Canada Rare Earth Corporation

Thunder Bay, ON – Rare Earth Metals Inc. (“Rare Earth Metals”, “RA” or the “Company”) (TSX VENTURE:RA) is pleased to report Rare Earth Element/Niobium/Beryllium results from three additional drill holes completed on the Two Tom Mineralized Zone at the Red Wine property located approximately 110 kilometers northeast of Churchill Falls in west central Labrador. The northwest striking Two Tom Zone has been traced to date by prospecting, trenching, and drilling for a minimum of 1.3 kilometers and is located at the eastern end of the Red Wine Peralkaline Complex. A total of eleven holes were completed on the Two Tom Zone in August/September and results have now been received for seven holes with the remaining four holes expected over the next three weeks. These latest results included:

DDH TT-10: An intersection of 1.45% TREO, 0.14% Nb2O5 and 0.14% BeO over 83.25 meters within a larger zone of mineralization which assayed 1.03% TREO, 0.10% Nb2O5 and 0.11% BeO over 168.5 meters. The HREO/TREO ratio from the 168.5 meter intersection is 8.4% and the 83.25 meter composite is also 8.4%. DDH TT-10 was drilled 950 meters northwest of TT-01 which returned results of 1.35% TREO, 0.31% Nb2O5, and 0.32% BeO over 105.7 meters. (See previous press release dated Oct 25, 2010.)

DDH TT-07: Results included 1.30% TREO, 0.17% Nb2O3, 0.17% BeO over 124.5 meters. The HREO/TREO ratio from this composite is 7.5%. This intersection was within a wider zone of 0.99% TREO, 0.22% Nb2O3, 0.13% BeO over 202.5 meters with a HREO/TREO ratio of 7.8%. DDH TT-07 was drilled 350 meters northwest of TT-01.

DDH TT- 09: A best intersection of 1.10 % TREO, 0.58% Nb2O5 and 0.37% BeO over 30 meters within a wider zone of 0.95% TREO, 0.48% Nb2O5 and 0.34% BeO over 57 meters. The HREO/TREO ratio from the 30 meter intersection is 6.2% and the 57 meter composite is 6.5%. This hole was drilled 650 meters northwest of TT-01.

The Two Tom Mineralized Zone has been tested with drilling for a strike extent in excess of 1100 meters and is open in all directions. Seven of the eleven drill holes have now been reported for the Two Tom Mineralized Zone, and all holes intersected multiple wide REE/Nb/Be zones up to 202.5 meters. The remainder of the drill results from the recently completed program and prospect sample results will be released as they are received.

A map of the Two Tom drill hole locations can be found on the company’s website at www.RareEarthMetals.ca. Significant results from the latest drill holes are tabulated below:

Core from the drill program was transported by helicopter from the drill site, logged at Rare Earth Metals’ camp and split in half using a diamond table saw or a manual core splitter. One half of the core was sent to Activation Laboratories Ltd. (“Actlabs”) for analysis and the other half was kept in core boxes at the camp for reference. All samples were delivered by Company personnel to Actlabs’ sample preparation facility in Happy Valley-Goose Bay. The samples were processed and representative pulps sent to Actlabs’ analytical facility in Ancaster, Ontario. The digestion technique was total digestion that employs a lithium metaborate/tetraborate fusion and the analysis is completed using ICP, ICP/MS and XRF techniques. For QA/QC purposes Rare Earth Metals systematically inserts duplicates and blanks into every sample batch. The Company has also established a program of third party check-assays with other labs to confirm the original results. Actlabs is an ISO 17025 (Lab 266) and NELAP (lab E87979) accredited lab for specific registered tests.

The Rare Earth Element assays are reported as Total Rare Earth Oxides (TREO), the Niobium assays are given as Niobium Oxide (Nb2O5), and the Beryllium assays are given as Beryllium Oxide (BeO). The TREO includes all the Rare Earth Oxides plus Yttrium Oxide. As per industry standard the TREO are broken down into Light Rare Earth Oxides (LREO) and Heavy Rare Earth Oxides (HREO). The LREO consists of Ce2O3, La2O3, Nd2O3, Pr2O3 and Sm2O3 and the HREO consists of Eu2O3, Gd2O3, Tb2O3, Dy2O3, Ho2O3, Er2O3, Tm2O3, Yb2O3, Lu2O3 and Y2O3. The %HREO is calculated by dividing the HREO by the TREO. The most abundant REEs from the drill hole composites described above are in decreasing order: Cerium, Lanthanum and Neodymium. A breakdown of the most abundant REE’s from the drill holes can be found on the company’s website at www.RareEarthMetals.ca.

Wayne Reid, PGeo, is aqualified person as defined in National Instrument 43-101, and has reviewed and approved the technical information forming the basis for release.

About Rare Earth Metals Inc.

Rare Earth Metals is a well-funded company with a focus on exploring for Rare Earth Element deposits. The Company’s shares are listed on the TSX-V exchange under the symbol RA and the OTCQX exchange under the symbol RAREF. The Company presently has two advanced projects in Ontario and Newfoundland and Labrador, both exhibiting multi element potential (REEs, Niobium, Beryllium, Zirconium and Iron Ore) and proximity to available infrastructure. Its flagship properties are the Clay-Howells Prospect and the Red Wine Project. The Company has recently acquired additional properties in the Coldwell Complex near Marathon, Ontario and the Lavergne-Springer REE Prospect near Sturgeon Falls, Ontario. Additional information concerning the Company is contained in documents filed by the Company with securities regulators, available under the Company’s profile at www.sedar.com. For more information please visit the Rare Earth Metals website at www.rareearthmetals.ca.

ON BEHALF OF THE BOARD OF DIRECTORS OF RARE EARTH METALS INC.:

“Michael Stares”
President and CEO

“Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.”

This release includes certain statements that may be deemed forward-looking statements. All statements in this release, other than statements of historical facts, that address future production, reserve potential, exploration drilling, exploitation activities and events or developments that the Company expects are forward-looking statements. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices, exploitation and exploration successes, continued availability of capital and financing, and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and those actual results or developments may differ materially from those projected in the forward-looking statements. For more information on the Company, Investors should review the Company’s filings that are available at www.sedar.com.

FOR FURTHER INFORMATION PLEASE CONTACT:

Rare Earth Metals Inc.

Michael Stares
President and CEO
Phone: (807) 623-6840
Fax: (807) 623-9526
www.RareEarthMetals.ca