Canada Rare Earth Corporation

Rare Earth Metals Inc. reports final prospect sampling results from its Red Wine Property and has initiated mineralogy studies on the Two Tom and Mann #1 deposits.

- Results from the final batch of prospect samples are up to 9.08% total rare earth oxides (TREO), 2.70% NbO5, 1.36% BeO, and 2.40% zirconium oxide (ZrO2)
- Dr. Anthony (Tony) Mariano has agreed to carry out mineralogical analysis on the Two Tom and Mann #1 Deposits

Thunder Bay, ON – Rare Earth Metals Inc. (“Rare Earth Metals”, “RA” or the “Company”) (TSX VENTURE:RA) is pleased to report that results have been received from the final 123 prospect samples collected from various locations within the Company’s Red Wine Property in central Labrador during the 2010 summer exploration program. These new results include values up to 9.08% total rare earth oxides (TREO), 2.70%NbO5, 1.36%BeO, and 2.40% zirconium oxide (ZrO2).

Several new occurrences of rare earth mineralization were discovered on the Mann #1 and Mann #2 Blocks, further extending the previously reported mineralized zones and showings (see previous press releases dated August 31, September 22, and November 22, 2010). Significant results from these 123 prospect samples are tabulated below: (click to view)

Mann #1

New results from prospect samples with values up to 4.15% TREO, 2.70% NbO5, 1.06% BeO, and 2.40% ZrO2 has extended the Mann #1 Mineralized Zone along strike a further 600 meters to the east and 300 meters to the west for a total strike length to date of 1500 meters. The HREO/TREO ratio for these samples ranged from 1% to 28% with an average of 6% for values greater than 0.5% TREO. Recent drilling on the central part of Mann# 1 had a best result of 1.35% TREO over 45 meters within a plus 100 meter mineralized envelope on the Mann #1 Beryllium deposit. These new zone extensions will be targeted for future drilling in 2011.

Mann #2

The Mann #2 Block is located 5.6 kilometers southwest and along the same tectonostratigraphic horizon as the Mann #1 Beryllium Deposit and is associated with deformed gneisses and syenitic rocks of the Red Wine Intrusive Suite. Of particular note are the results of 50 prospect samples from the new Green Arrow Mineralized Zone which has been delineated from 250 meters to 1200 meters southwest and along strike with the Mann #2 showing. The new results have values up to 9.08% TREO, 1.42% Nb2O5, and 1.36% BeO. The HREO/TREO ratio for these samples ranged from 1% to 16% with an average of 7% for values greater than 0.5% TREO. When combined with the Mann #2 East this untested mineralized zone has been traced for over 6 kilometers and will be targeted for future drilling in 2011. Previously reported results from 200 prospect samples from the Mann #2 Block ranged up to 8.19% TREO, 1.94% Nb2O5, and 0.69% BeO. The TREO values contained from 1% to 58% Heavy Rare Earth Oxides with an average of 10% HREO.

Dory Pond

Two orientation lines of soil sampling to better locate the source of mineralization were completed over the Dory Pond REE–Zr Mineralized Zone located on the B3N-1 Block situated approximately 16 kilometers southwest of the Mann #1 Beryllium deposit. A total of 76 B–horizon samples were collected and the analytical results revealed 4 separate zones from 50 meters to 200 meters wide of soil samples with high REE values, indicating that soils will be a good vectoring tool to help define the bedrock source of the Dory Pond boulders. The Dory Pond Zone is outlined by a mineralized boulder train that has been traced for a 1000 meter strike extent. Results from the previously reported prospect samples from the Dory Pond Zone ranged up to 6.72% TREO (see press release dated October 19, 2010) with very significant Heavy Rare Earth content that varied from 5% to 30% TREO. The Dory Pond Zone will be targeted by further soil sampling and future drill testing in 2011.

These prospect and soil results have identified and partially defined two additional REE zones at Mann #2 and Dory Pond, both of which show good size and grade potential as well as significant HREO ratios. These two new target areas along with the two REE deposits recently drill tested at Mann #1 and Two Tom strongly support the high potential of the Red Wine Complex to host a number of REE deposits with variable rare metal distributions. In September, a 2900 meter diamond drilling program was completed on the two advanced REE showings at Mann #1 and Two Tom. Results from 13 of 18 holes have been received and these results were described in previous press releases. The results from the final 5 holes will be released as they become available.

In summary, the initial field work carried out by the Company at Red Wine between June and September, 2010 was quite comprehensive and resulted in a number of highlights. A total of 1005 prospect samples were collected with values up to 11.9% TREO, 8.705% Nb2O5, 2.00% BeO, and 5.82% ZrO2; 271 channel samples from 20 trenches with a best result of 1.35% TREO over 30 meters; and 1194 drill core sample results from the 13 holes received to date with a best result of 1.35% TREO, 0.31% Nb2O5 and 0.32% BeO over 105.7 meters.

Rare Earth Metals is also pleased to announce that Anthony (Tony) Mariano, Ph.D., has agreed to complete a mineralogical analysis on samples of drill core from the Mann #1 and the Two Tom mineralized zones. Dr. Mariano is a geological consultant specializing in rare earths and other rare metals, a seasoned mineralogist and petrographer, and is a recognized authority on REE mineralogy and deposits at a world level. Tony integrates his strong knowledge of geology and extractive metallurgy to predict success or failure of proposed rare earth ventures.

All prospect samples were delivered by Company personnel to Activation Laboratories Ltd.’s sample preparation facility in Happy Valley-Goose Bay. The samples were processed and representative pulps sent to Activation Laboratories Ltd.’s analytical facility in Ancaster, Ontario for analysis. The digestion technique was total digestion that employs a lithium metaborate/tetraborate fusion and the analysis is completed using ICP/MS and XRF techniques. 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), the Beryllium assays are given as Beryllium Oxide (BeO), and the Zirconium assays are given as Zirconium Oxide (ZrO2). 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 sample analysis described above are in decreasing order: Cerium, Lanthanum and Neodymium.

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