“Richard W. Hughes” (signed)
President

For Further Information Contact: The Hughes Exploration Group

Visit the Company’s website:  www.klondikesilver.com to see the Smartstox Report in which Stanlie Hunt interviews Klondike Silver Corp. President Richard Hughes.

This document contains certain forward looking statements which involve known and unknown risks, delays and uncertainties not under the corporation’s control which may cause actual results, performance or achievements of the corporation to be materially different from the results, performance or expectation implied by these forward looking statements.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release.